SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act
of 1934 (Amendment No.)
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240.14a-12
IPALCO Enterprises, Inc.
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(Name of Registrant as Specified In Its Charter)
IPALCO Enterprises, Inc.
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(Name of Person(s) Filing Proxy Statement)
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IPALCO ENTERPRISES, INC.
25 Monument Circle
P. O. Box 1595
Indianapolis, Indiana 46206-1595
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD APRIL 19, 1995
TO THE SHAREHOLDERS OF
IPALCO ENTERPRISES, INC.
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of
IPALCO Enterprises, Inc. will be held at the office of the corporation, 25
Monument Circle, Indianapolis, Indiana on Wednesday, April 19, 1995, at 11
o`clock A.M. (Eastern Standard Time), for the following purposes:
1. To elect six directors in Class III to hold office for terms of
three years each and until their successors are duly elected and
qualified;
2. To vote on approval of the IPALCO Enterprises, Inc. Long-Term
Performance and Restricted Stock Incentive Plan (As Amended and
Restated Effective January 1, 1995); and
3. To transact such other business as may properly come before the
meeting or any adjournment thereof.
The Board of Directors fixed the close of business on Monday, February
27, 1995 as the record date for determining the shareholders entitled to
notice of, and to vote at, the Annual Meeting and at any adjournment thereof.
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THIS MEETING.
Whether or not you expect to be present at the meeting, you are urged to fill
in, date and sign the enclosed proxy and return it immediately in the
accompanying postage guaranteed envelope.
By order of the Board of Directors.
IPALCO ENTERPRISES, INC.
By: BRYAN G. TABLER, Secretary
Indianapolis, Indiana
March 6, 1995
TABLE OF CONTENTS
ANNUAL MEETING INFORMATION . . . . . . . . . . . . . . . . . . . . . . . 1
Date, Time and Place of Annual Meeting. . . . . . . . . . . . . . . . 1
Proxy Revocable . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Solicitation of Proxies . . . . . . . . . . . . . . . . . . . . . . . 1
Other Business. . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Date of Receipt of Shareholder Proposals. . . . . . . . . . . . . . . 2
RELATIONSHIP WITH AUDITOR. . . . . . . . . . . . . . . . . . . . . . . . 2
VOTING SECURITIES AND BENEFICIAL OWNERS. . . . . . . . . . . . . . . . . 2
Beneficial Owners of 5% or More of Common Stock . . . . . . . . . . . 2
Beneficial Ownership of Common Stock By Directors, Nominees and
Executive Officers. . . . . . . . . . . . . . . . . . . . . . . . . . 3
PROPOSAL 1 -- ELECTION OF SIX DIRECTORS. . . . . . . . . . . . . . . . . 4
Nominees For Directors To Be Elected At the 1995 Annual Meeting . . . 4
CLASS III. . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Current Directors Whose Terms Expire in 1996 (Class I) and in 1997
(Class II). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
CLASS I. . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
CLASS II . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Vote Required For Election of Directors . . . . . . . . . . . . . . . 7
Procedure To Propose Nominees For Director. . . . . . . . . . . . . . 7
Number Of Board Meetings and Attendance . . . . . . . . . . . . . . . 7
Committees of the Board . . . . . . . . . . . . . . . . . . . . . . . 7
Other Required Disclosure . . . . . . . . . . . . . . . . . . . . . . 8
PROPOSAL 2 -- APPROVING ADOPTION OF IPALCO ENTERPRISES, INC.
LONG-TERM PERFORMANCE AND RESTRICTED STOCK INCENTIVE PLAN
(As Amended and Restated Effective January 1, 1995) . . . . . . . . . 8
Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Summary of the Plan . . . . . . . . . . . . . . . . . . . . . . . . . 9
Federal Income Tax Consequences of Grants Under the Plan. . . . . . . 11
Vote Required to Approve the Plan . . . . . . . . . . . . . . . . . . 11
COMPENSATION OF EXECUTIVE OFFICERS . . . . . . . . . . . . . . . . . . . 11
Nature and Types of Compensation. . . . . . . . . . . . . . . . . . . 11
Summary Compensation - Table I. . . . . . . . . . . . . . . . . . . . 12
Option Exercises - Table II . . . . . . . . . . . . . . . . . . . . . 13
Long-Term Incentive Plans - Table III . . . . . . . . . . . . . . . . 14
Subsidiary Incentive Plan . . . . . . . . . . . . . . . . . . . . . . 15
COMPENSATION OF DIRECTORS. . . . . . . . . . . . . . . . . . . . . . . . 15
Standard Arrangements . . . . . . . . . . . . . . . . . . . . . . . . 15
Certain Business Relationships. . . . . . . . . . . . . . . . . . . . 15
BOARD COMPENSATION COMMITTEE REPORT ON EXECUTIVE
COMPENSATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Compensation Policies Relating Generally to Executive Officers. . . . 16
Base Salary. . . . . . . . . . . . . . . . . . . . . . . . . . 16
Annual Incentive Plan. . . . . . . . . . . . . . . . . . . . . 16
Long-Term Incentive Plan . . . . . . . . . . . . . . . . . . . 17
Stock Option Plan. . . . . . . . . . . . . . . . . . . . . . . 17
Basis for Chief Executive Officer's Compensation. . . . . . . . . . . 18
Compensation Committee Interlocks and Insider Participation . . . . . 18
Performance Graph - Table IV. . . . . . . . . . . . . . . . . . . . . 19
Performance Graph . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Pension Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Pension Plan Table - Table V . . . . . . . . . . . . . . . . . 20
Employment Contracts and Termination of Employment and Change-in-
Control Arrangements. . . . . . . . . . . . . . . . . . . . . . . . . 21
APPENDIX A -- Text of IPALCO Enterprises, Inc.
Long-Term Performance and Restricted Stock Incentive Plan
(As Amended and Restated Effective January 1, 1995) . . . . . . . . A-1
IPALCO ENTERPRISES, INC.
25 Monument Circle P. O. Box 1595
Indianapolis, Indiana 46206-1595
PROXY STATEMENT
For Annual Meeting of Shareholders
To Be Held April 19, 1995
(Mailed on or about March 6, 1995)
ANNUAL MEETING INFORMATION
Date, Time and Place of Annual Meeting
The information set forth in this Proxy Statement is furnished in
connection with the solicitation of the enclosed proxy by and on behalf of
the Board of Directors of IPALCO Enterprises, Inc. (``IPALCO'') for use at
its Annual Meeting of Shareholders to be held April 19, 1995, at 11:00
o'clock A.M. (EST) at the principal office of IPALCO, 25 Monument Circle,
Indianapolis, Indiana, pursuant to the foregoing Notice of Annual Meeting,
and at any adjournment of such meeting.
Proxy Revocable
A shareholder executing and delivering the enclosed proxy has the
unconditional right to revoke it at any time before the authority granted
thereby is exercised.
Solicitation of Proxies
This solicitation of proxies is being made by IPALCO and the expenses
thereof will be borne by IPALCO. The principal solicitation is being made by
mail. However, additional solicitation may be made by telephone, telegraph or
personal contact by officers and other employees of IPALCO and its
subsidiaries, who will not be additionally compensated therefor. IPALCO
expects to reimburse broker-dealers and others for reasonable expenses of
forwarding proxy material to beneficial owners.
Other Business
Management is not aware of any business to be presented at the 1995
Annual Meeting other than the election of six directors and the approval of
the IPALCO Enterprises, Inc. Long-Term Performance and Restricted Stock
Incentive Plan. The minutes of the Annual Meeting of Shareholders held April
20, 1994, will be presented for approval at the 1995 Annual Meeting; however,
such action is not intended to constitute approval or disapproval of any
matter referred to in such minutes. If other matters are properly brought
before the meeting, or any adjournment thereof, the enclosed proxy gives
discretionary authority to the persons named therein to act in accordance
with their best judgment on such matters.
Date of Receipt of Shareholder Proposals
If a shareholder intends to present a proposal at the Annual Meeting
of Shareholders to be held April 17, 1996, the proposal must be received by
the Corporate Secretary for inclusion in IPALCO's proxy statement and form of
proxy not later than November 7, 1995.
RELATIONSHIP WITH AUDITOR
Deloitte & Touche, with offices at Market Tower, Suite 3000, 10 West
Market Street, Indianapolis, Indiana, has been the auditor of IPALCO since
its inception. Upon the recommendation of the Audit Committee, that firm was
again appointed by IPALCO's Board of Directors to serve as auditor for IPALCO
and its subsidiaries for the current year. A representative of Deloitte &
Touche will be present at the Annual Meeting of Shareholders to be held April
19, 1995, and will be given the opportunity to make a statement and to
respond to appropriate shareholders' questions.
VOTING SECURITIES AND BENEFICIAL OWNERS
On February 10, 1995, IPALCO had outstanding 37,755,966 shares of
common stock. In addition, there are a total of 41,246,338 authorized but
unissued shares of common stock reserved for issuance in accordance with the
provisions of the Shareholder Rights Plan, the Automatic Dividend
Reinvestment and Stock Purchase Plan (the ``Dividend Reinvestment Plan''),
the 1991 Directors Stock Option Plan, and the 1990 (Officers) Stock Option
Plan, all of which are IPALCO Plans and of the Employees' Thrift Plan (the
``Thrift Plan'') of Indianapolis Power & Light Company (``IPL''), a
subsidiary of IPALCO. Each share of common stock entitles its owner to one
(1) vote upon each matter to come before the meeting. Only shareholders of
record at the close of business on Monday, February 27, 1995, will be
entitled to vote at the meeting or at any adjournment thereof.
Beneficial Owners of 5% or More of Common Stock
At January 31, 1995, the following beneficial owners held more than 5%
of IPALCO's voting securities:
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Name and Address of Amount and Nature Percent
Title of Class Beneficial Owner of Beneficial Ownership of Class
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Common Stock IPALCO (Employees' Thrift Plan) 3,499,154 shares<F1> 9.27
c/o National City Bank, Indiana,
Trustee
101 West Washington Street
Indianapolis, Indiana 46255
_________________________________
<FN>
<F1> Trustee, under a continuing agreement, has discretion to vote shares as to which no
voting instructions are received.
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Beneficial Ownership of Common Stock By Directors, Nominees and Executive Officers
At January 31, 1995, the following-named directors, nominees and executive officers
of IPALCO, individually and as a group, beneficially owned equity securities of IPALCO as
follows:
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Name of Amount and Nature Percent
Title of Class Beneficial Owner of Beneficial Ownership<F1> of Class<F4>
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Common Stock Joseph D. Barnette, Jr. 5,073 shares <F3>
Robert A. Borns 18,689 shares <F3>
John R. Brehm 22,398 shares <F2>
Mitchell E. Daniels, Jr. 8,100 shares <F3>
Rexford C. Early 1,579 shares
Otto N. Frenzel III 16,800 shares <F3>
Max L. Gibson 3,400 shares
Edwin J. Goss 5,428 shares <F3>
N. Stuart Grauel 30,308 shares <F2>
Earl B. Herr, Jr. 5,103 shares
John R. Hodowal 102,526 shares <F2>
Ramon L. Humke 100,934 shares <F2>
Sam H. Jones 8,240 shares <F3>
Andre B. Lacy 19,900 shares <F3>
L. Ben Lytle 4,445 shares
Michael S. Maurer 3,086 shares
Thomas M. Miller 4,358 shares
Sallie W. Rowland 8,738 shares <F3>
Thomas H. Sams 9,292 shares <F3>
Gerald D. Waltz 60,063 shares <F2>
All 27 directors and
executive officers, as
a group 554,577 shares <F2>, <F3> 1.2%
<FN>
<F1> Except as otherwise noted below, each person named in the table has sole voting and
investment power with respect to all shares of common stock listed as owned by such
person. Shares beneficially owned include 405,834 shares that may be acquired
pursuant to exercise of outstanding options that are exercisable within 60 days as
follows: Mr. Barnette-2,000; Mr. Borns-4,000; Mr. Brehm-15,000; Mr. Daniels-8,000;
Mr. Frenzel-8,000; Mr. Goss-4,000; Mr. Grauel-20,000; Dr. Herr-4,000; Mr. Hodowal-
85,000; Mr. Humke-85,000; Mr. Jones-8,000; Mr. Lacy-8,000; Mr. Lytle-4,000; Mr.
Maurer-2,000; Mr. Miller-4,000; Mrs. Rowland-8,000; Mr. Sams-8,000; Mr. Waltz-
40,000; other executive officers-88,834; directors and executive officers as a group-
405,834.
<F2> Includes vested and contingent interests in shares of common stock held by the Trustee
in the Thrift Plan (stated in whole shares) of: Mr. Brehm-7,106; Mr. Grauel-9,826; Mr.
Hodowal-16,052; Mr. Humke-3,283; Mr. Waltz-19,359; other executive officers-24,970; and
all directors and executive officers as a group-80,596.
