Table of Contents
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14C INFORMATION
Information Statement Pursuant to Section 14(c)
of the Securities Exchange Act of 1934 (Amendment No. )
Check the appropriate box:
o Preliminary Information Statement
o Confidential, for Use of the Commission Only (as permitted by Rule 14c-5(d)(2))
þ Definitive Information Statement
UNION ELECTRIC COMPANY
(Name of Registrant As Specified In Its Charter)
Payment of Filing Fee (Check the appropriate box):
þ No fee required |
o Fee computed on table below per Exchange Act Rules 14c-5(g) 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: |
o Fee paid previously with preliminary materials. |
o 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: |
Table of Contents
Secretary
SECTION | PAGE | |
1 | ||
1 | ||
2 | ||
2 | ||
Important Notice Regarding the Availability of Information Statement and 2007 Form 10-K for the Annual Meeting to be Held on April 22, 2008 | 2 | |
3 | ||
3 | ||
3 | ||
3 | ||
3 | ||
3 | ||
5 | ||
8 | ||
8 | ||
9 | ||
10 | ||
11 | ||
11 | ||
11 | ||
12 | ||
12 | ||
12 | ||
13 | ||
13 | ||
13 | ||
22 | ||
24 | ||
26 | ||
29 | ||
30 | ||
36 | ||
37 | ||
37 | ||
37 | ||
37 | ||
38 | ||
38 | ||
38 |
i
Table of Contents
Table of Contents
2
Table of Contents
http://www.ameren.com at 9:00 A.M. CT on April 22, 2008, to hear the webcast of the Annual Meeting. On the home page, you will click on “Live Webcast Annual Meeting April 22, 2008, 9:00 A.M. CT,” then the appropriate audio link. The webcast will remain on Ameren’s website for one year. You cannot record your vote on this webcast.
- | by mail addressed to |
Union Electric Company
P.O. Box 66149, Mail Code 1370
St. Louis, MO63166-6149
3
Table of Contents
4
Table of Contents
5
Table of Contents
6
Table of Contents
• | considering compensation for the Executives (as defined below) in the context of all of the components of total compensation; | |
• | requiring several meetings to discuss important decisions; | |
• | reviewing tally sheets for the Executives including all components of total compensation packages (tally sheets help the Committee understand the cumulative effect of the compensation decisions it has made over time, to determine whether the result has been excessive or unreasonable; the Committee concluded upon review that it was neither); | |
• | receiving meeting materials several days in advance of meetings; | |
• | conducting executive sessions with Committee members only; and | |
• | obtaining professional advice from an outside compensation consultant engaged directly by and who reports to the Committee. |
• | provide ongoing recommendations regarding executive compensation consistent with Ameren’s business needs, its pay philosophy, market trends and the latest legal and regulatory considerations; | |
• | provide market data as background to annual decisions regarding CEO and senior management base salaries and short-term and long-term incentive amounts; | |
• | advise the Committee as to best practices for working effectively with management while representing shareholders’ interests; and | |
• | provide other services as the Committee may request. |
• | competitive market pay analyses and market trend analyses; | |
• | preparation of tally sheets and review of the same with the Committee; | |
• | advice with respect to legal, regulatory,and/or accounting considerations impacting Ameren’s compensation and benefit programs; |
7
Table of Contents
• | assistance with the design of compensation and benefit programs, including changes in the design of the short-term incentive compensation program for 2008; and | |
• | other requests relating to executive compensation issues. |
8
Table of Contents
• | the highest professional and personal ethics; | |
• | broad experience in business, government, education or technology; | |
• | ability to provide insights and practical wisdom based on their experience and expertise; | |
• | commitment to enhancing shareholder value; | |
• | sufficient time to effectively carry out their duties; their service on other boards of public companies should be limited to a reasonable number; | |
• | compliance with legal and regulatory requirements; and | |
• | ability to develop a good working relationship with other Board members. |
9
Table of Contents
10
Table of Contents
11
Table of Contents
Number of Shares of | ||||||||
Ameren Common Stock | Percent | |||||||
Name | Beneficially Owned(1) | Owned(2) | ||||||
Warner L. Baxter | 28,739 | * | ||||||
Daniel F. Cole | 41,662 | * | ||||||
Richard J. Mark | 6,451 | * | ||||||
