<PAGE>
PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
Filed by the Registrant X
Filed by a Party other than the Registrant
Check the appropriate box:
Preliminary Proxy Statement Confidential. For Use of
the Commission Only (as
permitted by Rule 14a-6(e)(2))
X Definitive Proxy Statement
Definitive Additional Materials
Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
TRIGEN ENERGY CORPORATION
(Name of Registrant as Specified in Its Charter)
Payment of Filing Fee (Check the appropriate box):
X No fee required.
Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(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 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
Fee paid previously with preliminary materials:
Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the form or schedule and the date of its filing.
(1) Amount previously paid:
(2) Form, Schedule or Registration Statement no.:
(3) Filing Party:
(4) Date Filed:
<PAGE>
TRIGEN ENERGY CORPORATION
One Water Street, White Plains, New York 10601
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held on May 13, 1998
To the Shareholders of Trigen Energy Corporation:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of Trigen
Energy Corporation, a Delaware corporation (the "Company"), will be held at The
Blaustein Building, One North Charles Street, 25th Floor, Baltimore, Maryland
21201 on Wednesday, May 13, 1998 at 9:30 a.m. for the following purposes:
1. To elect to the board a Class A director for a term of three years, or
until his successor is elected and shall qualify.
2. To consider and act upon such business as may properly come before the
meeting or any adjournment thereof.
All of the above matters are more fully described in the accompanying Proxy
Statement.
Shareholders of record at the close of business on March 30, 1998 are
entitled to notice of and to vote at the annual meeting or any adjournment
thereof. A list of such shareholders will be available for inspection by any
shareholder, for any purpose germane to the meeting, for a period of 10 days
prior to the meeting at One Water Street, White Plains, New York 10601.
Regardless of whether you attend the meeting, please complete the enclosed
form of proxy, date and sign it exactly as your name appears on the proxy card
and return it promptly in the postpaid envelope furnished for that purpose to
ensure the voting of your shares if you do not attend the meeting. If you
desire to revoke your proxy for any reason, you may do so at any time prior to
the voting.
Shareholders are urged to send in their proxies as soon as possible.
Prompt response is helpful and your cooperation will be appreciated.
By order of the Board of Directors,
White Plains, New York Thomas R. Casten
March 31, 1998 President and Chief Executive Officer
IMPORTANT
PLEASE COMPLETE, DATE AND SIGN THE ENCLOSED PROXY AND MAIL IT PROMPTLY IN THE
ENCLOSED ENVELOPE EVEN IF YOU PLAN TO ATTEND THE MEETING. IN THE EVENT YOU ARE
PRESENT AT THE MEETING AND WISH TO DO SO, YOU MAY WITHDRAW YOUR PROXY AND VOTE
IN PERSON.
<PAGE>
TRIGEN ENERGY CORPORATION
One Water Street
White Plains, New York 10601
PROXY STATEMENT
For the Annual Meeting of Shareholders
to be held on May 13, 1998
This proxy statement is furnished in connection with the solicitation by
the Board of Directors of Trigen Energy Corporation, a Delaware corporation (the
"Company" or "Trigen"), of proxies from the holders of the Company's common
stock, par value $.01 per share (the "common stock"), to be voted at the Annual
Meeting of Shareholders of the Company (the "Meeting") to be held at the time
and place and for the purposes set forth in the accompanying Notice, and at any
adjournment or postponement of the Meeting. The Notice of the Meeting, this
proxy statement, and the enclosed form of proxy card are being mailed to
shareholders on or about March 31, 1998.
The Board of Directors has fixed March 30, 1998 as the record date for the
determination of shareholders entitled to notice of and to vote at the Meeting.
At the close of business on such date, there were issued and outstanding
12,321,680 shares of common stock, which constitute the only outstanding capital
stock of the Company entitled to vote at the Meeting. Each outstanding share of
the common stock is entitled to one vote per proposal.
Shares represented by properly executed proxies received prior to or at the
Meeting will be voted in accordance with the choices specified thereon. As to
any matter for which no choice has been specified in a duly executed proxy, the
shares represented thereby will be voted in favor of the proposal to elect the
nominee specified herein as a director of the Company. Execution of a proxy
will not prevent a shareholder from attending the Meeting and voting in person.
Any shareholder giving a proxy may revoke it at any time before it is voted by
giving to the Secretary of the Company written notice bearing a later date than
the proxy, by submission of a later dated proxy, or by voting in person at the
Meeting (although attendance at the Meeting will not in and of itself constitute
revocation of a proxy). Any written notice revoking a proxy should be sent to
Eugene E. Murphy, Secretary, Trigen Energy Corporation, One Water Street, White
Plains, New York 10601.
MATTERS TO BE CONSIDERED AT THE ANNUAL MEETING
AGENDA ITEM NO. ONE:
ELECTION OF DIRECTOR
The Board of Directors currently has eleven members. The Board is divided into
three classes denoted as Class A, Class B and Class C, serving staggered three-
year terms with one class of the Board of Directors elected each year. One
Class A director is proposed to be elected at the Meeting. The Board of
Directors' nominee for the directorship is listed below. The nominee is
currently a director of the Company. The other two current Class A directors
have not been nominated for election at the Meeting. Therefore, if the Class A
director proposed for election at the Meeting is elected, the Board of Directors
will have nine members.The Class B Directors are Messrs. Keane, Casten, Desnos
and Brongniart, and the Class C Directors are Messrs. Bayless, Bleitrach, Cassou
and Mangin d'Ouince. The terms of the Class B and Class C Directors will expire
at the annual meeting of the shareholders of the Company in 1999 and 2000,
respectively. All directors hold office until the third succeeding annual
meeting of the shareholders of the Company or until their successors have been
elected and qualified.
Position with
Nominee Age the Company
- ------- --- -------------
Richard E. Kessel 48 Director
Management recommends that the shareholders vote FOR the election to the
Board of Directors of Mr. Kessel.
The following pages set forth information regarding the nominee for
election as well as information about the directors whose terms of office do not
expire this year. The nominee has consented to being named as nominee for
director and agreed to serve if elected.
