BY-LAWS
OF
CINERGY CORP.
Adopted: October 24, 1994
Amended: January 25, 1996
Amended: December 18, 1997
TABLE OF CONTENTS
ARTICLE I
Offices and Headquarters
Section 1.1 Offices
1.2 Headquarters
ARTICLE II
Stockholders
Section 2.1 Annual Meeting
2.2 Special Meetings
2.3 Notice of Meetings
2.4 Quorum
2.5 Voting
2.6 Presiding Officer and Secretary
2.7 Proxies
2.8 List of Stockholders
ARTICLE III
Directors
Section 3.1 Number of Directors
3.2 Election and Term of Directors
3.3 Vacancies and Newly Created Directorships
3.4 Resignation
3.5 Meetings
3.6 Quorum and Voting
3.7 Written Consent of Directors in Lieu of a Meeting
3.8 Compensation
3.9 Contracts and Transactions Involving Directors
ARTICLE IV
Committees of the Board of Directors
Section 4.1 Appointment and Powers
ARTICLE V
Officers, Agents and Employees
Section 5.1 Appointment and Term of Office
5.2 The Chairman of the Board
Section 5.3 Vice-Chairman
5.4 Chief Executive Officer
5.5 The President
5.6 The Vice-Presidents
5.7 The Secretary
5.8 The Treasurer
5.9 The Comptroller
5.10 Compensation and Bond
ARTICLE VI
Indemnification
Section 6.1 Indemnification of Directors, Officers, Employees and Agents
6.2 Advances for Litigation Expenses
6.3 Indemnification Nonexclusive
6.4 Indemnity Insurance
6.5 Definitions
ARTICLE VII
Common Stock
Section 7.1 Certificates
7.2 Transfers of Stock
7.3 Lost, Stolen or Destroyed Certificates
7.4 Stockholder Record Date
7.5 Beneficial Owners
ARTICLE VIII
Seal
Section 8.1 Seal
ARTICLE IX
Waiver of Notice
Section 9.1 Waiver of Notice
ARTICLE X
Fiscal Year
Section 10.1 Fiscal Year
ARTICLE XI Contracts, Checks, etc.
Section 11.1 Contracts, Checks, etc
ARTICLE XII
Amendments
Section 12.1 Amendments
ARTICLE XIII
Dividends
Section 13.1 Dividends
BY-LAWS
OF
CINERGY CORP. (THE "CORPORATION")
ARTICLE I
Offices and Headquarters
Section 1.1 Offices. The location of the Corporation's principal office shall be
in the City of Cincinnati, County of Hamilton, State of Ohio. The Corporation
may, in addition to the aforesaid principal office, establish and maintain an
office or offices elsewhere in Delaware, Ohio or Indiana or in such other states
and places as the Board of Directors may from time to time find necessary or
desirable, at which office or offices the books, documents, and papers of the
Corporation may be kept.
Section 1.2 Headquarters. Subject to the sentence next following, the
Corporation's headquarters and executive offices, shall be located in the City
of Cincinnati, County of Hamilton, State of Ohio. The location of the
Corporation's headquarters and executive offices may be changed from the City of
Cincinnati, County of Hamilton, State of Ohio only by the affirmative vote of
80% of the full Board of Directors of the Corporation and not by the vote of any
committee of the Board of Directors. As used in these By-Laws, the term "the
full Board of Directors" shall mean all directors then in office together with
any vacancies, however created. For the avoidance of doubt and as an example
only, if the Board of Directors consists of 17 members and two vacancies exist,
the affirmative vote of 14 of the 15 members of the Corporation's Board of
Directors then in office would be required to authorize a change in location of
the Corporation's headquarters and executive offices. The headquarters and
executive offices of the Corporation's subsidiary, PSI Energy, Inc., shall be
located in the City of Plainfield, Indiana and the headquarters and executive
offices of the Corporation's subsidiary, The Cincinnati Gas & Electric Company,
shall be located in the City of Cincinnati, Ohio.
ARTICLE II
Stockholders
Section 2.1 Annual Meeting. An annual meeting of stockholders of the Corporation
for the election of directors and for the transaction of any other proper
business shall be held at such time and date in each year as the Board of
Directors may from time to time determine. The annual meeting in each year shall
be held at such hour on said day and at such place within or without the State
of Delaware as may be fixed by the Board of Directors, or if not so fixed, at
the principal business office of the Corporation in the City of Cincinnati,
County of Hamilton, State of Ohio. In addition to all other applicable
requirements for business to be properly brought before an annual meeting by a
stockholder, the stockholder must have given timely notice thereof in writing to
the Secretary of the Corporation. To be timely, a stockholder's notice must be
delivered to or mailed and received at the principal executive offices of the
Corporation, not less than 60 days nor more than 90 days prior to the annual
meeting; provided, however, that in the event that less than 70 days' notice or
prior public disclosure of the date of the annual meeting is given or made to
stockholders, notice by the stockholders to be timely must be so received not
later than the close of business on the fifteenth day following the date on
which such notice of the date of annual meeting was mailed or such public
disclosure was made whichever first occurs. A stockholder's notice to the
Secretary shall set forth as to each matter the stockholder proposes to bring
before the annual meeting: (i) a brief description of the business desired to be
brought before the annual meeting and the reasons for conducting such business
at the annual meeting; (ii) the name and record address of the stockholder
proposing such business; (iii) the class and number of shares of the Corporation
which are beneficially owned by the stockholder; and (v) any material interest
of the stockholder in the business.
Notwithstanding anything to the contrary in the By-Laws, no business shall be
conducted at the annual meeting except in accordance with the procedures set
forth in this Section 2.1; provided, however, that nothing in this Section 2.1
shall be deemed to preclude discussion by any stockholder of any business
properly brought before the annual meeting.
Section 2.2 Special Meetings. A special meeting of the stockholders of the
Corporation entitled to vote on any business to be considered at any such
meeting may be called by the Chairman of the Board or the President or by a
majority of the members of the Board of Directors then in office, acting with or
without a meeting, or by the persons who hold 50% of all shares outstanding and
entitled to vote thereat upon notice in writing, stating the time, place and
purpose of the special meeting. The business transacted at the special meeting
shall be confined to the purposes and objects stated in the call.
Section 2.3 Notice of Meetings. Whenever stockholders are required or permitted
to take any action at a meeting, unless notice is waived in writing by all
stockholders entitled to vote at the meeting, a written notice of the meeting
shall be given which shall state the place, date and hour of the meeting, and,
in the case of a special meeting, the purpose or purposes for which the meeting
is called.
Unless otherwise provided by law, and except as to any stockholder duly waiving
notice, the written notice of any meeting shall be given personally or by mail,
not less than 10 days nor more than 60 days before the date of the meeting to
each stockholder entitled to vote at such meeting. If mailed, notice shall be
deemed given when deposited in the mail, postage prepaid, directed to the
stockholder at his or her address as it appears on the records of the
Corporation.
When a meeting is adjourned to another time or place, notice need not be given
of the adjourned meeting if the time and place thereof are announced at the
meeting at which the adjournment is taken. At the adjourned meeting the
Corporation may transact any business which might have been transacted at the
original meeting. If, however, the adjournment is for more than 30 days, or if
after the adjournment a new record date is fixed for the adjourned meeting, a
notice of the adjourned meeting shall be given to each stockholder of record
entitled to vote at the meeting.
Section 2.4 Quorum. Except as otherwise provided by law or by the Certificate of
Incorporation or by these By-Laws in respect of the vote required for a
specified action, at any meeting of stockholders the holders of a majority of
the outstanding stock entitled to vote thereat, either present, in person or
represented by proxy, shall constitute a quorum for the transaction of any
business, but the stockholders present, although less than a quorum, may adjourn
the meeting to another time or place and, except as provided in the last
paragraph of Section 2.3 of these By-Laws, notice need not be given of the
adjourned meeting.
Section 2.5 Voting. Whenever directors are to be elected at a meeting, they
shall be elected by a plurality of the votes cast at the meeting by the holders
of stock entitled to vote. Whenever any corporate action, other than the
election of directors, is to be taken by vote of stockholders at a meeting, it
shall, except as otherwise required by law or by the Certificate of
Incorporation or by these By-Laws, be authorized by a majority of the votes cast
at the meeting by the holders of stock entitled to vote thereon.
Except as otherwise provided by law, or by the Certificate of Incorporation,
each holder of record of stock of the Corporation entitled to vote on any matter
at any meeting of stockholders shall be entitled to one (1) vote for each share
of such stock standing in the name of such holder on the stock ledger of the
Corporation on the record date for the determination of the stockholders
entitled to vote at the meeting.
Upon the demand of any stockholder entitled to vote, the vote for directors or
the vote on any other matter at a meeting shall be by written ballot, but
otherwise the method of voting and the manner in which votes are counted shall
be discretionary with the presiding officer at the meeting.
Section 2.6 Presiding Officer and Secretary. At every meeting of stockholders
the Chairman of the Board, or, in his or her absence, the President, or, in his
or her absence, the appointee of the meeting, shall preside. The Secretary, or,
in his or her absence an Assistant Secretary, or if none be present, the
appointee of the presiding officer of the meeting, shall act as secretary of the
meeting.
Section 2.7 Proxies. Each stockholder entitled to vote at a meeting of
stockholders or to express consent or dissent to corporate action in writing
without a meeting may authorize another person or persons to act for him or her
by proxy, but no such proxy shall be voted or acted upon after three years from
its date, unless the proxy provides for a longer period. Every proxy shall be
signed by the stockholder or by his duly authorized attorney. A stockholder may
authorize another person or persons to act for him as proxy by transmitting or
authorizing the transmission of a telegram, cablegram, or other means of
electronic transmission to the person who will be the holder of the proxy or to
a proxy solicitation firm, proxy support service organization or like agent duly
authorized by the person who will be the holder of the proxy to receive such
transmission if such transmission is submitted with information from which it
may be determined that the transmission was authorized by the stockholder.
Section 2.8 List of Stockholders. The officer who has charge of the stock ledger
of the Corporation shall prepare and make, at least 10 days before every meeting
of stockholders, a complete list of the stockholders entitled to vote at the
meeting, arranged in alphabetical order, and showing the address of each
stockholder and the number of shares registered in the name of each stockholder.
Such list shall be open to the examination of any stockholder, for any purpose
germane to the meeting, during ordinary business hours, for a period of at least
10 days prior to the meeting, either at a place within the city where the
meeting is to be held, which place shall be specified in the notice of the
meeting, or, if not so specified, at the place where the meeting is to be held.
The list shall also be produced and kept at the time and place of the meeting
during the whole time thereof, and may be inspected by any stockholder who is
present.
The stock ledger shall be the only evidence as to who are the stockholders
entitled to examine the stock ledger, the list required by this Section or the
books of the Corporation, or to vote in person or by proxy at any meeting of
stockholders.
ARTICLE III
Directors
Section 3.1 Number of Directors. The Board of Directors shall consist of 17
directors. This number may be changed to an odd number not less than 15 and not
more than 23 by a vote of not less than 75% of the full Board of Directors
("Supermajority Vote"). Any such determination made by the Board of Directors
shall continue in effect unless and until changed by the Board of Directors by
Supermajority Vote, but no such change shall affect the term of any director
then in office.
Section 3.2 Election and Term of Directors. Only persons who are nominated in
accordance with the following procedures shall be eligible for election as
directors. Except as may be required by applicable law, no person who is, at the
time of nomination, 70 years of age or older shall be eligible for election as a
director. Nominations of persons as candidates for election as directors of the
Corporation may be made at a meeting of stockholders (i) by or at the direction
of the Board of Directors acting by Supermajority Vote (or by a unanimous vote
of the remaining directors if a Supermajority Vote is not obtainable because the
number of vacancies on the Board of Directors); or (ii) by any stockholder of
the Corporation entitled to vote for the election of directors at such meeting
who complies with the notice procedures set forth herein. Any nomination other
than those governed by clause (i) of the preceding sentence shall be made
pursuant to timely notice in writing to the Secretary of the Corporation. To be
timely, a stockholder's notice shall be delivered to or mailed and received at
the principal office of the Corporation in the State of Ohio not less than 50
days prior to the meeting; provided, however, that if less than 60 days' notice
or prior public disclosure of the date of the meeting is given to stockholders
or made public, to be timely notice by a stockholder must be so received not
later than the close of business on the tenth day following the day on which
such notice of the date of the meeting was mailed or such public disclosure was
made. Such stockholder's notice to the Secretary shall set forth: (a) as to each
person whom the stockholder proposes to nominate for election as director: (i)
the name, age, business address, and residence address of such person; (ii) the
principal occupation or employment of such person; (iii) the class and number of
any shares of capital stock of the Corporation that are beneficially owned by
such person; and (iv) any other information relating to such person that is
required to be disclosed in solicitations for proxies for the election of
directors pursuant to any then existing rules or regulations promulgated under
the Securities Exchange Act of 1934, as amended; and (b) as to the stockholder
giving notice: (i) the name and record address of such stockholder; (ii) the
class and number of shares of capital stock of the Corporation that are
beneficially owned by such stockholder, and (iii) the period of time such
stockholder has held such shares. The Corporation may require any proposed
nominee to furnish such other information as may reasonably be required by the
Corporation to determine the eligibility of such proposed nominee to serve as a
director. No person otherwise eligible for election as a director shall be
eligible for election as a director unless nominated as set forth herein.
Commencing on October 24, 1994 (the "Classification Date") of the Board of
Directors of the Corporation, the terms of office of the Board of Directors
shall be divided into three (3) classes, Class I, Class II and Class III, as
determined by the Board of Directors. All classes shall be as nearly equal in
number as possible.
The terms of office of directors classified shall be as follows: (1) that of
Class I shall expire at the annual meeting of stockholders that occurs within
the first year after the Classification Date, (2) that of Class II shall expire
at the annual meeting of stockholders that occurs within the second year after
the Classification Date, and (3) that of Class III shall expire at the annual
meeting of stockholders that occurs within the third year after the
Classification Date. At each annual meeting of stockholders after the
Classification Date, the successors to directors whose terms shall expire shall
be elected to serve from the time of election and qualification until the third
annual meeting following election and until a successor shall have been elected
and qualified or until his earlier resignation, removal from office or death. As
being under 70 years of age constitutes a continuing qualification for service
on the Board of Directors, any director who reaches the age of 70 years while in
office shall, except as limited by applicable law, promptly resign from the
Corporation's Board of Directors.