Charles D. Naslund | 16,091 | * | ||||||
Steven R. Sullivan | 14,138 | * | ||||||
Thomas R. Voss | 34,981 | * | ||||||
All directors, nominees for director and executive officers as a group (8 persons) | 160,560 | * |
* | Less than one percent. |
(1) | This column lists voting securities, including Ameren restricted stock held by executive officers over which the individuals have voting power but no investment power. For Mr. Cole, this column also includes 16,300 shares issuable within 60 days upon the exercise of Ameren stock options. None of the other named individuals held shares issuable within 60 days upon the exercise of Ameren stock options. Reported shares include those for which a director, nominee for director or executive officer has voting or investment power because of joint or fiduciary ownership of the shares or a relationship with the record owner, most commonly a spouse, even if such director, nominee for director or executive officer does not claim beneficial ownership. | |
(2) | For each individual and group included in the table, percentage ownership is calculated by dividing the number of shares beneficially owned by such person or group as described above by the sum of the 208,728,929 shares of Ameren Common Stock outstanding on February 1, 2008 and the number of shares of Ameren Common Stock that such person or group had the right to acquire on or within 60 days of February 1, 2008, including, but not limited to, upon the exercise of options. |
12
Table of Contents
13
Table of Contents
• | base salary; | |
• | short-term incentives; | |
• | long-term incentives, specifically Ameren’s Performance Share Units Program; | |
• | retirement benefits; and | |
• | change of control protection. |
14
Table of Contents
AGL Resources | FirstEnergy Corp. | SCANA Corporation | ||
Allegheny Energy | FPL Group | Sempra Energy | ||
CenterPoint Energy | Great Plains Energy | Southern Company | ||
CMS Energy | NiSource Inc. | TXU Corp. | ||
Constellation Energy | Pepco Holdings, Inc. | WGL Holdings | ||
Dominion Resources, Inc. | PG&E Corporation | |||
DTE Energy Company | PPL Corporation | |||
Edison International | Progress Energy |
15
Table of Contents
Payout as a | ||||
Level of Performance | EPS | Percent of Target | ||
Maximum | $3.65 | 150% | ||
Target | $3.35 | 100% | ||
Threshold | $3.05 | 50% | ||
Below threshold | Less than $3.05 | 0% | ||
16
Table of Contents
• | provide compensation dependent on Ameren’s three-year Total Shareholder Return(“TSR”) (calculated as described below under“— 2007 Grants”) versus utility industry peers, as identified below; | |
• | provide some payout (below target) if three-year TSR is below the 30th percentile but EPS in each year of the three-year performance period is at least equal to the dividend paid of $2.54 per Ameren common share in 2006; | |
• | accrue dividends during the performance period, as declared and paid, in order to further align executives’ interests with those of shareholders; | |
• | promote retention of executives during a three-year performance and vesting period; and | |
• | share Ameren Common Stock price increases and decreases over a five-year period. |
• | align executives’ interests with shareholder interests: awards are denominated in Ameren Common Stock units and paid out in Ameren Common Stock. Payouts are dependent on Ameren’s Common Stock performance, and are limited to target if TSR is negative; | |
• | competitive with market practice:the majority of regulated utility companies use plans similar to this program, and with this performance measure; | |
• | promote Common Stock ownership:payout of earned awards is made 100 percent in Common Stock, with dividends on Common Stock, as declared and paid, reinvested into additional share units throughout the performance period. Share units are restricted from sale for two years once earned; |
17
Table of Contents
• | allow executives to share in the returns created for shareholders:returns for shareholders include dividends as declared and paid and this is reflected in the plan performance measure and rewards; and | |
• | be retentive:annual competitive grants with a three-year vesting and performance period provide incentive for executives to stay with Ameren and manage Ameren in the long-term interests of Ameren and its shareholders. |
18
Table of Contents
• | Classified as a transmission and distribution, integrated electric and gas, or diversified energy company as determined by Standard & Poor’s Ratings Service (“S&P”) in its company classifications. | |