Under applicable Delaware law, directors shall be elected by a plurality of
the shares present in person or represented by proxy at the Annual Meeting and
entitled to vote on the election of directors. The enclosed proxy, unless
authority to vote is withheld, will be voted for the election of the nominee
named above. Under the rules of the New York Stock Exchange, Inc. ("NYSE"),
brokers who hold shares in street name for customers have the authority to vote
on certain items when they have not received instructions from their customers,
the beneficial owners of the shares. Thus, brokers that do not receive
instructions are entitled to vote on the election of the foregoing nominee for
director.
In the event the nominee becomes unavailable for election, votes will be
cast pursuant to the authority granted by the enclosed proxy for such person or
persons as may be designated by the Board of Directors. The Board does not
expect that the nominee will be unavailable for election.
Nominee for Director:
Class A: serving until the annual election of directors in 2001 or until his
successor is elected and qualified.
Richard E. Kessel, 48, has served as a Director of Trigen since 1994. He
is also a member of the Executive Committee. He has been Executive Vice
President and Chief Operating Officer of Trigen since 1993 when the Company
acquired United Thermal Corporation ("UTC"). From 1991 to 1993 he was Managing
Director and Chief Executive Officer of UTC. From 1987 to 1991 he was Chief
Operating Officer of Sithe Energies USA, Inc., an independent power producer.
From 1971 to 1987 he held various positions at Ebasco Services Incorporated, an
international engineering and construction company, the last being Vice
President--Business/Project Development.
Other Class A Directors: who will be ending their tenure as directors at the
Meeting.
Francois Faessel, 53, has been a Director of Trigen since 1992. From 1989
to 1995 Mr. Faessel was Secretaire General of Elyo. Since 1995 he has been
Director, Major Projects Financing at Elyo.
Jonathan O'Herron, 68, has served as a Director of Trigen since 1994. He
is a managing director of Lazard Freres & Co. LLC and had previously been a
general partner of Lazard Freres & Co. since 1973. Mr. O'Herron has a broad
range of civic, educational and charitable interests and serves on various
boards in these areas.
Directors Continuing in Office:
Class B: serving until the annual election of directors in 1999 or until his
successor is elected and qualified.
George F. Keane, 68, has served as a Director and non-executive Chairman of
the Board since 1994. He is the Chairman of the Audit Committee and a member of
the Nominating Committee. From 1993 through 1996, he served as President
Emeritus and Senior Investment Adviser to The Common Fund, a company that he
helped organize and that manages the investment of over $17 billion in endowment
funds and operating cash for more than 1,300 member colleges, universities and
independent schools. Mr. Keane served as Chief Executive Officer of The Common
Fund from 1971 to 1993. Since 1996, Mr. Keane has been self-employed. He
serves on the boards of Universal Stainless & Alloy Products, Global
Pharmaceutical, United Water Resources, The Bramwell Funds, Nicholas-
Applegate Investment Trust, Northern Trust of Connecticut and Security
Capital U.S. Real Estate Shares.
Thomas R. Casten, 55, has been President, Chief Executive Officer and a
Director of Trigen since 1986. He is also a member of the Executive Committee.
From 1980 to 1986 he was President and Chief Executive Officer of Cogeneration
Development Corporation ("CDC"). From 1969 to 1980 he held various positions at
Cummins Engine Company, a diesel engine manufacturer, the last being Vice
President and General Manager of Cummins Cogeneration Company, a division of
Cummins Engine Company, from 1977 to 1980. He was President of the
International District Energy Association for the 1993-1994 term and in 1989 he
was selected "Man of the Year" by that association.
Patrick Desnos, 45, has been a Director of Trigen since 1992. He is
Chairman of the Executive Committee and the Nominating Committee and a member of
the Compensation Committee. Since 1995 he has been Deputy Managing Director of
Elyo and President of INES S.A., a French subsidiary of Elyo. From 1992 to 1995
he was Directeur General of Compagnie Parisienne de Chauffage Urban ("CPCU").
From 1987 to 1995 he was a Managing Director of INES S.A.
Philippe Brongniart, 59, has been a Director of Trigen since 1997. Since
1997 he has been Directeur General of Suez Lyonnaise des Eaux ("Suez
Lyonnaise"). From 1993 to 1997 he was General Manager of Societe Lyonnaise des
Eaux ("Lyonnaise"). He was Chairman and Chief Executive Officer of Sita since
1988 and Chief Operating Officer of Sita from 1986 to 1988.
Class C: serving until the annual election of directors in 2000 or until his
successor is elected and qualified.
Charles E. Bayless, 54, has served as a Director of Trigen since 1994. He
is a member of the Compensation Committee, the Nominating Committee and the
Audit Committee. He has been Chairman of Tucson Electric Power Company ("Tucson
Electric"), an electric utility corporation, since 1992. Since 1990 he has been
President and Chief Executive Officer of Tucson Electric. He became Chairman,
President and Chief Executive Officer of UniSource Energy on January 1, 1998.
UniSource Energy is Tucson Electric's holding company. From 1989 to 1990 he was
Senior Vice President and Chief Financial Officer of Tucson Electric. From 1981
to 1989 he was Senior Vice President and Chief Financial Officer of Public
Service Company of New Hampshire, an electric utility corporation.
Michel Cassou, 55, has been a Director of Trigen since 1993. He is a
member of the Compensation Committee. Mr. Cassou has been Directeur General
Adjoint of Suez Lyonnaise since 1997. From 1994 to 1997 he was Director General
Adjoint of Lyonnaise. From 1990 to 1994 he was Vice President, Development of
Lyonnaise. From 1988 to 1990 he was Directeur Financier of Lyonnaise.
Michel Bleitrach, 52, has been a Director of Trigen since 1995. He is
Chairman of the Compensation Committee. Mr. Bleitrach has been the Chairman of
Elyo since 1995 and has been the Chief Executive Officer of Elyo since 1993.
From 1990 to 1993 he was Chief Executive Officer of PRIAM.
Dominique Mangin d'Ouince, 48, has been a Director of Trigen since 1995.
He is a member of the Executive Committee. Mr. Mangin d'Ouince has been an
Executive Vice President and Managing Director of Elyo since 1995 and was a
Managing Director in charge of Business Development of Lyonnaise from 1990 to
1997.
Meetings and Committees of the Board of Directors
The Board of Directors met four (4) times in 1997. During 1997, each
director attended at least 75% of the total number of the Board meetings and
meetings of all committees on which such director served, except for Mr.