<F3> Includes 20,031 shares owned by or with family members sharing their home and shares
held in trust or other arrangements with family members. Also includes 8,000 shares
owned by LDI, Ltd. and 800 shares owned by the Lacy Foundation of which Mr. Lacy is
a partner and a director, respectively, and 400 shares representing his vested
interest in a self-employment retirement plan, totaling 9,200 shares, 6,784 of which
he disclaims beneficial ownership. Mr. Sams disclaims beneficial ownership of 1,000
shares of the total shares shown opposite his name.
<F4> Percentages less than 1% of total common stock outstanding are not indicated.
PROPOSAL 1 -- ELECTION OF SIX DIRECTORS
At a meeting held January 31, 1995, the Executive Committee of the Board
nominated 6 directors to stand for election as Class III directors of IPALCO
at its Annual Meeting of Shareholders to be held April 19, 1995, for terms of
three years each and until their successors are duly elected and qualified.
Proxies representing shares held on the record date which are returned
duly executed, will be voted, unless otherwise specified, in favor of the 6
nominees for the Board of Directors named below in Class III. All such
nominees are members of IPALCO's present Board of Directors and all nominees
have consented to serve if elected. However, if any nominee becomes
unavailable to serve, the persons named as proxies may exercise their
discretion to vote for a substitute nominee.
The nominees for directors in Class III, the current directors in Class
I and Class II, as assigned by the Board of Directors, and the names, ages
(as of April 19, 1995), business experience and directorships of such
nominees and directors are as follows:
Nominees For Directors To Be Elected At The 1995 Annual Meeting:
CLASS III
Otto N. Frenzel III, 64, Chairman of the Board of National City Bank, Indiana,
Indianapolis, Indiana. Mr. Frenzel has held his present position since
May, 1992. For more than 5 years prior to that time, Mr. Frenzel was
Chairman of the Board of Merchants National Corporation and Vice
Chairman of Merchants National Bank & Trust Company of Indianapolis,
Indiana. He is a director of IPL, National City Corporation, American
United Life Insurance Company, Indiana Energy, Inc., Indiana Gas
Company, Inc., Indianapolis Water Company, Baldwin & Lyons, Inc. and
IWC Resources, Inc. He has been a director of IPALCO since September,
1983.
Dr. Earl B. Herr, Jr., 67, Retired. For more than five years prior to his
retirement in December, 1992, Dr. Herr was Executive Vice President of
Eli Lilly and Company (pharmaceuticals manufacturer), Indianapolis,
Indiana. He is a director of IPL and Lilly Endowment and has been a
director of IPALCO since April, 1986 (excluding the period March 15 to
August 23, 1993).
Sam H. Jones, 67, President, Indianapolis Urban League, Inc., Indianapolis,
Indiana. Mr. Jones has held his present position for more than 5 years
and serves on numerous educational, social and cultural boards,
including the Advisory Board of Indiana University-Purdue University at
Indianapolis, Methodist Health Foundation, Board of One Hundred Black
Men of Indianapolis and the Administrative Board of Riverside Park
United Methodist Church. He is a director of IPL and has been a director
of IPALCO since September, 1983.
Andre B. Lacy, 55, General Partner and Chief Executive of LDI, Ltd. (an
industrial and investment limited partnership), Chairman of the Board,
Chief Executive Officer and President of LDI Management, Inc., the
managing general partner of LDI, Ltd., and Chairman and Chief Executive
Officer of all subsidiaries and divisions thereof. He has held his
present positions for more than 5 years. He is a director of IPL, Ethyl
Corporation, Tredegar Industries, Inc., Albemarle Corporation, Patterson
Dental Co. and The National Bank of Indianapolis. He has been a director
of IPALCO since April, 1985.
L. Ben Lytle, 48, Chairman, President and Chief Executive Officer, Associated
Insurance Companies, Inc. (insurance and financial services),
Indianapolis, Indiana. He assumed the title of Chairman in March, 1994,
and has held the remaining positions for more than five years. He is a
director of IPL, Bank One, Indianapolis, NA, and Associated Insurance
Companies, Inc. and its subsidiaries. He has been a director of IPALCO
since April, 1992.
Thomas M. Miller, 65, Retired. For more than 5 years prior to his retirement
on May 31, 1994, Mr. Miller was Chairman of the Board and Chief
Executive Officer of NBD Indiana, Inc. (a bank holding company) and NBD
Bank, N.A., Indianapolis, Indiana, and predecessor companies. Mr. Miller
is a director of IPL, NBD Indiana, Inc., NBD Bank, N.A., State Life
Insurance Company, Indianapolis Water Company and IWC Resources, Inc. He
has been a director of IPALCO since April, 1992.
Current Directors Whose Terms Expire in 1996 (Class I) and in 1997 (Class II):
CLASS I
Robert A. Borns, 59, Chairman of Borns Management Corporation (real estate
management), Indianapolis, Indiana. Mr. Borns has held his present
position since 1961 and serves on numerous social and cultural boards,
including the Board of Trustees of Indianapolis Museum of Art. He is
also a director of IPL, Indianapolis Water Company, IWC Resources, Inc,
and of Heritage Partners Management, Inc. He has been a director of
IPALCO since April, 1987 (excluding the period March 15 to August 23,
1993).
Mitchell E. Daniels, Jr., 46, President, North American Pharmaceutical
Operations, Eli Lilly and Company, (pharmaceuticals manufacturer),
Indianapolis, Indiana since April 1, 1993. Prior to that time, he was
Vice President, Corporate Affairs of Eli Lilly and Company and
President and Chief Executive Officer of Hudson Institute, Inc. (March,
1987 to August, 1990). He is a director of IPL and NBD Bank, N.A. and
has been a director of IPALCO since November, 1989.
Rexford C. Early, 60, President of Carlisle Insurance Agency, Inc.,
Indianapolis, Indiana, a position he has held for more than five years.
Mr. Early was Chairman of the Indiana Republican Party from March, 1991
to March, 1993. He is a director of IPL and has been a director of
IPALCO since August, 1993.
John R. Hodowal, 50, Chairman of the Board and President of IPALCO and
Chairman of the Board and Chief Executive Officer of IPL. Except for
the Chairmanship of IPL which he assumed in February, 1990, Mr. Hodowal
has held his current positions since May, 1989. For some years prior to
that time, he was Vice President and Treasurer of IPALCO and Executive
Vice President of IPL. He is a director of IPL, Bank One, Indianapolis,
NA and Associated Insurance Companies, Inc. He has been a director of
IPALCO since April, 1984.
Michael S. Maurer, 52, Chairman of the Board of MyStar Communications
Corporation (radio station operations), a position he has held for
more than five years; Chairman of the Board of IBJ Corporation
(newspaper publisher), since December, 1990; Chairman of the Board of
The National Bank of Indianapolis since December, 1993. Mr. Maurer is
Chair, Board of Trustees of the Indianapolis Zoo and Jewish Community
Relations Council and is on the boards of various organizations
including University of Indianapolis and United Way of Central Indiana.
He has been a director of IPL and IPALCO since January, 1993.
Thomas H. Sams, 53, President and Chief Executive Officer, Waldemar
Industries, Inc. (an investment holding company), Indianapolis, Indiana
and an officer of various subsidiary and affiliated corporations thereof.
Mr. Sams has held these positions since 1966. He is a director of IPL,
NBD Bank, N.A., Meridian Insurance Group, Inc. and State Life Insurance
Company. He has been a director of IPALCO since April, 1987.
CLASS II
Joseph D. Barnette, Jr., 55, Chairman and Chief Executive Officer of Banc One
Indiana Corporation (a bank holding company) since January, 1993 and
Chairman and Chief Executive Officer of Bank One, Indianapolis, NA,
since October, 1994. Prior to that, Mr. Barnette was President and
Chief Executive Officer of Banc One Indiana Corporation (July, 1990 -
January, 1993) and President and Chief Executive Officer of Bank One,
Indianapolis, NA (January, 1990 - October, 1994). He is a director of
IPL, IWC Resources Corporation, Indianapolis Water Company and Meridian
Insurance Group, Inc. He has been a director of IPALCO since January,
1993.
Max L. Gibson, 54, Retired July, 1989. For more than five years prior to
retirement, Mr. Gibson was President of Victory Services Corporation
(waste disposal), Terre Haute, Indiana. He is a director of IPL, First
Financial Corporation, Terre Haute First National Bank and First State
Bank of Clay County. He has been a director of IPALCO since August,
1993.
Edwin J. Goss, 68, Retired, March, 1990. For more than five years prior to
his retirement, Mr. Goss was the Chairman and Chief Executive Officer
of American States Insurance Company and its subsidiaries, Indianapolis,
Indiana. Mr. Goss continues as a director of these companies. He also is
a director of IPL, National City Bank, Indiana, and has been a director
of IPALCO since July, 1986 (excluding the period March 15 to August 23,
1993).
Ramon L. Humke, 62, Vice Chairman of IPALCO and President and Chief Operating
Officer of IPL. Prior to February, 1990 when he assumed his present
position with IPL, Mr. Humke was President and Chief Executive Officer
of Ameritech Services and Senior Vice President of Ameritech Bell Group
(September, 1989 - February, 1990) and President and Chief Executive
Officer of Indiana Bell Telephone Company (October, 1983 - September,
1989). He is a director of IPL, NBD Bank, N.A., LDI Management, Inc.
and is Chairman of the Boards of Meridian Mutual Insurance Company and
Meridian Insurance Group, Inc. He has been a director of IPALCO since
February, 1990.
Sallie W. Rowland, 62, Chairman and Chief Executive Officer of
Rowland Design, Inc. (a design and space planning firm),
Indianapolis, Indiana, positions she has held for more than
5 years. Mrs. Rowland serves on various community boards
including The Indianapolis Chamber of Commerce of which she
is Vice Chairman. She is a director of IPL, NBD Bank, N.A.,
and Meridian Mutual Insurance Company and is a member of the
Advisory Board of The Walker Group. She has been a director
of IPALCO since April, 1988.
Vote Required For Election of Directors
Under Indiana law, directors are elected by plurality vote
at a meeting where a quorum (a majority of shares issued and
outstanding) is present. Shares represented for any purpose are
deemed present for quorum purposes; thus, withheld votes are
counted for quorum purposes but abstentions and broker non-votes
are not counted for any purpose.
Procedure To Propose Nominees For Director
IPALCO will accept timely notice by shareholders of proposed
nominees for directors. Any such notice must be received by the
Corporate Secretary of IPALCO not less than 60 days nor more than
90 days prior to the date of each annual meeting. Such
shareholder's notice shall set forth (a) as to each proposed
nominee for director (i) the name, age, business address and
residence address of such nominee, (ii) the principal occupation
or employment of such nominee, (iii) the class and/or series and
number of shares that are beneficially owned by such nominee on
the date of such shareholder notice and (iv) any other
information relating to such nominee that is required to be
disclosed pursuant to Regulation 14A under the Securities
Exchange Act of 1934, as amended, and (b) as to the shareholder
giving the notice (i) the name and address, as they appear on
IPALCO's books, of such shareholder and any shareholders known to
be supporting such nominee and (ii) the class and/or series and
number of shares beneficially owned by such shareholder and by
any shareholders known to be supporting such nominee on the date
of such shareholder notice. The Board of Directors may reject any
nomination for director not made in accordance with the foregoing
provisions.
Number of Board Meetings and Attendance
During 1994, the Board of Directors of IPALCO held 11
meetings and Committees of the Board held a total of 18 meetings.
Each director attended more than 75% of the aggregate of Board
meetings and assigned committee meetings, except for Mr. L. Ben
Lytle, who attended 69.2% of such meetings. All directors, on
average, attended over 91% of the Board meetings and assigned
Committee meetings held in 1994.
Committees of the Board
The Board of Directors of IPALCO has four standing
committees, the Executive Committee, the Audit Committee, the
Compensation Committee, and the Committee on Strategies. The
Board does not have a nominating committee as such, but the
Executive Committee performs the functions of such committee. It
reviews, among other things, the qualifications and suitability
of candidates to stand for election to IPALCO's Board of
Directors and makes specific recommendations with respect
thereto. In addition, the Executive
Committee considers and recommends the declaration of dividends
and acts on matters when the full Board is not in session. The
Executive Committee held six meetings in 1994. Currently, Mr.
John R. Hodowal is Chairman and Messrs. Robert A. Borns, Otto N.
Frenzel III, Earl B. Herr, Jr., Ramon L. Humke, and Sam H. Jones
are members.
The Audit Committee recommends the appointment of the
auditor for the ensuing year for IPALCO and its subsidiaries,
reviews the scope of the audit, examines the auditor's reports,
makes appropriate recommendations to the Board of Directors as a
result of such review and examination, and inquires into the
effectiveness of the financial and accounting functions and
controls. The Audit Committee first approves all non-audit
services and gives appropriate consideration to the effect, if
any, such services may have on the independence of the auditor,
except that management advisory and tax services which do not
exceed $50,000 per project or $150,000 in the aggregate per
calendar year may be approved by the Chairman of the Board
without such Committee's consent. The Audit Committee held three
meetings in 1994. Currently, Mrs. Sallie W. Rowland is Chairman
and its members are Messrs. Rexford C. Early, Edwin J. Goss, Sam
H. Jones, and Andre B. Lacy.
The Compensation Committee reviews current and proposed
compensation levels of all officers of IPALCO and its
subsidiaries, including the advice of independent consultants,
and makes specific recommendations as to the compensation each
officer should receive on an annual basis. It also reviews and
makes recommendations with respect to other forms of compensation
for such officers, including supplemental pension benefits,
bonuses and stock options. (See ``Board Compensation Committee
Report on Executive Compensation'' below.) The Compensation
Committee held seven meetings in 1994. Currently, Mr. Otto N.