• | Market capitalization greater than $2 billion (as of August 5, 2005). | |
• | Minimum S&P credit rating of BBB- (investment grade). | |
• | Dividends flat or growing over the2003-2004 period. | |
• | Beta (a measure of a stock’s volatility in comparison to the market as a whole) within .25 of Ameren’s Beta over the last five years. | |
• | Not an announced acquisition target. |
Consolidated Edison, Inc. | FPL Group, Inc. | PPL Corporation | ||
Dominion Resources, Inc. | Great Plains Energy Inc. | Progress Energy, Inc. | ||
DTE Energy Company | Keyspan Corporation | Puget Energy | ||
Duke Energy | Northeast Utilities | SCANA Corporation | ||
Energy East | NSTAR | Southern Company | ||
Entergy Corporation | OGE Energy | Vectren Corporation | ||
Exelon Corporation | Pepco Holdings, Inc. | Wisconsin Energy | ||
FirstEnergy Corp. | Pinnacle West Capital Corporation | WPS Resources Corporation | ||
Xcel Energy, Inc. |
Payout (% of Share | ||||||
Performance | Units Granted) | |||||
90th percentile + | 200% | ) | If TSR is negative over the three-year | |||
70th percentile | 150% | ) ß | period, the plan is capped at 100% of | |||
50th percentile | 100% | ) | target regardless of performance vs. peers | |||
30th percentile | 50% | |||||
Less than 30th percentile (EPS each year = $2.54 or greater) | 30% | |||||
Less than 30th percentile (EPS each year¹ $2.54 or greater) | 0% (No payout) | |||||
19
Table of Contents
• | employee benefit plans that are available to all employees of Ameren, including 401(k) savings and tax-qualified retirement plans; | |
• | the Supplemental Retirement Plan (the “SRP”) provides the Executives a benefit equal to the difference between the benefit that would have been paid if IRC limitations were not in effect and the reduced benefit payable as a result of such IRC limitations; and | |
• | the deferred compensation plans provide the opportunity to defer to future years taxability of part of base salary and all non-equity incentive compensation at an identified interest rate. It enhances retirement savings for the Executives. |
20
Table of Contents
• | Messrs. Voss and Baxter: 2 times base salary; and | |
• | Messrs. Sullivan, Naslund and Cole: 1 times base salary. |
• | the Executives’ base salaries changes for 2007 were determined at the February 2007 Committee meeting retroactive to January 1, 2007; and | |
• | Executive Incentive Plan EPS goals for 2007 were set and PSU grants to the Executives were made at the February 2007 Committee meeting. |
21
Table of Contents
Change in | ||||||||||||||||||||||||||||||||||
Pension | ||||||||||||||||||||||||||||||||||
Non-Equity | Value and | |||||||||||||||||||||||||||||||||
Stock | Option | Incentive Plan | Nonqualified Def. | All Other | ||||||||||||||||||||||||||||||
Name and Principal Position | Salary(2) | Bonus(2) | Award(3) | Awards(4) | Compensation(2)(5) | Comp. Earnings(6) | Compensation(7) | Total | ||||||||||||||||||||||||||
at December 31, 2007(1) | Year | ($) | ($) | ($) | ($) | ($) | ($) | ($) | ($) | |||||||||||||||||||||||||
(a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | (i) | (j) | |||||||||||||||||||||||||
T.R. Voss | 2007 | 460,000 | – | 772,741 | – | 271,308 | 149,455 | 19,288 | 1,672,792 | |||||||||||||||||||||||||
Chairman, President and | 2006 | 440,000 | – | 468,068 | – | 118,800 | 151,572 | 18,250 | 1,196,680 | |||||||||||||||||||||||||
Chief Executive Officer, Union Electric; and Executive Vice President and Chief Operating Officer, Ameren | ||||||||||||||||||||||||||||||||||
W.L. Baxter | 2007 | 530,000 | – | 842,939 | – | 312,594 | 65,537 | 11,683 | 1,762,753 | |||||||||||||||||||||||||
Executive Vice President | 2006 | 500,000 | – | 491,898 | – | 180,000 | 76,060 | 22,042 | 1,270,000 | |||||||||||||||||||||||||
and Chief Financial Officer, Union Electric and Ameren; and Chairman, President, Chief Executive Officer and Chief Financial Officer, Ameren Services | ||||||||||||||||||||||||||||||||||
S.R. Sullivan | 2007 | 400,000 | – | 613,451 | – | 230,022 | 83,023 | 10,236 | 1,336,732 | |||||||||||||||||||||||||
Senior Vice President, | 2006 | 380,000 | – | 348,511 | – | 119,700 | 92,733 | 9,611 | 950,555 | |||||||||||||||||||||||||
General Counsel and Secretary, Union Electric and Ameren | ||||||||||||||||||||||||||||||||||
C.D. Naslund | 2007 | 365,000 | 21,000 | 370,344 | – | 179,398 | 97,727 | 14,311 | 1,047,780 | |||||||||||||||||||||||||
Senior Vice President and | 2006 | 335,000 | – | 215,882 | – | 100,500 | 94,675 | 13,750 | 759,807 | |||||||||||||||||||||||||
Chief Nuclear Officer, Union Electric | ||||||||||||||||||||||||||||||||||
