SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
QUARTERLY REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarterly period ended March 31, 1994
--------------
Commission file number 1-3132-2
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INDIANAPOLIS POWER & LIGHT COMPANY
----------------------------------
(Exact name of Registrant as specified in its charter)
Indiana 35-0413620
(State or other jurisdiction of (I. R. S. Employer
incorporation or organization) Identification No.)
25 Monument Circle, P. O. Box 1595, Indianapolis, Indiana 46206
(Address of principal executive offices) (Zip Code)
317-261-8261
(Registrant's telephone number, including area code)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No
------- -------
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
Class Outstanding At March 31, 1994
----- -----------------------------
Common (Without Par Value) 17,206,630 Shares
INDIANAPOLIS POWER & LIGHT COMPANY
INDEX
Page No.
--------
PART I. FINANCIAL INFORMATION
Statements of Income -
Three Months Ended March 31, 1994 and 1993 2
Balance Sheets - March 31, 1994 and
December 31, 1993 3
Statements of Cash Flows -
Three Months Ended March 31, 1994 and 1993 4
Notes to Financial Statements 5
Management's Discussion and Analysis of
Financial Condition and Results of Operations 6-7
PART II. OTHER INFORMATION 8-9
-1-
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
<TABLE>
INDIANAPOLIS POWER & LIGHT COMPANY
Statements of Income
(In Thousands)
(Unaudited)
<CAPTION>
Three Months Ended
March 31
1994 1993
------------ ------------
<S> <C> <C>
OPERATING REVENUES:
Electric $ 168,902 $ 157,867
Steam 12,276 11,175
------------ ------------
Total operating revenues 181,178 169,042
------------ ------------
OPERATING EXPENSES:
Operation:
Fuel 44,588 40,547
Other 26,630 24,763
Power purchased 5,168 3,157
Purchased steam 2,200 2,358
Maintenance 15,015 13,593
Depreciation and amortization 20,221 19,369
Taxes other than income taxes 7,987 7,811
Income taxes - net 17,849 17,376
------------ ------------
Total operating expenses 139,658 128,974
------------ ------------
OPERATING INCOME 41,520 40,068
------------ ------------
OTHER INCOME AND (DEDUCTIONS):
Allowance for equity funds used during construction 863 366
Other - net (153) (484)
Income taxes - net 319 170
------------ ------------
Total other income and (deductions) - net 1,029 52
------------ ------------
INCOME BEFORE INTEREST CHARGES 42,549 40,120
------------ ------------
INTEREST CHARGES:
Interest 12,136 10,822
Allowance for borrowed funds used during construction (1,150) (740)
------------ ------------
Total interest charges 10,986 10,082
------------ ------------
NET INCOME 31,563 30,038
PREFERRED DIVIDEND REQUIREMENTS 795 795
------------ ------------
INCOME APPLICABLE TO COMMON STOCK $ 30,768 $ 29,243
============ ============
See notes to financial statements.
-2-
</TABLE>
<TABLE>
INDIANAPOLIS POWER & LIGHT COMPANY
Balance Sheets
(In Thousands)
(Unaudited)
<CAPTION>
March 31 December 31
1994 1993
-------------- --------------
ASSETS
------
<S> <C> <C>
UTILITY PLANT:
Utility plant in service $ 2,322,171 $ 2,300,682
Less accumulated depreciation 889,852 876,054
-------------- --------------
Net plant in service 1,432,319 1,424,628
Construction work in progress 170,079 168,480
Property held for future use 15,762 15,763
-------------- --------------
Utility plant - net 1,618,160 1,608,871
-------------- --------------
OTHER PROPERTY -
At cost, less accumulated depreciation 1,875 1,873
-------------- --------------
CURRENT ASSETS:
Cash and cash equivalents 37,190 8,349
Accounts receivable (less allowance for doubtful
accounts 1994, $893 and 1993, $626) 53,636 52,847
Fuel - at average cost 32,847 35,213
Materials and supplies - at average cost 54,604 54,847
Prepayments and other current assets 3,641 3,240
-------------- --------------
Total current assets 181,918 154,496
-------------- --------------
DEFERRED DEBITS:
Unamortized Petersburg Unit #4 carrying charges 31,062 30,587
Unamortized redemption premiums and expenses on
debt and preferred stock 28,014 25,453
Other regulatory assets 36,077 32,954
Miscellaneous 16,223 16,072
-------------- --------------
Total deferred debits 111,376 105,066
-------------- --------------
TOTAL $ 1,913,329 $ 1,870,306
============== ==============
CAPITALIZATION AND LIABILITIES
CAPITALIZATION:
Common shareholder's equity:
Common stock $ 324,537 $ 324,537
Premium on 4% cumulative preferred stock 1,363 1,363
Retained earnings 390,036 379,249
-------------- --------------
Total common shareholder's equity 715,936 705,149
Cumulative preferred stock 51,898 51,898
Long-term debt (less current maturities
and sinking fund requirements) 634,452 532,260
-------------- --------------
Total capitalization 1,402,286 1,289,307
-------------- --------------
CURRENT LIABILITIES:
Notes payable - banks and commercial paper - 90,000
Current maturities and sinking fund requirements 7,779 8,729
Accounts payable 69,767 74,187
Dividends payable 20,783 20,024
Payrolls accrued 3,736 4,505
Taxes accrued 42,190 21,377
Interest accrued 12,116 11,150
Other current liabilities 5,603 5,316
-------------- --------------
Total current liabilities 161,974 235,288
-------------- --------------
DEFERRED CREDITS:
Accumulated deferred income taxes - net 270,318 270,182
Unamortized investment tax credit 56,212 57,029
Accrued postretirement benefits 21,734 17,668
Miscellaneous 805 832
-------------- --------------
Total deferred credits 349,069 345,711
-------------- --------------
TOTAL $ 1,913,329 $ 1,870,306
============== ==============
See notes to financial statements.