Frenzel III is Chairman and Messrs. Robert A. Borns, Earl B.
Herr, Jr., Thomas M. Miller, and Thomas H. Sams are members.
The Committee on Strategies considers and makes
recommendations with respect to issues and processes involving
dynamic planning, matters affecting the allocation of corporate
resources among regulated and non-regulated subsidiaries, and
other components of overall corporate strategy. The Committee on
Strategies held two meetings in 1994. Currently, Mr. Joseph D.
Barnette, Jr. is Chairman and Messrs. Mitchell E. Daniels, Jr.,
Max L. Gibson, L. Ben Lytle, and Michael S. Maurer are members.
Other Required Disclosure
Under the federal securities laws, IPALCO's directors,
certain officers, and 10% shareholders are required to report to
the Securities and Exchange Commission, by specific due dates,
transactions and holdings in IPALCO's stock. IPALCO believes that
during 1994 all these filing requirements were satisfied, except
for one report on a Form 4 of Mr. Robert A. Borns, a director of
IPALCO, reporting one transaction in IPALCO stock. The Form 4 was
due to be filed on May 10, 1994 and was filed May 19, 1994.
PROPOSAL 2 -- APPROVING ADOPTION OF IPALCO ENTERPRISES, INC.
LONG-TERM PERFORMANCE AND RESTRICTED STOCK INCENTIVE PLAN
(As Amended and Restated Effective January 1, 1995)
Introduction
At its meeting held October 25, 1994, the Board of Directors
approved the IPALCO Enterprises, Inc. Long-Term Performance and
Restricted Stock Incentive Plan (As Amended and Restated
Effective January 1, 1995) (the ``Plan''). The Plan is a
performance based incentive compensation and restricted stock
plan for officers and other key executive employees of IPALCO and
its subsidiaries. The Plan is a replacement
plan for the IPALCO Enterprises, Inc. 1990 Long-Term Performance
Incentive Plan and the IPALCO Enterprises, Inc. 1990 Stock Option Plan.
If the Plan performance goals are met, participants will earn IPALCO
common stock (the ``Stock''). The Board of Directors believes that
restricted Stock grants will be a significant benefit to IPALCO
and its subsidiaries in attracting and retaining key executive
employees and in providing a long range incentive to work for the
continued success of these companies. The Plan is set forth in
Appendix A to this Proxy Statement, to which reference is made
for a full and complete statement of its terms and conditions. A
summary of the principal features of the Plan follows. (See also
``Compensation of Executive Officers'' and ``Board Compensation
Committee Report on Executive Compensation'' below.)
Summary of the Plan
Administration. The Plan is administered by the Compensation
Committee of IPALCO's Board of Directors, which is made up of
five disinterested outside directors (the ``Committee''). The
Committee has sole authority to (a) select plan participants, (b)
determine the number of shares of Stock covered by each grant,
(c) establish the appropriate performance measures, (d) choose
the appropriate IPALCO peer group, and (e) makes rules,
regulations and other necessary determinations in the course of
administering the Plan.
Eligibility. Officers and other key employees who are
materially responsible for, and contribute to, strategic and
long-term growth of IPALCO and its subsidiaries are eligible to
participate in the Plan.
Stock Subject to Plan. Four Hundred Thousand shares of Stock
(representing 1.06% of currently outstanding shares) are reserved
for restricted Stock grants during the expected duration of the
Plan. Forfeited Stock may again become available for additional
Stock grants.
(a) The first grants were made as of January 1, 1995,
subject to shareholder approval at the April 19, 1995 Annual
Meeting. The next grants will be made as of January 1, 1998, and
on each January 1 thereafter.
(b) The number of shares granted will have an aggregate
fair market value (with fair market value determined based on
average Stock values during each of the trading dates in the
November immediately preceding the grant date) equal to a
percentage (determined separately for each participant by the
Committee) of the participant's base salary for the first
calendar year of each three-year program. The base salary
percentage target of the conditional 1995 three-year grants range
from 10% to 35%. The maximum base salary grant permitted by the
Plan may under no circumstances exceed 70% of a participant's
base salary, and the minimum grant may be zero. The shares of
restricted Stock are granted at the beginning of the first
calendar year based on the base salary in effect on the first day
of the calendar year. However, the number of shares awarded will
be adjusted as soon as practicable after the end of the first
year of the program based on the actual base salary paid to the
participant. Since the January 1, 1995 payment is a three-year
grant (the next program will not begin until January 1, 1998),
the award will be based on the base salary for the entire
three-year program, and the adjustment in the award will not be
made until early in 1998.
(c) The 1995 grants are conditioned upon the approval of
the Plan by the shareholders of IPALCO.
Restrictions and Lifting of Restrictions. The Stock awarded
is subject to financial performance restrictions and employment
restrictions, which restrictions are described below:
(a) The financial performance restrictions relate to the
performance of IPALCO versus its peer group
(as determined by the Committee) during the three-year measuring
period. The performance measures utilized by the Plan are Cost
Effective Service and Total Return to Shareholders (as those terms
are defined in the Plan). At the end of the three-year measuring
period, IPALCO's performance is compared with its peer group's
performance as to these measures. Depending on IPALCO's
performance, the Stock award for the measuring period is adjusted
upward or downward. If shares of Stock are forfeited, the shares
will become eligible for subsequent grants under the Plan.
(b) After the performance restrictions are lifted, the
shares are still subject to continuing employment restrictions
which lapse in 1/3rd increments beginning on the July 1 following
the end of the measuring period with the other 1/3rd increments
lapsing on the first and second anniversary of the first July 1.
If the participant's employment is terminated before the lifting
of the employment restrictions, the shares that are still
restricted are forfeited. At such time that the continuing
employment restrictions are lifted as to each 1/3rd increment,
the participant will be permitted to sell up to 50% of the
non-restricted shares to IPALCO for their fair market value.
(c) If during the period in which the shares of Stock
are subject to financial performance and employment restrictions,
a participant reaches age 65, employment restrictions will no
longer be applicable. However, the shares will still be subject
to the financial performance restrictions and adjustments. The
Plan also contains other special vesting rules which apply if a
participant becomes disabled or dies before the lifting of
restrictions of his or her shares.
(d) If there is a change in control of IPALCO, the
employment restrictions will immediately lapse. Also, while
additional shares may be awarded after the measuring period based
on financial performance, shares awarded in the measuring period
during which the change in control occurs may not be reduced
regardless of financial performance.
No Employment Rights. No right to continue in the employ
of IPALCO or its subsidiaries is conferred by the Plan.
Adjustment of Shares. Upon a reorganization,
recapitalization, stock split, stock dividend, combination of
shares, exchange of shares, merger or consolidation, liquidation
or other similar corporate change after the Plan becomes
effective, the Committee shall make appropriate adjustments in
share grants, as to which adjustments in the number and kind of
shares, the Committee's determination is conclusive.
Tax Withholding. Whenever the Stock is issued or
transferred under the Plan, IPALCO has the right to withhold
federal, state or local tax as dictated by applicable
requirements or to require payments sufficient to satisfy such
requirements.
Amendment. IPALCO's Board of Directors may amend the
Plan. However, shareholder approval is required (a) to increase
the number of shares reserved for issuance; (b) to modify
materially the class of eligible participants; and (c) to
materially increase the benefits accruing to participants.
Termination. IPALCO's Board of Directors may terminate
the Plan at any time, but awards theretofore granted will not be
affected.
Federal Income Tax Consequences of Grants Under the Plan
At the time on which the restrictions lapse (both the
financial performance and employment restrictions), the fair
market value of the non-restricted shares will be ordinary income
to a participant and deductible by IPALCO and its subsidiaries
for federal income taxes as long as withholding requirements are
met. However, a participant may accelerate the tax recognition of
a restricted share grant by making an election under Section
83(b) of the Internal Revenue Code of 1986 (the ``Code'') within
thirty days from the date of grant. In such case, the deduction
available to IPALCO or a subsidiary is also accelerated as long
as withholding requirements are met. Since the Plan is intended
to be a performance-based plan, the value of benefits should
therefore be exempt from the deductibility limitations of Section
162(m) of the Code.
Vote Required to Approve the Plan
Adoption of Proposal 2 requires the affirmative vote of the
holders of a majority of a quorum present, in person and by
proxy, at the 1995 Annual Meeting of Shareholders. A majority of
the shares of common stock outstanding on February 27, 1995, the
record date for such Annual Meeting, constitutes a quorum for
such purpose. Shares will be counted as cast against the proposal
if the shares are voted either against the proposal or to abstain
from voting. Broker non-votes will not change the number of votes
cast for or against the proposal and will not be treated as
shares entitled to vote. If the Plan is approved, the 1994-97
Performance Program under the IPALCO Enterprises, Inc. 1990
Long-Term Incentive Plan (see Table III below) is cancelled.
COMPENSATION OF EXECUTIVE OFFICERS
Nature and Types of Compensation
The three tables that follow on succeeding pages disclose
all plan and non-plan compensation awarded to, earned by, or paid
to the Chairman of the Board and President of IPALCO, who is its
chief executive officer (``CEO''), and to the four named
executive officers other than the CEO who are the most highly
compensated key policy-making executive officers of IPALCO and
its subsidiaries. The tables include a Summary Compensation Table
(Table I), an Aggregate Option/SAR Exercises and Fiscal Year-End
Option/SAR Values Table (Table II) and a table concerning
Long-Term Incentive Plans--Awards in Last Fiscal Year (Table
III). No table is presented for Option/SAR Grants in last fiscal
year since no stock options were granted during 1994.
SUMMARY COMPENSATION TABLE
Long-Term Compensation
Annual Compensation Awards Payouts
-------------------------------------- ------------------------
Other Securities
Annual Underlying All Other
Compen- Options/ LTIP Compen-
Name and sation<F1> SARs<F2> Payouts<F3> sation<F4>
Principal Position Year Salary ($) Bonus ($) ($) (#) ($) ($)
- ---------------------------- ---- ---------- --------- ---------- -------- ----------- ----------
John R. Hodowal 1992 420,907<F5> 165,994 24,134 15,000 $48,800 9,389
Chairman & President; 1993 424,459 209,672 45,851 105,000 82,350 8,624
Chairman & CEO of IPL 1994 461,051 214,566 41,471 -0- 76,250 8,955
Ramon L. Humke 1992 348,925<F5> 137,607 53,617 10,000 $39,867 8,771
Vice Chairman; 1993 351,889 173,827 112,425 60,000 68,250 8,624
President & COO of IPL 1994 382,221 177,881 130,141 -0- 63,646 8,955
John R. Brehm 1992 196,983<F5> 51,748 2,364 5,000 $16,500 7,879
Vice President & Treasurer; 1993 199,822 65,839 6,717 30,000 27,844 7,993
Senior Vice President of IPL 1994 218,304 67,728 3,678 -0- 25,781 8,199
N. Stuart Grauel 1992 164,396<F5> 43,177 6,421 5,000 $ 8,533 6,576
Vice President, Public Affairs 1993 164,718 54,246 16,543 30,000 14,400 6,589
1994 178,957 55,521 8,882 -0- 13,333 3,948
Gerald D. Waltz 1992 194,628<F5> 51,069 965 -0- $16,667 7,785
Senior Vice President of IPL 1993 193,415 63,684 23,757 30,000 28,125 7,735
1994 202,955 62,887 4,465 -0- 26,042 7,731
- -------------------------------
<FN>
<F1> Represents taxes paid by IPALCO and/or IPL on accrued interest and contributions of principal under the Funded
Supplemental Plan. (See ``Pension Plans'')
<F2> No options have stock appreciation rights.
<F3> Payouts shown were made in 1994 for the 3-year LTIP Program ended December 31, 1993.
<F4> Represents 1994 contributions made by company to Trustee of Employees' Thrift Plan.
<F5> Pay periods were changed December 1, 1992 from monthly to bi-weekly resulting in 1992 payouts being greater
than annual salary rates.
TABLE I
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUES
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options/SARs at Options/SARs at
FY-End FY-End ($)*
Shares Acquired Exercisable/ Exercisable/
Name On Exercise (#) Value Realized ($) Unexercisable Unexercisable
- ------------------- --------------- ------------------ ------------------ ----------------
John R. Hodowal -0- -0- 85,000(e) ----
70,000(u) ----
Ramon L. Humke 5,000 35,000 85,000(e) $ 58,750 (e)
40,000(u) ----
John R. Brehm 30,000 195,000 15,000(e) ----
20,000(u) ----
N. Stuart Grauel 25,000 660,000 20,000(e) ----
20,000(u) ----
Gerald D. Waltz -0- -0- 40,000(e) $ 62,500 (e)
20,000(u) ----
- ------------------------------
(e) Exercisable.