D.F. Cole | 2007 | 320,000 | – | 385,323 | – | 157,280 | 82,031 | 13,737 | 958,371 | |||||||||||||||||||||||||
Senior Vice President, Union Electric |
(1) | Includes compensation received as an officer of Ameren and its subsidiaries (including Union Electric), except that Mr. Naslund serves as an officer of Union Electric only and not of Ameren and Mr. Cole serves as an officer of various Ameren subsidiaries and not of Ameren. | |
(2) | Except for a cash bonus award made to Mr. Naslund for 2007 performance, all cash compensation received by each Executive for fiscal years 2007 and 2006 are found in either the Salary or Non-Equity Incentive Plan Compensation column of this Table. The amounts that would generally be considered “bonus” awards are found under the Non-Equity Incentive Plan Compensation column. See “— Compensation Discussion and Analysis” for information regarding Mr. Naslund’s cash bonus award for 2007. | |
(3) | The amounts in column (e) reflect the dollar amount recognized for financial statement reporting purposes for the applicable fiscal year, in accordance with FAS 123R of restricted stock awards under Ameren’s Long-Term Incentive Plan of 1998 and PSU awards under Ameren’s 2006 Omnibus Incentive Compensation Plan without regard to estimated forfeitures related to service-based vesting conditions and thus include amounts from awards granted in and, in the case of restricted stock awards, prior to 2006. Assumptions used in the calculation of these amounts are described in Note 10 to our audited financial statements for the fiscal year ended December 31, 2007 included in our 2007Form 10-K. |
22
Table of Contents
The amounts reported for the 2006 and 2007 PSU award grants, representing the dollar amount recognized for financial statement reporting purposes, do not reflect compensation realized by the Executives and are not a guarantee of the amount that the Executive will actually receive from the grant of the respective PSU awards. The PSUP performance periods for the 2006 and 2007 grants will not end until December 31, 2008 and December 31, 2009, respectively, and, as such, the actual value, if any, of the PSU awards will generally depend on the Company’s achievement of certain performance measures during these periods. See“— Compensation Discussion and Analysis” for information regarding the terms of the awards, the description of performance based vesting conditions, and the criteria for determining the amounts payable. | ||
(4) | None of the Executives received any option awards in 2007 or 2006. | |
(5) | Represents payouts for performance under the applicable year’s EIP. See “— Compensation Discussion and Analysis” for a discussion of how amounts were determined for 2007. | |
(6) | Amounts shown in column (h) are the sum of (1) the increase in the actuarial present value of each Executive’s accumulated benefit under all defined benefit and actuarial pension plans (including the SRP) from December 31 of the prior fiscal year to December 31 of the applicable fiscal year and (2) the difference between the interest rate credited in Ameren’s deferred compensation plans and 120 percent of the Internal Revenue Service (“IRS”) long-term Applicable Federal Rate published by the IRS and calculated as of January 1, 2007 for the year ended December 31, 2006 and as of January 1, 2008 for the year ended December 31, 2007. The table below shows the allocation of these amounts for each Executive. For 2007, the applicable interest rate for the deferred compensation plans was 8.39 percent. The above-market earnings equal that amount minus 120 percent of the Applicable Federal Rate of 5.36 percent published by the IRS, and calculated as of January 2008. For 2006, the applicable interest rate was 7.86 percent. The above-market earnings equal that amount minus 120 percent of the Applicable Federal Rate of 5.70 percent published by the IRS and calculated as of January 2007. |
Pension Plan | Deferred Compensation Plans | |||||||||||
Increase | Above-Market Interest | |||||||||||
Name | Year | ($) | ($) | |||||||||
Voss | 2007 | 117,643 | 31,812 | |||||||||
2006 | 133,044 | 18,528 | ||||||||||
Baxter | 2007 | 50,617 | 14,920 | |||||||||
2006 | 67,470 | 8,590 | ||||||||||
Sullivan | 2007 | 57,985 | 25,038 | |||||||||
2006 | 78,528 | 14,205 | ||||||||||
Naslund | 2007 | 74,527 | 23,200 | |||||||||
2006 | 81,356 | 13,319 | ||||||||||
Cole | 2007 | 64,193 | 17,838 |
(7) | None of the Executives received perquisites and other personal benefits in the aggregate amount of $10,000 or more. |
23
Table of Contents