</TABLE>
-3-
<TABLE>
INDIANAPOLIS POWER & LIGHT COMPANY
Statements of Cash Flows
(In Thousands)
(Unaudited)
<CAPTION>
Three Months Ended
March 31
1994 1993
------------ ------------
<S> <C> <C>
CASH FLOWS FROM OPERATIONS:
Net income $ 31,563 $ 30,038
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 20,502 19,555
Deferred income taxes and investment tax
credit adjustments, net (681) (799)
Allowance for funds used during construction (2,013) (1,106)
Decrease (increase) in certain assets:
Accounts receivable (789) 3,217
Fuel, materials and supplies 2,609 4,693
Other current assets (401) 139
Increase (decrease) in certain liabilities:
Accounts payable (4,420) 814
Taxes accrued 20,813 17,976
Other liabilities 458 (727)
------------ ------------
Net cash provided by operating activities 67,641 73,800
------------ ------------
CASH FLOWS FROM INVESTING:
Construction expenditures (27,448) (28,151)
Other 273 (3,808)
------------ ------------
Net cash used in investing activities (27,175) (31,959)
------------ ------------
CASH FLOWS FROM FINANCING:
Issuance of long-term debt 180,000 -
Retirement of long-term debt - including premiums (79,513) (843)
Short-term debt - net (90,000) (25,000)
Dividends paid (20,018) (19,240)
Other (2,094) -
------------ ------------
Net cash used in financing activities (11,625) (45,083)
------------ ------------
Net increase (decrease) in cash and cash equivalents 28,841 (3,242)
Cash and cash equivalents at beginning of period 8,349 10,581
------------ ------------
Cash and cash equivalents at end of period $ 37,190 $ 7,339
============ ============
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest (net of amount capitalized) $ 10,234 $ 10,522
============ ============
Income taxes $ 1,390 $ 4,164
============ ============
See notes to financial statements.
-4-
</TABLE>
INDIANAPOLIS POWER & LIGHT COMPANY
----------------------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
1. Indianapolis Power & Light Company is a subsidiary of IPALCO
Enterprises, Inc.
2. In the opinion of management these statements reflect all adjustments,
consisting of only normal recurring accruals, which are necessary to a
fair statement of the results for the interim periods covered by such
statements. Due to the seasonal nature of the electric utility
business, the annual results are not generated evenly by quarter during
the year. Certain amounts from prior year financial statements have
been reclassified to conform to the current year presentation. These
financial statements and notes should be read in conjunction with the
audited financial statements included in IPL's 1993 Annual Report on
Form 10-K.
3. LONG-TERM DEBT
On February 3, 1994, IPL issued First Mortgage Bonds, 6.05% Series, due
2004, in the principal amount of $80 million. The net proceeds were
used to redeem on March 1, 1994, IPL's $33.2 million First Mortgage
Bonds, 7.40% Series, due 2002, at a redemption price of 101.79%, and to
redeem on March 15, 1994, IPL's $19.75 million First Mortgage Bonds, 7
1/8% Series, due 1998, at a redemption price of 101.2% and IPL's
$25.2 million First Mortgage Bonds, 7.65% Series, due 2003, at a
redemption price of 102.11%. Accrued interest was also paid at the
time of redemption.
Also, on February 3, 1994, IPL issued First Mortgage Bonds, 7.05%
Series, due 2024, in the principal amount of $100 million. The net
proceeds were used in part to repay outstanding unsecured promissory
notes, and the remaining amount will be used to finance future
construction costs.
-5-
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
Overview
- - --------
The Board of Directors of Indianapolis Power & Light Company (IPL) on
February 22, 1994, declared a quarterly dividend on common stock of
$19,979,922. The dividend was paid by IPL to IPALCO Enterprises, Inc. in
April, 1994.
Internally generated cash provided by IPL's operations and the
issuance of long-term debt were used primarily for construction
expenditures and the repayment of short-term and long-term debt during the
first three months of 1994.
On February 3, 1994, IPL issued First Mortgage Bonds, 6.05% Series,
due 2004, in the principal amount of $80 million. The net proceeds were
used to redeem on March 1, 1994, IPL's $33.2 million First Mortgage Bonds,
7.40% Series, due 2002, at a redemption price of 101.79%, and to redeem on
March 15, 1994, IPL's $19.75 million First Mortgage Bonds, 7 1/8% Series,
due 1998, at a redemption price of 101.2% and IPL's $25.2 million First
Mortgage Bonds, 7.65% Series, due 2003, at a redemption price of 102.11%.