Section 3.3 Vacancies and Newly Created Directorships. Vacancies and newly
created directorships resulting from any increase in the authorized number of
directors may be filled by election at a meeting of stockholders. Except as
otherwise provided by law, and notwithstanding the provision of Section 3.6, the
remaining directors, whether or not constituting a majority of the whole
authorized number of directors, may, by not less than a Supermajority Vote (or
by a unanimous vote of the remaining directors if a Supermajority Vote is not
obtainable because of the number of vacancies on the Board of Directors) fill
any vacancy in the Board, however arising, for the unexpired term thereof. Any
person elected to fill a vacancy in the Board shall hold office until the
expiration of the term of office for the class to which he or she is elected and
until a successor is elected and qualified or until his or her earlier
resignation, removal from office or death.
Section 3.4 Resignation. Any director may resign at any time upon written notice
to the Corporation. Any such resignation shall take effect at the time specified
therein or, if the time be not specified, upon receipt thereof, and the
acceptance of such resignation, unless required by the terms thereof, shall not
be necessary to make such resignation effective.
Section 3.5 Meetings. Meetings of the Board of Directors, regular or special,
may be held at any place within or without the State of Delaware. Members of the
Board of Directors, or of any committee designated by the Board, may participate
in a meeting of such Board or committee by means of conference telephone or
similar communications equipment by means of which all persons participating in
the meeting can hear each other, and participation in a meeting by such means
shall constitute presence in person at such meeting. An annual meeting of the
Board of Directors shall be held after each annual election of directors. If
such election occurs at an annual meeting of stockholders, the annual meeting of
the Board of Directors shall be held at the same place and immediately following
such meeting of stockholders, and no notice thereof need be given. The Board of
Directors may fix times and places for regular meetings of the Board and no
notice of such meetings need be given. A special meeting of the Board of
Directors shall be held whenever called by the Chairman of the Board, the
President or by the written request of at least two (2) members of the Board of
Directors, at such time and place as shall be specified in the notice or waiver
thereof. Notice of each special meeting shall be given by the Secretary or by a
person calling the meeting to each director in writing, through the mail, not
later than the second day before the meeting, or personally served or by
telephone, telecopy, telegram, cablegram or radiogram, in each such cases, not
later than the day before the meeting, and such notice shall be deemed to be
given at the time when the same shall be transmitted.
Section 3.6 Quorum and Voting. A majority of the full Board of Directors shall
constitute a quorum for the transaction of business, but, if there be less than
a quorum at any meeting of the Board of Directors, a majority of the directors
present may adjourn the meeting from time to time, and no further notice thereof
need be given other than announcement at the meeting which shall be so
adjourned. Except as otherwise provided by law, by the Certificate of
Incorporation, or by these By-Laws (including, without limitation, where any
Supermajority Vote or any other vote in excess of a majority is required), the
vote of a majority of the directors present at a meeting at which a quorum is
present shall be the act of the Board of Directors.
Section 3.7 Written Consent of Directors in Lieu of a Meeting. Any action
required or permitted to be taken at any meeting of the Board of Directors or of
any committee thereof may be taken without a meeting if all members of the Board
or of such committee, as the case may be, consent thereto in writing, and the
writing or writings are filed with the minutes of proceedings of the Board or
committee.
Section 3.8 Compensation. Each director of the Corporation (other than directors
who are salaried officers of the Corporation or any of its subsidiaries) shall
be entitled to receive as compensation for services such reasonable
compensation, which may include pension, disability and death benefits, as may
be determined from time to time by the Board of Directors. Reasonable
compensation may also be paid to any person other than a director officially
called to attend any such meeting.
Section 3.9 Contracts and Transactions Involving Directors. No contract or
transaction between the Corporation and one or more of its directors or
officers, or between the Corporation and any other corporation, partnership,
association, or other organization in which one or more of its directors or
officers are directors or officers, or have a financial interest, shall be void
or voidable solely for this reason, or solely because the director or officer is
present at or participates in the meeting of the Board of Directors or committee
thereof which authorizes the contract or transaction, or solely because his, her
or their votes are counted for such purpose, if: (1) the material facts as to
his or her relationship or interest and as to the contract or transaction are
disclosed or are known to the Board of Directors or the committee, and the Board
or committee in good faith authorizes the contract or transaction by the
affirmative votes of a majority of the disinterested directors, even though the
disinterested directors be less than a quorum; or (2) the material facts as to
his or her relationship or interest and as to the contract or transaction are
disclosed or are known to the stockholders entitled to vote thereon, and the
contract or transaction is specifically approved in good faith by vote of the
stockholders; or (3) the contract or transaction is fair as to the Corporation
as of the time it is authorized, approved or ratified, by the Board of
Directors, a committee thereof, or the stockholders. Common or interested
directors may be counted in determining the presence of a quorum at a meeting of
the Board of Directors or of a committee which authorizes the contract or
transaction.
ARTICLE IV
Committees of the Board of Directors
Section 4.1 Appointment and Powers. The Board of Directors shall, by resolution
adopted by a majority of the Board, designate annually (subject to Article V
hereof) six of their number to constitute an Executive Committee, and may
delegate to such committee power to authorize the seal of the Corporation to be
affixed to all papers which may require it and to exercise in the intervals
between the meetings of the Board of Directors the powers of the Board in the
management of the business and affairs of the Corporation; provided, however,
that the Executive Committee shall not have the power or authority to take any
action for which a Supermajority Vote or other vote in excess of a majority of
the Board of Directors is required. Each member of the Executive Committee shall
continue to be a member thereof only during the pleasure of a majority of the
full Board of Directors.
The Executive Committee may act by a majority of its members at a meeting or by
a writing signed by all of its members.
All action by the Executive Committee shall be reported to the Board of
Directors at its meeting next succeeding such action.
Non-employee members of such Executive Committee shall be entitled to receive
such fees and compensation as the Board of Directors may determine.
The Board of Directors may also appoint a Finance Committee, a Committee on
Directors, an Audit Committee, a Public Policy Committee and a Compensation
Committee and may also appoint such other standing or temporary committees from
time to time as they may see fit, delegating to such committees all or any part
of their own powers (subject to the provisions of these By-Laws); provided,
however, that any compensation or benefits to be paid to an executive officer
who is also a director must be approved by the Board of Directors. The members
of such committees shall be entitled to receive such fees as the Board may
determine.
The Board of Directors shall not amend, modify, vary or waive any of the terms
of the Amended and Restated Agreement and Plan of Reorganization by and among
The Cincinnati Gas & Electric Company, PSI Resources, Inc., PSI Energy, Inc.,
the Corporation, Cinergy Corp., an Ohio corporation, and Cinergy Sub, Inc. dated
as of December 11, 1992, as amended and restated as of July 2, 1993 and as of
September 10, 1993 and as further amended as of June 20, 1994, as of July 26,
1994 and as of September 30, 1994 (the "Merger Agreement") other than by a
Supermajority Vote of the Board of Directors.
ARTICLE V
Officers, Agents and Employees
Section 5.1 Appointment and Term of Office. The executive officers of the
Corporation, shall consist of a Chairman of the Board, a Vice-Chairman, a Chief
Executive Officer, a President, one or more Vice-Presidents, a Secretary, a
Treasurer and a Comptroller, all of whom shall be elected by the Board of
Directors by a Supermajority Vote, and shall hold office for one (1) year and
until their successors are chosen and qualified. Any number of such offices may
be held by the same person, but no officer shall execute, acknowledge or verify
any instrument in more than one capacity. Any vacancy occurring in the office of
the Chairman, Chief Executive Officer or President shall be filed by
Supermajority Vote of the Board of Directors. The Chairman, Chief Executive
Officer or President shall be subject to removal without cause only by
Supermajority Vote of the Board of Directors at a special meeting of the Board
of Directors called for that purpose.
The Board of Directors may appoint, and may delegate power to appoint, such
other non-executive officers, agents and employees as it may deem necessary or
proper, who shall hold their offices or positions for such terms, have such
authority and perform such duties as may from time to time be determined by or
pursuant to authorization of the Board of Directors.
Section 5.2 The Chairman of the Board. The Chairman of the Board shall be a
director and shall preside at all meetings of the Board of Directors and, in the
absence or inability to act of the Chief Executive Officer, meetings of
stockholders and shall, subject to the Board's direction and control, be the
Board's representative and medium of communication, and shall perform such other
duties as may from time-to-time be assigned to the Chairman of the Board by
Supermajority Vote of the Board of Directors. The Chairman of the Board shall
direct the long-term strategic planning process of the Corporation and shall
also lend his or her expertise to the President, as may be requested from
time-to-time by the President. The Chairman shall be a member of the Executive
Committee.
Section 5.3 Vice-Chairman. The Vice-Chairman of the Board shall be a director
and shall preside at meetings of the Board of Directors in the absence or
inability to act of the Chairman of the Board or meetings of stockholders in the
absence or inability to act of the Chief Executive Officer and the Chairman of
the Board. The Vice-Chairman shall perform such other duties as may from
time-to-time be assigned to him or her by Supermajority Vote of the Board of
Directors. The Vice-Chairman shall be a member of the Executive Committee and
the Corporate Governance Committee.
Section 5.4 Chief Executive Officer. The Chief Executive Officer shall be a
director and shall preside at all meetings of the stockholders, and, in the
absence or inability to act of the Chairman of the Board and the Vice-Chairman,
meetings of the Board of Directors, and shall submit a report of the operations
of the Corporation for the fiscal year to the stockholders at their annual
meeting and from time-to-time shall report to the Board of Directors all matters
within his or her knowledge which the interests of the Corporation may require
be brought to their notice. The Chief Executive Officer shall be the chairman of
the Executive Committee and ex officio a member of all standing committees.
Where the offices of President and Chief Executive Officer are held by different
individuals, the President will report directly to the Chief Executive Officer.
Section 5.5 The President. The President shall be the chief operating officer of
the Corporation. The President shall have general and active management and
direction of the affairs of the Corporation, shall have supervision of all
departments and of all officers of the Corporation, shall see that the orders
and resolutions of the Board of Directors and of the Executive Committee are
carried into effect, and shall have the general powers and duties of supervision
and management usually vested in the office of President of a corporation. All
corporate officers and functions except those reporting to the Chairman of the
Board or the Chief Executive Officer shall report directly to the President.
Section 5.6 The Vice-Presidents. The Vice-Presidents shall perform such duties
as the Board of Directors shall, from time to time, require. In the absence or
incapacity of the President, the Vice President designated by the President or
Board of Directors or Executive Committee shall exercise the powers and duties
of the President.
Section 5.7 The Secretary. The Secretary shall attend all meetings of the Board
of Directors, of the Executive Committee and any other committee of the Board of
Directors and of the stockholders and act as clerk thereof and record all votes
and the minutes of all proceedings in a book to be kept for that purpose, and
shall perform like duties for the standing committees when required.
The Secretary shall keep in safe custody the seal of the corporation and,
whenever authorized by the Board of Directors or the Executive Committee, affix
the seal to any instrument requiring the same.
The Secretary shall see that proper notice is given of all the meetings of the
stockholders of the Corporation and of the Board of Directors and shall perform
such other duties as may be prescribed from time to time by the Board of
Directors, the Chairman, the Chief Executive Officer, or the President.
Assistant Secretaries. At the request of the Secretary, or in his or her absence
or inability to act, the Assistant Secretary or, if there be more than one, the
Assistant Secretary designated by the Secretary, shall perform the duties of the
Secretary and when so acting shall have all the powers of and be subject to all
the restrictions of the Secretary. The Assistant Secretaries shall perform such
other duties as may from time to time be assigned to them by the President, the
Secretary, or the Board of Directors.
Section 5.8 The Treasurer. The Treasurer shall be the financial officer of the
Corporation, shall keep full and accurate accounts of all collections, receipts
and disbursements in books belonging to the corporation, shall deposit all
moneys and other valuables in the name and to the credit of the Corporation, in
such depositories as may be directed by the Board of Directors, shall disburse
the funds of the Corporation as may be ordered by the Board of Directors, the
Chairman, the Chief Executive Officer, or the President, taking proper vouchers
therefor, and shall render to the President, the Chief Executive Officer, the
Chairman, and/or directors at all regular meetings of the Board, or whenever
they may require it, and to the annual meeting of the stockholders, an account
of all his or her transactions as Treasurer and of the financial condition of
the Corporation.
The Treasurer shall also perform such other duties as the Board of Directors,
the Chairman, the Chief Executive Officer, or the President may from time to
time require.
If required by the Board of Directors the Treasurer shall give the Corporation a
bond in a form and in a sum with surety satisfactory to the Board of Directors
for the faithful performance of the duties of his or her office and the
restoration to the Corporation in the case of his or her death, resignation or
removal from office of all books, papers, vouchers, money and other property of
whatever kind in his or her possession belonging to the Corporation.
Assistant Treasurers. At the request of the Treasurer, or in his or her absence
or inability to act, the Assistant Treasurer or, if there be more than one, the
Assistant Treasurer designated by the Treasurer, shall perform the duties of the
Treasurer and when so acting shall have all the powers of and be subject to all
the restrictions of the Treasurer. The Assistant Treasurers shall perform such
other duties as may from time to time be assigned to them by the President, the
Treasurer, or the Board of Directors.
Section 5.9 The Comptroller. The Comptroller shall have control over all
accounts and records of the Corporation pertaining to moneys, properties,
materials and supplies. He or she shall have executive direction over the
bookkeeping and accounting departments and shall have general supervision over
the records in all other departments pertaining to moneys, properties, materials
and supplies. He or she shall have such other powers and duties as are incident
to the office of Comptroller of a corporation and shall be subject at all times
to the direction and control of the Board of Directors, the Chairman, the Chief
Executive Officer, the President, or a Vice President.
Assistant Comptrollers. At the request of the Comptroller, or in his or her
absence or inability to act, the Assistant Comptroller or, if there be more than
one, the Assistant Comptroller designated by the Comptroller, shall perform the
duties of the Comoptroller and when so acting shall have all the powers of and
be subject to all the restrictions of the Comptroller. The Assistant
Comptrollers shall perform such other duties as may from time to time be
assigned to them by the President, the Comptroller, or the Board of Directors.
Section 5.10 Compensation and Bond. The compensation of the officers of the
Corporation shall be fixed by the Compensation Committee of the Board of
Directors, but this power may be delegated to any officer in respect of other
officers under his or her control. The Corporation may secure the fidelity of
any or all of its officers, agents or employees by bond or otherwise.