All Other | All Other | |||||||||||||||||||||
Stock | Option | |||||||||||||||||||||
Awards: | Awards: | Grant Date | ||||||||||||||||||||
Estimated Possible Payouts | Number of | Number of | Exercise or | Fair Value | ||||||||||||||||||
Under Non-Equity Incentive Plan | Estimated Future Payouts Under | Shares | Securities | Base Price of | of Stock | |||||||||||||||||
Awards(3) | Equity Incentive Plan Awards(3) | of Stock | Underlying | Option | and Option | |||||||||||||||||
Threshold | Target | Maximum | Threshold | Target | Maximum | or Units | Options(4) | Awards(4) | Awards(5) | |||||||||||||
Name | Grant Date(1) | ($) | ($) | ($) | (#) | (#) | (#) | (#) | (#) | ($/Sh) | ($) | |||||||||||
(a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | (i) | (j) | (k) | (l) | |||||||||||
Voss | EIP: 2/9/2007 | 138,000 | 276,000 | 414,000 | – | – | – | – | – | – | – | |||||||||||
PSUP: 2/9/2007 | – | – | – | 4,601 | 15,336 | 30,672 | – | – | – | 914,019 | ||||||||||||
Baxter | EIP: 2/9/2007 | 159,000 | 318,000 | 477,000 | – | – | – | – | – | – | – | |||||||||||
PSUP: 2/9/2007 | – | – | – | 5,301 | 17,670 | 35,340 | – | – | – | 1,053,124 | ||||||||||||
Sullivan | EIP: 2/9/2007 | 120,000 | 240,000 | 360,000 | – | – | – | – | – | – | – | |||||||||||
PSUP: 2/9/2007 | – | – | – | 4,001 | 13,336 | 26,672 | – | – | – | 794,820 | ||||||||||||
Naslund | EIP: 2/9/2007 | 91,250 | 182,500 | 273,750 | – | – | – | – | – | – | – | |||||||||||
PSUP: 2/9/2007 | – | – | – | 2,333 | 7,775 | 15,550 | – | – | – | 463,387 | ||||||||||||
Cole | EIP: 2/9/2007 | 80,000 | 160,000 | 240,000 | – | – | – | – | – | – | – | |||||||||||
PSUP: 2/9/2007 | – | – | – | 2,045 | 6,816 | 13,632 | – | – | – | 406,231 |
(1) | The PSU awards were granted on February 9, 2007. See “— Compensation Discussion and Analysis” for a discussion of the timing of various pay decisions. | |
(2) | The amounts shown in column (c) reflect the threshold payment level under the EIP which is 50 percent of the target amount shown in column (d). The amount shown in column (e) is 150 percent of such target amount. These amounts are based on the individual’s 2007 salary and position. See “— Compensation Discussion and Analysis” for information regarding the description of performance-based conditions. | |
(3) | The amounts shown in column (f) reflect the threshold PSU award which is 30 percent of the target amount shown in column (g). The amount shown in column (h) is 200 percent of such target amount. See “— Compensation Discussion and Analysis” for information regarding the terms of the awards, the description of performance-based vesting conditions, and the criteria for determining the amounts payable. | |
(4) | None of the Executives received any option awards in 2007. | |
(5) | Represents the full grant date fair value of the PSU awards in 2007 determined in accordance with FAS 123R, based on the assumptions referenced in footnote (3) to the Summary Compensation Table. There is no guarantee that, if and when the 2007 PSU awards vest, they will have this value. |
24
Table of Contents
Option Awards(1) | Stock Awards | |||||||||||||||||||||||||||||||||||
Equity Incentive | Market | Equity Incentive | Equity Incentive | |||||||||||||||||||||||||||||||||
Plan Awards: | Value of | Plan Awards: | Plan Awards: | |||||||||||||||||||||||||||||||||
Number of | Number of | Number of | Shares or | Number of | Market or | |||||||||||||||||||||||||||||||
Securities | Securities | Securities | Number of | Units of | Unearned Shares, | Payout Value of | ||||||||||||||||||||||||||||||
Underlying | Underlying | Underlying | Shares or | Stock | Units, or Other | Unearned Shares, | ||||||||||||||||||||||||||||||
Unexercised | Unexercised | Unexercised | Option | Units of Stock | That | Rights That | Units, or Other | |||||||||||||||||||||||||||||
Options | Options | Unearned | Exercise | Option | That Have Not | Have | Have Not | Rights That Have | ||||||||||||||||||||||||||||
Exercisable | Unexercisable | Options | Price | Expiration | Vested | Not Vested | Vested(2) | Not Vested(3) | ||||||||||||||||||||||||||||
Name | (#) | (#) | (#) | ($) | Date | (#) | ($) | (#) | ($) | |||||||||||||||||||||||||||
(a) | (b) | (c) | (d) | (e) | (f) | (g) | (h) | (i) | (j) | |||||||||||||||||||||||||||
Voss | – | – | – | – | – | – | – | 16,860 | 913,981 | |||||||||||||||||||||||||||
Baxter | – | – | – | – | – | – | – | 20,490 | 1,110,763 | |||||||||||||||||||||||||||
Sullivan | – | – | – | – | – | – | – | 13,827 | 749,562 | |||||||||||||||||||||||||||
Naslund | – | – | – | – | – | – | – | 8,772 | 475,530 | |||||||||||||||||||||||||||