(u) Unexercisable.
* Based upon year-end closing market price of $30.00 per share of common stock.
TABLE II
LONG-TERM INCENTIVE PLANS<F1> - AWARDS IN LAST FISCAL YEAR
Estimated Future Payouts
Under Non-Stock Price-Based Plans
-------------------------------------------
Performance
Period Until
Maturation or Threshold Target<F3><F4> Maximum<F3>
Name Payout (2) ($) ($) ($)
- ------------------ --------------- --------- -------------- -----------
John R. Hodowal 1994 - 1997 $ -0- $75,038 $150,076
Ramon L. Humke 1994 - 1997 $ -0- 62,208 124,416
John R. Brehm 1994 - 1997 $ -0- 23,684 47,368
N. Stuart Grauel 1994 - 1997 $ -0- 19,418 38,836
Gerald D. Waltz 1994 - 1997 $ -0- 21,632 43,265
- ----------------------------------------
<FN>
<F1> IPALCO's Long-Term Incentive Plan became effective January 1, 1990. Under the Plan,
Performance Incentive Awards (``PI Awards'') amounting to 15% of average base salary
over a Performance Period may be earned by the Chairman and the Vice Chairman (10%
for other participants) payable after the end of each Program. (Performance Periods
are typically 4-year periods called ``Programs,'' although Programs 1 and 2 have
2-year and 3-year Performance Periods, respectively.) The amount of a PI Award,
however, may be increased or decreased by a multiple ranging from 0% to 200%
depending upon the quartile ranking for cost effective service and total return to
shareholders that IPALCO has achieved at the end of each Program in relation to other
companies within a pre-determined peer group. A program begins each year. The third
Program spanned the 4-year period ended December 31, 1993 for which PI Awards were
paid out in 1994 (See Table I). None of the 17 members of the Peer Group is a company
included in the Dow Jones Utility Index. (See Table IV.) For the four-year period
1990-93 the Company ranked first among 16 peers in cost-effective service and eighth
in total return to shareholders. Payouts have not yet been determined for Program 4
that ended December 31, 1994. Program 7 reported in this Table began in 1994; however,
see note (2) below.
<F2> If the Long-Term Performance and Restricted Stock Incentive Plan described in
``Proposal 2'' above and set out in Appendix A is approved by shareholders at the
1995 Annual Meeting of Shareholders, Program 7 reported in this Table is cancelled
in full and no payouts will be made.
<F3> Based upon 108% of 1994 salary reported in Table I.
<F4> There is no targeted payout under the LTIP. The multiple of 100% was used to calculate
the values shown in this column.
TABLE III
Subsidiary Incentive Plan
In early 1995, the Board of Directors of Mid-America Capital
Resources, Inc. (``Mid-America''), a wholly owned subsidiary of
IPALCO, approved the implementation of an incentive compensation
plan that will provide for payment of incentive compensation in
the year 2000 or later to key employees of Mid-America, its
subsidiaries, and certain executive employees of IPALCO if
certain objective performance measures are met.
COMPENSATION OF DIRECTORS
Standard Arrangements
Non-employee directors serving on the Board of IPALCO are
paid an annual fee of $8,500 plus $450 for each meeting attended;
however, directors of IPALCO and its subsidiaries are limited to
two annual fees. Non-employee members of the Executive Committee
of the Board are paid annual fees of $10,000, but no meeting
fees. Members of the Audit Committee, Compensation Committee and
the Committee on Strategies of the Board, all of whom are
non-employee directors, are paid annual fees of $4,000 plus $450
for each meeting attended. The Chairmen of the latter three
committees each receives an additional fee of $1,500 annually.
Members of the Executive and Audit Committees of both IPALCO and
IPL are limited to one annual fee. Only one meeting fee is paid
to members of the Audit Committees of both such companies when
meetings are held jointly or follow one another. Directors who
are also officers of IPALCO or one of its subsidiaries receive no
director fees.
Certain Business Relationships
During 1994, Acordia, Inc. (``Acordia'') and Anthem
Companies, Inc. (``Anthem'') administered health care programs
for IPALCO and its subsidiaries under contracts that involve
payments to Acordia and Anthem aggregating approximately $14
Million. Mr. L. Ben Lytle is Chairman and Chief Executive Officer
of Acordia and Anthem, which are subsidiaries of Associated
Insurance Companies, Inc. of which Mr. Lytle is Chairman,
President and Chief Executive Officer.
IPALCO subsidiaries IPL and Mid-America Capital Resources,
Inc. (``Mid-America'') each maintained a line of credit during
1994 with National City Bank, Indiana (``NCB'') of which Mr. Otto
N. Frenzel III is Chairman of the Board. During 1994, IPL
utilized $5 Million of its $30 Million line of credit and
Mid-America utilized $1.51 Million of its $2 Million line of
credit with NCB. An unutilized credit line was also maintained by
IPL with NBD Bank, N.A., of which Mr. Thomas M. Miller was
Chairman of the Board and Chief Executive Officer until May 31,
1994, and of which Mr. Ramon L. Humke is a director. IPALCO
subsidiary, Indianapolis Campus Energy (``ICE''), established an
$18 Million line of credit with NBD Bank, N.A. During 1994, ICE
utilized $2.35 Million of its $18 Million line of credit.
IPALCO subsidiary IPL has agreements with Rowland Design,
Inc. for architectural and design services for certain
improvements to the Electric Building. During 1994, IPL paid fees
of approximately $128,000 under such agreements. Mrs. Sallie W.
Rowland is Chairman and CEO of Rowland Design, Inc.
In late 1994, IPALCO subsidiary IPL contracted with
Schenkel, McVey & Associates, LLC, for consulting services in the
areas of community affairs, public relations, and communication
for an annual fee of $25,000. No payments under the contract were
made in 1994. Mr. Thomas M. Miller is majority owner of Schenkel,
McVey & Associates, LLC.
BOARD COMPENSATION COMMITTEE REPORT
ON EXECUTIVE COMPENSATION
Compensation Policies Relating Generally to Executive Officers
The Compensation Committee of the Board of Directors
(``Committee''), in consultation with its outside advisor,
establishes the compensation policies of IPALCO Enterprises, Inc.
and its subsidiaries (``IPALCO'') with regard to all officers.
The Committee recommends to the Board the adoption or amendment
of compensation plans for officers, including the named executive
officers. On authority of the full Board, the Committee
administers all such plans, including establishing officers' base
salary levels, reviewing and approving performance measures and
goals for both annual and long-term incentive plans, and
approving incentive awards.
The Committee is made up of five non-employee directors
whose philosophy is to attract, retain, and motivate a high
quality management team by providing a strong and direct link
between IPALCO performance and officer compensation, with a
significant portion of total compensation being dependent upon
measurable performance objectives. The compensation program for
executive and other selected officers had four basic components
in 1994: base salary, annual incentive plan, long-term incentive
plan, and stock option plan. Subject to shareholder approval, a
performance-based restricted stock plan will succeed both the
current long-term incentive plan and the stock option plan in
1995 as a way of more directly linking executive and shareholder
interests. (See ``Proposal 2'' above and ``Appendix A'' below.)
Base Salary
The Committee targeted the 1994 base salaries for officers,
including the named executive officers, at the median level for
similar positions within the electric utility industry, and where
such positions are also found in general industry, at a level
approximating one-half the difference between the utility
industry and general industry. The Committee considered the
analysis provided by the outside advisor that IPALCO salaries are
within the median range of comparable utilities and below those
of general industry. The Committee also considered both company
and individual performance in approving the range of salary
increases and the salary for each officer, including the named
executive officers. 1994 base salary increases for all officers
averaged 4.7%; however, as a result of a reduction in the number
of officer positions, total officer salaries for 1994 were less
than total officer salaries for 1993.
The comparative compensation data for electric utilities
used by the Committee were derived from 25 companies with
comparable revenues as reported in the annual ``Edison Electric
Institute Executive Compensation Survey'' (``EEI ECS''). Data for
general industry were drawn from four national executive
compensation surveys by the outside consultant.
Annual Incentive Plan
The IPALCO Annual Incentive Plan is a performance-based plan
that measures company performance under four equally weighted
criteria: Net Income, Customer Satisfaction, Productivity, and
Budget Compliance. Participants in the plan are approved in
advance of the plan year by the Committee; and all participants,
including the named executive officers, are measured against
performance goals that are established by the Committee and
announced at the beginning of the year. Goals are set at
Threshold, Target, and Maximum levels, with Threshold performance
required for any award under each criterion; however, if the
Threshold goal for Net Income is not met, no payout is made
regardless of the performance under the other criteria. Each
performance level is assigned an award value, with interpolation
for performance between levels. For named executive officers,
other than the CEO, performance at Threshold, Target, and Maximum
levels, respectively, warrants a payout of 10%, 22.5%, and 35% of
base salary. Factors ranging from .75 to 1.5 are applied to the
award
percentage based upon the participant's position. For the
CEO, this performance award range is adjusted by a factor of 1.5.
For 1994, the Company achieved the Maximum performance goal
in Productivity; achieved slightly below Maximum performance in
Net Income; and performed above Target goals in both Budget
Compliance and Customer Satisfaction.
The plan has been amended for 1995 to permit the reduction
or elimination of an award should an individual participant's
performance be below expectations.
Long-Term Incentive Plan
Subject to shareholder approval, the Long-Term Incentive
Plan and the Stock Option Plan, both adopted in 1990, will be
followed by a performance-based restricted stock plan designed to
focus the attention of prospective participants on long-term
company objectives and performance. Participation will be subject
to Committee approval and will be limited to key employees
(including non-officers) who contribute to the strategic and
long-term growth of the company.
IPALCO has continued to perform within the top two quartiles
of the Committee-approved Peer Group in both Total Return to
Shareholders and Cost Effective Service, the criteria used to
measure performance for the long-term incentive plan in effect
through 1994. For the four-year performance period 1990-1993,
IPALCO ranked first among peers in Cost Effective Service (net
income as a percent of operating revenues plus other income) and
eighth in Total Return to Shareholders. Using the schedule
specified in the plan for that level of performance, the named
executive officers received incentive payments totaling $205,000
in 1994. Awards paid in 1994 were below the median of awards to
comparably positioned executives of peer companies. The long-term
award to the CEO was also below the median award for CEOs in the
Peer Group. Performance results and incentive payments to be made
in 1995, if any, for the performance period 1991-1994 have not
been determined.
The new restricted stock plan continues to measure company
performance in Total Return to Shareholders and in Cost Effective
Service compared with the performance of a Peer Group of 15
comparable utilities. Criteria for selection of peer companies
included revenue size and sources, market-to-book ratio, fuel
source, and dividend yield, among others. The current Peer Group
does not include any of the 15 companies that make up the current
Dow Jones Electric Utility Index. Final restricted stock awards
are based upon IPALCO's ranking within the Peer Group over a
three-year performance period, with one-third of the shares to be
vested during each of the fourth, fifth, and sixth years after
the beginning of the performance period. Subject to its approval
by shareholders, this plan generally will not be subject to the
special rules set forth under Section 162(m) of the Internal
Revenue Code, since it qualifies as a performance-based
compensation plan. Additional details of the revised Long-Term
Performance and Restricted Stock Incentive Plan are described
above under ``Proposal 2'' and in the Plan itself at Appendix A.
Stock Option Plan
Subject to shareholder approval, the Stock Option Plan will
be succeeded by the Restricted Stock Incentive Plan described
above and in Appendix A. No stock options were granted during
1994.
Basis For Chief Executive Officer's Compensation
The Chief Executive Officer's (``CEO'') compensation
continues to be directly and explicitly linked to IPALCO
performance. The CEO's total compensation is set in relation to
the median compensation for CEOs in the Peer Group and in
consideration of the Committee's assessment of his individual
performance. The Committee thoroughly reviews the CEO's
performance, including strategic direction, management team
development, and leadership, as well as overall company
performance. The Committee's review is both subjective and
objective. Company performance data used in the incentive plans
plus other financial, operational, service, and administrative
data are considered.
Total 1994 compensation for the CEO (including base salary,
Annual Incentive Plan payment, and Long-Term Incentive payment),
as shown in Table I, increased 5.2% over 1993. His total
compensation was slightly above the median of Peer Group CEOs,
but was slightly below the median of CEO compensation in
comparably high-performing peer companies. As cited above, IPALCO
has continued to rank among the high-performing peer companies in
Total Return to Shareholder and in Cost Effective Service.
At Target performance, under the current compensation
program, approximately 33% of the CEO's total direct compensation
is variable and at risk. During 1994, approximately 39% of the
CEO's actual total direct compensation was at risk. With
shareholder approval of the revised Long-Term Performance and
Restricted Stock Incentive Plan, it is expected that the portion
of his compensation that is at risk will increase.
The Compensation Committee of the
Board of Directors of IPALCO
Enterprises, Inc.
Otto N. Frenzel III, Chairman
Robert A. Borns
Earl B. Herr, Jr.