ARTICLE VI
Indemnification
Section 6.1 Indemnification of Directors, Officers, Employees and Agents. (A)
Any person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (other than any action or suit by or
in the right of the Corporation) by reason of the fact that he or she is or was
a director, officer, employee or agent of the Corporation, or is or was serving
at the request of the Corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise
(specifically including employee benefit plans), shall be indemnified by the
Corporation, if, as and to the extent authorized by applicable law, against
expenses (specifically including attorney's fees), judgments, fines
(specifically including any excise taxes assessed on a person with respect to an
employee benefit plan) and amounts paid in settlement actually and reasonably
incurred by him or her in connection with the defense or settlement of such
action, suit or proceeding, if he or she acted in good faith and in a manner he
or she reasonably believed to be in or not opposed to the best interests of the
Corporation and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his or her conduct was unlawful. The termination of
any action, suit or proceeding by judgment, order, settlement, or conviction, or
upon a plea of nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner he or she
reasonably believed to be in and not opposed to the best interests of the
Corporation and, with respect to any criminal action or proceeding, he or she
had no reasonable cause to believe his or her conduct was unlawful.
(B) The Corporation shall, to the extent not prohibited by applicable law,
indemnify or agree to indemnify any person who was or is a party, or is
threatened to be made a party, to any threatened, pending, or completed action
or suit by or in the right of the Corporation to procure a judgement in its
favor by reason of the fact that he or she is or was a director, officer,
employee, or agent of the Corporation or is or was serving at the request of the
Corporation as a director, trustee, officer, employee, or agent of another
corporation, domestic or foreign, non-profit or for-profit, partnership, joint
venture, trust or other enterprise (specifically including employee benefit
plans), against expenses (including attorneys' fees) actually and reasonably
incurred by him or her in connection with the defense or settlement of such
action or suit if he or she acted in good faith and in a manner reasonably
believed to be in or not opposed to the best interests of the Corporation;
provided that, no indemnification shall be made in respect of any claim, issue
or matter as to which such person shall have been adjudged to be liable to the
Corporation unless and only to the extent that the Court of Chancery or the
court in which such action or suit was brought shall determine upon application
that, despite the adjudication of liability but in view of all the circumstances
of the case, such person is fairly and reasonably entitled to indemnity for such
expenses which the Court of Chancery or such other court shall deem proper.
(C) To the extent that a director, officer, employee, or agent of the
Corporation has been successful on the merits or otherwise in defense of any
action, suit, or proceeding referred to in the paragraphs (A) or (B) of this
Section, or in defense of any claim, issue, or matter therein, he or she shall
be indemnified against expenses, specifically including attorneys' fees,
actually and reasonably incurred by him or her in connection therewith.
(D) Any indemnification under Paragraphs (A) and (B) of this Section, unless
ordered by a court, shall be made by the Corporation only as authorized in the
specific case upon a determination that indemnification of the director,
trustee, officer, employee, or agent is proper in the circumstances because he
or she has met the applicable standard of conduct set forth in such Paragraphs
(A) and (B). Such determination shall be made as follows: (1) the Board of
Directors by a majority vote of a quorum consisting of directors who were not
parties to such action, suit, or proceeding; (2) if the quorum described in
(D)(1) of this Section is not obtainable or, even if obtainable a quorum of
disinterested directors so directs, by independent legal counsel in a written
opinion; or (3) by the stockholders.
Section 6.2 Advances for Litigation Expenses. Expenses (including attorneys'
fees) incurred by a director, officer, employee, or agent of the Corporation in
defending any civil, criminal, administrative or investigative action, suit or
proceeding, shall be paid by the Corporation as they are incurred in advance of
the final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such director, officer, employee, or agent: (1)
to repay such amount if it shall ultimately be determined that he is not
entitled to be indemnified by the Corporation as authorized in this Article VI;
and (2) to cooperate reasonably with the Corporation concerning the action, suit
or proceeding.
Section 6.3 Indemnification Nonexclusive. The indemnification provided by this
Article shall not be exclusive of and shall be in addition to any other rights
granted to those seeking indemnification under the Certificate of Incorporation,
these By-Laws, any agreement, any vote of stockholders or disinterested
directors or otherwise, both as to action in his or her official capacity and as
to action in another capacity while holding such office and shall continue as to
a person who has ceased to be a director, trustee, officer, employee, or agent
and shall inure to the benefit of the heirs, executors, and administrators of
such a person.
Section 6.4 Indemnity Insurance. The Corporation may purchase and maintain
insurance or furnish similar protection, including but not limited to trust
funds, letters of credit, or self-insurance, on behalf of or for any person who
is or was a director, officer, employee, or agent of the Corporation, or is or
was serving at the request of the Corporation as a director, trustee, officer,
employee or agent of another corporation, domestic or foreign, nonprofit or for
profit, partnership, joint venture, trust, or other enterprise, against any
liability asserted against him or her and incurred by him or her in any such
capacity, or arising out of his or her status as such, whether or not the
Corporation would have the power to indemnify him or her against such liability
under this Article. Insurance may be purchased from or maintained with a person
in which the Corporation has a financial interest.
Section 6.5 Definitions. For purposes of this Article: (1) a person who acted in
good faith and in a manner he or she reasonably believed to be in the interest
of the participants and beneficiaries of an employee benefit plan shall
conclusively be deemed to have acted in a manner "not opposed to the best
interests of the Corporation"; (2) a person shall be deemed to have acted in
"good faith" and in a manner he reasonably believed to be in or not opposed to
the best interests of the Corporation, or, with respect to any criminal action
or proceeding, to have had no reasonable cause to believe his conduct was
unlawful, if his action is based on the records or books of account of the
Corporation or another enterprise, or on information supplied to him by the
officers of the Corporation or another enterprise in the course of their duties,
or on the advice of legal counsel for the Corporation or another enterprise or
on information or records given or reports made to the Corporation or another
enterprise by an independent certified public accountant or by an appraiser or
other expert selected with reasonable care by the Corporation or another
enterprise; (3) the term "another enterprise" as used in this Article VI shall
mean any other corporation or any partnership, joint venture, trust, employee
benefit plan or other enterprise of which such person is or was serving at the
request of the Corporation as a director, officer, employee or agent; and (4)
references to "the Corporation" shall include, in addition to the resulting
corporation, any constituent corporation (including any constituent of a
constituent) absorbed in a consolidation or merger, which, if its separate
existence had continued, would have had power and authority to indemnify its
directors, officers, employees, and agents.
ARTICLE VII
Common Stock
Section 7.1 Certificates. Certificates for stock of the Corporation shall be in
such form as shall be approved by the Board of Directors and shall be signed in
the name of the Corporation by the Chairman or the President or a Vice
President, and by the Treasurer or an Assistant Treasurer, or the Secretary or
an Assistant Secretary. Such certificates may be sealed with the seal of the
Corporation or a facsimile thereof. Any of or all the signatures on a
certificate may be a facsimile. In case any officer, transfer agent or registrar
who has signed or whose facsimile signature has been placed upon a certificate
shall have ceased to be such officer, transfer agent or registrar before such
certificate is issued, it may be issued by the Corporation with the same effect
as if he or she were such officer, transfer agent or registrar at the date of
issue.
Section 7.2 Transfers of Stock. Transfers of stock shall be
made only upon the books of the Corporation by the holder, in person or by duly
authorized attorney, and on the surrender of the certificate or certificates for
such stock properly endorsed. The Board of Directors shall have the power to
make all such rules and regulations, not inconsistent with the Certificate of
Incorporation and these By-Laws and the law, as the Board of Directors may deem
appropriate concerning the issue, transfer and registration of certificates for
stock of the Corporation. The Board of Directors or the Finance Committee may
appoint one (1) or more transfer agents or registrars of transfers, or both, and
may require all stock certificates to bear the signature of either or both.
Section 7.3 Lost, Stolen or Destroyed Certificates. The Corporation may issue a
new stock certificate in the place of any certificate theretofore issued by it,
alleged to have been lost, stolen or destroyed, and the Corporation may require
the owner of the lost, stolen or destroyed certificate or his or her legal
representative to give the Corporation a bond sufficient to indemnify it against
any claim that may be made against it on account of the alleged loss, theft or
destruction of any such certificate or the issuance of any such new certificate.
The Board of Directors may require such owner to satisfy other reasonable
requirements.
Section 7.4 Stockholder Record Date. In order that the Corporation may determine
the stockholders entitled to notice of or to vote at any meeting of stockholders
or any adjournment thereof, or to express consent to corporate action in writing
without a meeting, or entitled to receive payment of any dividend or other
distribution or allotment of any rights, or entitled to exercise any rights in
respect of any change, conversion or exchange of stock, or for the purpose of
any other lawful action, the Board of Directors may fix, in advance, a record
date, which shall not be more than 60 nor less than 10 days before the date of
such meeting, nor more than sixty days prior to any other action. Only such
stockholders as shall be stockholders of record on the date so fixed shall be
entitled to notice of, and to vote at, such meeting and any adjournment thereof,
or to give such consent, or to receive payment of such dividend or other
distribution, or to exercise such rights in respect of any such change,
conversion or exchange of stock, or to participate in such action, as the case
may be, notwithstanding any transfer of any stock on the books of the
Corporation after any record date so fixed.
If no record date is fixed by the Board of Directors, (l) the record date for
determining stockholders entitled to notice of or to vote at a meeting of
stockholders shall be at the close of business on the day next preceding the
date on which notice is given, or, if notice is waived by all stockholders
entitled to vote at the meeting, at the close of business on the day next
preceding the day on which the meeting is held and (2) the record date for
determining stockholders for any other purpose shall be at the close of business
on the day on which the Board of Directors adopts the resolution relating
thereto.
A determination of stockholders of record entitled to notice of or to vote at a
meeting of stockholders shall apply to any adjournment of the meeting; provided,
however, that the Board of Directors may fix a new record date for the adjourned
meeting.
Section 7.5 Beneficial Owners. The Corporation shall be entitled to recognize
the exclusive right of a person registered on its books as the owner of shares
to receive dividends, and to vote as such owner, and to hold liable for calls
and assessments a person registered on its books as the owner of shares, and
shall not be bound to recognize any equitable or other claim to or interest in
such share or shares on the part of any other person, whether or not it shall
have express or other notice thereof, except as otherwise provided by law.
ARTICLE VIII
Seal
Section 8.1 Seal. The seal of the Corporation shall be circular in form and
shall bear, in addition to any other emblem or device approved by the Board of
Directors, the name of the Corporation, the year of its incorporation and the
words "Corporate Seal" and "Delaware". The seal may be used by causing it or a
facsimile thereof to be impressed or affixed or in any other manner reproduced.
ARTICLE IX
Waiver of Notice
Section 9.1 Waiver of Notice. Whenever notice is required to be given by
statute, or under any provision of the Certificate of Incorporation or these
By-Laws, a written waiver thereof, signed by the person entitled to notice,
whether before or after the time stated therein, shall be deemed equivalent to
notice. In the case of a stockholder, such waiver of notice may be signed by
such stockholder's attorney or proxy duly appointed in writing. Attendance of a
person at a meeting shall constitute a waiver of notice of such meeting, except
when the person attends a meeting for the express purpose of objecting at the
beginning of the meeting, to the transaction of any business because the meeting
is not lawfully called or convened. Neither the business to be transacted at,
nor the purpose of, any regular or special meeting of the stockholders,
directors or members of a committee of directors need be specified in any
written waiver of notice.
ARTICLE X
Fiscal Year
Section 10.1 Fiscal Year. The Fiscal Year of the corporation shall begin on the
first day of January and terminate on the thirty-first day of December each
year.
ARTICLE XI
Contracts, Checks, etc.
Section 11.1 Contracts, Checks, etc. The Board of Directors or the Finance
Committee may by resolution adopted at any meeting designate officers of the
Corporation who may in the name of the Corporation execute contracts, checks,
drafts, and orders for the payment of money in its behalf and, in the discretion
of the Board of Directors or the Finance Committee, such officers may be so
authorized to sign such contracts or checks singly without the necessity of
counter-signature.
ARTICLE XII
Amendments
Section 12.1 Amendments. Except as set forth below, these By-Laws may be amended
or repealed by the Board of Directors or by the affirmative vote of the holders
of a majority of the issued and outstanding common stock of the Corporation, or
by the unanimous written consent of the holders of the issued and outstanding
common stock of the Corporation.
Notwithstanding the foregoing paragraph, the affirmative vote of the holders of
at least 80% of the issued and outstanding shares of common stock of the
Corporation shall be required to amend, alter or repeal, or adopt any provision
inconsistent with, the requirements of Section 2.2, Section 3.1, Section 3.2,
Section 3.3 or this paragraph of Section 12.1 of these ByLaws, in addition to
any requirements of law and any provisions of the Certificate of Incorporation,
any By-law, or any resolution of the Board of Directors adopted pursuant to the
Certificate of Incorporation (and notwithstanding that a lesser percentage may
be specified by law, the Certificate of Incorporation, these By-Laws, such
resolution, or otherwise).
Notwithstanding any of the foregoing, the affirmative vote of a majority of the
holders of the issued and outstanding common stock of the Corporation shall be
required to amend, alter or repeal, or adopt any provision inconsistent with (i)
any provision of these ByLaws requiring a Supermajority Vote of the Board of
Directors (including this provision of Section 12.1) or (ii) the
responsibilities of the Chief Executive Officer or President as set forth in
Section 5.4 or Section 5.5, and the Board of Directors shall not recommend any
such amendment to such provisions to the stockholders unless the proposed
amendment is approved by the Board of Directors acting by Supermajority Vote.
ARTICLE XIII
Dividends
Section 13.1 Dividends. Dividends upon the capital stock of the Corporation,
subject to the provisions of the Certificate of Incorporation, if any, may be
declared by the Board of Directors at any regular or special meeting, and may be
paid in cash, in property, or in shares of the capital stock. Before payment of
any dividend, there may be set aside out of any funds of the Corporation
available for dividends such sum or sums as the Board of Directors from time to
time, in its absolute discretion, deems proper as a reserve or reserves to meet
contingencies, or for equalizing dividends, or for repairing or maintaining any
property of the Corporation, or for any proper purpose, and the Board of
Directors may modify or abolish any such reserve.
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-3
<SEQUENCE>3
<DESCRIPTION>CINERGY 12/31/97 10-K
<TEXT>
PSI ENERGY, INC.
Effective July 10, 1997, the second paragraph of ARTICLE D of the Amended
Articles of Consolidation of PSI Energy, Inc. was amended and now reads as set
forth below:
The name and post office address of its resident agent are C T Corporation
System, One North Capitol Avenue, Indianapolis, Marion County, Indiana.
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-3
<SEQUENCE>4
<DESCRIPTION>CINERGY 12/31/97 10-K
<TEXT>
THE UNION LIGHT, HEAT AND POWER COMPANY
Effective July 24, 1997, ARTICLE THIRD of the Restated Articles of Incorporation
of The Union Light, Heat and Power Company was amended and now reads as set
forth below:
ARTICLE THIRD
The place in the Commonwealth of Kentucky where the registered office is located
is C T Corporation System, c/o Kentucky Home Life Building, in the City of
Louisville, and the County of Jefferson, and the principal place of business of
the Company is located at 107 Brent Spence Square, in the City of Covington, and
the County of Kenton.