Cole | 16,300 | – | – | 31.00 | 2/11/10 | – | – | 9,776 | 529,957 |
(1) | None of the Executives, except for Mr. Cole, hold any options to purchase shares of Ameren’s Common Stock. | |
(2) | Represents outstanding grants of PSUs at threshold (due to lack of payout history) and restricted stock awards at target, based on historical payout levels. |
# of Potential Shares Vesting (at Target) Each Year Including Projected Dividends | ||||||||||||||||
Name | 3/1/09 | 3/1/10 | 3/1/11 | 3/1/12 | ||||||||||||
Voss | 2,829 | 2,022 | 1,699 | 1,189 | ||||||||||||
Baxter | 3,723 | 2,789 | 2,287 | 1,396 | ||||||||||||
Sullivan | 2,081 | 1,587 | 1,322 | 831 | ||||||||||||
Naslund | 1,539 | 1,104 | 948 | 713 | ||||||||||||
Cole | 2,461 | 1,556 | 1,212 | 713 |
(3) | The dollar value of the payout of the 2006 and the 2007 PSU awards is based on achieving the threshold (minimum) performance goals for such awards. The dollar value of the payout of outstanding restricted stock awards is based on achieving target performance goals for such awards. Valuations are based on the closing price of $54.21 per share of Ameren’s Common Stock on the NYSE on December 31, 2007, the last business day of 2007. There is no guarantee that, if and when the PSU awards and restricted stock awards vest, they will have this value. |
25
Table of Contents
Option Awards(1) | Stock Awards | |||||||||||||||
Number of Shares | Number of Shares | Value | ||||||||||||||
Acquired on | Value Realized | Acquired on | Realized on | |||||||||||||
Exercise | on Exercise | Vesting(2) | Vesting(3) | |||||||||||||
Name | (#) | ($) | (#) | ($) | ||||||||||||
(a) | (b) | (c) | (d) | (e) | ||||||||||||
Voss | – | – | 3,592 | 153,378 | ||||||||||||
Baxter | – | – | 4,265 | 182,116 | ||||||||||||
Sullivan | – | – | 2,545 | 108,672 | ||||||||||||
Naslund | – | – | 1,955 | 83,479 | ||||||||||||
Cole | – | – | 3,248 | 138,690 |
(1) | None of the Executives, except for Mr. Cole, hold any options to purchase shares of Ameren’s Common Stock. | |
(2) | These shares were earned and vested under the restricted stock awards under Ameren’s Long-Term Incentive Plan of 1998 due to achievement of specified EPS hurdles for restricted shares awarded during2001-2005. The restricted shares were released on February 29, 2008. | |
(3) | The value of the vested restricted shares is based on the closing price of $42.70 per share of Ameren’s Common Stock on the NYSE on February 29, 2008. |
Number of | Present Value of | Payments During | ||||||||||||
Years Credited | Accumulated | Last Fiscal | ||||||||||||
Service | Benefit(1)(2) | Year(3) | ||||||||||||
Name | Plan Name | (#) | ($) | ($) | ||||||||||
(a) | (b) | (c) | (d) | (e) | ||||||||||
Voss | 1) Retirement Plan | 38 | 863,481 | – | ||||||||||
2) SRP | 38 | 314,111 | – | |||||||||||
Baxter | 1) Retirement Plan | 12 | 102,299 | – | ||||||||||
2) SRP | 12 | 217,516 | – | |||||||||||
Sullivan | 1) Retirement Plan | 18 | 240,104 | – | ||||||||||
2) SRP | 18 | 192,194 | – | |||||||||||
Naslund | 1) Retirement Plan | 33 | 614,697 | – | ||||||||||
2) SRP | 33 | 160,236 | – | |||||||||||
Cole | 1) Retirement Plan | 32 | 494,279 | – | ||||||||||
2) SRP | 32 | 212,167 | – |
(1) | Represents the actuarial present value of the accumulated benefits relating to the Executives under the Retirement Plan and the SRP as of December 31, 2007. See Note 9 to our audited consolidated financial statements for the year ended December 31, 2007 included in our 2007 Form10-K for an explanation |
26
Table of Contents
of the valuation method and all material assumptions applied in quantifying the present value of the accumulated benefit. The calculations were based on retirement at the plan normal retirement age of 65, included no pre-retirement decrements in determining the present value, used an 80 percent lump sum/20 percent annuity payment form assumption, and used the plan valuation mortality assumptions after age 65 in the 1994 Group Annuity Reserving Table. Cash balance accounts were projected to age 65 using the 2007 plan interest crediting rate of 5.00 percent. | ||
(2) | The following table provides the Cash Balance Account (Lump Sum) Value for accumulated benefits relating to the Executives under the Retirement Plan and the SRP at December 31, 2007 as an alternative to the presentation of the actuarial present value of the accumulated benefits relating to the Executives under the Retirement Plan and the SRP as of December 31, 2007. |
Cash Balance | ||||||||||
Lump Sum Value | ||||||||||
Name | Plan Name | ($) | ||||||||
Voss | 1) Retirement Plan | 926,613 | ||||||||