Accrued interest was also paid at the time of redemption.
Also, on February 3, 1994, IPL issued First Mortgage Bonds, 7.05%
Series, due 2024, in the principal amount of $100 million. The net
proceeds were used in part to repay outstanding unsecured promissory notes,
and the remaining amount will be used to finance future construction costs.
Future Rate Relief
- - ------------------
IPL filed a petition with the Indiana Utility Regulatory Commission on
April 8, 1994, seeking approval to increase IPL's electric rates. The
specific amount of the requested rate increase will not be determined until
"test year" data is prepared. It is estimated, however, that the overall
request will probably range from 12 to 16 percent. IPL last received an
order from the IURC authorizing an increase in electric basic rates and
charges in August, 1986. A number of expenditures and investments are now
needed to supply electricity to the growing Central Indiana economy and to
meet an increasing number of federal and state laws and regulations. Among
these are: two new peaking combustion turbines, a power purchase agreement
with Indiana Michigan Power Company (IMP), new Demand Side Management
Programs, and new sulfur dioxide emission control equipment. A complete
description of these projects is included in the Management's Discussion
and Analysis of IPL's 1993 Annual Report on Form 10-K.
RESULTS OF OPERATIONS
Comparison of Quarters Ended March 31, 1994 and March 31, 1993
--------------------------------------------------------------
Income applicable to common stock increased $1.5 million during the
first quarter of 1994 from the comparable 1993 period. The following
discussion highlights the factors contributing to this result.
Operations
- - ----------
The increase in electric operating revenues of $11.0 million was
-6-
primarily a result of the colder weather during this quarter compared to
the same period one year ago. Contributing to the higher revenues was an
increase in retail electric kilowatthour (KWH) sales of $9.1 million,
partially offset by lower fuel cost adjustment recoveries of $.3 million.
Sales for resale also increased $2.2 million, due to increased energy sales
to neighboring utilities. The following table is a summary of KWH sales to
each customer class:
Retail KWH Sales By Customer Class
In Millions of KWHs
Three Months Ended March 31,
1994 1993 % Change
-------- -------- --------
Residential 1,283.6 1,170.3 9.7%
Commercial 639.6 597.3 7.1
Industrial 1,504.0 1,442.8 4.2
Other 21.2 20.7 2.4
-------- --------
Total Retail 3,448.4 3,231.1 6.7
======== ========
Fuel costs increased $4.0 million due to an increase in fuel
consumption of $3.1 million -- as a result of the colder weather -- as well
as increased prices of $.7 million and increased deferred fuel costs of $.2
million. Other operating expenses increased $1.9 million primarily due to
increased administrative and general expenses of $1.3 million, increased
marketing expenses of $.3 million and increased distribution expenses of
$.2 million. Power purchased increased $2.0 million due to increased
capacity payments to IMP of $1.8 million and increased purchases of short-
term energy from other utilities.
Maintenance expenses increased $1.4 million, reflecting increased
expenditures for unit overhaul costs at the Petersburg plant of $2.7
million. These expenses were partially offset by decreased expenditures at
the Stout plant of $1.4 million, for which a unit overhaul was performed
during early 1993.
As a result of the foregoing, utility operating income increased 3.6%
over last year, to $41.5 million.
Other Income and Deductions
- - ---------------------------
Allowance for equity funds used during construction increased $.5
million due to an increased construction base.
Interest and Other Charges
- - --------------------------
Interest expense increased $1.3 million primarily due to the issuance
of $100 million long-term debt on February 3, 1994, as previously discussed
under "Liquidity and Capital Resources". The increase in interest expense
for the first quarter of 1994 was partially offset by decreased expense as
a result of refinancing certain first mortgage bonds during 1993 with more
favorable terms.
-7-
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
- - --------------------------
There were no changes to "Item 3. Legal Proceedings" as set forth in
IPL's Form 10-K for the year ended December 31, 1993, except as follows:
On August 18, 1993, the Indiana Utility Regulatory Commission (IURC)
entered an order in Cause No. 39437, approving IPL's Environmental
Compliance Plan required by the Clean Air Act Amendments of 1990. The
estimated cost of IPL's Environmental Compliance Plan is approximately $250
million before including allowance for funds used during construction. A
primary part of IPL's Plan, scrubbing IPL's Petersburg 1 and 2 coal-fired
units by 1996 to enable IPL to continue to burn high sulfur coal, was
opposed by the Office of Utility Consumer Counselor (OUCC), the Citizens
Action Coalition (CAC), and the Industrial Intervenors Group (IIG). On
April 4, 1994, the OUCC and IIG each perfected its appeal of the
Commission's order to the Indiana Court of Appeals; thereafter, CAC joined
in their appeal.