Effective July 24, 1997, Section 1 of ARTICLE I of the By-Laws of The Union
Light, Heat and Power Company was amended and now reads as set forth below:
ARTICLE I
Offices
Section 1. Offices. The registered office of the Corporation shall be located in
the City of Louisville, Jefferson County, Commonwealth of Kentucky. The
Corporation may establish branch offices and conduct and carry on business at
such other places within or without the Commonwealth of Kentucky as the Board of
Directors may from time to time fix or designate, and any business conducted or
carried on at such other place or places shall be as binding and effectual as if
transacted at the registered office of the Corporation.
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-4
<SEQUENCE>5
<DESCRIPTION>CINERGY 12/31/97 10-K
<TEXT>
PSI ENERGY, INC.
AND
THE FIFTH THIRD BANK,
Trustee
Third Supplemental Indenture
Dated as of March 15, 1998
To
Indenture
Dated as of November 15, 1996
7.25% JUnior Maturing Principal Securities ("JUMPS-SM-") Due 2028
THIRD SUPPLEMENTAL INDENTURE, dated as of March 15, 1998, between PSI
Energy, Inc., a corporation duly organized and existing under the laws of the
State of Indiana (herein called the "Company"), having its principal office at
1000 East Main Street, Plainfield, Indiana 46168, and The Fifth Third Bank, an
Ohio banking corporation, as Trustee (herein called the "Trustee") under the
Indenture dated as of November 15, 1996 between the Company and the Trustee, as
supplemented (the "Indenture").
Recitals of the Company
The Company has executed and delivered the Indenture to the Trustee to
provide for the issuance from time to time of its unsecured debentures, notes or
other evidences of indebtedness (the "Securities"), to be issued in one or more
series as provided in the Indenture.
Pursuant to the terms of the Indenture, the Company desires to provide for the
establishment of a new series of its Securities to be known as its 7.25% JUnior
Maturing Principal Securities ("JUMPS-SM-") Due 2028 (herein called the
"Debentures"), in this Third Supplemental Indenture.
All things necessary to make this Third Supplemental Indenture a valid
agreement of the Company have been done.
Now, Therefore, This Third Supplemental Indenture Witnesseth:
For and in consideration of the premises and the purchase of the
Debentures by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Debentures, as follows:
ARTICLE ONE
Terms of the Debentures
Section 101. There is hereby authorized a series of Securities designated the
"7.25% JUnior Maturing Principal Securities ("JUMPS-SM-") Due 2028", limited in
aggregate principal amount to $100,000,000 (except as provided in Section 301(2)
of the Indenture). The Debentures shall mature and the principal shall be due
and payable together with all accrued and unpaid interest thereon on March 15,
2028 and shall be issued in the form of a registered Global Security without
coupons, registered in the name of Cede & Co., as nominee of the Depository
Trust Company (the "Depositary").
Section 102. The provisions of Section 305 of the Indenture applicable
to Global Securities shall apply to the Debentures.
Section 103. Interest on each of the Debentures shall be payable
semiannually on March 15 and September 15 in each year (each an "Interest
Payment Date"), commencing on September 15, 1998, at the rate per annum
specified in the designation of the Debentures from March 15, 1998, or from the
most recent Interest Payment Date to which interest has been paid or duly
provided for. The interest so payable, and punctually paid or duly provided for,
on any Interest Payment Date will be paid to the Person in whose name such
Debenture (or one or more Predecessor Securities) is registered at the close of
business on the Regular Record Date for such interest, which shall be the
Business Day immediately preceding such Interest Payment Date. The amount of
interest payable for any period will be computed on the basis of a 360-day year
of twelve 30-day months. As used herein, "Business Day" means any day, other
than a Saturday or Sunday, or a day on which banking institutions in New York,
New York are authorized or obligated by law or executive order to be closed.
Section 104. Subject to agreements with or the rules of the Depositary
or any successor book-entry security system or similar system with respect to
Global Securities, payments of interest will be made by check mailed to the
Holder of each Debenture at the address shown in the Security Register, and
payments of the principal amount of each Debenture will be made at maturity by
check against presentation of the Debenture at the office or agency of the
Trustee.
Section 105. The Debentures shall be issued in denominations of $1,000
or any integral multiple of $1,000.
Section 106. Principal and interest on the Debentures shall be payable
in the coin or currency of the United States of America, which, at the time of
payment, is legal tender for public and private debts.
Section 107. The Debentures shall be subject to defeasance and covenant
defeasance, at the Company's option, as provided for in Sections 1302 and 1303
of the Indenture.
Section 108. Subject to the terms of Article Eleven of the Indenture, the
Company shall have the right to redeem the Debentures, in whole but not in part,
from time to time and at any time (such redemption, an "Optional Redemption",
and the date thereof, the "Optional Redemption Date"), upon not less than 30
days' notice to the holders, at a redemption price equal to the sum of (A) the
greater of (i) 100% of the principal amount of the Debentures to be redeemed or
(ii) the sum of the present values of the Remaining Scheduled Payments thereon
discounted to the Optional Redemption Date on a semiannual basis (assuming a
360-day year consisting of twelve 30-day months) at the Treasury Rate plus 20
basis points, less the Applicable Accrued Interest Amount plus (B) the
Applicable Accrued Interest Amount.
"Applicable Accrued Interest Amount" means, at the Optional Redemption
Date, the amount of interest accrued and unpaid from the prior interest payment
date to the Optional Redemption Date on the Debentures subject to the Optional
Redemption determined at the rate per annum shown in the title thereof, computed
on the basis of a 360-day year of twelve 30-day months.
"Comparable Treasury Issue" means the United States Treasury security
selected by an Independent Investment Banker as having a maturity that would be
utilized, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of comparable
maturity to the remaining term of the Debentures to be redeemed pursuant to the
Optional Redemption. "Independent Investment Banker" means one of the Reference
Treasury Dealers appointed by the Trustee after consultation with the Company.
"Comparable Treasury Price" means, with respect to the Optional
Redemption Date, the average of the Reference Treasury Dealer Quotations for
such Optional Redemption Date.
"Reference Treasury Dealer" means each of Salomon Brothers Inc, First
Chicago Capital Markets, Inc., and their respective successors; provided,
however, that if any of the foregoing shall cease to be a primary U.S.
Government securities dealer in New York City (a "Primary Treasury Dealer") the
Company will substitute therefor another Primary Treasury Dealer. "Reference
Treasury Dealer Quotations" means, with respect to each Reference Treasury
Dealer and any redemption date, the average, as determined by the Trustee, of
the bid and asked prices for the Comparable Treasury Issue (expressed in each
case as a percentage of its principal amount) quoted in writing to the Trustee
by such Reference Treasury Dealer at 5:00 p.m. on the third Business Day
preceding such redemption date.
"Remaining Scheduled Payments" means, with respect to any Debenture,
the remaining scheduled payments of the principal thereof to be redeemed and
interest thereon that would be due after the Optional Redemption Date but for
the Optional Redemption.
"Treasury Rate" means, with respect to the Optional Redemption Date (if
any), the rate per annum equal to the semiannual equivalent yield to maturity of
the Comparable Treasury Issue, assuming a price for the Comparable Treasury
Issue (expressed as a percentage of its principal amount) equal to the
Comparable Treasury Price for such Optional Redemption Date.
Section 109. The Company shall have the right, at any time during the
term of the Debentures, from time to time to extend the interest payment period
of such Debentures for up to the earlier of 10 consecutive semiannual periods or
the maturity of the Debentures (the "Extended Interest Payment Period"), at the
end of which period the Company shall pay all interest accrued and unpaid
thereon (together with interest thereon at the rate specified for the Debentures
to the extent permitted by applicable law); provided that, during such Extended
Interest Payment Period, the Company shall not declare or pay any dividend on,
or purchase, acquire or make a liquidation payment with respect to, any of its
capital stock or make any guarantee payments with respect to the foregoing.
Prior to the termination of any such Extended Interest Payment Period, the
Company may further extend such period, provided that such period together with
all such further extensions thereof shall not exceed 10 consecutive semiannual
periods or extend beyond the maturity of the Debentures. Upon the termination of
any Extended Interest Payment Period and upon the payment of all accrued and
unpaid interest then due, the Company may select a new Extended Interest Payment
Period, subject to the foregoing requirements. No interest shall be due and
payable during an Extended Interest Payment Period, except at the end thereof.
The Company shall give the Holders of the Debentures and the Trustee
written notice of its selection of such Extended Interest Payment Period 10
business days prior to the earlier of (i) the next succeeding Interest Payment
Date or (ii) the date the Company is required to give notice to Holders of the
Debentures of the record or payment date of such interest payment, but in any
event not less than two business days prior to such record date. The semiannual
period in which any notice is given pursuant to this paragraph shall constitute
one of the 10 semiannual periods which comprise the maximum Extended Interest
Payment Period.
Section 110. The provisions of Article Fourteen of the Indenture shall
apply with respect to the Debentures. Such Article provides, among other things,
that the payment of principal, premium, if any, and interest on the Debentures
are subordinate and subject in right of payment to the prior payment in full of
all Senior Debt of the Company, whether outstanding at the date of this Third
Supplemental Indenture or thereafter incurred.
ARTICLE TWO
Form of the Debentures
Section 201. The Debentures are to be substantially in the following form and
shall include substantially the legend shown so long as the Debentures are
Global Securities:
(FORM OF FACE OF DEBENTURE)
No. R-1 $100,000,000
CUSIP No. 693627AE1
PSI ENERGY, INC.
7.25% JUNIOR MATURING PRINCIPAL SECURITIES ("JUMPS-SM-")
DUE 2028
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER OR ITS AGENT
FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT AND SUCH CERTIFICATE ISSUED
IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
PSI ENERGY, INC., a corporation duly organized and existing under the laws of
the State of Indiana (herein called the "Company", which term includes any
successor Person under the Indenture hereafter referred to), for value received,
hereby promises to pay to CEDE & CO., or registered assigns, the principal sum
of One Hundred Million and No/100 Dollars ($100,000,000) on March 15, 2028, and
to pay interest thereon from March 15, 1998 or from the most recent Interest
Payment Date to which interest has been paid or duly provided for, semiannually
(subject to deferral as set forth below), on March 15 and September 15, in each
year, commencing September 15, 1998, at the rate of 7.25% per annum, until the
principal hereof is paid or made available for payment. The amount of interest
payable on any Interest Payment Date shall be computed on the basis of a 360-day
year of twelve 30-day months. The interest so payable, and punctually paid or
duly provided for, on any Interest Payment Date will, as provided in the
Indenture, be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest, which shall be the Business Day immediately
preceding such Interest Payment Date. Any such interest not so punctually paid
or duly provided for will forthwith cease to be payable to the Holder on such
Regular Record Date and may either be paid to the Person in whose name this
Security (or one or more Predecessor Securities) is registered at the close of
business on a Special Record Date for the payment of such Defaulted Interest to
be fixed by the Trustee, notice whereof shall be given to Holders of Securities
of this series not less than 10 days prior to such Special Record Date, or be
paid at any time in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Securities of this series
may be listed, and upon such notice as may be required by such exchange, all as
more fully provided in the Indenture.
Payment of the principal of (and premium, if any) and interest on this
Security will be made at the corporate trust office of the Trustee maintained
for that purpose in the City of Cincinnati, in such coin or currency of the
United States of America as at the time of payment is legal tender for payment
of public and private debts; provided, however, that at the option of the
Company payment of interest may be made by check mailed to the address of the
Person entitled thereto as such address shall appear in the Security Register.
Any payment on this Security due on any day which is not a Business Day
in the City of New York need not be made on such day, but may be made on the
next succeeding Business Day with the same force and effect as if made on the
due date and no interest shall accrue for the period from and after such date,
unless such payment is a payment at maturity or upon redemption, in which case
interest shall accrue thereon at the stated rate for such additional days.
As used herein, "Business Day" means any day, other than a Saturday or
Sunday, or a day on which banking institutions in New York, New York are
authorized or obligated by law or executive order to be closed.
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof including, without limitation, provisions
subordinating the payment of the principal hereof and any premium and interest
hereon to the payment in full of all Senior Debt as defined in the Indenture,
which further provisions shall for all purposes have the same effect as if set
forth at this place.
Unless the certificate of authentication hereon has been executed by the Trustee
referred to on the reverse hereof by manual signature, this Security shall not
be entitled to any benefit under the Indenture or be valid or obligatory for any
purpose.
In Witness Whereof, the Company has caused this instrument to be duly
executed.
PSI ENERGY, INC.
By.............
CERTIFICATE OF AUTHENTICATION
Dated:
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
THE FIFTH THIRD BANK,
as Trustee
By...............
Authorized Signatory
(FORM OF REVERSE OF DEBENTURE)
This Security is one of a duly authorized issue of securities of the Company
(herein called the "Securities"), issued and to be issued in one or more series
under an Indenture, dated as of November 15, 1996 (herein called the
"Indenture", which term shall have the meaning assigned to it in such
instrument), between the Company and The Fifth Third Bank, as Trustee (herein
called the "Trustee", which term includes any successor trustee under the
Indenture), and reference is hereby made to the Indenture for a statement of the
respective rights, limitations of rights, duties and immunities thereunder of
the Company, the Trustee and the Holders of the Securities and of the terms upon
which the Securities are, and are to be, authenticated and delivered. This
Security is one of the series designated on the face hereof, limited in
aggregate principal amount to $100,000,000.
The indebtedness evidenced by the Securities of this series is, to the extent
and in the manner provided in the Indenture, expressly subordinate and subject
in right of payment to the prior payment in full of all Senior Debt of the
Company (as defined in the Indenture) whether outstanding at the date of the
Indenture or thereafter incurred, and this Security is issued subject to the
provisions of the Indenture with respect to such subordination. Each holder and
owner of this Security, by accepting the same, agrees to and shall be bound by
such provisions and authorizes the Trustee in his or her behalf to take such
action as may be necessary or appropriate to effectuate the subordination so
provided and appoints the Trustee his or her attorney-in-fact for such purpose.
The Indenture contains provisions for defeasance at any time of the entire
indebtedness of this Security or certain restrictive covenants and Events of
Default with respect to this Security upon compliance with certain conditions
set forth in the Indenture.