2) SRP | 337,077 | |||||||||
Baxter | 1) Retirement Plan | 127,111 | ||||||||
2) SRP | 270,274 | |||||||||
Sullivan | 1) Retirement Plan | 292,032 | ||||||||
2) SRP | 233,761 | |||||||||
Naslund | 1) Retirement Plan | 694,984 | ||||||||
2) SRP | 181,165 | |||||||||
Cole | 1) Retirement Plan | 564,724 | ||||||||
2) SRP | 242,405 |
(3) | All Executives are active and were not eligible for payments prior to December 31, 2007. |
27
Table of Contents
Transition | ||||||||||||
Credit for | ||||||||||||
Participant’s Age | Regular Credit for | Pensionable | ||||||||||
on December 31 | Pensionable Earnings* | Earnings | Total Credits | |||||||||
Less than 30 | 3% | 1% | 4% | |||||||||
30 to 34 | 4% | 1% | 5% | |||||||||
35 to 39 | 4% | 2% | 6% | |||||||||
40 to 44 | 5% | 3% | 8% | |||||||||
45 to 49 | 6% | 4.5% | 10.5% | |||||||||
50 to 54 | 7% | 4% | 11% | |||||||||
55 and over | 8% | 3% | 11% | |||||||||
* An additional regular credit of 3 percent is received for pensionable earnings above the Social Security wage base. |
28
Table of Contents
Executive | Company | Aggregate | Aggregate | |||||||||||||||||
Contributions | Contributions | Earnings | Withdrawals/ | Aggregate Balance | ||||||||||||||||
in 2007(1) | in 2007 | in 2007(2) | Distributions | at 12/31/07(3) | ||||||||||||||||
Name | ($) | ($) | ($) | ($) | ($) | |||||||||||||||
(a) | (b) | (c) | (d) | (e) | (f) | |||||||||||||||
Voss | 115,008 | – | 88,117 | – | 1,201,290 | |||||||||||||||
Baxter | 79,512 | – | 41,330 | – | 577,456 | |||||||||||||||
Sullivan | 120,000 | – | 69,360 | – | 961,723 | |||||||||||||||
Naslund | 86,754 | – | 64,270 | – | 863,047 | |||||||||||||||
Cole | 70,416 | – | 49,416 | – | 676,887 |
(1) | A portion of these amounts are also included in amounts reported as “Salary” in column (c) of the Summary Compensation Table. These amounts also include a portion of amounts reported as “Non-Equity Incentive Plan Compensation” in our 2007 information statement, representing compensation paid in 2007 for performance during 2006. | |
(2) | The dollar amount of aggregate interest earnings accrued during 2007. The above-market interest component of these amounts is included in amounts reported in column (h) of the Summary Compensation Table. See footnote (6) to the Summary Compensation Table for the amounts of above-market interest. | |
(3) | The dollar amount of the total balance of the Executive’s account as of December 31, 2007 consists of the following elements. |
Executive | Interest | Total Per Table | Amount Previously Reported as | |||||||||||||
Contributions | Earnings | Above | Compensation in Prior Years(1) | |||||||||||||
Name | ($) | ($) | ($) | ($) | ||||||||||||
Voss | 787,245 | 414,044 | 1,201,290 | 444,653 | ||||||||||||
Baxter | 380,114 | 197,342 | 577,456 | 191,492 | ||||||||||||
Sullivan | 702,472 | 259,250 | 961,723 | 320,205 | ||||||||||||
Naslund | 555,658 | 307,389 | 863,047 | 311,075 | ||||||||||||
Cole | 463,171 | 213,715 | 676,887 | – |
(1) | Represents amounts previously reported as compensation to the Executive in the Company’s Summary Compensation Table in previous years. |
29
Table of Contents
30
Table of Contents
31
Table of Contents
• | Retirement Plan Benefit Assumptions. Amount equal to the difference between (a) the account balance under the Retirement Plan and SRP which the participant would receive if his or her employment continued during the three-year period upon which severance is received (assuming the participant’s compensation during such period would have been equal to his or her compensation as in effect immediately prior to termination), and (b) the actual account balance (paid or payable) under such plans as of the date of termination. | |
• | Welfare Benefit Payment Assumptions. Continued coverage for the Executive’s family with medical, dental, life insurance and executive life insurance benefits as if employment had not been terminated during the three-year period upon which severance is received. Calculation assumes full cost of benefits over the three-year period. In addition, the Executive’s family receives additional retiree medical benefits (if applicable) as if employment had not been terminated during the three-year period upon which severance is received. All retiree medical benefits are payable only in their normal form as monthly premium payments. The actuarial present value of the additional retiree medical benefits is included, calculated based on retirement at the end of the three-year severance period, a discount rate of 5.68 percent (120 percent of the long-term annual Federal rate at December 2007), and the plan valuation mortality assumptions (only after age 65) in the 1994 Group Annuity Reserving Table. |