O'Herron who has not been nominated for re-election, and Mr. Casten attended 73%
of the aggregate of Board and committee meetings for which he was eligible. A
quorum was present at Board and committee meetings and the presence of the
individuals not in attendance was not required.
Directors who are regularly employed officers of the Company receive no
fees for serving as directors of the Company. Each non-officer director
receives $20,000 (the Chairman receives $30,000) per year plus $1,000 per day of
meetings of the Board or Committee of the Board attended, and each may elect to
receive such compensation in shares of common stock. Upon his election to the
Board in 1997, Philippe Brongniart received options to purchase 10,000 shares of
common stock exercisable at $25.00 per share (the price per share on the date of
the grant). Upon their election to the Board in 1995, Messrs. Bleitrach and
Mangin d'Ouince each received options to purchase 10,000 shares of common stock
exercisable at $22.13 per share (the price per share on the date of the grant).
During 1994, each individual who was then a Director received options to
purchase 10,000 shares of common stock (20,000 for the Chairman) exercisable
at $15.75 per share (the price per share on the date of the grant). In July
1996 the Chairman received additional options to purchase 10,000 shares of
Common Stock exercisable at $18.75 per share. Each Director is reimbursed
for the out-of-pocket costs of attending meetings.
The Board of Directors has an Executive Committee, a Compensation
Committee, an Audit Committee and a Nominating Committee.
The Executive Committee oversees all activities of the Company between
meetings of the Board of Directors and may exercise the power and authority of
the full Board of Directors to the extent permitted by Delaware law and the
Company's By-Laws. The Executive Committee consists of Messrs. Desnos
(Chairman), Mangin d'Ouince, Casten and Kessel (two non-employee Directors and
two employee Directors). Non-employee members of the Executive Committee
receive $1,000 per meeting not held on the same day as a Board meeting. The
Executive Committee met eleven (11) times in 1997.
The Compensation Committee reviews the salaries and bonuses of management
and administers the Company's 1994 Stock Incentive Plan. The Compensation
Committee has sole discretion to determine the number of option shares granted
to employees of the Company. The Compensation Committee consists of five (5)
Board members, currently Messrs. Bleitrach (Chairman), Bayless, Cassou and
Desnos and Mr. Keane, who serves as an ex officio member of the Committee, none
of whom is an employee of the Company. Members of the Compensation Committee
receive $1,000 per meeting not held on the same day as a Board of Directors'
meeting. The Compensation Committee met three (3) times during 1997.
The Audit Committee consists of two (2) members, currently Messrs. Keane
(Chairman) and Bayless, and is responsible for (i) recommending independent
auditors, (ii) reviewing with the independent auditors the scope and results of
the audit engagement, (iii) monitoring the Company's financial policies and
control procedures and (iv) reviewing and monitoring the provision of non-audit
services by the Company's auditors. Members of the Audit Committee receive
$1,000 per meeting not held on the same day as a Board of Directors' meeting.
The Audit Committee met twice during 1997.
The Nominating Committee consists of three (3) members, currently Messrs.
Desnos (Chairman), Keane and Bayless, none of whom is an employee of the
Company. The Nominating Committee performs two principal functions: (i) to
review possible candidates for membership on the Board of Directors and make
recommendations to the Board concerning nominees to be elected by the
shareholders (or by the Board to fill vacancies), and (ii) to make
recommendations to the Board concerning membership and chairs of the various
board committees. The Nominating Committee considers nominees recommended
by security holders, subject to their submission by the required date. No
submissions had been made for the Meeting by the required date,
which was November 26, 1997. Members of the Nominating Committee receive
$1,000 per meeting not held on the same day as a Board of Directors' meeting.
The Nominating Committee met once during 1997.
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
No accountant has been recommended by the Audit Committee or selected by
the Board of Directors for the Company's fiscal year ending December 31, 1998,
and therefore no accountant will be recommended to the shareholders for
ratification at the Meeting. The principal accountant for the Company for the
fiscal year ending December 31, 1994, December 31, 1995, December 31, 1996 and
December 31, 1997 was KPMG Peat Marwick LLP ("KPMG"). The Company has made a
decision to change the Company's principal accountant for the Company's fiscal
year ending December 31, 1998 for the reason set forth below. The Audit
Committee and the Board of Directors have approved this determination.
KPMG is also in the business of providing consulting services to clients
with respect to issues related to the energy business. In 1997, a dispute arose
between the Company and the consulting services division of KPMG with respect to
the conduct of consulting services provided to a third party. That dispute was
not resolved to the satisfaction of the Company. The change in principal
accountant is not due to any matter regarding KPMG's accounting services.
KPMG's report on the financial statements of the Company since KPMG became the
principal accountant for the Company has not contained an adverse opinion or a
disclaimer of opinion, nor has it been qualified or modified as to uncertainty,
audit scope or accounting principles. Neither were there, since KPMG became the
principal accountant for the Company, any disagreements with KPMG on any matter
of accounting principles or practices, financial statement disclosure, or
auditing scope or procedure, which disagreements, if not resolved to the
satisfaction of KPMG, would have caused it to make reference to the subject
matter of the disagreement in connection with its report.
The Audit Committee intends to recommend a new principal accountant for
selection by the Board of Directors following an appropriate set of interviews
of various accounting firms being conducted by the management of the Company and
recommendation to the Audit Committee.
A representative of KPMG Peat Marwick is expected to attend the Meeting and
will be available to respond to appropriate shareholder questions. The
representative will have an opportunity to make a statement at the Meeting, if
he or she so desires.
OTHER MATTERS
Management does not intend to bring any other matters before the Meeting
and has not been informed that any other matters are to be presented to the
Meeting by others. If other matters properly come before the Meeting or any
adjournment thereof, the persons named in the accompanying proxy and acting
thereunder intend to vote in accordance with their best judgment.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers, directors and persons who own more than 10% of the Company's common
stock to file certain reports with respect to each such person's beneficial
ownership of the Company's common stock. In addition, Item 405 of Regulation
S-K requires the Company to identify in its Proxy Statement each reporting
person that failed to file on a timely basis reports required by Section 16(a)
of the Exchange Act during the most recent fiscal year or prior fiscal year.