The Securities of this series are subject to optional redemption, in whole but
not in part, from time to time and at any time (such redemption, an "Optional
Redemption", and the date thereof, the "Optional Redemption Date"), upon not
less than 30 days' notice to the holders, at a redemption price equal to the sum
of (A) the greater of (i) 100% of the principal amount of the Securities of this
series to be redeemed or (ii) the sum of the present values of the Remaining
Scheduled Payments thereon discounted to the Optional Redemption Date on a
semiannual basis (assuming a 360-day year consisting of twelve 30-day months) at
the Treasury Rate plus 20 basis points, less the Applicable Accrued Interest
Amount plus (B) the Applicable Accrued Interest Amount.
"Applicable Accrued Interest Amount" means, at the Optional Redemption Date, the
amount of interest accrued and unpaid from the prior interest payment date to
the Optional Redemption Date on the Securities of this series subject to the
Optional Redemption determined at the rate per annum shown in the title thereof,
computed on the basis of a 360-day year of twelve 30-day months.
"Comparable Treasury Issue" means the United States Treasury security selected
by an Independent Investment Banker as having a maturity that would be utilized,
at the time of selection and in accordance with customary financial practice, in
pricing new issues of corporate debt securities of comparable maturity to the
remaining term of the Securities of this series to be redeemed pursuant to the
Optional Redemption. "Independent Investment Banker" means one of the Reference
Treasury Dealers appointed by the Trustee after consultation with the Company.
"Comparable Treasury Price" means, with respect to the Optional Redemption Date,
the average of the Reference Treasury Dealer Quotations for such Optional
Redemption Date.
"Reference Treasury Dealer" means each of Salomon Brothers Inc, First Chicago
Capital Markets, Inc., and their respective successors; provided, however, that
if any of the foregoing shall cease to be a primary U.S. Government securities
dealer in New York City (a "Primary Treasury Dealer") the Company will
substitute therefor another Primary Treasury Dealer. "Reference Treasury Dealer
Quotations" means, with respect to each Reference Treasury Dealer and any
redemption date, the average, as determined by the Trustee, of the bid and asked
prices for the Comparable Treasury Issue (expressed in each case as a percentage
of its principal amount) quoted in writing to the Trustee by such Reference
Treasury Dealer at 5:00 p.m. on the third Business Day preceding such redemption
date.
"Remaining Scheduled Payments" means, with respect to any Securities of this
series, the remaining scheduled payments of the principal thereof to be redeemed
and interest thereon that would be due after the Optional Redemption Date but
for the Optional Redemption.
"Treasury Rate" means, with respect to the Optional Redemption Date (if any),
the rate per annum equal to the semiannual equivalent yield to maturity of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such Optional Redemption Date.
If an Event of Default with respect to Securities of this series shall occur and
be continuing, the principal of the Securities of this series may be declared
due and payable in the manner and with the effect provided in the Indenture.
The Company shall have the right, at any time during the term of the Securities,
from time to time to extend the interest payment period of such Securities for
up to the earlier of 10 consecutive semiannual periods or the maturity of the
Securities (the "Extended Interest Payment Period"), at the end of which period
the Company shall pay all interest accrued and unpaid thereon (together with
interest thereon at the rate specified for the Securities to the extent
permitted by applicable law); provided that, during such Extended Interest
Payment Period, the Company shall not declare or pay any dividend on, or
purchase, acquire or make a liquidation payment with respect to, any of its
capital stock or make any guarantee payments with respect to the foregoing.
Prior to the termination of any such Extended Interest Payment Period, the
Company may further extend such period, provided that such period together with
all such further extensions thereof shall not exceed 10 consecutive semiannual
periods or extend beyond the maturity of the Securities. Upon the termination of
any Extended Interest Payment Period and upon the payment of all accrued and
unpaid interest then due, the Company may select a new Extended Interest Payment
Period, subject to the foregoing requirements. No interest shall be due and
payable during an Extended Interest Payment Period, except at the end thereof.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with the
consent of the Holders of a majority in principal amount of the Securities at
the time Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of a majority in principal amount of the
Securities of each series at the time Outstanding, on behalf of the Holders of
all Securities of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Security
shall be conclusive and binding upon such Holder and upon all future Holders of
this Security and of any Security issued upon the registration of transfer
hereof or in exchange herefor or in lieu hereof, whether or not notation of such
consent or waiver is made upon this Security.
As provided in and subject to the provisions of the Indenture, the Holder of
this Security shall not have the right to institute any proceeding with respect
to the Indenture or for the appointment of a receiver or trustee or for any
other remedy thereunder, unless such Holder shall have previously given the
Trustee written notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than 35% in principal amount
of the Securities of this series at the time Outstanding shall have made written
request to the Trustee to institute proceedings in respect of such Event of
Default as Trustee and offered the Trustee reasonably satisfactory indemnity,
and the Trustee shall not have received from the Holders of a majority in
principal amount of Securities of this series at the time Outstanding a
direction inconsistent with such request, and shall have failed to institute any
such proceeding, for 60 days after receipt of such notice, request and offer of
indemnity. The foregoing shall not apply to any suit instituted by the Holder of
this Security for the enforcement of any payment of principal hereof or any
premium or interest hereon on or after the respective due dates expressed
herein.
No reference herein to the Indenture and no provision of this Security or of the
Indenture shall alter or impair the obligation of the Company, which is absolute
and unconditional, to pay the principal of and any premium and interest on this
Security at the times, place and rate, and in the coin or currency, herein
prescribed.
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Security is registrable in the Security Register,
upon surrender of this Security for registration of transfer at the office or
agency of the Company in any place where the principal of and any premium and
interest on this Security are payable, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by, the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Securities of this series
and of like tenor, of authorized denominations and for the same aggregate
principal amount, will be issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered form without
coupons in denominations of $1,000 and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Securities of this series are exchangeable for a like aggregate principal amount
of Securities of this series and of like tenor of a different authorized
denomination, as requested by the Holder surrendering the same. No service
charge shall be made for any such registration of transfer or exchange, but the
Company may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Security is registered as the owner hereof for all
purposes, whether or not this Security be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
All terms used in this Security which are defined in the Indenture shall have
the meanings assigned to them in the Indenture.
ARTICLE THREE
Original Issue of Debentures
Section 301. Debentures in the aggregate principal amount of
$100,000,000, may, upon execution of this Third Supplemental Indenture, or from
time to time thereafter, be executed by the Company and delivered to the Trustee
for authentication, and the Trustee shall thereupon authenticate and deliver
said Debentures upon a Company Order without any further action by the Company.
ARTICLE FOUR
Paying Agent and Security Registrar
Section 401. The Fifth Third Bank will be the Paying Agent and Security
Registrar for the Debentures.
ARTICLE FIVE
Sundry Provisions
Section 501. Except as otherwise expressly provided in this Third
Supplemental Indenture or in the form of Debenture or otherwise clearly required
by the context hereof or thereof, all terms used herein or in said form of
Debenture that are defined in the Indenture shall have the several meanings
respectively assigned to them thereby.
Section 502. The Indenture, as supplemented by this Third Supplemental
Indenture, is in all respects ratified and confirmed, and this Third
Supplemental Indenture shall be deemed part of the Indenture in the manner and
to the extent herein and therein provided.
------------------
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
In Witness Whereof, the parties hereto have caused this Third
Supplemental Indenture to be duly executed as of the day and year first above
written.
PSI ENERGY, INC.
By /s/ William L. Sheafer
William L. Sheafer
Vice President and Treasurer
THE FIFTH THIRD BANK, as Trustee
By /s/ Kerry Byrne
Kerry Byrne
Vice President
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>6
<DESCRIPTION>CINERGY 12/31/97 10-K
<TEXT>
FIRST AMENDMENT TO EMPLOYMENT AGREEMENT
This First Amendment to Employment Agreement date effective January 1,
1997, amends that certain Employment Agreement ("Employment Agreement") by and
among Cinergy Corp., a Delaware corporation ('"Cinergy"), Cinergy Services,
Inc., a Delaware corporation ("Cinergy Service"), Cinergy Investments, Inc., a
Delaware corporation ("Cinergy Investments"), The Cincinnati Gas & Electric
Company, an Ohio corporation ("CG&E"), PSI Energy, Inc., an Indiana corporation
("PSI"), and William J. Grealis (the "Executive") dated effective January 1,
1995. Cinergy, Cinergy Services, Cinergy Investments, CG&E, and PSI will
sometimes be referred to in this First Amendment to Employment Agreement
collectively as the "Corporation." This First Amendment to Employment Agreement
amends the Employment Agreement as follows:
1. The substantive provisions of Section 1(b) are deleted in their entirety and
replaced with the following:
"The Employment Period of the Executive as provided in Section 1(a) will
commence on January 16, 1995 (the "Effective Date") and shall continue until
June 30, 2000; provided, however; commencing on January 1, 1998, and each
January 1 thereafter (the "Renewal Date"), the Employment Period of this
Employment Agreement shall automatically be extended for one (1) additional year
if neither the Corporation nor the Executive shall have given between December 1
and December 15 prior to each applicable Renewal Date written notice to the
other of its intent to terminate this Employment Agreement."
2. Section (5)(a)(iii)(1)(B) is hereby amended by deleting the words "two (2)
times the sum" and substituting the words "three (3) times the sum."
3. Section (5)(a)(iii)(2) is hereby amended by deleting the words "twenty-four
month period" wherever it appears in Section (5)(a)(iii)(2) and substituting the
words "thirty-six (36) month period."
4. All other provisions of the Employment Agreement remain unchanged by this
First Amendment to Employment Agreement.
IN WITNESS WHEREOF, the Executive and the Corporation have caused this First
Amendment to Employment Agreement to be executed effective as of the day and
year first written above.
CINERGY CORP., CINERGY SERVICES, INC.,
CINERGY INVESTMENTS, INC., THE
CINCINNATI GAS & ELECTRIC COMPANY,
and PSI ENERGY, INC.
By: _____________________________
James E. Rogers
Vice Chairman and
Chief Executive Officer
Dated: ___________________________
EXECUTIVE
- ---------------------------------
William J. Grealis
Dated: ___________________________
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>7
<DESCRIPTION>CINERGY 12/31/97 10-K
<TEXT>
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT made and entered into as of the 22nd day of April,
1997, by and among Cinergy Corp., a Delaware Corporation ("Cinergy"), Cinergy
Services, Inc., a Delaware Corporation ("Cinergy Services"), The Cincinnati Gas
& Electric Company, an Ohio Corporation ("CG&E"), PSI Energy, Inc., an Indiana
Corporation ("PSI"), and Madeleine W. Ludlow (the "Executive"). Cinergy, Cinergy
Services, CG&E, and PSI will sometimes be referred to in this Agreement
collectively as the "Corporation".
WHEREAS, the Corporation desires that the Executive become an employee in
accordance with this Agreement;
WHEREAS, the Executive is willing to commit herself to the employ of the
Corporation and any successor thereto, on the terms and conditions set forth in
this Agreement and thus to forego opportunities elsewhere; and
WHEREAS, the parties desire to enter into this Agreement as of the date first
set forth above setting forth the terms and conditions for the employment
relationship of the Executive;
NOW, THEREFORE, IN CONSIDERATION of the mutual premises, covenants and
agreements set forth below, it is hereby agreed as follows:
1. Employment and Term.
a. The Corporation agrees to employ the Executive, and the Executive agrees to
be employed, in accordance with the terms and provisions of this Agreement for
the period set forth below (the "Employment Period").
b. The Employment Period of the Executive as provided in Section 1(a) will
commence on April 22, 1997, (the "Effective Date") and shall continue until
December 31, 2000; provided, however, commencing on January 1, 1999, and each
January 1 thereafter (the "Renewal Date"), the Employment Period of this
Agreement shall automatically be extended for one (1) additional year if neither
the Corporation not the Executive shall have given between December 1 and
December 15 prior to each applicable Renewal Date written notice to the other of
its intent to terminate this Agreement.
2. Duties and Powers of Executive.
a. Position. The Executive shall serve the Corporation in such responsible
executive capacity or capacities as the Board of Directors of Cinergy or Cinergy
Services (the Board of Directors of Cinergy or Cinergy Services, as the case may
be, may be referred to sometimes as the "Board") or the Chief Executive Officer
of Cinergy or the Chief Operating Officer of Cinergy may from time to time
determine and shall have such responsibilities, duties and authority as may be
assigned to her from time to time during the Employment Period by the Board or
the Chief Executive Officer of Cinergy or the Chief Operating Officer of Cinergy
that are consistent with such responsibilities, duties and authority. Upon the
Effective Date of this Agreement, the Executive shall initially serve as Vice
President, and Chief Financial Officer for the Corporation, but consistent with
the foregoing provisions of this Section 2(a), may be assigned to any other
position or positions by either the Board or the Chief Executive Officer of
Cinergy or the Chief Operating Officer of Cinergy during the Employment Period.
b. Place of Performance. In connection with the Executive's employment, the
Executive shall be based at the principal executive offices of the Corporation,
221 East Fourth Street, Cincinnati, Ohio, and, except for required business
travel to an extent substantially consistent with the present business travel
obligations of executives of the Corporation who have positions of authority
comparable to that of the Executive, the Executive shall not be required to
relocate to a new principal place of business which is more that thirty (30)
miles from the current principal place of business of the Corporation.
3. Compensation. The Executive shall receive the following compensation for her
services under this Agreement.
a. Salary and Transition Allowance. The Executive's annual base salary (the
"Annual Base Salary"), payable not less often than semi-monthly, shall be at the
annual rate of not less than $275,000.00. The Board may, from time to time,
direct such upward adjustments in the Annual Base Salary as the Board deems to
be necessary or desirable, including without limitation adjustments in order to
reflect increases in the cost of living. Any increase in the Annual Base Salary
shall not serve to limit or reduce any other obligation of the Corporation under
this Agreement. The Annual Base Salary shall not be reduced after any increase
thereof except for across-the-board salary reductions similarly affecting all
management personnel of Cinergy, Cinergy Services, PSI or CG&E. In addition to
the Annual Base Salary described in this Section, the Corporation shall pay to
the Executive a transition allowance in the gross sum of $50,000.00 on the
Effective Date or as soon thereafter as administratively feasible.
b. Retirement, Incentive, Welfare Benefit Plans and Other Benefits. During the
Employment Period and so long as the Executive is employed by the Corporation,
the Executive shall be eligible, and the Corporation shall take such actions as
may be necessary or required to cause the Executive to become eligible, to
participate in all short-term and long-term incentive, stock option, restricted
stock, performance unit, savings, retirement and welfare plans, practices,
policies and programs applicable generally to employees and/or other senior
executives of the Corporation who are considered Tier II executives for
compensation purposes, including, but not limited to, Cinergy's Annual Incentive
Plan, Cinergy's 1996 Long-Term Incentive Compensation Plan, Cinergy's Executive
Supplemental Life Insurance Program, PSI's Supplemental Retirement Plan and
PSI's Excess Benefit Plan, or any successors thereto, except with respect to any
plan, practice, policy or program to which the Executive has waived her rights
in writing.
c. Fringe Benefits and Perquisites. During the Employment Period and so long as
the Executive is employed by the Corporation, the Executive shall be entitled to
the following additional fringe benefits:
(i) The Corporation shall furnish to the Executive an automobile and shall pay
all of the related expenses for gasoline, insurance, maintenance and repairs;
(ii) The Corporation shall pay the initiation fee and the annual dues,
assessments and other membership charges of the Executive for membership charges
of the Executive for membership in a country club selected by the Executive;
(iii) The Corporation shall provide paid vacation for four (4) weeks per year
(or longer if permitted by the Corporation's policy); and
(iv) The Corporation shall furnish to the Executive annual financial planning
and tax preparation services. In addition, the Executive shall be entitled to
receive such other fringe benefits in accordance with the plans, practices,
programs and policies of the Corporation from time to time in effect,
commensurate with her position and at least comparable to those received by
other senior executives of the Corporation.
d. Expenses. The Corporation agrees to reimburse the Executive for all expenses,
including those for travel and entertainment, properly incurred by her in the
performance of her duties under this Agreement in accordance with the policies
established from time to time by the Board.
e. Relocation Benefits. The Executive shall be entitled to reimbursement from
the Corporation pursuant to the terms of the Corporation Relocation Program in
effect as of the day and year first written above, as well as all actual
expenses for temporary housing until such time as she has moved into a new
primary residence in the general area of the Corporation's principal corporate
office located in Cincinnati, Ohio. The expenses described in this Section shall
be "grossed up" to provide for adverse tax consequences to the Executive.