In October, 1993, IPL received a Findings of Violation from EPA,
Region V, regarding IPL's compliance with the thermal limitations of the
NPDES (water discharge) permit under which IPL operates its Petersburg
Generating Station. At a meeting held March 8, 1994, EPA acknowledged it
had misinterpreted the data IPL supplied to EPA in response to the latter's
Clean Water Act information request that preceded issuance of the Findings
of Violation. EPA continues to be concerned about the accuracy of the
river monitoring equipment operated and maintained by the United States
Geological Survey (USGS) with whom IPL contracts for such operation and
maintenance. IPL is pursing the matter with USGS and will provide EPA with
an update regarding expected improvements. IPL believes it continues to be
in compliance with the requirements of the permit. If IPL is found to be
in violation of its permit, it could be subject to maximum fines of $25,000
per day per violation.
On April 8, 1994, IPL filed a petition with the IURC for an increase
in its retail electric rates and charges. A prehearing conference to
establish a test year, and to schedule the filing of testimony, the conduct
of hearings and other related matters will be scheduled by the IURC in the
near future.
Item 6. Exhibits and Reports on Form 8-K
- - -----------------------------------------
a) Exhibits
(3) Articles of Incorporation and By-Laws
By-Laws as last amended January 25, 1994.
b) Reports on Form 8-K
A report on Form 8-K, dated January 25, 1994, reporting Item 5,
"Other Events", and Item 7, "Exhibits", with respect to the
issuance of $180 million First Mortgage Bonds.
-8-
Signatures
----------
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
INDIANAPOLIS POWER & LIGHT COMPANY
------------------------------------
(Registrant)
Date: May 12, 1994 /s/ John R. Brehm
------------------ -----------------------------
John R. Brehm
Senior Vice President
Finance and Information Services
Date: May 12, 1994 /s/ Stephen J. Plunkett
------------------ -----------------------------
Stephen J. Plunkett
Controller
-9-
EXHIBIT 3
BY-LAWS
OF
INDIANAPOLIS POWER & LIGHT
COMPANY
--------------------------------------
As Amended and Restated in
Full on May 27, 1969, and
Further Amended on
January 26, 1971
January 30, 1973,
January 28, 1975,
April 27, 1976,
March 31, 1981,
January 31, 1984,
May 30, 1989,
November 13, 1989,
August 27, 1991, and
January 25, 1994
--------------------------------------
BY-LAWS
OF
INDIANAPOLIS POWER & LIGHT
COMPANY
--------------------------------------
As Amended and Restated in
Full on May 27, 1969, and
Further Amended on
January 26, 1971,
January 30, 1973,
January 28, 1975,
April 27, 1976,
March 31, 1981,
January 31, 1984
May 30, 1989,
November 13, 1989,
August 27, 1991, and
January 25, 1994
--------------------------------------
ARTICLE I.
Offices
-------
SECTION 1. Principal Office. The principal office of the Company shall
be in the City of Indianapolis, County of Marion, State of Indiana.
SECTION 2. Other Offices. The Company may also have an office in the
City of Chicago, Illinois, and in the City of New York, New York, and also
offices at such other places as the Board of Directors may from time to
time appoint or the business of the Company may require.
ARTICLE II.
Shareholders Meetings
---------------------
SECTION 1. Place of Meeting. Meetings of the shareholders of the
Company shall be held at such place within or without the State of Indiana
as may be specified from time to time in the respective notices, waivers of
notice thereof, or by resolution of the Board of Directors or the
shareholders.
SECTION 2. Annual Meeting. The annual meeting of shareholders shall be
held on the third Wednesday of April of each year at the hour of 10 o'clock
A.M., unless such day shall be a legal holiday, in which event the meeting
shall be held on the next succeeding business day at the same hour.
(As Amended January 31, 1984)
SECTION 3. Special Meetings. Special meetings of the shareholders for
any purpose or purposes may be called by the President, by the Board of
Directors, or by shareholders holding not less than one-fourth of all the
shares outstanding and entitled by the Amended Articles of Incorporation to
vote on the business proposed to be transacted thereat. Business transacted
at any such meeting shall be confined to the objects stated in the call and
matters germane thereto.
SECTION 4. Notice of Meetings; Waiver. Written or printed notice,
stating the place, day and hour of the annual and/or special meetings of
the shareholders, and in case of a special meeting, the purpose or purposes
for which the meeting is called, shall be delivered or mailed by the
Secretary, or by the officer or persons calling the meeting, to each
shareholder of record entitled by the Amended Articles of Incorporation and
by law to vote at such meeting, at such address as appears upon the records
of the Company, at least ten (10) days before the date of the meeting.
Notice of any shareholders meeting may be waived in writing by any
shareholder, if the waiver sets forth in reasonable detail the purpose or
purposes for which the meeting is called and the time and place thereof.
Attendance at any meeting, in person or by proxy, shall constitute a waiver
of notice of such meeting.
SECTION 5. Quorum. The holders of a majority of the shares issued and
outstanding and then entitled to vote, present in person or represented by
proxy, shall be requisite and sufficient to constitute a quorum at all
meetings of the shareholders for the transaction of business, except as
otherwise provided by law, by the Amended Articles of Incorporation, or by
these By-Laws. If, however, such majority shall not be present or
represented at any meeting of the shareholders, the shareholders present in
person or by proxy shall have power to adjourn the meeting from time to
time without notice, other than announcement at the meeting, until a quorum
shall attend, when any business may be transacted which might have been
transacted at the meeting as originally called.