The statement of changes in beneficial ownership on Form 4 for the month of
December, 1996 for Mr. Murphy was not filed on a timely basis. However, the
shares involved were not acquired directly by Mr. Murphy, but rather through the
actions of others and the beneficial ownership of these shares is attributed to
Mr. Murphy.
ADDITIONAL INFORMATION FOR SHAREHOLDERS
EXECUTIVE OFFICERS
Executive Officers
The executive officers of the Company include Thomas R. Casten and Richard
E. Kessel, who are also on the Board of Directors, and the following:
Jean M. Malahieude, 59, has been Executive Vice President, Engineering
since 1997, and also heads the Company's project development division. He was
Vice President, Engineering of Trigen from 1987 to 1997. Since 1987 he has been
Executive Vice President of Cofreth-American Corporation ("CAC").
Carol R. Beerbaum, 54, has been Vice President--Strategic Planning and
Strategic Resources since April 1996. From 1992 through 1995 she was Vice
President--Human Resources for Santa Fe Pacific, a major transport and railroad
company.
David H. Kelly, 54, has been Vice President--Finance and Chief Financial
Officer of Trigen since December 1994. From 1969 to 1994 he held various
financial positions at Air Products and Chemicals, Inc., an industrial gas,
specialty chemicals and energy company, as Treasurer in 1990 and as Vice
President and Treasurer from 1991 to 1994.
James F. Lowry, 59, has been Vice President of Acquisitions and National
Accounts since 1997. He was Vice President, Development of Trigen from 1995 to
1997. From 1993 to 1995 he was a principal in International Ventures Group,
which provided consulting services to developing businesses in countries of the
former USSR. From 1992 to 1993 he was President of Commercial Fuel Cell
Business Unit of United Technologies, Inc., which developed, manufactured,
marketed, installed and serviced small fuel-cell power plants throughout the
world. From 1991 to 1992 he was Vice President of ABB, Inc., a major worldwide
industrial and power engineering company providing steam generation, steam and
gas turbines, locomotion and other engineering services to utilities and
industrial customers.
Eugene E. Murphy, 63, has been Vice President and General Counsel of Trigen
since 1986. He has been Secretary of Trigen since 1988. From 1986 to 1994 he
was a Director of Trigen.
Daniel J. Samela, 50, has been Controller of Trigen since 1995. From 1991
to 1995 he was Chief Financial Officer of the Dealer Division of Savin
Corporation, a distributor of office machinery and equipment.
Stephen T. Ward, 55, has been Treasurer of Trigen since 1995. From 1988 to
1995 he was Treasurer of TI Group Inc. TI Group plc is a London-based
manufacturer of automotive and aerospace products. TI Group Inc. is their U.S.
holding company.
Michael Weiser, 55, has been Vice President, Development of Trigen since
1992. From 1986 to 1994 he was a Director of Trigen. From 1986 to 1992 he was
Treasurer of Trigen.
REPORT OF THE COMPENSATION COMMITTEE
Compensation Committee Report On Executive Compensation
All decisions on compensation of the Company's executive officers,
including decisions about awards under certain of the Company's stock-based
compensation plans, are made by the members of the Compensation Committee, each
of whom is a non-employee director. This report addresses the Company's
compensation policies for 1997 as they affected Messrs. Casten, Kessel, Kelly,
Murphy, and Ms. Beerbaum, the five highest paid executive officers of the
Company for 1997, and Messrs. Steven G. Smith and Richard S. Strong, the two
highest paid non-officer employees who were among the five (5) highest paid
employees of the Company including the Chief Executive Officer (collectively,
the "Named Executive Officers").
Compensation Policies
The Compensation Committee's executive compensation policies are designed
to (a) provide competitive compensation opportunities when financial and
operational performance attains pre-set ambitious levels, (b) reward executives
consistent with the Company's performance, (c) recognize individual performance
and responsibility, (d) underscore the importance of shareholder value creation,
and (e) assist the Company in attracting, retaining and inspiring qualified
executives. The principal elements of compensation employed by the Committee to
meet these objectives are base salaries, annual cash incentives, and long term
stock-based incentives. By design, the variable or "at-risk" components of
compensation are proportionately greater for more senior executives, in
recognition of their greater potential impact on the Company's results.
All compensation decisions are determined following a detailed review of
many factors that the Committee believes are relevant, including external
competitive data, the Company's achievements over the past year, the
individual's contributions to the Company's success, any significant changes in
role or responsibility, and the reasonableness of compensation in relation to
that of other employees.
The competitiveness of the Company's total compensation program
(incorporating base salaries, annual cash bonuses, and long term stock-based
incentives) is assessed regularly with the assistance of an independent expert
compensation consultant. Comparisons are made with executives in similarly
sized firms with comparable responsibilities. Data for these comparisons is
drawn from two primary sources: (1) a national compensation survey of similar
publicly traded companies, and (2) the proxy statements of identified
competitors, including all companies in the Peer Group (as defined in "Stock
Performance Information").
One of the guiding principles is to pay at a level that allows the Company
to compensate key executives competitively compared with similarly placed
executives within a selected group of peer industry organizations (the
"Compensation Peer Groups"). This comparison is performed while considering the
Company's performance in relation to the performance results of those companies.
In general, the Committee intends to pay base salary levels at the median or
average levels of competitive compensation for executives with comparable
responsibilities in the Company's Compensation Peer Groups. In addition to base
salary, the Company's total compensation program includes an annual cash
incentive plan and a long-term stock-based incentive program. The targeted
total compensation levels for the Named Executive Officers are intended to be
consistent with competitive levels (as measured by the total compensation levels
of similar positions at the Compensation Peer Groups) when the Company
attains its targeted corporate performance objectives. Actual payouts, if
any, depend upon actual Company performance. Thus, the total compensation
levels and individual compensation components received in any particular
year could be demonstrably lesser or greater than the Compensation
Peer Groups' average.
The Company compensation philosophy for senior management emphasizes pay at
risk, highlights a long-term performance results perspective, provides executive
commitment via stock ownership, and bolsters the creation of shareholder value.
Base Salary. Base salaries for all Named Executive Officers, including the
Chief Executive Officer, are reviewed by the Committee on an annual basis. In
determining appropriate base salaries, the Committee considers external
competitiveness, the roles and responsibilities of the individual, the
reasonableness of compensation in relation to that of other employees, and the
contributions of the individual.