4. Termination of Employment.
a. Death. The Executive's employment shall terminate automatically upon the
Executive's death during the Employment Period.
b. By the Corporation for Cause. The Corporation may terminate the Executive's
employment during the Employment Period for Cause. For purposes of this
Agreement, "Cause" shall mean:
(i) The willful and continued failure by the Executive to substantially perform
the Executive's duties with the Corporation (other than any such failure
resulting from Executive's incapacity due to physical or mental illness) or any
such actual or anticipated failure after the issuance of a Notice of Termination
for Good Reason by the Executive pursuant to Section 4(c) after a written demand
for substantial performance is delivered to the Executive by the Board, which
demand specifically identifies the manner in which the Board believes that the
Executive has not substantially performed the Executive's duties, or
The breach by the Executive of the confidentiality provisions set forth in
Section 8 of this Agreement, or
(iii) The conviction of the Executive for the commission of a felony, including
the entry of a guilty or nolo contendere plea, or any willful or grossly
negligent action or inaction by the Executive that has a materially adverse
effect on the Corporation.
For purposes of this definition of "Cause," no act, or failure to act, on the
Executive's part shall be deemed "willful" unless done, or omitted to be done,
by the Executive not in good faith and without reasonable belief that the
Executive's act, or failure to act, was in the best interest of the Corporation.
Notwithstanding the above definition of "Cause", the Corporation may terminate
the Executive's employment during the Employment Period for a reason other than
Cause, but the obligations placed upon the Corporation in Section 5 shall apply.
c. By the Executive for Good Reason. The Executive may terminate her employment
during the Employment Period for Good Reason. For purposes of this Agreement,
"Good Reason" shall mean:
(i) The reduction in the Executive's Annual Base Salary as specified in Section
3(a) of this Agreement, or any other benefit or payment described in Section 3
of this Agreement, except for across-the-board salary reductions similarly
affecting all management personnel of Cinergy, Cinergy Services, CG&E, and PSI,
and changes to the employee benefits programs affecting all management personnel
of those Corporations, provided that such changes (either individually or in the
aggregate) will not result in a material adverse change with respect to the
benefits which the Executive was entitled to receive as of the Effective Date;
(ii) The material reduction without her consent of the Executive's title,
authority, duties or responsibilities from those in effect immediately prior to
the reduction;
(iii) Any breach by the Corporation of any other material provision (including
but not limited to the place of performance as specified in Section 2(b);
(iv) The Executive's disability due to physical or mental illness or injury
which precludes the Executive from performing any job for which she is qualified
and able to perform based upon her education, training or experience; or
(v) Any event which constitutes a "Change in Control" as defined in Section 4(f)
of this Agreement.
d. Notice of Termination. Any termination by the Corporation for Cause, or by
the Executive for Good Reason, shall be communicated by Notice of Termination to
the other party to this Agreement given in accordance with Section 10(b) of this
Agreement. For purposes of this Agreement, a "Notice of Termination" means a
written notice which:
(i) Indicates the specific termination provision in this Agreement relied upon;
(ii) To the extent applicable, sets forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the Executive's
employment under the provision so indicated; and
(iii) If the Date of Termination (as defined in Section 4(e)) is other than the
date of receipt of such notice, specifies the termination date (which date shall
be not more than thirty (30) days after the giving of such notice). The failure
by the Executive or the Corporation to set forth in the Notice of Termination
any fact or circumstances which contributes to a showing of Good Reason or Cause
shall not waive any right of the Executive or the Corporation under this
Agreement or preclude the Executive or the Corporation from asserting such fact
or circumstances in enforcing the Executive's or the Corporation's rights under
this Agreement.
e. Date of Termination. "Date of Termination" means:
(i) If the Executive's employment is terminated by the Corporation for Cause, or
by the Executive for Good Reason, the date of receipt of the Notice of
Termination or any later date specified therein, as the case may be;
(ii) If the Executive's employment is terminated by the Corporation other than
for Cause, the date on which the Corporation notifies the Executive of such
termination; and
(iii) If the Executive's employment is terminated by reason of death, the date
of death.
f. Change in Control. A "Change in Control" shall be deemed to have occurred if
any of the following events occur after the Effective Date:
(i) Any "person" or "group" (within the meaning of Subsection 13(d) and
Paragraph 14(d)(2) of the Securities Exchange Act of 1934 (the "1934 Act") is or
becomes the beneficial owner (as defined in Rule 13d-3 under the 1934 Act),
directly or indirectly, of securities of Cinergy (not including in the
securities beneficially owned by such Person any securities acquired directly
from Cinergy or its affiliates) representing fifty percent (50%) or more of the
combined voting power of Cinergy's then outstanding securities, excluding any
person who becomes such a beneficial owner in connection with a transaction
described in clause (1) of paragraph (ii) below; or
(ii) There is consummated a merger or consolidation of Cinergy or any direct or
indirect subsidiary of Cinergy with any other corporation , other than (1) a
merger or consolidation with would result in the voting securities of Cinergy
outstanding immediately prior to such merger or consolidation continuing to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity or any parent thereof) at least fifty percent
(50%) of the combined voting power of the securities of Cinergy or such
surviving entity or any parent thereof outstanding immediately such merger or
consolidation, or (2) a merger or consolidation effected to implement a
recapitalization of Cinergy (or similar transaction) in which no person is or
becomes the beneficial owner, directly or indirectly, of securities of Cinergy
(not including in the securities beneficially owned by such person any
securities acquired directly from Cinergy or its affiliates other than in
connection with the acquisition by Cinergy or its affiliates of a business)
representing twenty-five percent (25%) or more of the combined voting power of
Cinergy's then outstanding securities; or
During any period of two consecutive years, individuals who at the beginning of
that period constitute Cinergy's Board of Directors and any new director (other
than a director whose initial assumption of office is in connection with an
actual or threatened election contest, including but not limited to a consent
solicitation, relating to the election of directors of Cinergy) whose
appointment or election by Cinergy's shareholders was approved or recommended by
a vote of at least two-thirds (2/3) of the directors then still in office who
either were directors at the beginning of that period or whose appointment,
election or nomination for election was previously so approved or recommended
cease for any reason to constitute a majority of Cinergy's Board of Directors;
or
(iv) The shareholders of Cinergy approve a plan of complete liquidation or
dissolution of Cinergy or there is consummated an agreement for the sale or
disposition by Cinergy of all or substantially all of Cinergy's assets, other
than a sale or disposition by Cinergy of all or substantially all of Cinergy's
assets to an entity, at least sixty percent (60%) of the combined voting power
of the voting securities of which are owned by shareholders of Cinergy in
substantially the same proportions as their ownership of Cinergy immediately
prior to such sale.
g. Person. "Person" shall have the meaning given in Section 3(a)(9) of the 1934
Act, as modified and used in Sections 13(d) and 14(d) thereof; however, a Person
shall not include:
(i) The Corporation or any of its subsidiaries;
(ii) A trustee or other fiduciary holding securities under an employee benefit
plan of Cinergy or any of its subsidiaries;
(iii) An underwriter temporarily holding securities pursuant to an offering of
such securities; or
(iv) A corporation owned, directly or indirectly, by the stockholders of Cinergy
in substantially the same proportions as their ownership of stock of the
Corporation.
5. Obligations of the Corporation Upon Termination.
a. Certain Terminations. During the Employment Period, if the Corporation shall
terminate the Executive's employment (other than in the case of a termination
for Cause), the Executive shall terminate her employment for Good Reason or the
Executive's employment shall terminate by reason of death (termination in any
such case referred to as "Termination"):
(i) The Corporation shall pay to the Executive a lump sum amount, in cash, equal
to the sum of:
(1) the Executive's Annual Base Salary through the Date of Termination, and the
Executive's Transition Allowance, in each case to the extent most previously
paid;
(2) an amount equal to the Cinergy Annual Incentive Plan target percentage
benefit for the fiscal year that includes the Date of Termination multiplied by
a fraction the numerator of which shall be the number of days from the beginning
of such fiscal year to and including the Date of Termination and the denominator
of which shall be three hundred and sixty-five (365);
(3) an amount equal to her vested accrued benefit under the Cinergy Value
Creation Plan of the Cinergy 1996 Long-Term Incentive Compensation Plan; and
(4) any compensation previously deferred by the Executive (together with any
accrued interest or earnings thereon) and any accrued vacation pay, in each case
to the extent not previously paid.
(The amounts specified in clauses (1), (2), (3) and (4) shall be referred to in
this Agreement as the "Accrued Obligations".) The amounts specified in this
Section 5(a)(i) shall be paid within thirty (30) days after the Date of
Termination. The Accrued Obligations described in this Section are payable to
the Executive regardless of whether a Change in Control has occurred.
(ii) Prior to the occurrence of a Change in Control, and in the event of
Termination other than by reason of the Executive's death, then:
(1) the Corporation shall pay to the Executive a lump sum amount, in cash, equal
to the present value discounted using an interest rate equal to the prime rate
promulgated by CitiBank, N.A. and in effect as of the Date of Termination (the
"Prime Rate") of the Annual Base Salary, and the Cinergy Annual Incentive Plan
target percentage payable through the end of the Employment Period, each at the
rate, and using the same goals and factors, in effect at the time Notice of
Termination is given, and paid within thirty (30) days of the Date of
Termination;
(2) the Corporation shall pay to the Executive the present value (discounted at
the Prime Rate) of all amounts to which the Executive would have been entitled
had she remained in employment with the Corporation until the end of the
Employment Period, each, where applicable, at the rate of the Annual Base
Salary, and using the same goals and factors, in effect at the time Notice of
Termination is given, under the Cinergy Value Creation Plan of the Cinergy 1996
Long-Term Incentive Compensation Plan and the Cinergy Executive Supplemental
Life Insurance Program minus the present value (discounted at the Prime Rate) of
the benefits to which she is actually entitled under the above mentioned plans
and programs;
(3) the Corporation shall pay the value of all deferred compensation amounts
whether or not then payable; and
(4) the Corporation shall continue, until the end of the Employment Period,
medical and welfare benefits to the Executive and/or the Executive's family at
least equal to those which would have been provided if the Executive's
employment had not been terminated (excluding benefits to which the Executive
has waived her rights in writing), such benefits to be in accordance with the
most favorable medical and welfare benefit plans, practices, programs or
policies (the "M&W Plans") of the Corporation as in effect and applicable
generally to other senior executives of the Corporation and their families
during the ninety (90) day period immediately preceding the Date of Termination;
provided, however, that if the Executive becomes employed with another employer
and is eligible to receive medical or other welfare benefits under another
employer-provided plan, the benefits under the M&W Plans shall be secondary to
those provided under such other plan during such applicable period of
eligibility.
(iii) From and after the occurrence of a Change in Control and in the event of
Termination other than by reason of the Executive's death, then in lieu of any
further salary payments to the Executive for periods subsequent to the Date of
Termination and in lieu of any other benefits payable pursuant to Section
5(a)(ii) of this Agreement:
(1) The Corporation shall pay to the Executive a lump sum severance payment, in
cash, equal to the greater of:
(A) the present value of all amounts and benefits that would have been due under
Sections 5(a)(ii) of this Agreement, excluding Section 5(a)(ii)(4), and
(B) three (3) times the sum of (x) the higher of the Executive's Annual Base
Salary in effect immediately prior to the occurrence of the event or
circumstance upon which the Notice of Termination is based or in effect
immediately prior to the Change in Control, and (y) the higher of the amount
paid to the Executive pursuant to all incentive compensation or bonus plans or
programs maintained by the Corporation, in the year preceding that in which the
Date of Termination occurs or in the year preceding that in which the Change in
Control occurs; and
(2) For a thirty-six (36) month period after the Date of Termination, the
Corporation shall arrange to provide the Executive with life, disability,
accident and health insurance benefits substantially similar to those which the
Executive is receiving immediately prior to the Notice of Termination (without
giving effect to any reduction in such benefits subsequent to a Change in
Control which reduction constitutes Good Reason), except for any benefits that
were waived by the Executive in writing. Benefits otherwise receivable by the
Executive pursuant to this Section 5(a)(iii)(2) shall be reduced to the extent
comparable benefits are actually received by or made available to the Executive
without cost during the thirty-six (36) month period following the Executive's
termination of employment (and any such benefits actually received by the
Executive shall be reported to the Corporation by the Executive).