SECTION 6. Voting. At each meeting of the shareholders, every
shareholder entitled to vote may vote in person or by proxy appointed by an
instrument in writing subscribed by such shareholder or by his duly
authorized attorney and delivered to the Secretary of the meeting. Each
shareholder shall have one vote for each share of common stock and two
votes for each share of preferred stock registered in his name at the time
of the closing of the transfer books or taking of the record for said
meeting. The vote for directors, and, upon the demand of any shareholder,
the vote upon any question before the meeting, shall be by ballot. All
elections shall be had by plurality vote and all other questions shall be
decided by a majority vote, except as otherwise provided by law, by the
Amended Articles of Incorporation, or by these By-Laws.
ARTICLE III.
Directors
---------
SECTION 1. Number and Term. The number of directors of this Company
shall be seventeen (17). Such directors shall be elected for a term of one
year each and until their successors are duly elected and qualified.
(As Amended January 25, 1994 to be Effective April 20, 1994)
SECTION 2. Powers and Duties. In addition to the powers and duties
expressly conferred upon it either by law, by the Amended Articles of
Incorporation, or by these By-Laws, the Board of Directors may exercise all
such powers of the Company as are conferred upon the Company by law and by
the Amended Articles of Incorporation, and do all such lawful acts and
things as are not inconsistent with the law or the Amended Articles of
Incorporation.
Subject to the provisions of law, the Amended Articles of
Incorporation, and the resolutions of the Board of Directors creating the
several series of the Company's outstanding Cumulative Preferred Stock, the
Board of Directors shall have absolute discretion in the declaration of
dividends and in changing the date for the declaration and payment of
dividends.
--2--
SECTION 3. Annual and Regular Meetings; Notice. The annual meeting of
the Board of Directors shall be held on the last Tuesday of the month in
which the annual meeting of shareholders is held, and other regular
meetings of the Board of Directors shall be held on the last Tuesday of
each month. If the day fixed pursuant to this Section for the annual or any
regular meeting shall be a legal holiday, then such annual or regular
meeting shall be held on the next succeeding business day.
The annual meeting and all regular meetings of the Board shall be held
at 1:30 P.M. at the principal office of the Company, unless notice of a
different time and/or place is given with respect to any such meeting at
least seven days prior thereto by mail or three days prior thereto by
telegraph. No notice of the annual or any regular meeting of the Board
shall be required unless such meeting is to be held at a time and/or place
other than the principal office of the Company.
(As Amended January 26, 1971)
SECTION 4. Special Meetings. Special meetings of the Board of
Directors may be called by the Chairman of the Board of Directors, the
President, or any two directors on two days' notice by mail or one day's
notice by telephone or telegraph to each director, which notice shall state
the time, place and purpose of the holding of such meetings. Any special
meeting of the Board of Directors may be held either within or without the
State of Indiana.
SECTION 5. Quorum. At all meetings of the Board of Directors a
majority of the directors shall be necessary and sufficient to constitute a
quorum for the transaction of business, and the act of a majority of the
directors present at any meeting at which there is a quorum shall be the
act of the Board of Directors, except as otherwise may be provided
specifically by statute, by the Amended Articles of Incorporation, or by
these By-Laws. If at any meeting of the Board of Directors there shall be
less than a quorum present, a majority of those directors present may
adjourn the meeting to another day and thereupon the Secretary shall mail,
telephone, or telegraph to each director, notice of the time and place of
the holding of such adjourned meeting. At any such adjourned meeting at
which there is a quorum present, any business may be transacted which might
have been transacted at the meeting as originally scheduled or called.
SECTION 6. Resignations. Any director of the Company may resign at any
time by giving written notice to the Board of Directors or to the President
or to the Secretary of the Company. Any such resignation shall take effect
at time specified therein, or if the time is not specified, upon receipt
thereof. Unless otherwise specified in the notice, the acceptance of such
resignation shall not be necessary to make it effective.
SECTION 7. Vacancies. Except as otherwise provided in the Amended
Articles of Incorporation, any vacancy occurring in the Board of Directors
caused by resignation, death or other incapacity, or increase in the number
of directors may be filled by a majority vote of the remaining members of
the Board, until the next annual or special meeting of the shareholders or,
at the discretion of the Board of Directors, such vacancy may be filled by
vote of the shareholders at a special meeting called for the purpose.
Shareholders shall be notified of any increase in the number of directors
and the name, address, principal occupation and other pertinent information
about any director elected by the Board of Directors to fill any vacancy.
Such notice shall be given in the next mailing sent to shareholders
following any such increase or election, or both, as the case may be.
--3--
ARTICLE IV.
Committees Of The Board Of Directors
------------------------------------
SECTION 1. Executive Committee.
Number and Powers. The Board of Directors shall create an Executive
Committee consisting of the Chairman of the Board of Directors and the
President, as ex officio members, and two or more directors who shall be
elected by the Board of Directors from time to time to hold office until
the next annual meeting of the Board of Directors and until their
respective successors are duly elected and qualified. The Board of
Directors shall designate the Chairman of such committee.