Annual Cash Bonuses. The Company believes that the Incentive Compensation
Plan should reward executives for their contributions to the success and
profitability of the business. Bonuses paid under the Incentive Compensation
Plan reflect the Committee's assessment of the degree to which the Company met
predetermined earnings per share and profitability objectives. All Named
Executive Officers, including the Chief Executive Officer, are eligible to
participate in this program.
Long Term Stock-Based Incentives. The Company also believes that it is
essential to link management and shareholder interests. To meet this objective,
the Company implemented the 1994 Stock Incentive Plan ("Stock Plan"), which
allows the Committee to grant stock options, restricted stock, performance
shares, and stock appreciation rights to help attract, retain, and inspire
executives and other employees by providing them with an opportunity to share in
the Company's success. In determining actual awards, the Committee considers
the externally competitive market, the contributions of the individual to the
success of the Company, and the need to retain the individual over time. All
Named Executive Officers, including the Chief Executive Officer, are eligible to
participate in this program. The Company implemented a long-term program in
1997 under the Stock Plan in which senior management, including all Named
Executive Officers, were granted a combination of incentive stock options and
restricted shares. A key component of this program is for management to meet
share ownership goals in order to participate fully in this program. See
"Option/SAR Grants in Last Fiscal Year."
The Committee has reviewed Internal Revenue Code Section 162(m) and has
determined that, at present, its limitations are not applicable to the Company.
Annually, the Committee will continue to consider the implications of this
statute.
The Committee's policy regarding the compensation of other executive
officers of the firm is consistent with the approach outlined here.
1997 Compensation
As in prior years, the Company engaged the services of an outside,
independent compensation consulting firm to conduct and verify to the Committee
its findings concerning the compensation levels and practices of the
Compensation Peer Groups and its recommendations for compensation actions for
the Named Executive Officers. As outlined in the Compensation Policies Section,
the Committee is thoroughly committed to the Company's variable pay concept.
Under this philosophy, the Company is driven to leverage its compensation
dollars and reward above high performance levels when the Company's
shareholder value added levels warrant.
Base salaries paid in 1997 to the Named Executive Officers, including the
CEO, reflect the Committee's review of external competitiveness, the roles,
responsibilities and contributions of the individuals and the reasonableness of
compensation in relation to that of other employees.
Incentive Compensation Plan bonuses to be paid to all Named Executive
Officers for 1997 were determined in conjunction with the Committee's assessment
of the Company's performance with respect to predetermined earnings per share
and profitability objectives. Overall, the Company's performance as measured by
earnings per share was below the target levels established in 1997 for the
Incentive Compensation Plan. Accordingly, neither the CEO nor any other Named
Executive Officer received a bonus for 1997, except Mr. Strong, President of
Trigen-Boston Energy Corporation and Mr. Smith, President of Trigen-Philadelphia
Energy Corporation. In addition to the Corporate earnings per share target, the
business units in 1997 also were measured by Net Income and Return on Asset
performance criteria. Some business units did achieve their goals and the
remaining business units were below their assigned target levels. Overall,
the bonus levels are significantly less than the approved target levels for
those Named Executive Officers who did receive a bonus.
The Company launched a long-term stock-based compensation program in 1997.
The program's primary objective is to focus management on increasing shareholder
value. The program has three components: a) stock ownership goals, b) a
restricted share award, and c) an incentive stock option grant. The restricted
shares, which have a life cycle of eight years, will remain restricted until the
Company announces accumulated basic Earnings per Share over four consecutive
fiscal quarters of $2.08. This earnings target represents a doubling of the
Company's 1996 Earnings per Share figure. In addition to the earnings target,
the shares are also restricted from vesting unless the participant achieves
his/her prescribed stock ownership levels. Each participant, including the
Named Executive Officers, have been provided with a stock ownership target.
The stock ownership targets are stated as a percentage of the participant's
restricted share award and the percentages are progressive based on the
increase in role and responsibility.
Compensation Committee
George F. Keane (ex officio)
Michel Bleitrach (Chairman)
Charles E. Bayless
Michel Cassou
Patrick Desnos
Compensation Committee Interlocks and Inside Participation in Compensation
Decisions
There are no Compensation Committee interlocks. Mr. Bleitrach, a Director
of Trigen, is the Chairman and Chief Executive Officer of Elyo. Mr. Bayless, a
Director of Trigen, is Chairman of Tucson Electric. Mr. Cassou, a Director of
Trigen, is Directeur General Adjoint of Suez Lyonnaise. Mr. Desnos, a Director
of Trigen, is Deputy Managing Director of Elyo.
COMPENSATION AND OPTION TABLES
The following table presents before-tax information on compensation earned,
paid, awarded or accrued as of the end of fiscal years 1997, 1996 and 1995 for
services by the Named Executive Officers, including options granted.
<PAGE>
<TABLE>
<CAPTION>
SUMMARY COMPENSATION TABLE
Annual Compensation
------------------- Other
Name and Annual
Principal (1) Compensa-
Position Year Salary($) Bonus($) tion($)(4)
- ----------------- ----- --------- --------- ----------
<S> <C> <C> <C> <C>
Thomas R. Casten 1997 390,000 -0- 24,650
President & Chief 1996 375,000 125,500 23,296
Executive Officer 1995 350,000 175,000 8,064
Richard E. Kessel 1997 332,800 -0- 22,058
Executive VicePres.1996 320,000 85,750 20,800
Chief Operating 1995 300,000 120,000 20,800
Officer
David H. Kelly, 1997 192,400 -0- 19,439
Vice President-- 1996 185,000 37,200 18,278
Finance 1995 175,000 52,500 18,278
Carol R. Beerbaum, 1997 175,100 -0- 15,308
VicePres.Strategic 1996 97,036 25,560 125,015(5)
Resources&Planning 1995 -0- -0-(3) -0-
Eugene E. Murphy 1997 171,600 -0- 19,439
Vice President and 1996 165,000 33,150 18,278
General Counsel 1995 157,000 47,100 18,278
Richard S. Strong 1997 174,100 35,510 14,558
President--Trigen 1996 167,400 91,494(6) 14,100
- -Boston EnergyCorp.1995 161,200 45,942 14,100
Steven G. Smith 1997 187,575 23,162 14,558
President--Trigen- 1996 167,400 203,700(6) 14,100
PhiladelphiaEnergy 1995 161,200 58,032 14,100
Long Term Compensation
Awards
-----------------------------
Securities Payouts
----------------- ----------
(2)
All
Underlying LTIP Other
Name and Restricted Options/ Pay Compen-
Principal Stock SARs Outs sation
Position Awards ($) Granted(#) ($) ($)
- ----------------------- ---------- ----------- ----- --------
<S> <C> <C>
Thomas R. Casten 30,000 11,825
President & Chief -0- 19,830
Executive Officer 4,200 10,673
Richard E. Kessel 19,000 8,920
Executive Vice Pres. -0- 15,009
Chief Operating 3,200 8,866
Officer
David H. Kelly 9,000 6,537
Vice President-- -0- 9,601
Finance -0- 4,920
Carol R. Beerbaum 9,000 6,033
Vice Pres.Strategic 18,000 9,065
Resources&Planning -0- -0-
Eugene E. Murphy 9,000 6,033
Vice President and 18,000 9,065
General Counsel -0- -0-
Richard S. Strong 9,000 7,450
President - Trigen- -0- 8,238
Boston Energy Corp. -0- 8,150
Steven G. Smith 12,500 7,616
President - Trigen- -0- 11,194
Philadelphia Energy -0- 7,400
Corporation
</TABLE>
(1) Amounts shown in this column are bonuses earned in the year shown, rather
than bonuses paid in the year shown.