Three Years’ | ||||||||||||||||||||||||
Base Salary | Three | Excise Tax | ||||||||||||||||||||||
and Target | Three Years’ | Years’ | and | |||||||||||||||||||||
EIP, Plus Pro | Additional | Welfare | Outplacement | Gross-up (to | ||||||||||||||||||||
Rata EIP | Pension Credit | Benefits(1) | at Maximum | IRS) | Total | |||||||||||||||||||
Name | ($) | ($) | ($) | ($) | ($) | ($) | ||||||||||||||||||
Voss | 2,484,000 | 392,258 | 57,720 | 30,000 | 1,738,576 | 4,720,554 | ||||||||||||||||||
Baxter | 2,862,000 | 256,438 | 57,720 | 30,000 | 2,468,797 | 5,674,955 | ||||||||||||||||||
Sullivan | 2,160,000 | 227,882 | 57,720 | 30,000 | 1,766,791 | 4,242,393 | ||||||||||||||||||
Naslund | 1,825,000 | 291,882 | 77,337 | 30,000 | 1,198,126 | 3,422,345 | ||||||||||||||||||
Cole | 1,600,000 | 262,797 | 98,008 | 30,000 | 1,245,430 | 3,236,235 |
(1) | Reflects the estimated lump-sum present value of all future premiums which will be paid on behalf of or to the Executives under Ameren’s welfare benefit plans. These amounts are not paid as a cash lump sum upon a Change of Control and termination of employment. |
32
Table of Contents
Number of Restricted Shares That Would | ||
Name | Vest Upon a Change of Control | |
Voss | 6,860 | |
Baxter | 9,050 | |
Sullivan | 5,161 | |
Naslund | 3,808 | |
Cole | 5,302 |
• | Change of Control prior to vesting after which there is no traded stock.Upon a Change of Control which occurs on or before December 31, 2009 in which Ameren ceases to exist or is no longer publicly trading on the NYSE or the NASDAQ Stock Market, the target number of PSU awards granted, together with dividends accrued thereon, will be converted to nonqualified deferred compensation. Interest on the nonqualified deferred compensation will accrue based on the prime rate, computed as provided in the award agreement. |
33
Table of Contents
Number of Shares Relating to PSU Awards to be | ||||
Paid Out After a Change of Control and on | ||||
Name | Earliest of Events Described Above | |||
Voss | 33,334 | |||
Baxter | 38,135 | |||
Sullivan | 28,885 | |||
Naslund | 16,546 | |||
Cole | 14,114 | |||
• | Change of Control after vesting, and after which there is no traded stock. Upon a Change of Control that occurs after December 31, 2009, the participant will receive an immediate distribution of cash equal to the value of the earned PSUs, computed as provided in the award agreement. | |
• | Change of Control but Ameren continues in existence. If there is a Change of Control but Ameren continues in existence and remains a publicly traded company on the NYSE or the NASDAQ Stock Market, the PSUs will pay out upon the earliest to occur of the following: |
• | Age 61 and under: A prorated award is earned through the termination date at the March 1 following the end of the performance period (based on actual performance) and paid immediately following such March 1. All other unvested restricted shares are forfeited. | |
• | Age 62 or higher: Restricted shares continue to vest in accordance with the terms of the awards. |
34
Table of Contents
Employment Event | Payout (Always in Ameren Common Stock) | ||
Death | All awards pay out at target (plus accrual of dividends), pro rata for the number of days worked in each performance period. | ||
Disability | All outstanding awards are earned at the same time and to the same extent that they are earned by other participants, and are paid out by March 15 after the performance period ends. | ||
Retirement | If retirement occurs during the performance period at: | ||
Age 55-62 with 5 years of service: A prorated award is earned at the end of the 3-year performance period (based on actual performance) and paid immediately. | |||
Age 62+ with 5 years of service: A full award is earned at the end of the3-year performance period and paid immediately. | |||
If retirement occurs during the 2-year holding period following the performance period, payout of earned and vested awards is made immediately. | |||
Number of PSUs That Would Vest Upon | Number of PSUs That Would Vest Upon | |||||||
Name | Death of Executive | Retirement of Executive(1) | ||||||
Voss | 16,854 | 5,056 | ||||||
Baxter | 19,237 | – | ||||||
Sullivan | 14,588 | – | ||||||
Naslund | 8,309 | 2,493 | ||||||
Cole | 7,556 | – |
(1) | Messrs. Baxter, Sullivan and Cole are not retirement eligible. Therefore, no PSUs would vest under this scenario. |
35
Table of Contents
36
Table of Contents
37
Table of Contents
38