Thomas M. Miller
Thomas H. Sams
Compensation Committee Interlocks and Insider Participation
IPALCO's Vice Chairman, Mr. Ramon L. Humke, is a member of
the Compensation Committee of the Board of Directors of LDI
Management, Inc. Mr. Andre B. Lacy is Chairman of the Board,
Chief Executive Officer and President of LDI Management, Inc. and
is also a director of IPALCO. Mr. Humke is also a member of the
Board of Directors of NBD Bank, N.A., and Mr. Thomas M. Miller, a
director of IPALCO, was Chairman of the Board and Chief Executive
Officer of NBD Bank, N.A., until May 31, 1994. Mr. John R.
Hodowal, Chairman of IPALCO, is a member of the Board of
Directors of Bank One, Indianapolis, N.A. Mr. Joseph D. Barnette,
Jr. is Chairman and Chief Executive Officer of Bank One,
Indianapolis, N.A. and is also a director of IPALCO.
The Compensation Committee of the Board of Directors of
IPALCO is currently composed of Messrs. Robert A. Borns, Otto N.
Frenzel III (Chairman), Earl B. Herr, Jr., Thomas M. Miller, and
Thomas H. Sams. Until April 26, 1994, Messrs. Mitchell E.
Daniels, Jr., Max L. Gibson, and Michael S. Maurer were members.
[GRAPHICS DELETED]
Performance Graph
The Performance Graph on this page, Table IV, plots the
total cumulative return that shareholders of IPALCO received
(solid line) during the five year period ended December 31, 1994,
compared with the total cumulative return to shareholders of
companies comprising the Dow Jones Electric Utility Index (broken
line) and the Standard and Poors 500 Index (dotted line). The
Graph shows the cumulative total return assuming dividend
reinvestment and based upon an initial investment of $100.00.
The vertical portion of the graph indicates the dollar value
ranging from $90.00 to $180.00, and the horizontal portion of the
Graph is the year, beginning in 1989 and continuing through 1994.
The points on the Performance Graph are as follows:
CUMULATIVE TOTAL RETURN ASSUMING DIVIDEND REINVESTMENT
- -----------------------------------------------------------------
1989 1990 1991 1992 1993 1994
---- ---- ---- ---- ---- ----
IPALCO<F1> 100 109 145 165 172 156
Dow Jones
Electric
Utilities<F1> 100 102 132 141 158 138
S&P 500<F2> 100 97 126 136 150 152
Source:
<FN>
<F1> Dow Jones Total Return Indexes
<F2> Standard and Poors Compustat Services, Inc.
TABLE IV
Performance Graph
The Performance Graph (Table IV) on the preceding page plots
the total cumulative return that shareholders of IPALCO received
(solid line) during the 5-year period ended December 31, 1994,
compared with the total cumulative return to shareholders of
companies comprising the Dow Jones Electric Utilities Index
(broken line) and the Standard and Poors 500 Index (dotted line).
The Graph reflects IPALCO's superior return in years 1991 through
1994 referenced in the foregoing Compensation Committee Report as
one of the bases for the Chief Executive Officer's compensation
disclosed in preceeding sections of this statement.
Pension Plans
Table V below illustrates the combined annual retirement
benefits computed on a straight-life annuity basis (less Social
Security) that are payable under the Base Retirement Plan, as
defined below, and the Funded Supplemental Plan (assuming
continuous employment to age 65) to named executive officers
having the remuneration and years of service shown.
PENSION PLAN TABLE <F1>
Remuneration Years of Service
- ------------ --------------------------------------------------------------------------
15 20 25 30 35 40
-------- -------- -------- -------- -------- --------
$150,000 $ 97,500 $ 97,500 $ 97,500 $ 97,500 $ 97,500 $ 97,500
200,000 130,000 130,000 130,000 130,000 130,000 130,000
250,000 162,500 162,500 162,500 162,500 162,500 162,500
300,000 195,000 195,000 195,000 195,000 195,000 195,000
350,000 227,500 227,500 227,500 227,500 227,500 227,500
400,000 260,000 260,000 260,000 260,000 260,000 260,000
450,000 292,500 292,500 292,500 292,500 292,500 292,500
500,000 325,000 325,000 325,000 325,000 325,000 325,000
___________________________________
<FN>
<F1> This table takes into account the latest Internal Revenue
Code Section 415 benefit limitations and Internal Revenue
Code Section 401(a)(17) compensation limitation applicable
to the Base Retirement Plan. Benefits for both the Base
Retirement Plan portion and Funded Supplemental Plan portion
of the combined amounts have been shown without adjustment
for income taxes. The Funded Supplemental Plan portion
reflects the change in that Plan in 1994 to eliminate the
offset for Social Security.
TABLE V
IPL's Employees' Retirement Plan (the ``Base Retirement
Plan'') covers all permanent employees with one (1) year of
service but excludes directors unless they are also officers. It
provides fixed benefits at normal retirement age based upon
compensation and length of service, the costs of which are
computed actuarially. The remuneration covered by the Plan includes
``Salary'' but excludes ``Bonus'' and ``Other Compensation,'' annual
or otherwise, as those terms are used in the Summary Compensation
Table (Table I). Benefits are calculated on the basis of the
highest average annual salary in any 60 consecutive months of
employment. Years of service for Pension Plan purposes of named
executive officers are as follows: Mr. Hodowal - 26, Mr. Humke -
5, Mr. Brehm - 19, Mr. Grauel - 15, and Mr. Waltz - 34.
The Funded Supplemental Plan referred to above is applicable
to the named executive officers and, at reduced benefits, to all
other officers of IPALCO and IPL. Contributions and accrued
interest credited during 1994 to the accounts of Messrs. Hodowal,
Humke, Brehm, Grauel and Waltz amounted to $44,097, $148,628,
$3,524, $10,299 and $3,029, respectively (in addition to the
federal, state and local income tax payments reflected in Table I
above). Contributions are based on actuarial assessments of
benefits projected to accrue to such officers under the Funded
Supplemental Plan upon termination of employment at normal
retirement age and at current salary levels.
Employment Contracts and Termination of Employment and
Change-in-Control Arrangements
IPALCO and IPL have employment contracts with Messrs.
Hodowal and Humke which provide for an indefinite term that is
convertible into a fixed 3-year term upon notice. Such contracts
terminate upon death, total disability or retirement. Should they
be terminated without ``cause'' or resign for ``good reason'' (as
those terms are defined in the contract--see below), they would
continue to receive their Salary, as that term is used in Table I
above, for up to 3 years thereafter, less any severance payments
received from other agreements.
All Officers of IPALCO and its subsidiaries have Termination
Benefits Agreements, dated as of January 1, 1993. These
Agreements provide for payment of severance benefits equal to
299.99% of the last 5 years' average annual Salary (but not
exceeding the limits of Internal Revenue Code 280G), if IPALCO
undergoes an ``acquisition of control'' while the agreement is in
effect and if, within 3 years after an acquisition of control,
any such officer is terminated without ``cause'' or resigns for
``good reason,'' as those terms are therein defined (see below).
The term ``without `cause''' is defined in the employment
contracts and Termination Benefits Agreements discussed above to
mean in the absence of fraud, dishonesty, theft of corporate
assets or other gross misconduct, as set out in a good faith
determination of the Board of Directors. The term ``resign for
`good reason''' is defined in the same agreements to mean
generally, and subject to lengthy qualifications and
amplification, demotion; assignment of duties inconsistent with
the officer's status, position or responsibilities; reduction in
base salary or failure to grant annual increases commensurate
with increases of other officers; relocation of the headquarters
of IPALCO or IPL to a location outside Greater Indianapolis; or
termination of the executive's participation in, or the existence
of, an incentive compensation, insurance or pension program. The
term ``acquisition of control'' in such contracts means,
generally and subject to lengthy amplification and qualifications
therein, acquisition by any person, entity, or group of 20% or
more of the combined voting power of the outstanding securities
of IPALCO entitled to vote in the election of directors,
excluding acquisitions by or from IPALCO or any acquisition by
any employee benefit plan of IPALCO or IPL; change in majority
membership of the Board of Directors other than by normal
succession; certain reorganizations, mergers or consolidations
resulting in control of the reorganized, merged, or consolidated
entity by persons not previously in control of IPALCO; approval
by the shareholders of complete liquidation or dissolution of
IPALCO, or of a sale of all or substantially all of its assets to
an entity not controlled by directors and holders of voting
securities who were directors and holders of voting securities of
IPALCO prior to the transaction.
A Benefit Protection Fund and Trust Agreement (``Fund'') is
also in effect to pay litigation expenses in the event it becomes
necessary for any officer to enforce the employment contracts and
Termination Benefits Agreements above described. The Fund is held
in trust by National City Bank, Indianapolis, and at December 31,
1994, the sum of $787,000 was reserved in trust for such
expenses.
By order of the Board of Directors.
IPALCO ENTERPRISES, INC.
By: BRYAN G. TABLER, Secretary
Indianapolis, Indiana
March 6, 1995
- -----------------------------------------------------------------
APPENDIX A
IPALCO ENTERPRISES, INC.
LONG-TERM PERFORMANCE AND RESTRICTED STOCK INCENTIVE PLAN
(As Amended and Restated Effective January 1, 1995)
Pursuant to Section XI of the IPALCO Enterprises, Inc. 1990
Long-Term Performance Incentive Plan (the ``Plan''), IPALCO
Enterprises, Inc. (``IPALCO'') renames the Plan and amends it to
provide, in its entirety, as follows:
SECTION 1
PURPOSE
The purpose of the amended Plan (as such term is described
below) is to provide an incentive to selected key executives of
the Company (as such term is described below), by providing an
opportunity to earn long-term incentive compensation, based upon
the attainment of Company performance goals. In addition, the
restricted stock component of the Plan is intended to provide the
key executives with a means of acquiring or increasing
aproprietary interest in IPALCO so that they shall have an
increased incentive to work toward the attainment of the
long-term growth and profit objectives of IPALCO and its
affiliated companies. Specifically, the Plan is designed to:
A. Link, directly and indirectly, executive and shareholder
interests.
B. Attract and retain individuals of outstanding ability.
C. Encourage key Company officers to render superior
performance.
SECTION 2
DEFINITIONS
The terms defined in this Section 2 shall, for purposes of
this Plan, have the meanings herein specified, unless the context
expressly or by necessary implication otherwise requires:
A. Acquisition of Control: An ``Acquisition of Control''
means:
(1) The acquisition by any individual, entity or group
(within the meaning of Section 13(d) (3) or 14(d) (2) of the
Securities Exchange Act of 1934, as amended (the ``Exchange
Act'') (a ``Person'') of beneficial ownership (within the meaning
of Rule 13d-3 promulgated under the Exchange Act) of twenty
percent (20%) or more of either (A) the then outstanding shares
of common stock of IPALCO (the ``Outstanding IPALCO Common
Stock'') or (B) the combined voting power of the then outstanding
voting securities of IPALCO entitled to vote generally in the
election of directors (the ``Outstanding IPALCO Voting
Securities''); provided, however, that the following acquisitions
shall not constitute an Acquisition of Control: (i) any
acquisition directly from IPALCO (excluding an acquisition by
virtue of the exercise of a conversion privilege), (ii) any
acquisition by IPALCO, (iii) any acquisition by any employee
benefit plan (or related trust) sponsored or maintained by
IPALCO, IPL or any corporation controlled by IPALCO or (D) any
acquisition by any corporation
pursuant to a reorganization, merger or consolidation, if,
following such reorganization, merger or consolidation, the
conditions described in clauses (A), (B) and (C) of subsection
(3) of this Section 2.A. are satisfied;
(2) Individuals who, as of the date hereof, constitute the
Board of Directors of IPALCO (the ``Incumbent Board'') cease for
any reason to constitute at least a majority of the Board of
Directors of IPALCO; provided, however, that any individual
becoming a director subsequent to the date hereof whose election,
or nomination for election by IPALCO's shareholders, was approved
by a vote of at least a majority of the directors then comprising
the Incumbent Board shall be considered as though such individual
were a member of the Incumbent Board, but excluding, for this
purpose, any such individual whose initial assumption of office
occurs as a result of either an actual or threatened election
contest (as such terms are used in Rule 14a-11 of Regulation 14A
promulgated under the Exchange Act) or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person
other than the Board of Directors; or
(3) Approval by the shareholders of IPALCO of a
reorganization, merger or consolidation, in each case, unless,
following such reorganization, merger or consolidation, (A) more
than sixty percent (60%) of, respectively, the then outstanding
shares of common stock of the corporation resulting from such
reorganization, merger or consolidation and the combined voting
power of the then outstanding voting securities of such
corporation entitled to vote generally in the election of
directors is then beneficially owned, directly or indirectly, by
all or substantially all of the individuals and entities who were
the beneficial owners, respectively, of the Outstanding IPALCO
Common Stock and Outstanding IPALCO Voting Securities immediately
prior to such reorganization, merger or consolidation in
substantially the same proportions as their ownership,
immediately prior to such reorganization, merger or
consolidation, of the Outstanding IPALCO Stock and Outstanding
IPALCO Voting Securities, as the case may be, (B) no Person
(excluding IPALCO, any employee benefit plan or related trust of
IPALCO, IPL or such corporation resulting from such
reorganization, merger or consolidation and any Person
beneficially owning, immediately prior to such reorganization,
merger or consolidation, directly or indirectly, twenty percent
(20%) or more of the Outstanding IPALCO Common Stock or
Outstanding Voting Securities, as the case may be) beneficially
owns, directly or indirectly, twenty percent (20%) or more of,
respectively, the then outstanding shares of common stock of the
corporation resulting from such reorganization, merger or
consolidation or the combined voting power of the then
outstanding voting securities of such corporation entitled to
vote generally in the election of directors and (C) at least a
majority of the members of the board of directors of the
corporation resulting from such reorganization, merger or
consolidation were members of the Incumbent Board at the time of
the execution of the initial agreement providing for such
reorganization, merger or consolidation;
(4) Approval by the shareholders of IPALCO of (A) a
complete liquidation or dissolution of IPALCO or (B) the sale or
other disposition of all or substantially all of the assets of
IPALCO, other than to a corporation, with respect to which
following such sale or other disposition (i) more than sixty
percent (60%) of, respectively, the then outstanding shares of
common stock of such corporation and the combined voting power of
the then outstanding voting securities of such corporation
entitled to vote generally in the election of directors is then
beneficially owned, directly or indirectly, by all or
substantially all of the individuals and entities who were the
beneficial owners, respectively, of the Outstanding IPALCO
Common Stock and Outstanding IPALCO Voting Securities immediately
prior to such sale or other disposition in substantially the same
proportion as their ownership, immediately prior to such sale or
other disposition, of the Outstanding IPALCO Common Stock and
Outstanding IPALCO Voting Securities, as the case may be, (ii) no
Person (excluding IPALCO and any employee benefit plan or related
trust of IPALCO, IPL or such corporation and any Person
beneficially
owning, immediately prior to such sale or other
disposition, directly or indirectly, twenty percent (20%) or more
of the Outstanding IPALCO Common Stock or Outstanding IPALCO
Voting Securities, as the case may be) beneficially owns,
directly or indirectly, twenty percent (20%) or more of,
respectively, the then outstanding shares of common stock of such
corporation and the combined voting power of the then outstanding
voting securities of such corporation entitled to vote generally
in the election of directors and (iii) at least a majority of the
members of the board of directors of such corporation were
members of the Incumbent Board at the time of the execution of
the initial agreement or action of the Board of Directors
providing for such sale or other disposition of assets of IPALCO;
or
(5) The closing, as defined in the documents relating to,
or as evidenced by a certificate of any state or federal
governmental authority in connection with, a transaction approval
of which by the shareholders of IPALCO would constitute an
``acquisition of control'' under subsection (3) or (4) of this
Section 2.A. of this Plan.