The Executive Committee shall have and exercise (except as the Board
of Directors shall direct and except when the Board of Directors shall be
in session) such powers and rights of the full Board of Directors in the
management of the business and affairs of the Company as may be lawful, and
it shall have power to authorize the seal of the Company to be affixed to
all papers which may require it.
Meetings and Notice. Meetings of the Executive Committee may be held
either at the office of the Company in the City of Indianapolis, Indiana,
or at such other places as the Executive Committee or Chairman thereof
shall from time to time designate. Such meetings may be called by or at the
request of the Chairman or any member of the Executive Committee by giving
at least twenty-four (24) hours' previous notice to each member of the
Executive Committee. Such notice may be given personally or by telephone or
telegraph.
Quorum. A majority of the Executive Committee shall constitute a
quorum for the transaction of business, and the affirmative vote of such
majority shall be necessary to the determination of any question.
Compensation. The members of the Executive Committee, other than ex
officio members, shall be entitled to receive such compensation as may be
determined from time to time by the Board of Directors.
Minutes. Minutes of the meetings of the Executive Committee shall be
kept and read at the next meeting of the Board of Directors.
Vacancies. Vacancies occurring in the Executive Committee shall be
filled by the Board of Directors at any meeting of said Board.
(As Amended April 27, 1976)
SECTION 2. Audit Committee.
The Board of Directors, by a majority vote of the whole Board of
Directors, may designate three (3) or more members of such Board who shall
not be officers of the Company to constitute an Audit Committee. Such
Committee shall have and exercise such authority as shall be specified in
the resolution of the Board of Directors appointing such Committee. The
Chairman of such Audit Committee shall be designated by the Board of
Directors.
(As Amended August 27, 1991)
--4--
ARTICLE V.
Officers of the Company
-----------------------
SECTION 1. Officers. The officers of the Company shall be a Chairman
of the Board of Directors, a President, one or more Vice Presidents, a
Secretary, a Treasurer, a Controller, and, if the Board of Directors
desires, one or more Assistant Vice Presidents, Assistant Secretaries,
Assistant Treasurers and Assistant Controllers, who shall be elected by the
Board of Directors at its annual meeting. Any two or more of such offices
may be held by the same person, except that the duties of the President and
Secretary, shall not be performed by the same person. In the election of
Vice Presidents, the Board of Directors may give each vice presidency such
special designation as it may deem appropriate. The Chairman of the Board
of Directors and the President shall be chosen from among the directors.
The Board of Directors may appoint such other officers and agents as
it shall deem necessary, who shall have such authority and perform such
duties as from time to time shall be prescribed by the Board of Directors.
(As Amended January 26, 1971)
SECTION 2. Salaries. The salaries of all officers of the Company shall
be fixed by the Board of Directors. No officer shall be prevented from
receiving such salary by reason of the fact he is also a director of the
Company.
SECTION 3. Term; Removal. The officers of the Company shall hold
office for one year and until their successors are chosen and qualified;
provided, however, that any officer elected or appointed by the Board of
Directors may be removed at any time by the affirmative vote of a majority
of the full Board of Directors.
SECTION 4. Resignations. Any officer of the Company may resign at any
time by giving written notice to the Board of Directors, to the President,
or to the Secretary of the Company. Any such resignation shall take effect
at time specified therein, or if the time be not specified, upon receipt
thereof. Unless otherwise specified in the notice, the acceptance of such
resignation shall not be necessary to make it effective.
SECTION 5. Vacancies. If the office of the Chairman of the Board of
Directors, the President, any Vice President, the Secretary, the Treasurer,
the Controller, any Assistant Vice President, Assistant Secretary,
Assistant Treasurer, or Assistant Controller, or other officer or agent, is
vacant or becomes vacant by reason of death, resignation, retirement,
disqualification, removal from office or the creation of a new office, the
Board of Directors shall elect a person to such office who shall hold
office for the unexpired term in respect of which such vacancy occurred;
provided that, in its discretion, the Board of Directors, by vote of a
majority of the whole Board, may leave unfilled for such period as it deems
appropriate any office, except the offices of President, Controller,
Treasurer and Secretary.
(As Amended January 30, 1973)
SECTION 6. Duties of Officers May Be Delegated. In case of the absence
of any officer of the Company, or for any other reason that the Board of
Directors may deem sufficient, the Board may delegate the power or duties
of such officer to any other officer, or to any director for the time
being.
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SECTION 7. Chairman of the Board of Directors. The Chairman of the
Board of Directors shall be the chief executive officer of the Company.
Subject to the control of the Board of Directors, he shall have general
charge of, and supervision and authority over the business and affairs of
the Company. He shall preside at all meetings of the shareholders and
directors of the Company. He shall have such other duties as may be
assigned to him by the Board of Directors.