The Executive's employment shall be deemed to have been terminated following a
Change in Control of Cinergy without Cause or by the Executive for Good Reason
if, in addition to all other applicable Terminations, the Executive's employment
is terminated prior to a Change in Control without Cause at the direction of a
Person who has entered into an agreement with Cinergy or any of its subsidiaries
or affiliates, the consummation of which will constitute a Change in Control or
if the Executive terminates her employment for Good Reason prior to a Change in
Control if the circumstances or event which constitutes Good Reason occurs at
the direction of such Person.
b. Termination by the Corporation for Cause or by the Executive Other Than for
Good Reason. Subject to the provisions of Section 7 of this Agreement, if the
Executive's employment shall be terminated for Cause during the Employment
Period, or if the Executive terminates employment during the Employment Period
other than a termination for Good Reason, the Corporation shall have no further
obligations to the Executive under this Agreement other than the obligation to
pay to the Executive the Accrued Obligations and the amounts determined under
Section 5(c), plus any other earned but unpaid compensation, in each case to the
extent not previously paid.
c. Retirement Benefits on Termination. In addition to retirement benefits under
PSI's Pension Plan, PSI's Supplemental Retirement Plan, and PSI's Excess Benefit
Plan, or any successor thereto, the Executive shall be eligible to participate
in any supplemental executive retirement plan (commonly referred to as a "SERP")
sponsored by the Corporation.
d. Survival of Section 5(c). The provisions of Section 5(c) shall survive the
expiration or termination of this Agreement for any reason.
e. Certain Tax Consequences. In the event that the Executive becomes entitled to
the payments and benefits described in this Section 5 (the "Severance
Benefits"), if any of the Severance Benefits will be subject to any excise tax
(the "Excise Tax") imposed under Section 4999 of the Internal Revenue Code of
1986, as amended (the "Code"), the Corporation shall pay to the Executive an
additional amount (the "Gross-Up Payment") such that the net amount retained by
the Executive, after deduction of an Excise Tax on the Severance Benefits and
any federal, state and local income and employment tax and Excise Tax upon the
payment provided for by this Section 5, shall be equal to the Severance
Benefits. For purposes of determining whether any of the Severance Benefits will
be subject to the Excise Tax and the amount of such Excise Tax,
(i) any other payments or benefits received or to be received by the Executive
in connection with a Change in Control or the Executive's termination of
employment (whether pursuant to the terms of this Agreement or any other plan,
arrangement or agreement with the Corporation, any Person whose actions result
in a Change in Control or any Person affiliated with the Corporation or such
Person) shall be treated as "parachute payments" within the meaning of Section
280G(b)(2) of the Code, and all "excess parachute payments" within the meaning
of Section 280G(b)(1) of the Code shall be treated as subject to the Excise Tax,
unless in the opinion of tax counsel selected by the Corporation's independent
auditors and reasonably acceptable to the Executive such other payments or
benefits (in whole or in part) do not constitute parachute payments, including
by reason of Section 280G(b)(4)(A) of the Code, or such excess parachute
payments (in whole or in part) represent reasonable compensation for services
actually rendered, within the meaning of Section 280G(b)(4)(B) of the Code, in
excess of the Base Amount as defined in Section 280G(b)(3) of the Code allocable
to such reasonable compensation, or are otherwise not subject to the Excise Tax,
(ii) the amount of the Severance Benefits that shall be treated as subject to
the Excise Tax shall be equal to the lesser of
(1) the total amount of the Severance Benefits, or
(2) the amount of excess parachute payments within the meaning of Section
280G(b)(1) of the Code (after applying clause (i), above), and
(iii) the value of any non-cash benefits or any deferred payment or benefit
shall be determined by the Corporation's independent auditors in accordance with
the principles of Section 280G(d)(3) and (4) of the Code. For purposes of
determining the amount of the Gross-Up Payment, the Executive shall be deemed to
pay federal income taxes at the highest marginal rate of federal income taxation
in the calendar year in which the Gross-Up Payment is to be made and state and
local income taxes at the highest marginal rate of taxation in the state and
locality of the Executive's residence on the Date of Termination, net of the
maximum reduction in federal income taxes which would be obtained from deduction
of such state and local taxes. In the event that the Excise Tax is subsequently
determined to be less than the amount taken into account hereunder at the time
of termination of the Executive's employment, the Executive shall repay to the
Corporation, at the time that the amount of such reduction in Excise Tax is
finally determined, the portion of the Gross-Up Payment attributable to such
reduction (plus that portion of the Gross-Up Payment attributable to the Excise
Tax and federal, state and local income and employment tax imposed on the
Gross-Up Payment being repaid by the Executive to the extent that such repayment
results in a reduction in Excise Tax and/or a federal, state or local income or
employment tax deduction) plus interest on the amount of such repayment at the
rate provided in Section 1274(b)(2)(B) of the Code. In the event that the Excise
Tax is determined to exceed the amount taken into account hereunder at the time
of the termination of the Executive's employment (including by reason of any
payment the existence or amount of which cannot be determined at the time of the
Gross-Up Payment), the Corporation shall make an additional Gross-Up Payment in
respect of such excess (plus any interest, penalties or additions payable by the
Executive with respect to such excess) at the time that the amount of such
excess is finally determined. The Executive and the Corporation shall each
reasonably cooperate with the other in connection with any administrative or
judicial proceedings concerning the existence or amount of liability for Excise
Tax with respect to the Severance Benefits.
f. Other Fees and Expenses. The Corporation also shall pay to the Executive all
legal fees and expenses incurred by the Executive as a result of a termination
which entitles the Executive to the Severance Benefits (including all such fees
and expenses, if any, incurred in disputing any such termination or in seeking
in good faith to obtain or enforce any benefit or right provided by this
Agreement). Such payments shall be made within five (5) business days after
delivery of the Executive's written requests for payment accompanied with such
evidence of fees and expenses incurred as the Corporation reasonably may
require.
6. Non-exclusivity of Rights. Nothing in this Agreement shall prevent or limit
the Executive's continuing or future participation in any benefit, plan,
program, policy or practice provided by the Corporation and for which the
Executive may qualify (except with respect to any benefit to which the Executive
has waived her rights in writing), nor shall anything herein limit or otherwise
affect such rights as the Executive may have under any other contract or
agreement entered into after the date hereof with the Corporation. Amounts which
are vested benefits or which the Executive is otherwise entitled to receive
under any benefit, plan, program, policy or practice of, or any contract or
agreement entered into after the date hereof with, the Corporation at or
subsequent to the Date of Termination, shall be payable in accordance with such
benefit, plan, program, policy or practice, or contract or agreement, except as
explicitly modified by this Agreement.
7. Full Settlement: Mitigation. Except as provided in Sections 5(a)(ii)(4) and
5(a)(iii)(2) of this Agreement, the Corporation's obligation to make the
payments provided for in this Agreement and otherwise to perform its obligations
under this Agreement shall not be affected by any set-off, counterclaim,
recoupment, defense or other claim, right or action which the Corporation may
have against the Executive or others. In no event shall the Executive be
obligated to seek other employment or take any other action by way of mitigation
of the amounts (including amounts for damages for breach) payable to the
Executive under any of the provisions of this Agreement and such amounts shall
not be reduced whether or not the Executive obtains other employment. If the
Executive finally prevails with respect to any dispute between the Corporation,
the Executive or others as to the interpretation, terms, validity or
enforceability of (including any dispute about the amount of any payment
pursuant to) this Agreement, the Corporation agrees to pay all legal fees and
expenses which the Executive may reasonably incur as a result of any such
dispute.
8. Confidential Information. The Executive shall hold in a fiduciary capacity
for the benefit of Cinergy, all of its subsidiary companies and affiliates, as
well as all successors and assigns thereof (the "Cinergy Companies"), all
secret, confidential information, knowledge or data relating to the Cinergy
Companies, and their respective businesses, that shall have been obtained by the
Executive during the Executive's employment by the Corporation and that shall
not have been or now or subsequently have become public knowledge (other than by
acts by the Executive or representatives of the Executive in violation of this
Agreement). During the Employment Period and thereafter, the Executive shall
not, without the prior written consent of the Corporation or as may otherwise by
required by law or legal process, communicate or divulge any such information,
knowledge or data to anyone other than the Corporation and those designated by
it. The Executive understands that during the Employment Period, the Cinergy
Companies may be required from time to time to make public disclosure of the
terms or existence of the Executive's employment relationship in order to comply
with various laws and legal requirements. In addition to all other remedies
available to the Corporation in law and equity, this Agreement is subject to
termination by the Corporation for Cause under Section 4(b) in the event the
Executive violates any provision of this Section 8.
9. Successors.
a. This Agreement is personal to the Executive and, without the prior written
consent of the Corporation, shall not be assignable by the Executive otherwise
than by will or the laws of descent and distribution. This Agreement shall inure
to the benefit of and be enforceable by the Executive's legal representatives.
b. This Agreement shall inure to the benefit of and be binding upon the
Corporation, and its successors and assigns.
c. The Corporation shall require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of the
business and/or assets of the Corporation to assume expressly and agree to
perform this Agreement in the same manner and to the same extent that the
Corporation would be required to perform it if no such succession had taken
place.
10. Miscellaneous.
a. This Agreement shall be governed by and construed in accordance with the laws
of the State of Ohio, without reference to principles of conflict of laws. The
captions of this Agreement are not part of the provisions hereof and shall have
no force or effect. This Agreement may not be amended, modified, repealed,
waived, extended or discharged except by an agreement in writing signed by the
party against whom enforcement of such amendment, modification, repeal, waiver,
extension or discharge is sought. No person, other than pursuant to a resolution
of the Board or a committee thereof, shall have authority on behalf of the
Corporation to agree to amend, modify, repeal, waive, extend or discharge any
provision of this Agreement or anything in reference thereto.
b. All notices and other communications hereunder shall be in writing and shall
be given by hand delivery to the other party or by registered or certified mail,
return receipt requested, postage prepaid, addressed as follows:
If to the Executive: Madeleine W. Ludlow Cinergy Corp. 221 East Fourth Street P.
O. Box 960 Cincinnati, Ohio 45201-0960 If to the Corporation: Cinergy Corp. 221
East Fourth Street P. O. Box 960 Cincinnati, Ohio 45201-0960 Attn: Chief
Executive Officer or to such other address as either party shall have furnished
to the other in writing in accordance with this Agreement. All notices and
communications shall be effective when actually received by the addressee.
c. The invalidity or unenforceability of any provision of this Agreement shall
not affect the validity or enforceability of any other provision of this
Agreement.
d. The Corporation may withhold from any amounts payable under this Agreement
such federal, state or local taxes as shall be required to be withheld pursuant
to any applicable law or regulation.
e. The Executive's or the Corporation's failure to insist upon strict compliance
with any provision of this Agreement or the failure to assert any right the
Executive or the Corporation may have under this Agreement, including without
limitation the right of the Executive to terminate employment for Good Reason
pursuant to Section 4(c) of this Agreement, or the right of the Corporation to
terminate the Executive's employment for Cause pursuant to Section 4(b) of this
Agreement, shall not be deemed to be a waiver of such provision or right or any
other provision or right of this Agreement.
f. This instrument contains the entire agreement of the Executive and the
Corporation with respect to the subject matter hereof; and all promises,
representations, understandings, arrangements and prior agreements are merged
into this Agreement and accordingly superseded.
g. This Agreement may be executed in counterparts, each of which shall be deemed
to be an original but all of which together will constitute one and the same
instrument.
h. The Corporation and the Executive agree that Cinergy shall be authorized to
act for the Corporation with respect to all aspects pertaining to the
administration and interpretation of this Agreement.
IN WITNESS WHEREOF, the Executive and the Corporation have caused this Agreement
to be executed as of the day and year first above written.
CINERGY CORP., CINERGY SERVICES, INC.,
THE CINCINNATI GAS & ELECTRIC COMPANY,
AND PSI ENERGY, INC.
By: _________________________
James E. Rogers
Vice Chairman and Chief Executive Officer
EXECUTIVE
- --------------------------
Madeleine W. Ludlow
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>8
<DESCRIPTION>CINERGY 12/31/97 10-K
<TEXT>
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT made and entered into as of the 1st day of October,
1997, by and among Cinergy Corp., a Delaware Corporation ("Cinergy"), Cinergy
Services, Inc., a Delaware Corporation ("Cinergy Services"), The Cincinnati Gas
& Electric Company, an Ohio Corporation ("CG&E"), PSI Energy, Inc., an Indiana
Corporation ("PSI"), and Donald B. Ingle, Jr. (the "Executive"). Cinergy,
Cinergy Services, CG&E, and PSI will sometimes be referred to in this Agreement
collectively as the "Corporation".
WHEREAS, the Corporation desires that the Executive become an employee in
accordance with this Agreement;
WHEREAS, the Executive is willing to commit himself to the employ of the
Corporation and any successor thereto, on the terms and conditions set forth in
this Agreement and thus to forego opportunities elsewhere; and
WHEREAS, the parties desire to enter into this Agreement as of the date first
set forth above setting forth the terms and conditions for the employment
relationship of the Executive;
NOW, THEREFORE, IN CONSIDERATION of the mutual premises, covenants and
agreements set forth below, it is hereby agreed as follows:
1. Employment and Term.
a. The Corporation agrees to employ the Executive, and the Executive agrees to
be employed, in accordance with the terms and provisions of this Agreement for
the period set forth below (the "Employment Period").
b. The Employment Period of the Executive as provided in Section 1(a) will
commence on October 1, 1997, (the "Effective Date") and shall continue until
December 31, 2000; provided, however, commencing on January 1, 1999, and each
January 1 thereafter (the "Renewal Date"), the Employment Period of this
Agreement shall automatically be extended for one (1) additional year if neither
the Corporation nor the Executive shall have given between December 1 and
December 15 prior to each applicable Renewal Date written notice to the other of
its intent to terminate this Agreement.
2. Duties and Powers of Executive.
a. Position. The Executive shall serve the Corporation in such responsible
executive capacity or capacities as the Board of Directors of Cinergy or Cinergy
Services (the Board of Directors of Cinergy or Cinergy Services, as the case may
be, may be referred to sometimes as the "Board") or the Chief Executive Officer
of Cinergy or the Chief Operating Officer of Cinergy may from time to time
determine and shall have such responsibilities, duties and authority as may be
assigned to him from time to time during the Employment Period by the Board or
the Chief Executive Officer of Cinergy or the Chief Operating Officer of Cinergy
that are consistent with such responsibilities, duties and authority. Upon the
Effective Date of this Agreement, the Executive shall initially serve as
President, Energy Services Business Unit for the Corporation, but consistent
with the foregoing provisions of this Section 2(a), may be assigned to any other
position or positions by either the Board or the Chief Executive Officer of
Cinergy or the Chief Operating Officer of Cinergy during the Employment Period.
b. Place of Performance. In connection with the Executive's employment, the
Executive shall be based at the principal executive offices of the Corporation,
221 East Fourth Street, Cincinnati, Ohio, and, except for required business
travel to an extent substantially consistent with the present business travel
obligations of executives of the Corporation who have positions of authority
comparable to that of the Executive, the Executive shall not be required to
relocate to a new principal place of business which is more than thirty (30)
miles from the current principal place of business of the Corporation.