Notwithstanding anything contained in this Plan to the contrary,
if a Participant's employment is terminated before an
``Acquisition of Control'' as defined in this subsection (A) and
the Participant reasonably demonstrates that such termination (i)
was at the request of a third party who has indicated an
intention or taken steps reasonably calculated to effect an
Acquisition of Control and who effectuates an ``Acquisition of
Control'' or (ii) otherwise occurred in connection with, or in
anticipation of, an Acquisition of Control which actually occurs,
then for all purposes of this Plan, the date of an Acquisition of
Control with respect to such Participant shall mean the date
immediately prior to the date of such termination of the
Participant's employment.
B. Administrative Guidelines: The guidelines established
for each Program used to administer this Plan as now in effect or
as modified from time to time by the Committee.
C. Base Salary: The aggregate base salary paid to a
Participant in a Fiscal Year.
D. Board of Directors: The Board of Directors of IPALCO.
E. Committee: The Compensation Committee of the Board of
Directors.
F. Company: IPALCO and its subsidiaries, or successors.
G. Cost Effective Service: For Performance Periods
beginning on or after January 1, 1995, the three (3) year
average, as applicable, of net income of the Company as a
percentage of the sum of the Company's total operating revenues
and other income. The Company's net income, total operating
revenues and other income shall be as reported in the Company's
Uniform Statistical Report; provided, however, that the total
operating revenues and other income shall include gross IPL
revenues but, with respect to the non-utility businesses, shall
only include their net income.
H. Fiscal Year: The calendar year.
I. IPALCO: IPALCO Enterprises, Inc. or its successor.
J. IPL: Indianapolis Power & Light Company or its
successor.
K. Market Price: For a Fiscal Year, the average of the
prices of a company's common stock on the New York Stock
Exchange, or other appropriate exchange, if the company's common
stock is not traded on the New York Stock Exchange, as published
in The Wall Street Journal, at the close of trading on the tenth
(10th) business day of February, May, August and November in such
Fiscal Year.
L. Participant: The employees of the Company designated by
the Committee to receive an award under the Plan. The employees
eligible for designation include officers of the Company and
other employees who the Committee expect to contribute to the
strategic growth of the Company.
M. Peer Group: Those comparable investor-owned electric
utility companies or holding companies which are designated by
the Committee as members of a comparison group for a Performance
Period pursuant to Section 11 hereof.
N. Performance Incentive Award: The incentive award amount
for a Performance Period expressed as a percentage of a
Participant's Base Salary for the first (1st) fiscal year of a
Performance Period; provided, however, that for purposes of
making the Share grants at the beginning of each Performance
Period, the Share grants shall be based on the Participant's
rate of base compensation in effect on the first (1st) calendar
day of the Fiscal Year; provided, however, that the number of
Shares awarded shall be increased or decreased as soon as
practicable after the end of the first (1st) Fiscal Year to
reflect the actual Base Salary paid to the Participant in such
Fiscal Year. Notwithstanding anything contained herein to the
contrary, a Participant's Base Salary for the Performance Period
beginning on January 1, 1995 shall be the average annual Base
Salary paid to the Participant for the entire three (3) year
period or, if lesser, the portion of such three (3) year period
that he was employed; provided, however, that the initial grant
shall be based on the rate of Base Salary in effect on January 1,
1995, and the adjustment for actual Base Salary shall not be
effected until the first (1st) business day in 1998. The maximum
number of Shares (including any additional Shares awarded in
accordance with Section 16 based on Performance Period
Performance Measure results) shall not have an aggregate fair
market value (with Share fair market value determined for all
Shares, including any additional Shares awarded after the end of
the Performance Period, in accordance with Section 9 based on the
Share value in the month of November preceding the beginning of
the Performance Period) in excess of the lesser of:
(1) seventy percent (70%) of a Participant's Base Salary
for the first (1st) calendar year of such Performance Period, or
(2) one hundred percent (100%) of the annualized Base
Salary of a Participant in effect on the first (1st) calendar day
of the Performance Period;
provided, however, that with respect to the Performance Period
beginning in 1995, the seventy percent (70%) Base Salary limit
shall be applied against the total Base Salary for all three (3)
calendar years in such Performance Period, and the number ``three
hundred percent (300%)'' shall be substituted for the number
``one hundred percent (100%);'' provided, further, that in
applying these seventy percent (70%) and one hundred percent
(100%) limits, dividends paid on restricted Shares shall be
disregarded.
O. Performance Incentive Award Schedule: A schedule
containing the ranking of Cost Effective Service versus the Peer
Group and the ranking of Total Return to Shareholders versus the
Peer Group, and a percent of the Performance Incentive Award for
each of the levels of achievement listed.
P. Performance Measures: The measures used in determining
the amount of any Program Incentive Payment.
Q. Performance Period: For the period before January 1,
1995, a period of two (2), three (3), or four (4) consecutive
Fiscal Years, as applicable, commencing on the first (1st) day of
the first (1st) Fiscal Year of a Program, over which the
Performance Measures are to be taken. For the period after
December 31, 1994, a period of three (3) consecutive Fiscal
Years, commencing on the first (1st) day of the first (1st)
Fiscal Year of a Program, over which the Performance measures are
to be taken. The first (1st) Performance Period after the
Performance Period beginning on January 1, 1995 shall begin on
January 1, 1998. Beginning on January 1, 1998, a new Performance
Period shall begin on the first (1st) day of each Fiscal Year
until the final Performance Period which will begin on January 1,
2004.
R. Period of Restriction: The period during which the
transfer of shares are restricted pursuant to the Plan.
S. Plan: This Long-Term Performance and Restricted Stock
Incentive Plan, as now in effect and as amended from time to
time.
T. President: The President of IPALCO.
U. Program: One (1) Performance Period with its respective
Performance Incentive Awards, Performance Incentive Award
Schedule, and Participants.
V. Shares: Shares of common stock of IPALCO.
W. Total Return to Shareholders: The average return on
investment to shareholders from stock price appreciation and
dividends paid during each Fiscal Year of the Performance Period.
SECTION 3
ADMINISTRATION
The Plan shall be administered by the Committee. No member
of the Committee shall be eligible, at any time when he or she is
such a member or within one (1) year period to his or her
appointment to the Committee, to be granted Shares under the
Plan. Provided, however, that notwithstanding the preceding
clause of this sentence, a member of the Committee shall not be
precluded from participating in, the IPALCO Enterprises, Inc.
1991 Directors' Stock Option Plan or any other formula plan
within the meaning of Rule 16b-3(a) (C) (2) (i) (A) promulgated
under the Exchange Act (as defined in Section 2.A). The decision
of a majority of the members of the Committee shall constitute
the decision of the Committee, and the Committee may act either
at a meeting at which a majority of its members are present or by
a written consent signed by all of its members. The Committee may
appoint individuals to act on its behalf in the administration of
the Plan; provided, however, that except as otherwise provided by
the Plan, the Committee shall have the sole, final and conclusive
authority to administer, construe and interpret the Plan.
SECTION 4
NUMBER OF SHARES SUBJECT TO THE PLAN
The total number of Shares that may be granted under the
Plan may not exceed Four Hundred Thousand (400,000) Shares,
subject to adjustment as provided in Section 6 hereof. Those
Shares may consist, in whole or in part, of authorized but
unissued Shares or Shares reacquired by IPALCO, including
Shares purchased in the open market, not reserved for any other
purpose; provided, however, that the Shares granted hereunder
shall be authorized and unissued unless the Committee, in its
sole discretion, takes action to utilize open market Shares.
SECTION 5
UNUSED SHARES
In the event any Shares subject to grants made under the
Plan are forfeited pursuant to Section 16 hereof, such forfeited
Shares shall again become available for issuance under the Plan.
SECTION 6
ADJUSTMENTS IN CAPITALIZATION
In the event of any change in the outstanding Shares by
reason of a stock dividend, stock split, recapitalization,
merger, consolidation, combination, stock rights plan or exchange
of shares or other similar corporate change, the aggregate number
of Shares issuable under the Plan shall be appropriately adjusted
by the Committee, whose determination shall be conclusive. In
such event, the Committee shall also have discretion to make
appropriate adjustments in the number and type of shares subject
to restricted Share grants then outstanding under the Plan
pursuant to the terms of such grants or otherwise.
SECTION 7
PARTICIPATION
A. Prior to the commencement of each Fiscal Year,
Participants shall be recommended by the President and approved
by the Committee. Participants are to be those key employees who,
in the opinion of the Committee, are in a position to make a
significant contribution to the long-term success of the Company.
Participants for each Program shall be notified of their
participation prior to the beginning of the first (1st) Fiscal
Year of a Program. Participation in one (1) Program does not
guarantee participation in subsequent Programs.
B. For the Program beginning on January 1, 1995 only, the
Committee, in its sole discretion, may select additional
Participants to participate in the final one (1) or two (2)
Fiscal Years of the 1995 Program. The Committee approval shall
include the establishment of the Performance Incentive Award
for any new Participant. If a Participant is added in the 1995
Program, the first (1st) Fiscal Year of his participation shall
be substituted for the first (1st) Fiscal Year of the Performance
Period for purposes of determining the number of Shares awarded
under Section 9.
C. For the Program beginning on January 1, 1995 only, the
Committee, in its sole discretion, may discontinue the
participation of a Participant forthe final one (1) or two (2)
Fiscal Years of the 1995 Program. If a Participant's
participation is discontinued in the 1995 Program, he shall
forfeit, as soon as practicable after the effective date of his
participation termination, two-thirds (2/3) of the Shares granted
to him for such Program if his participation is discontinued for
the final two (2) Fiscal Years of the 1995 Program or one-third
(1/3) of the Shares granted to him for such Program if his
participation is discontinued for the final Fiscal Year of the
1995 Program. At the end of the 1995 Program, the reduced share
grant shall be adjusted in accordance with Section 16.
SECTION 8
PERFORMANCE INCENTIVE AWARD GRANTS
A. Each Program shall be subject to the limitations and
terms provided in the Plan. A new Program shall commence on the
first (1st) anniversary date of the preceding Program. These
Programs shall be of three (3) year duration. The Performance
Period beginning on January 1, 1994 shall be cancelled,
conditioned upon the majority of Participants eligible for a
bonus for the Performance Period beginning on January 1, 1994
consenting to its cancellation.
B. The Committee shall determine for each Participant his
Performance Incentive Award for each Program. Only one (1) grant
shall be made to each Participant during each Program.