(As Amended November 13, 1989 to be Effective February 1, 1990)
SECTION 8. President. The President shall be the chief operating
officer of the Company. Subject to the supervision of the Chairman of the
Board of Directors and the Board of Directors, itself, he shall have
general charge of, and supervision and authority over, the operations of
the Company. In the absence of the Chairman of the Board of Directors, he
shall preside at all meetings of the shareholders and directors. He shall
perform such other duties as are incident to his office or as may be
assigned to him by the Board of Directors or the Chairman of the Board of
Directors.
(As Amended January 28, 1975)
SECTION 9. Vice Presidents. Subject to the control of the Board of
Directors, the Chairman of the Board of Directors and the President, the
Vice Presidents and the Assistant Vice Presidents shall have such power,
and perform such duties, as the Board of Directors, the Chairman of the
Board of Directors, or the President, from time to time shall assign to
them, and, in the case of Assistant Vice Presidents, such powers and duties
as may be assigned to them by the respective Vice Presidents whom they
assist.
(As Amended January 28, 1975)
SECTION 10. Secretary and Assistant Secretaries. The Secretary shall
attend all meetings of the shareholders and Board of Directors, and shall
record all votes and other proceedings in a book to be kept for that
purpose. He shall give, or cause to be given, all required notices of
meetings of the shareholders and Board of Directors. He shall have custody
of the seal of the Company and of its records, and shall perform such other
duties as usually appertain to the office of Secretary and as may be
prescribed by the Board of Directors, the Chairman of the Board of
Directors or the President.
The Assistant Secretaries shall perform such duties as shall be
delegated to them by the Board of Directors, the Chairman of the Board of
Directors, the President or the Secretary.
(As Amended January 28, 1975)
SECTION 11. Treasurer and Assistant Treasurers. The Treasurer shall
have custody of the corporate funds and securities, and shall keep full and
accurate accounts of receipts and disbursements in books of the Company to
be kept for that purpose. He shall deposit all moneys and other valuable
effects in the name and to the credit of the Company in such depositaries
as may be designated by authority of the Board of Directors, and shall
disburse the funds of the Company as may be ordered by the Board of
Directors, taking proper vouchers for such disbursements. He shall render
to the Board of Directors, whenever it may so require, an account of all
his transactions as Treasurer and of the financial condition of the
Company. He shall have such other powers and duties as may be assigned to
him by the Board of Directors, the Chairman of the Board of Directors or
the President.
The Assistant Treasurers shall perform such duties as shall be
delegated to them by the Board
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of Directors, the Chairman of the Board of Directors, the President or the
Treasurer.
(As Amended January 28, 1975)
SECTION 12. Controller and Assistant Controllers. The Controller shall
be the chief accounting officer of the Company. He shall keep or cause to
be kept all books of account and accounting records of the Company, and
shall render appropriate financial statements to the Board of Directors and
to the shareholders. He shall perform such other duties as usually
appertain to the office of Controller and as may be prescribed by the Board
of Directors, the Chairman of the Board of Directors or the President.
The Assistant Controllers shall perform such duties as shall be
delegated to them by the Board of Directors, the Chairman of the Board of
Directors, the President or the Controller.
(As Amended January 28, 1975)
SECTION 13. General Counsel and Assistant General Counsel. The General
Counsel, who shall be an attorney licensed to practice law in the State of
Indiana, shall be the chief legal officer of the Company. He, or one or
more other attorneys designated by him, shall represent the Company in
proceedings before state and federal courts and administrative agencies and
shall provide advice and render opinions to directors, officers and other
management personnel of the Company with respect to any legal matter in
which the Company is or may become involved. He shall perform such other
duties as usually appertain to the office of General Counsel and as may be
prescribed by the Board of Directors, the Chairman of the Board of
Directors or the President.
The Assistant General Counsel shall perform such duties as may be
delegated to him by the Board of Directors, the Chairman of the Board of
Directors, the President or the General Counsel.
(As Amended May 30, 1989 to be Effective May 1, 1989)
ARTICLE VI.
Shares
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SECTION 1. Certificates. The certificates for shares in the Company
shall be consecutively numbered in the order of their issue, and each
certificate shall state the name of the registered holder, the number of
shares represented thereby, the par value of each share or a statement that
such shares have no par value, whether such shares have been fully paid up
and are non-assessable, the kind and class of shares represented thereby,
and a statement or summary of the relative rights, interests, preferences
and restrictions of all classes of such shares; provided, that if the Board
of Directors so authorizes, such statement or summary may be omitted from
the certificate if it shall be set forth upon the face or back of the
certificate that such statement, in full, will be furnished by the Company
to any shareholder upon written request and without charge.
Certificates for shares shall be in such form, consistent with the
Amended Articles of Incorporation, as the Board of Directors shall approve.
Such certificates shall be signed by the President, or a Vice President,
and the Secretary, or an Assistant Secretary, and shall be sealed with the
corporate seal, which seal may be an original impression or a facsimile
thereof. Where any certificate is countersigned by the written signature of
a registrar other than the Company or its employees, the signature of the
transfer agent, and the President, Vice President, Secretary or Assistant
Secretary of the Company may be facsimiles.
(As Amended March 31, 1981)
SECTION 2. Record of Shareholders. The Company shall keep at its
principal office a complete
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and accurate list of the shareholders of each class of shares issued and
outstanding setting forth the names and addresses of the shareholders of
each class and the number of shares held by each such shareholder.