(2) Amount shown is the total of the Company's matching contribution to the
401(k) Plan, profit sharing contribution, and term life insurance premiums. The
years 1995 and 1996 have been restated to include the profit sharing
contribution and adjusted term life insurance premiums.
(3) Ms. Beerbaum commenced her employment in April 1996.
(4) For each of the individuals listed, in 1997 the portion of Other Annual is
compensation which is auto allowance for each respective individual is as
follows: Mr. Casten - $24,192, Mr. Kessel - $21,600, Mr. Kelly - $18,981, Ms.
Beerbaum - $14,850, Mr. Murphy - $18,981, Mr. Strong - $14,100 and Mr. Smith
- $14,100. In 1996 and 1995 the total amount of Other Annual Compensation is
auto allowance.
(5) For Ms. Beerbaum $114,566 of the $125,015 is relocation
allowance, which includes relocation expense, tax gross-up and
temporary living expense.
(6) 1996 bonus figures have been restated to include amounts subsequently paid
for 1996 activity.
<TABLE>
<CAPTION>
OPTIONS/SAR GRANTS IN LAST FISCAL YEAR
Percent
of Total (1)
Number of Options/ Potential Realizable
Securities SARS Value at Assumed
Underlying Granted Annual Rate of Stock
Options/ to Exercise Expir- Price Appreciation
SARS Employees Base ation for Option Term
Granted in Fiscal Price Date 5%($) 10%($)
Name (#) Year ($/Sh)
- ----------- -------- --------- -------- ----------- --------- -------
<S> <C> <C> <C> <C> <C> <C>
Thomas R. Casten 30,000 9% 21.00 August 12, 2007 347,337 855,507
Richard E. Kessel 19,000 5% 21.00 August 12, 2007 219,980 541,821
David H. Kelly 9,000 3% 21.00 August 12, 2007 104,201 256,652
Carol R. Beerbaum 9,000 3% 21.00 August 12, 2007 104,201 256,652
Eugene E. Murphy 9,000 3% 21.00 August 12, 2007 104,201 256,652
Richard S. Strong 9,000 3% 21.00 August 12, 2007 104,201 256,652
Steven G. Smith 12,500 4% 21.00 August 12, 2007 144,724 356,461
</TABLE>
____________________________________
(1) Required by the Commission for reporting purposes; does not represent the
Company's predictions for stock price appreciation.
<TABLE>
<CAPTION>
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTIONS/SAR VALUES
Value of
Underlying Unexercised
Unexercised In-the-Money
Options/SARs at Options/SARs at
Shares Fiscal Year-End(#) Fiscal Year End($)
Acquired on Value Exercisable/ Exercisable/
Name Exercise(#) Realized($) Unexercisable Unexercisable
- ------------- ---------- ---------- ----------------- ------------------
<S> <C> <C>
Thomas R. Casten 31,740/48,360 293,615/48,360
Richard E. Kessel 18,680/29,320 171,870/97,214
David H. Kelly 15,000/19,000 122,850/81,900
Eugene E. Murphy 4,200/14,400 39,564/50,868
Carol R. Beerbaum 3,600/23,400 -0-/ -0-
Richard S. Strong 8,640/14,760 81,389/54,259
Steven G. Smith 8,640/18,260 81,389/54,259
</TABLE>
Stock Performance Information
The following graph assumes the investment on August 12, 1994 of $100 in each of
the three investment alternatives. For the Standard & Poor's Mid-Cap 400 Index
and the Peer Group, the initial investment was assumed to be allocated among the
respective companies based on their market capitalizations at the start of the
period. The graphs assume dividends were reinvested when received. The Peer
Group is composed of companies in the independent power producer sector, and
includes the Company (which represented 4.0% of the market capitalization of the
Peer Group at the start of the period). The other companies are AES
Corporation, CalEnergy Company, Inc., Calpine Corp., Destec Energy, Inc.,
Kenetech Corp., Magma Power Company and Sithe Energies USA, Inc., during the
periods that each company has been publicly traded. Calpine Corp. was added to
the Peer Group in 1997. Excluding the Company, the Peer Group is included
in the Compensation Peer Groups which are composed of the firms with which
the Company's compensation practices were compared.