Participants shall generally be notified of their individual
Performance Incentive Award before the beginning of each Program.
SECTION 9
GRANT OF SHARES
Concurrently with the beginning of each Performance Period,
the Committee shall cause the Secretary of IPALCO to issue to
each Participant a number of restricted Shares determined by
dividing:
(a) the Participant's Performance Incentive Award for such
Performance Period, by
(b) the average of the closing of the high and low prices
of the Shares for all of the business days in the November
immediately preceding the beginning of the Performance Period (as
reported in The Wall Street Journal), rounding up or down any
fractional Share to the nearest whole Share.
Notwithstanding anything contained herein to the contrary, the
Share grants for the Performance Period beginning on January 1,
1995 are conditioned upon the Plan being approved by IPALCO's
shareholders in accordance with Section 28 hereof. At the end of
the first (1st) Fiscal Year of each Performance Period (or, in
the case of the January 1, 1995 Program at the end of 1997), the
Share grants shall be adjusted, upward or downward, based on the
Participant's actual Base Salary.
SECTION 10
ESTABLISHMENT OF PERFORMANCE MEASURES
A. The Performance Measures to be used initially are
IPALCO's ranking versus the Peer Group on Cost Effective Service
and Total Return to Shareholders. The Performance Measures need
not be the same for each Program.
B. Once a Program has begun and Performance Measures and
the Performance Incentive Award Schedule have been established,
they may not be changed for that Performance Period without the
prior written approval of the majority of the Participants who
may be adversely affected by such change.
C. A Performance Incentive Award Schedule shall be
recommended by the President and approved by the Committee before
grants are made under each Program. The Committee shall approve
or modify the proposed Schedule which will contain various levels
of performance and corresponding Performance Incentive Award
values.
D. If the Company disposes of a significant part of the
business of IPL, or acquires through purchase, merger, or
otherwise the capital assets of any other company, the Committee
may, in its sole and absolute discretion, adjust the Total Return
to Shareholder and Cost Effective Service targets of a
Performance Incentive Award Schedule for a Performance Period so
as to reflect the financial impact of the acquisition.
SECTION 11
DETERMINATION OF PERFORMANCE RESULTS
A. Upon the completion of a Performance Period, the Shares
awarded for each Participant shall be adjusted based upon the
Performance Incentive Award Schedule approved for that Program.
Notwithstanding the Performance Incentive Award Schedule, all of
the Shares shall be forfeited if the Committee determines that
for a given Plan Program cycle the quality and reliability of
service of IPL deteriorates to the point that, for the last two
(2) consecutive years of that cycle, voltage reductions or
selective service interruptions to the general public are
necessary to maintain system integrity.
B. At or prior to the commencement of each Performance
Period for which the Committee selects one (1) or more
Participants, the Committee shall select a Peer Group of
comparable investor-owned electric utility companies or holding
companies of comparable investor-owned electric utility
companies. When selecting the membership of Peer Group for a
Performance Period, the Committee shall not be bound by any
decisions regarding the composition of any Peer Group selected
for a prior or overlapping Performance Period.
C. Cost Effective Service for the Company and each company
in the Peer Group shall be the annual average of the Cost
Effective Service for the Fiscal Years in the Performance Period.
The Company's ranking shall be determined by its performance
ranking versus the Peer Group.
D. For each Performance Period, the Total Return to
Shareholders of IPALCO shall be compared with the Total Return to
Shareholders of the members of the Peer Group. Total Return to
Shareholders for IPALCO and each member of the Peer Group shall
be measured by the following formula (with appropriate
adjust-
ments for changes in capital structure due to stock
dividends, stock splits, recapitalization, mergers, or other
events having significant distorting effect on IPALCO or on any
member of the Peer Group):
1. For each Fiscal Year of the Performance Period:
(a) Subtract the Market Price of
each company's common stock for the prior
Fiscal Year from the Market Price of the
company's common stock for the current Fiscal
Year.
(b) Add to the result obtained in
Step (a) the amount of all cash dividends
paid by the company with respect to its
common stock during the current Fiscal Year.
(c) Divide the result obtained in
Step (b) by the Market Price of the company's
common stock for the prior Fiscal Year.
2. The calculated values from Step 1 for the Fiscal Years in
the Performance Period shall then be converted to an annual
average for the Performance Period.
IPALCO's ranking shall be determined by its performance ranking
versus the Peer Group.
SECTION 12
RESTRICTIONS ON TRANSFERABILITY
Until the lifting of the restrictions on the Shares granted
hereunder, no Shares granted under the Plan may be sold,
transferred, pledged, assigned, or otherwise alienated or
hypothecated, otherwise than by will or by the laws of descent
and distribution until the termination of the applicable Period
of Restriction.
SECTION 13
CERTIFICATE LEGEND
Each certificate representing restricted Shares granted
pursuant to this Plan shall bear the following legend:
``The sale or other transfer of the shares
represented by this certificate, whether voluntary,
involuntary, or by operation of law, is subject to
certain restrictions on transfer set forth in the
IPALCO Enterprises, Inc. Long-Term Performance and
Restricted Stock Incentive Plan and rules of
administration adopted pursuant to such Plan. A copy of
the Restricted Stock Incentive Plan and the rules of
such Plan may be obtained from the Secretary of IPALCO
Enterprises, Inc.''
Once the restricted Shares are released from the restrictions,
the Participant shall be entitled to have the legend required by
this Section 13 removed from such Share certificate(s).
SECTION 14
VOTING RIGHTS
During the Period of Restriction, Participants holding
restricted Shares granted hereunder may exercise full voting
rights with respect to those Shares.
SECTION 15
DIVIDENDS AND OTHER DISTRIBUTIONS
During the Period of Restriction, Participants holding
restricted Shares granted hereunder shall be entitled to receive
all dividends and other distributions paid with respect to those
Shares while they are so held. If any such dividends or
distributions are paid in Shares, such Shares shall be subject to
the same restrictions on transferability as the restricted Shares
with respect to which they were paid.
SECTION 16
LIFTING OF RESTRICTIONS
The restricted Share grants under the Plan shall be subject
to restrictions as to transferability and shall also be subject
to forfeiture provisions. The lifting of the transferability
restrictions and the forfeitability provisions shall be dependent
on the Performance Measures during each Performance Period and on
the continued employment of the Participant during the Period of
Restriction.
As soon as practicable after the end of a Performance
Period, the Committee shall determine the adjustments, if any,
that are required to be made to the Share grants for the
Performance Period based on actual results of IPALCO under the
Performance Measures for such Performance Period. This evaluation
shall be completed no later than the July 1 immediately following
the end of the Performance Period. After the adjustments are made
in the Share grants consistent with the Performance Incentive
Award Schedule for the Performance Period and after effectuating
the adjustments described above rounding up or down any
fractional share to the nearest whole share, the restrictions on
the Shares held by a Participant at the end of the Performance
Period (after adjusted as described above) shall be lifted on
one-third (1/3) of the Shares as of the July 1 immediately
following the Performance Period and shall be lifted in
additional one-third (1/3) increments as of the first (1st) and
second (2nd) anniversary of such July 1; provided, however, that
except as provided in Section 17, 18 or 19 hereof:
(1) the restriction shall be lifted on a July 1 only if the
Participant is still employed by the Company on such
date, and
(2) if a Participant ceases to be employed by the Company
before the restrictions lapse on the Shares held by
him, the Shares still subject to restrictions shall be
immediately forfeited.
Notwithstanding anything contained in this Plan to the contrary,
the Committee shall have the complete discretion to delay the
lifting of the restrictions on Shares under this Plan (including
restrictions that lapse under
Sections 17 and 18) for a Participant to the extent it determines
such delay is necessary to avoid the non-deductibility of the
awards under Section 162(m) of the Internal Revenue Code of 1986,
as amended; provided, however, that any decision to delay the
lifting of the restrictions shall be required to be made and
communicated to the affected Participant in writing before the
beginning of the calendar year during which the restrictions
would have been lifted but for the delay.
SECTION 17
EFFECT OF PARTICIPANT'S ATTAINMENT OF AGE 65
Notwithstanding anything contained in Section 16 hereof to
the contrary, if a Participant attains age 65 after the end of a
Performance Period but before his employment with the Company is
terminated and before the restrictions lapse on the Shares
granted for such Performance Period, the remaining employment
restrictions on any Shares granted for such Performance Period
held by the Participant (after the Performance Measure
adjustments described in Section 16 are completed for such
Performance Period) shall immediately lapse on the date of his
attainment of age 65.
Notwithstanding anything contained in Section 16 hereof to
the contrary, if a Participant attains age 65 before his
employment with the Company is terminated and before the end of a
Performance Period but after completing at least one (1) full
Fiscal Year of employment during such Performance Period, the
remaining restrictions on any Shares attributable to such
Performance Period held by the Participant (after the number of
Shares are adjusted pursuant to the Performance Measure
adjustments described in Section 16 hereof are completed for such
Performance Period) shall lapse on the last calendar day of such
Performance Period; provided, however, that if a Participant's
employment with the Company is terminated, voluntarily or
involuntarily, before his completion of at least two (2) Fiscal
Years of employment, the Participant shall only be entitled to
two-thirds (2/3) of the restricted Shares granted to him for such
Performance Period (after the Performance Measure adjustments
described in Section 16 hereof are completed for such Performance
Period), rounding up or down any fractional Share to the nearest
whole Share, and the remaining one-third (1/3) of the Shares
shall be forfeited as soon as practicable after the end of the
Performance Period.
Notwithstanding anything contained in Section 16 hereof to
the contrary but only to the extent expressly approved by the
Committee, the provisions contained in the preceding two (2)
paragraphs of this Section 17 shall also apply, in whole or in
part, with respect to a Participant whose employment is
terminated before age sixty-five (65) but after meeting the
requirements for early retirement under the Employees' Retirement
Plan of Indianapolis Power & Light Company (or any successor
plan) to the extent the Committee waives the continued employment
requirements; provided, however, that under no circumstances
shall the waiver affect the Performance Measures adjustments
provided in Section 11.
SECTION 18
EFFECT OF TERMINATION OF EMPLOYMENT DUE TO DEATH OR
DISABILITY
Notwithstanding anything contained in Section 16 hereof to
the contrary, if a Participant's employment with the Company is
terminated by reason of his death or total and permanent
disability (as such term is defined in the Employees' Retirement
Plan of Indianapolis Power & Light Company or in any successor
retirement
plan thereto) that occurs after the end of the
Performance Period but before the restrictions lapse on the
Shares granted for such Performance Period, the remaining
restrictions on any Shares attributable to such Performance
Period held by the Participant (after the Performance Measure
adjustments described in Section 16 hereof are completed for such
Performance Period) shall immediately lapse on the date of his
death or total and permanent disability, whichever is applicable.
Notwithstanding anything contained in Section 16 hereof to
the contrary, if a Participant's employment with the Company is
terminated by reason of his death or total and permanent
disability that occurs before the end of the Performance Period,
the Participant shall be entitled to the number of Shares granted
to him at the beginning of the Performance Period (as adjusted
for Performance Periods beginning on or after January 1, 1998 to
reflect the actual Base Salary paid to such Participant but only
if the Participant's death or total and permanent disability
occurs after the first (1st) Fiscal Year of the Performance
Period), no further adjustments shall be effected with respect to
such Shares, and such Shares shall be fully vested and
transferable by such Participant or, if deceased, his legal
representative.
SECTION 19
ACQUISITION OF CONTROL
In the event that there is an Acquisition of Control and
notwithstanding anything contained in Section 16 to the contrary,
the lifting of the restrictions based on continued employment on
the restricted Shares held by a Participant who was employed by
the Company immediately preceding the date of the Acquisition of
Control shall immediately occur. Moreover, no Shares may be
forfeited after an Acquisition of Control, regardless of the
actual performance of the Performance Measures for such
Performance Period(s) during which the Acquisition of Control
occurs; provided, however, that additional Shares (which Shares
shall be freely transferable and nonforfeitable) may be granted
at the end of the Performance Period in accordance with Section
16 hereof during which the Acquisition of Control occurs
depending upon the results of the Performance Measures for such
Performance Period.
SECTION 20
ELECTIVE SALE OF SHARES
Participants shall also be permitted to cash-in up to fifty
percent (50%) of the Shares (after the adjustments required by
Section 16 are completed) that as of any July 1 cease to be
subject to the continued employment requirements under Section 16
(the ``Eligible Shares'') in accordance with the following
provisions:
(a) Election to Participate. Subject to the disapproval of
the Committee, any Participant may elect to receive cash in lieu
of all or some of the Eligible Shares by tendering a written
election to the Secretary of IPALCO before the end of the
calendar year immediately preceding the July 1 on which the
restrictions on such Eligible Shares lapse, which election
becomes irrevocable on the last day of such calendar year;
provided, however, that until the new rules under Section 16 of
the Exchange Act (as defined in Section 2.A) for exemption of
benefit plan transactions become applicable to transactions by
IPALCO insiders, the Committee may modify the procedure for the
cash election described above to the extent it determines
necessary to exempt the cash out as a sale under Section 16 of
the Exchange Act.