The Company shall be entitled to treat the holder of record of any
share or shares as the owner in fact thereof and accordingly shall not be
bound to recognize any equitable or other claim to or interest in such
shares on the part of any other person, whether or not it shall have
express or other notice thereof, except as otherwise expressly provided by
the laws of Indiana.
SECTION 3. Transfers of Shares. The transfer of shares may be made on
the books of the Company only by the holder thereof or his duly authorized
attorney and upon surrender of the certificate representing the same,
properly endorsed and/or assigned; title to certificates and to the shares
represented thereby can be transferred only as provided by the laws of the
State of Indiana.
SECTION 4. Transfer Books; Record Date. The books for the transfer of
the shares of the Company may be closed for such period, in anticipation of
shareholders meetings, the payment of dividends or the allotment of rights,
as the Board of Directors from time to time may determine. In lieu of
providing for the closing of the transfer books, the Board of Directors
may, in its discretion, fix a date not exceeding fifty (50) days (and in
the case of a shareholders meeting, not less than ten (10) days) prior to
the date fixed for any such meeting, payment, or allotment as a record date
for such purpose.
SECTION 5. Transfer Agents and Registrars. The Board of Directors may
appoint one or more transfer agents and registrars or appoint qualified
agents to perform both the functions of transfer agent and registrar. The
Board of Directors shall require all certificates for shares to bear the
written signature of the registrar and may require such certificates to
bear also the written signature of the transfer agent.
(As Amended March 31, 1981)
SECTION 6. Lost or Destroyed Certificates. Any person claiming a
certificate for shares to be lost or destroyed shall make an affidavit or
affirmation of that fact and shall give the Company and/or the transfer
agents and/or the registrars, if they shall so require, a bond of
indemnity, in form and with one or more sureties satisfactory to the
officers of the Company, and/or the transfer agents, and/or the registrars,
whereupon a new certificate may be issued of the same tenor and for the
same number of shares as the one alleged to be lost or destroyed; or in
lieu of the foregoing procedure, such person may proceed in accordance with
the laws of the State of Indiana.
ARTICLE VII.
Checks, Notes, Contracts, Etc.
------------------------------
SECTION 1. Checks; Notes. All checks, notes, drafts, acceptances, or
other demands or orders for the payment of money of the Company shall be
signed by such officer or officers, or person or persons, as the Board of
Directors may from time to time designate. When so authorized by the Board
of Directors, the signatures of such officers on any bonds, notes,
debentures, or other evidences of indebtedness may be facsimiles and such
facsimiles on such instruments shall be deemed the equivalent of and
constitute the written signatures of such officers for all purposes
including, but not limited to, the full satisfaction of any signature
requirements of the laws of the State of Indiana on the negotiable bonds,
notes, debentures, and other evidences of indebtedness of the Company.
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SECTION 2. Contracts Requiring Seal. All contracts, deeds, mortgages,
leases or instruments that require the seal of the Company shall be signed
by the President, or a Vice President, and by the Secretary, or an
Assistant Secretary, or by such officer or officers, or person or persons,
as the Board of Directors may by resolution prescribe, except as provided
in Section 1 of this Article VII. Such seal may be an original impression
or an engraved or imprinted facsimile thereof.
ARTICLE VIII.
Seal
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The corporate seal shall have inscribed thereon the name of the
Company and the word ``SEAL''.
ARTICLE IX.
Fiscal Year
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The fiscal year shall be the calendar year.
ARTICLE X.
Miscellaneous Provisions
------------------------
SECTION 1. Inspection of Books. The Board of Directors shall determine
from time to time whether, and, if allowed, when and under what conditions
and regulations, the accounts and books of the Company (except such as may
by statute be specifically open to inspection), or any of them, shall be
open to the inspection of the shareholders, and the shareholders' rights in
this respect are and shall be restricted and limited accordingly.
SECTION 2. Notices. Whenever under the provisions of these By-Laws
notice is required to be given to any director, officer, or shareholder, it
may be given by depositing the same in the post office or a letter box, in
a postpaid sealed wrapper, addressed to such director, officer, or
shareholder at such address as appears on the books of the Company, or in
default of other address, to such director, officer or shareholder at the
General Post Office in the City of Indianapolis, Indiana, and such notice
shall be deemed to be given at the time of such mailing.
SECTION 3. Waiver. Any director, officer or shareholder may waive any
notice required to be given under these By-Laws either before, at, or after
any meeting, and such waiver shall be equally as effective as the due
service of notice.
ARTICLE XI.
Amendments and Repeal
---------------------
SECTION 1. Amendments. These By-Laws may be altered, amended or
repealed, and new By-Laws may be made at any annual, regular, or special
meeting of the Board of Directors by the affirmative vote of a number of
directors equal to a majority of the number who would constitute the full
Board of Directors at the time of such action.
SECTION 2. Repeal. All By-Laws of the Company, and amendments thereto,
heretofore made and adopted by the shareholders and/or directors of the
Company are hereby expressly repealed.
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