<TABLE>
<CAPTION>
TOTAL SHAREHOLDER RETURNS
(Dividends Reinvested Monthly)
Annual Return Percentage Years Ending
Company Names/Index Dec.94 Dec.95 Dec.96 Dec.97
- ------------------- ------ ------ ------ -------
<S> <C> <C> <C> <C>
Trigen Energy Corp. 25.05 0.07 48.36 -30.23
S&P Midcap 400 Index-0.60 30.94 19.20 32.25
New Peer Group 12.23 -1.85 66.55 47.90
Old Peer Group 12.23 -2.26 66.54 52.70
Base
Period Indexed Returns Years Ending
Company Names/Index 8/11/94 Dec.94 Dec.95 Dec.96 Dec.97
- -------------------- ------- ------- ------ ------
<S> <C> <C> <C> <C> <C>
Trigen Energy Corp. 100 125.05 125.14 185.66 129.54
S&P Midcap 400 Index100 99.40 130.16 155.15 205.19
New Peer Group 100 112.23 110.15 183.45 271.32
Old Peer Group 100 112.23 109.69 182.68 278.96
</TABLE>
Old Peer Group: AES Corp., Calenergy Inc., Destec Energy, Inc., Kenetech Corp.,
Magma Power Co., Sithe Energies Inc., Trigen Energy Corp.
New Peer Group: AES Cor., Calenergy Inc., Calpine Corp., Destec Energy Inc.,
Kenetech Corp., Magma Power Co., Sithe Energies Inc., Trigen Energy Corp.
Employment Agreements
The Company entered into employment agreements (the "Employment
Agreements") with Thomas R. Casten, Richard E. Kessel, Eugene E. Murphy, Michael
Weiser and David H. Kelly (the "Executive Officers"). Except for Mr. Kelly's,
each of the Employment Agreements was initially for a period of three years
commencing as of August 12, 1994 and is renewable for additional annual
extensions unless terminated by either party. As of December 5, 1994, the
Company entered into an Employment Agreement with Mr. Kelly with an initial
term ending August 1997, but which is renewable for additional annual
extensions unless terminated by either party. The base salaries under the
Employment Agreements are subject to review by the Compensation Committee.
The Employment Agreements also provide for the payment of incentive
compensation. An Employment Agreement for a particular Executive Officer
contains other specified benefits only if those benefits have been approved
by a member of the Board of Directors who has been authorized to review and
approve such provisions.
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth the ownership of the Company's common stock
as of March 30, 1997, of each person known by the Company to own beneficially
more than 5% of the common stock outstanding as of such date. Except as
otherwise indicated, all shares are owned directly. Unless otherwise noted,
each of the stockholders has sole voting and investment power with respect to
the shares shown.
<TABLE>
<CAPTION>
Shares Beneficially Owned
Name and Address of Beneficial Owner Number Percent
- ------------------------------------ ------ -------
<S> <C> <C>
Suez Lyonnaise des Eaux 6,507,944(1)(2) 52.8
1, rue d'Astorg
Paris, France 75008
Elyo 6,507,944(1)(2) 52.8
235, avenue Georges Clemenceau
Nanterre, France 92000
Cofreth American Corporation 4,870,670(1)(2) 39.5
c/o John M. Malahieude
One Water Street
White Plains, New York 10601
Compagnie Parisienne de Chauffage Urbain 1,637,274(1)(2) 13.3
185 Rue de Bercy
75012 Paris, France
Janus Capital Corporation 1,225,350(3) 9.9
100 Fillmore Street, Suite 300
Denver, Colorado 80206
Thomas R. Casten 1,116,988(4) 9.1
One Water Street
White Plains, New York 10601
</TABLE>
- -----------------------
(1) Suez Lyonnaise owns 98% of Elyo, which directly owns 76.9% of the
outstanding voting stock of CAC, and may be deemed to own beneficially 89.6% of
the outstanding voting stock of CAC due to its ownership of stock in certain
other entities which are themselves owners of outstanding voting stock of CAC.
CPCU is a direct subsidiary of Elyo. All shares directly held by CAC or CPCU
are indirectly held by Elyo and Suez Lyonnaise.
(2) Messrs. Casten, Kessel, Weiser and Murphy had formerly granted to the Elyo
Group the right to direct the voting of their shares of their common stock under
specified circumstances, and CAC and CPCU were deemed to beneficially own all
outstanding common stock held by such persons. On August 12, 1997 these rights
expired.
(3) Based upon information filed by Janus Capital Corporation with the
Securities and Exchange Commission in a report on Schedule 13G dated February
13, 1998, the Company has reason to believe that Janus Capital Corporation has
sold shares of the Company's stock since February 13, 1998, but the Company does
not have accurate information which would be included in a subsequent Schedule
13G filing. Janus Capital Corporation is a registered investment adviser to
managed portfolios. As such it may be deemed to be the beneficial owner of the
shares of stock set forth above. However, it does not have a right to dividends
or to proceeds of a sale of the stock.
(4) Includes 43,950 shares held by his wife and children and 78,471 shares
owned by an S-corporation in which he shares beneficial ownership with two other
officers of the Company. In order to finance the purchase of 400,000 shares of
common stock from CAC and CPCU in August 1994, Mr. Casten and another officer
incurred loans from Societe Generale for which they pledged as security
769,618 shares of common stock, and Messrs. Casten and Murphy and two other
individuals, one an officer, incurred loans from Donaldson, Lufkin & Jenrette
Securities Corporation for which they pledged as security 301,750 shares of
common stock. In 1996, Mr. Murphy and the two other individuals repaid their
loans. See table below for Mr. Murphy's current shareholding.
The following table sets forth information furnished by the following
persons and, where possible, confirmed from records of the Company, as to the
number of shares of the Company's common stock beneficially owned by the
directors, the CEO and four (4) other most highly compensated executive
officers of the Company and all directors and executive officers as a group
as of March 30, 1997.
<TABLE>
<CAPTION>
Amounts in
Col. 2 include
the following
Amount shares subject
and Nature to acquisition
of Beneficial Percent through currently
Name of Beneficial Owner Ownership(1) of Class exercisable options
- ------------------------ ------------- -------- -------------------
<S> <C> <C> <C>
Thomas R. Casten 1,116,988(2)(6) 9.1 31,740
George F. Keane 55,275(3) (4) 30,000
Richard E. Kessel 60,296 (4) 18,680
Charles E. Bayless 17,374(5) (4) 10,000
Michel Cassou 13,712(5) (4) 10,000
Patrick Desnos 12,627(5) (4) 10,000
Francois Faessel 13,944(5) (4) 10,000
Jonathan O'Herron 17,992(5) (4) 10,000
Michel Bleitrach 11,874(5) (4) 10,000
Dominique Mangin d'Ouince 12,216(5) (4) 10,000
Philippe Brongniart 10,718(5) (4) 10,000
Eugene E. Murphy 247,384(2)(6) 2.0 4,200
David H. Kelly 24,906 (4) 15,000
Carol R. Beerbaum 19,370 (4) 3,600
All directors and executive
officers as a group 1,916,132(2) 15.6 216,340
(19 persons)
- ----------------------
</TABLE>
(1) Includes shares subject to acquisition through currently exercisable stock
options. See column 4 for amounts.