(b) Payment of Cash. If a Participant elects under this
Section to receive all or a portion of his Eligible Shares in
cash, the Committee shall cause IPALCO to pay the Participant on
the first (1st) business day of the July on which the
restrictions lapse an amount determined by multiplying:
(i) the number of his Eligible Shares to be converted
into cash, by
(ii) the mean between the high and low sales price of
the Shares on the last trading date of the June
immediately preceding such July; provided,
however, that until the new rules under Section 16
of the Exchange Act for exemption of benefit plan
transactions become applicable to transactions by
IPALCO insiders and if the Committee modifies the
procedures for making the cash election in
accordance with (b) above, the applicable trading
date to be used in determining the cash payment
shall be the date or dates established by the
Committee procedures.
(c) The Compensation Committee may also adopt other
rules which shall allow retired, disabled Participants and/or the
beneficiaries of deceased Participants with Shares with
restrictions that lapse in accordance with Section 17 and Section
18 to cash in the Shares consistent with this Section.
SECTION 21
NO EMPLOYMENT CONTRACT
The Plan is not and is not intended to be an employment
contract with respect to any of the Participants, and IPALCO's
and IPL's rights to continue or to terminate the employment
relationship of any Participant shall not be affected by the
Plan.
SECTION 22
AMENDMENT AND TERMINATION
The Board may at any time amend, modify, alter, or terminate
the Plan; provided, however, that without the approval of the
IPALCO shareholders:
(a) the number of Shares which may be reserved for issuance
under the Plan may not be increased except as provided
in Section 9 hereof;
(b) the class of employees to whom grants may be granted
under the Plan shall not be modified materially; and
(c) the benefits accruing to Participants under the Plan
shall not be increased materially within the meaning of
Reg. 16b-3(a) (2) (ii) (A) promulgated under the
Exchange Act (as defined in Section 2.A);
provided, further, that except for the modifications expressly
permitted by the last paragraph of Section 16 hereof, any
amendment, modification, alteration or termination to the Plan
which increases the restrictions as to transferability or
forfeitability of any restricted Shares granted hereunder to a
Participant, including any Performance Measure adjustments which
occur at the end of a Performance Period, shall not become
effective until the first (1st) Performance Period following the
Performance Period during which such amendment, modification,
alteration or termination to the Plan is adopted without the
written consent of the majority of the Participants adversely
affected by the change.
SECTION 23
INDEMNIFICATION
Each person who is or shall have been a member of the Board
of Directors or the Committee shall be indemnified and held
harmless by IPALCO against and from any loss, cost, liability, or
expense that may be imposed upon or reasonably incurred by him in
connection with or resulting from any claim, action, suit, or
proceeding to which he may be a party or in which he may be
involved by reason of any action taken or failure to act under
the Plan and against and from any and all amounts paid by him in
settlement thereof with IPALCO's approval, or paid by him in
satisfaction of a judgment in any such action, suit or proceeding
against him, provided he shall give IPALCO an opportunity, at its
own expense, to handle and defend the same before he undertakes
to handle and defend it on his behalf. The foregoing right of
indemnification shall not be exclusive of any other rights of
indemnification to which such persons may be entitled under the
IPALCO Articles of Incorporation or Code of By-Laws, as a matter
of law, or otherwise, or any power that IPALCO may have to
indemnify them or hold them harmless.
SECTION 24
GOVERNING LAW
The Plan, and all grants and other documents delivered
hereunder, shall be construed in accordance with and governed by
the laws of Indiana.
SECTION 25
EXPENSES OF PLAN
The expenses of administering the Plan shall be borne by
IPALCO.
SECTION 26
SUCCESSORS
The Plan shall be binding upon the successors and assigns of
the Participating Employers.
SECTION 27
TAX WITHHOLDING
IPALCO or IPL, as appropriate, shall have the right to
require the Participant or other person receiving Shares to pay
to IPALCO or IPL the amount of any federal, state or local taxes
which IPALCO or IPL are required to withhold with respect to such
Shares. If permitted by the Committee and pursuant to rules
established by the Committee, a Participant may make a written
election to have Shares having an aggregate fair market value, as
determined by the Committee, sufficient to satisfy the applicable
withholding taxes, withheld from the Shares otherwise to be
received at the end of the Period of Restriction. Elections by
Participants to have Shares withheld for this purpose shall be
subject to the following restrictions: (1) the elections must be
made prior to the date as of which the amount of tax withheld is
determined (the ``Tax Date''), (2) the elections will be
irrevocable, (3) the elections will be subject to the disapproval
of the Committee and (4) if a Participant is an officer (within
the meaning of Section 16 of the Exchange Act (as defined in
Section 2.A)) of IPALCO or IPL and the Shares are registered
under Section 12 of the Exchange Act, such elections (a) may not
be made within six (6) months of the award of restricted Shares
except that this limitation will not apply if death or disability
of the Participant occurs prior to the expiration of the six (6)
month period), and (b) must be made either more than six (6)
months prior to the Tax Date or in the ten (10) business day
``window period'' beginning on the third (3rd) business day
following the release of IPALCO's quarterly or annual financial
statements; provided, however, that until such time that the new
rules under Section 16 of the Exchange Act (as defined under
Section 2.A) for exemption of benefit plan transactions become
applicable for the Plan, the election must be made in the ten
(10) day `'window period'' described in this Section.
SECTION 28
EFFECTIVE DATE AND DURATION OF PLAN
This amended and restated Plan shall be effective January 1,
1995; provided, however, that the granting of Shares is
conditioned upon the approval of the Plan by the holders of a
majority of the Shares present, or represented, and entitled to
vote at IPALCO's 1995 annual shareholder meeting. The Performance
Periods beginning before January 1, 1995 shall be governed by the
provisions of the Plan in effect before January 1, 1995.
Notwithstanding the above and conditioned upon the approval of
the majority of the affected Plan Participants, the Performance
Period beginning on January 1, 1994 shall be cancelled.
SUPPLEMENT NUMBER ONE TO PROXY STATEMENT FOR IPALCO ENTERPRISES, INC.
This page 13 replaces page 13 in the enclosed Proxy Statement
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTION/SAR VALUES
Number of
Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options/SARs at Options/SARs at
FY-End FY-End ($)*
Shares Acquired Exercisable/ Exercisable/
Name On Exercise (#) Value Realized ($) Unexercisable Unexercisable
- ------------------- --------------- ------------------ ------------------ ----------------
John R. Hodowal -0- -0- 85,000(e) ----
70,000(u) ----
Ramon L. Humke 5,000 35,000 85,000(e) $ 58,750 (e)
40,000(u) ----
John R. Brehm 30,000 195,000 15,000(e) ----
20,000(u) ----
N. Stuart Grauel 25,000 169,550 20,000(e) ----
20,000(u) ----
Gerald D. Waltz -0- -0- 40,000(e) $ 62,500 (e)
20,000(u) ----
- ------------------------------
(e) Exercisable.
(u) Unexercisable.
* Based upon year-end closing market price of $30.00 per share of common stock.
TABLE II
[form of proxy/instruction card]
IPALCO ENTERPRISES, INC.
This Proxy/Instruction Card is Solicited on Behalf of the Board
of Directors
The undersigned hereby appoints John R. Hodowal and Bryan G.
Tabler as Proxies, each with the power of substitution, and
authorizes them to represent and vote and/or, in the case of
shares held in the Automatic Dividend Reinvestment and Stock
Purchase Plan, instructs the agent for such Plan to execute a
proxy empowering the above-named persons to vote, as designated
below, all the shares of IPALCO Enterprises, Inc. common stock
held of record by the undersigned and/or credited to the
undersigned's account in such Plan on February 27, 1995, at the
annual meeting of the shareholders to be held April 19, 1995, or
at any adjournment thereof, with respect to the matter(s) set
forth below.
1. Election of Six Nominees For Director, namely:
Otto N. Frenzel III;
Earl B. Herr, Jr.;
Sam H. Jones;
Andre B. Lacy;
L. Ben Lytle;
Thomas M. Miller
[ ] Vote For All Nominees
[ ] Withhold Vote from All Nominees
[ ] Vote For All Nominees, Except Nominees written below:
------------------------------------------------------
(Please write name(s) of Nominee(s) from whom vote is
withheld)
2. Approval of the IPALCO Enterprises, Inc. Long-term
Performance and Restricted Stock Incentive Plan (as amended
and restated effective January 1, 1995).
[ ] For [ ] Against [ ] Abstain
(FOLD HERE - DO NOT TEAR)
This Proxy/Instruction Card when properly executed will be voted
in the manner directed by the undersigned shareholder. If not
otherwise indicated, this Proxy/Instruction Card will be voted
FOR Proposals 1 and 2 and confers discretionary authority to vote
on currently unknown matters properly presented to the meeting.
This Proxy/Instruction Card shall be voted on those matters
properly presented in accordance with the best judgment of the
named Proxies.
Receipt of the Notice of Annual Meeting and Proxy Statement dated
March 6, 1995, and the 1994 Annual Report is hereby acknowledged.
Dated ________________,1995.
Your signature must be exactly ______________________________
as your name appears below. (SIGNATURE)
When signing as attorney-in-fact,
executor, administrator, trustee,
guardian or corporate officer, ______________________________
please give full title as such. (SIGNATURE IF HELD JOINTLY)
Please complete
1995 Proxy at right.
Then date, sign,
detach it from this
form at perforations,
fold it and return
immediately in
accompanying
postage guaranteed
envelope.
Account ID:
ADDRESS CHANGE
______________________
STREET
______________________
APT. NO./P.O. BOX
______________________
CITY
______________________
STATE
______________________
ZIP CODE
______________________
SIGNATURE
[at perforation]
(DETACH HERE)
[letter soliciting voting instructions
from participants in Employees' Thrift Plan]
IPL
INDIANAPOLIS POWER & LIGHT COMPANY
March 6, 1995
TO PARTICIPANTS IN THE EMPLOYEES' THRIFT PLAN:
As a participant in the Employees' Thrift Plan, you are
entitled to direct the manner in which shares of stock of IPALCO
Enterprises, Inc., (``IPALCO'') in which you have an interest,
shall be voted by the Trustee at the forthcoming Annual Meeting
of Shareholders of IPALCO to be held April 19, 1995. This right
is given to you by Section 305.90 of the Thrift Plan.
Enclosed is a copy of the Notice of the Annual Meeting and
Proxy Statement dated March 6, 1995 and an Instruction Card
indicating the number of shares with respect to which you may
give voting instructions to the Trustee. You may instruct the
Trustee how you wish such shares to be voted by placing a mark in
the box which expresses your choice.
The only business to be acted upon at the meeting of which
Management is presently aware, is the election of six directors
to hold office for terms of three years each and until their
successors are duly elected and qualified, and the approval of
the IPALCO Long-Term Performance and Restricted Stock Incentive
Plan.
It is important that you instruct the Trustee as to the
voting of the shares in which you have an interest. After
designating how you wish such shares to be voted, sign the
instruction form and return it via intra company mail to the
Secretary of IPALCO, Room 729, Electric Building, on or before
April 13, 1995.
Shares with respect to which no voting instructions are
given will be voted by the Trustee in its discretion.
/s/ John D. Wilson
John D. Wilson, Secretary
Employees' Pension Committee
[form to be executed by Thrift Plan participants]
IPALCO ENTERPRISES, INC.
Instructions To Thrift Plan Trustee For
Annual Meeting Of Shareholders -- April 19, 1995
TO THE EMPLOYEE PENSION COMMITTEE:
I understand that in accordance with Section 305.90 of the
Thrift Plan, I may instruct the voting of the number of shares
shown on this form. Will you please direct the Trustee to execute
a proxy empowering the persons appointed therein to vote as
follows:
1. Election of Six Nominees For Director, namely: Otto N.
Frenzel III; Earl B. Herr, Jr.; Sam H. Jones; Andre B. Lacy;
L. Ben Lytle; Thomas M. Miller
[ ] Vote For All Nominees
[ ] Withhold Vote from All Nominees
[ ] Vote For All Nominees, Except Nominees written below:
______________________________________________________________
(Please write name(s) of Nominee(s) from whom vote is withheld)
2. Approval of the IPALCO Enterprises, Inc. Long-term
Performance and Restricted Stock Incentive Plan (as amended
and restated effective January 1, 1995).
[ ] For [ ] Against [ ] Abstain
(FOLD HERE - DO NOT TEAR)
The Trustee will execute the proxy as above directed, or, if no
choice is indicated, the proxy will be voted by the Trustee in
its discretion. This instruction card confers discretionary
authority to vote on currently unknown matters properly presented
to the meeting.
Receipt of the Notice of Annual Meeting and Proxy Statement dated
March 6, 1995, and the 1994 Annual Report is hereby acknowledged.
Dated ____________, 1995.
Your signature must be exactly as _________________________
your name appears below. (SIGNATURE)
Please complete
1995 Instruction Card
at right. Then date,
sign, detach it from this
form at perforations,
fold it and return
immediately in
accompanying
interoffice envelope.
[at perforation]
(DETACH HERE)