(2) See Note 4 to the preceding table.
(3) Includes 15,000 shares held by the Keane Family Trust of which George Keane
is the trustee, and 275 shares held by his wife.
(4) Less than 1% of the outstanding shares.
(5) Includes shares acquired through the 1994 Director Stock Plan.
(6) Includes 78,471 shares owned by an S-corporation in which he is a director.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Relationships with the Elyo Group
License Agreement. Elyo and the Company have entered into an Intercompany
Services and License Agreement (the "License Agreement"). Under the License
Agreement, Elyo will continue to provide to the Company on a non-exclusive basis
technical assistance and technical knowledge. The Company will have the right
to use such technical knowledge to construct, operate and maintain community
energy systems within North America as well as the right to use patents and
licenses of Elyo and its subsidiaries in connection with the generation and
distribution of electricity, chilled water and waste incineration. Elyo has
also agreed that it may make available to the Company, upon request, new
support letters or other similar credit support, at mutually agreed rates.
Pursuant to the License Agreement the Company will have the first right to
develop any corporate opportunities relating to the application of the
licensed technologies in North America that are presented to Elyo or its
subsidiaries. Elyo also agreed that neither it nor its subsidiaries will
engage in activities that may cause the Company to become or be regulated as a
public-utility holding company or a subsidiary of a public-utility holding
company under federal, state or local laws or regulations. The initial term is
for three years with automatic two year renewals, unless terminated sooner as
a result of a default or bankruptcy or related event or a change of control with
respect to Trigen. The Company reimbursed Elyo Group $288,000 for salary, bonus
and fringe benefits paid to Jean Malahieude, an Executive Officer of Trigen, and
an additional $198,000 for the services of other professionals and out of pocket
costs in 1997. Elyo has guaranteed the Company's $1.5 million letter of credit
to fund construction of the Chicago system. For 1997, the Company paid Elyo a
fee of $26,150 for this guarantee.
Stockholders' Agreement. In August 1994, Messrs. Casten, Kessel, Weiser
and Murphy and a former officer of the Company (collectively, the "Management
Stockholders"), CAC and CPCU (collectively, the "Elyo Stockholder Group") and
the Company entered into a stockholders' agreement (the "Stockholders'
Agreement") which regulates certain aspects of their relationship with each
other. The Stockholders' Agreement provides a right of first offer upon a
private sale (as defined therein) and piggyback registration rights to the Elyo
Stockholder Group and the Management Stockholders. In addition, commencing in
August, 1996, CAC and CPCU jointly have the right to demand, not more than once
in any 12-month period during the term of the Stockholders' Agreement, that the
Company file a registration statement with the Securities and Exchange
Commission to permit the sale of common stock owned by them. No such demand
has yet been made.
The Stockholders' Agreement will terminate on the earliest to occur of (i)
August 12, 1999, (ii) the liquidation, dissolution, bankruptcy or insolvency of
the Company, (iii) the liquidation, dissolution, bankruptcy or insolvency of
CAC, CPCU, Elyo, Lyonnaise or any successor thereof or (iv) the date the voting
stock held by the Elyo Stockholder Group constitutes less than 10% of the voting
rights of all outstanding voting stock of the Company.
Trenton Partnership
Trigen-Trenton Company, L.P., a limited partnership ("Trigen-Trenton"),
which was formed in 1982, four (4) years before the formation of the Company,
owns and operates the community energy system in Trenton, New Jersey. Trenton
Energy Corporation, a wholly owned subsidiary of Trigen ("TEC"), is the managing
general partner of Trigen-Trenton and owns a 72.25% partnership interest in
Trigen-Trenton. Mr. Casten, who is the chief executive officer and a director of
Trigen, Mr. Weiser, who is an officer of Trigen, and Jeanne N. Murphy, whose
husband is an officer of Trigen, are general partners in Trigen-Trenton owning
approximately 1.04%, 0.46%, and 0.12%, respectively, of the partnership
interests. CDC is also a general partner of Trigen-Trenton and owns 2.08% of
the partnership interests. Messrs. Casten, Weiser and Murphy own
approximately 56%, 25% and 19%, respectively, of the shares of common stock
of CDC. The remaining general and limited partnership interests in
Trigen-Trenton are owned by persons not affiliated with the Company.
The Company itself owns directly a 7.48% limited partnership interest in
Trigen-Trenton.
CERTAIN PROCEDURAL INFORMATION
The Company will pay the cost of the Meeting and the costs of solicitation
of proxies, including the cost of mailing the proxy material. In addition to
solicitation by mail, officers and employees of the Company may solicit
proxies by telephone, telegram or personal interview. Such persons will receive
no additional compensation for such services. Brokerage houses, nominees,
fiduciaries and other custodians will be requested to forward solicitation
material to the beneficial owners for shares held of record by them and will be
reimbursed for their expenses by the Company.
SHAREHOLDER PROPOSALS
Proposals of shareholders intended to be presented at the 1999 Annual
Meeting of Shareholders, including nominees for director (who have consented to
serve), must be received by the Secretary of the Company on or prior to December
1, 1998 to be eligible for inclusion in the 1999 Proxy Statement and form of
Proxy.
A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION, INCLUDING CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 1997, IS BEING MAILED TO ALL SHAREHOLDERS WITH
THIS PROXY STATEMENT. SUCH ANNUAL REPORT IS NOT PART OF THE PROXY MATERIAL. AN
ADDITIONAL COPY OF SUCH ANNUAL REPORT IS AVAILABLE TO SHAREHOLDERS WITHOUT
CHARGE UPON WRITTEN REQUEST TO: SECRETARY, TRIGEN ENERGY CORPORATION, ONE WATER
STREET, WHITE PLAINS, NEW YORK 10601.
By order of the Board of Directors,
TRIGEN ENERGY CORPORATION
/s/ Thomas R. Casten
Thomas R. Casten
President and Chief Executive Officer
Dated: March 31, 1998