3. Compensation. The Executive shall receive the following compensation for his
services under this Agreement.
a. Salary and Transition Allowance. The Executive's annual base salary (the
"Annual Base Salary"), payable not less often than semi-monthly, shall be at the
annual rate of not less than $300,000.00. The Board may, from time to time,
direct such upward adjustments in the Annual Base Salary as the Board deems to
be necessary or desirable, including without limitation adjustments in order to
reflect increases in the cost of living. Any increase in the Annual Base Salary
shall not serve to limit or reduce any other obligation of the Corporation under
this Agreement. The Annual Base Salary shall not be reduced after any increase
thereof except for across-the-board salary reductions similarly affecting all
management personnel of Cinergy, Cinergy Services, PSI or CG&E. In addition to
the Annual Base Salary described in this Section, the Corporation shall pay to
the Executive a transition allowance in the gross sum of $100,000.00 on the
Effective Date or as soon thereafter as administratively feasible.
Retirement, Incentive, Welfare Benefit Plans and Other Benefits. During the
Employment Period and so long as the Executive is employed by the Corporation,
the Executive shall be eligible, and the Corporation shall take such actions as
may be necessary or required to cause the Executive to become eligible, to
participate in all short-term and long-term incentive, stock option, restricted
stock, savings, retirement and welfare plans, practices, policies and programs
applicable generally to employees and/or other senior executives of the
Corporation who are considered Tier II executives for compensation purposes,
including, but not limited to, Cinergy's Annual Incentive Plan, Cinergy's 1996
Long-Term Incentive Compensation Plan, Cinergy's Executive Supplemental Life
Insurance Program, Cinergy's Nonqualified Deferred Incentive Compensation Plan,
Cinergy's Excess 401(k) Plan, PSI's Employees' 401(k) Savings Plan, PSI's
Pension Plan, PSI's Supplemental Retirement Plan and PSI's Excess Benefit Plan,
or any successors thereto, except with respect to any plan, practice, policy or
program to which the Executive has waived his rights in writing. In addition,
the Corporation will take appropriate action to include the Executive as a
participant in Cinergy's Annual Incentive Plan and Cinergy's 1996 Long-Term
Incentive Compensation Plan retroactively to January 1, 1997, or otherwise
provide an equivalent economic benefit.
With regard to the Executive's retirement benefits under PSI's Pension Plan,
PSI's Supplemental Retirement Plan, and PSI's Excess Benefit Plan, or any
successor thereto, the Executive shall be entitled to a "Contractual Retirement
Supplement" (paid from the Corporation's general assets) which gives the
Executive upon retirement on or after age fifty-five (55) a non-qualified
benefit that when added to the Executive's benefit under PSI's Pension Plan,
PSI's Supplemental Retirement Plan, and PSI's Excess Benefit Plan or any
successor thereto, and any previous employer's pension benefits, will provide
total retirement income equivalent to a full career employee with equal annual
earnings. For purposes of the preceding sentence, a "full career employee" shall
be considered an employee with thirty (30) full years of participation under
PSI's Pension Plan. If the Executive terminates employment prior to age
fifty-five (55), he shall be entitled to a "Contractual Retirement Supplement"
(paid from the Corporation's general assets) a non-qualified benefit that when
added to the Executive's benefit under PSI's Pension Plan, PSI's Supplemental
Retirement Plan, and PSI's Excess Benefit Plan, or any successor thereto, will
provide total retirement income equivalent to an employee who had twenty-two
(22) years of service with the Corporation as of October 1, 1997. c. Fringe
Benefits and Perquisites. During the Employment Period and so long as the
Executive is employed by the Corporation, the Executive shall be entitled to the
following additional fringe benefits:
(i) The Corporation shall furnish to the Executive an automobile and shall pay
all of the related expenses for gasoline, insurance, maintenance and repairs;
(ii) The Corporation shall pay the initiation fee and the annual dues,
assessments and other membership charges of the Executive for membership charges
of the Executive for membership in a country club selected by the Executive;
(iii) The Corporation shall provide paid vacation for four (4) weeks per year
(or longer if permitted by the Corporation's policy); and
(iv) The Corporation shall furnish to the Executive annual financial planning
and tax preparation services. In addition, the Executive shall be entitled to
receive such other fringe benefits in accordance with the plans, practices,
programs and policies of the Corporation from time to time in effect,
commensurate with his position and at least comparable to those received by
other senior executives of the Corporation.
d. Expenses. The Corporation agrees to reimburse the Executive for all expenses,
including those for travel and entertainment, properly incurred by him in the
performance of his duties under this Agreement in accordance with the policies
established from time to time by the Board.
e. Relocation Benefits. The Executive shall be entitled to reimbursement from
the Corporation pursuant to the terms of the Corporation Relocation Program in
effect as of the day and year first written above, as well as all actual
expenses for temporary housing until such time as he has moved into a new
primary residence in the general area of the Corporation's principal corporate
office located in Cincinnati, Ohio. In addition, upon the termination of the
Executive's employment for any reason under Section 4 of this Agreement, the
Corporation shall purchase the Executive's primary residence in the general area
of the Corporation's principal corporate office located in Cincinnati, Ohio at
its fair market value. For purposes of this Section, the term "fair market
value" shall have the same meaning as used in the Corporation's Relocation
Program. The expenses described in this Section shall be "grossed up" to provide
for adverse tax consequences to the Executive.
4. Termination of Employment.
a. Death. The Executive's employment shall terminate automatically upon the
Executive's death during the Employment Period.
b. By the Corporation for Cause. The Corporation may terminate the Executive's
employment during the Employment Period for Cause. For purposes of this
Agreement, "Cause" shall mean:
(i) The willful and continued failure by the Executive to substantially perform
the Executive's duties with the Corporation (other than any such failure
resulting from Executive's incapacity due to physical or mental illness) or any
such actual or anticipated failure after the issuance of a Notice of Termination
for Good Reason by the Executive pursuant to Section 4(c) after a written demand
for substantial performance is delivered to the Executive by the Board, which
demand specifically identifies the manner in which the Board believes that the
Executive has not substantially performed the Executive's duties, or The breach
by the Executive of the confidentiality provisions set forth in Section 8 of
this Agreement, or
(iii) The conviction of the Executive for the commission of a felony, including
the entry of a guilty or nolo contendere plea, or any willful or grossly
negligent action or inaction by the Executive that has a materially adverse
effect on the Corporation.
For purposes of this definition of "Cause," no act, or failure to act, on the
Executive's part shall be deemed "willful" unless done, or omitted to be done,
by the Executive not in good faith and without reasonable belief that the
Executive's act, or failure to act, was in the best interest of the Corporation.
Notwithstanding the above definition of "Cause", the Corporation may terminate
the Executive's employment during the Employment Period for a reason other than
Cause, but the obligations placed upon the Corporation in Section 5 shall apply.
c. By the Executive for Good Reason. The Executive may terminate his employment
during the Employment Period for Good Reason. For purposes of this Agreement,
"Good Reason" shall mean:
(i) The reduction in the Executive's Annual Base Salary as specified in Section
3(a) of this Agreement, or any other benefit or payment described in Section 3
of this Agreement, except for across-the-board salary reductions similarly
affecting all management personnel of Cinergy, Cinergy Services, CG&E, and PSI,
and changes to the employee benefits programs affecting all management personnel
of those Corporations, provided that such changes (either individually or in the
aggregate) will not result in a material adverse change with respect to the
benefits which the Executive was entitled to receive as of the Effective Date;
(ii) The material reduction without his consent of the Executive's title,
authority, duties or responsibilities from those in effect immediately prior to
the reduction;
(iii) Any breach by the Corporation of any other material provision (including
but not limited to the place of performance as specified in Section 2(b));
(iv) The Executive's disability due to physical or mental illness or injury
which precludes the Executive from performing any job for which he is qualified
and able to perform based upon his education, training or experience; or
(v) Any event which constitutes a "Change in Control" as defined in Section 4(f)
of this Agreement.
d. Notice of Termination. Any termination by the Corporation for Cause, or by
the Executive for Good Reason, shall be communicated by Notice of Termination to
the other party to this Agreement given in accordance with Section 10(b) of this
Agreement. For purposes of this Agreement, a "Notice of Termination" means a
written notice which:
(i) Indicates the specific termination provision in this Agreement relied upon;
(ii) To the extent applicable, sets forth in reasonable detail the facts and
circumstances claimed to provide a basis for termination of the Executive's
employment under the provision so indicated; and
(iii) If the Date of Termination (as defined in Section 4(e)) is other than the
date of receipt of such notice, specifies the termination date (which date shall
be not more than thirty (30) days after the giving of such notice). The failure
by the Executive or the Corporation to set forth in the Notice of Termination
any fact or circumstances which contributes to a showing of Good Reason or Cause
shall not waive any right of the Executive or the Corporation under this
Agreement or preclude the Executive or the Corporation from asserting such fact
or circumstances in enforcing the Executive's or the Corporation's rights under
this Agreement.
e. Date of Termination. "Date of Termination" means:
(i) If the Executive's employment is terminated by the Corporation for Cause, or
by the Executive for Good Reason, the date of receipt of the Notice of
Termination or any later date specified therein, as the case may be;
(ii) If the Executive's employment is terminated by the Corporation other than
for Cause, the date on which the Corporation notifies the Executive of such
termination; and
(iii) If the Executive's employment is terminated by reason of death, the date
of death.
f. Change in Control. A "Change in Control" shall be deemed to have occurred if
any of the following events occur after the Effective Date:
(i) Any "person" or "group" (within the meaning of Subsection 13(d) and
Paragraph 14(d)(2) of the Securities Exchange Act of 1934 (the "1934 Act") is or
becomes the beneficial owner (as defined in Rule 13d-3 under the 1934 Act),
directly or indirectly, of securities of Cinergy (not including in the
securities beneficially owned by such Person any securities acquired directly
from Cinergy or its affiliates) representing fifty percent (50%) or more of the
combined voting power of Cinergy's then outstanding securities, excluding any
person who becomes such a beneficial owner in connection with a transaction
described in clause (1) of paragraph (ii) below; or
(ii) There is consummated a merger or consolidation of Cinergy or any direct or
indirect subsidiary of Cinergy with any other corporation , other than (1) a
merger or consolidation which would result in the voting securities of Cinergy
outstanding immediately prior to such merger or consolidation continuing to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity or any parent thereof) at least fifty percent
(50%) of the combined voting power of the securities of Cinergy or such
surviving entity or any parent thereof outstanding immediately after such merger
or consolidation, or (2) a merger or consolidation effected to implement a
recapitalization of Cinergy (or similar transaction) in which no person is or
becomes the beneficial owner, directly or indirectly, of securities of Cinergy
(not including in the securities beneficially owned by such person any
securities acquired directly from Cinergy or its affiliates other than in
connection with the acquisition by Cinergy or its affiliates of a business)
representing twenty-five percent (25%) or more of the combined voting power of
Cinergy's then outstanding securities; or
During any period of two (2) consecutive years, individuals who at the beginning
of that period constitute Cinergy's Board of Directors and any new director
(other than a director whose initial assumption of office is in connection with
an actual or threatened election contest, including but not limited to a consent
solicitation, relating to the election of directors of Cinergy) whose
appointment or election by Cinergy's shareholders was approved or recommended by
a vote of at least two-thirds (2/3) of the directors then still in office who
either were directors at the beginning of that period or whose appointment,
election or nomination for election was previously so approved or recommended
cease for any reason to constitute a majority of Cinergy's Board of Directors;
or
(iv) The shareholders of Cinergy approve a plan of complete liquidation or
dissolution of Cinergy or there is consummated an agreement for the sale or
disposition by Cinergy of all or substantially all of Cinergy's assets, other
than a sale or disposition by Cinergy of all or substantially all of Cinergy's
assets to an entity, at least sixty percent (60%) of the combined voting power
of the voting securities of which are owned by shareholders of Cinergy in
substantially the same proportions as their ownership of Cinergy immediately
prior to such sale.
g. Person. "Person" shall have the meaning given in Section 3(a)(9) of the 1934
Act, as modified and used in Sections 13(d) and 14(d) thereof; however, a Person
shall not include:
(i) The Corporation or any of its subsidiaries;
(ii) A trustee or other fiduciary holding securities under an employee benefit
plan of Cinergy or any of its subsidiaries;
(iii) An underwriter temporarily holding securities pursuant to an offering of
such securities; or
(iv) A corporation owned, directly or indirectly, by the stockholders of Cinergy
in substantially the same proportions as their ownership of stock of the
Corporation.
5. Obligations of the Corporation Upon Termination.
a. Certain Terminations. During the Employment Period, if the Corporation shall
terminate the Executive's employment (other than in the case of a termination
for Cause), the Executive shall terminate his employment for Good Reason or the
Executive's employment shall terminate by reason of death (termination in any
such case referred to as "Termination"):
(i) The Corporation shall pay to the Executive a lump sum amount, in cash, equal
to the sum of:
(1) the Executive's Annual Base Salary through the Date of Termination, and the
Executive's Transition Allowance, in each case to the extent not previously
paid;
(2) an amount equal to the Executive's target percentage benefit under Cinergy's
Annual Incentive Plan for the fiscal year that includes the Date of Termination
multiplied by a fraction the numerator of which shall be the number of days from
the beginning of such fiscal year to and including the Date of Termination and
the denominator of which shall be three hundred and sixty-five (365);
(3) an amount equal to the Executive's vested accrued benefit under the Cinergy
Value Creation Plan under the Cinergy 1996 Long-Term Incentive Compensation
Plan; and
(4) any compensation previously deferred by the Executive (together with any
accrued interest or earnings thereon) and any accrued vacation pay, in each case
to the extent not previously paid.
(The amounts specified in clauses (1), (2), (3) and (4) shall be referred to in
this Agreement as the "Accrued Obligations".) The amounts specified in this
Section 5(a)(i) shall be paid within thirty (30) days after the Date of
Termination. The Accrued Obligations described in this Section are payable to
the Executive regardless of whether a Change in Control has occurred.
(ii) Prior to the occurrence of a Change in Control, and in the event of
Termination other than by reason of the Executive's death, then:
(1) the Corporation shall pay to the Executive a lump sum amount, in cash, equal
to the present value discounted using an interest rate equal to the prime rate
promulgated by CitiBank, N.A. and in effect as of the Date of Termination (the
"Prime Rate") of the Annual Base Salary, and the Cinergy Annual Incentive Plan
target percentage payable through the end of the Employment Period, each at the
rate, and using the same goals and factors, in effect at the time Notice of
Termination is given, and paid within thirty (30) days of the Date of
Termination;
(2) the Corporation shall pay to the Executive the present value (discounted at
the Prime Rate) of all amounts to which the Executive would have been entitled
had he remained in employment with the Corporation until the end of the
Employment Period, each, where applicable, at the rate of the Annual Base
Salary, and using the same goals and factors, in effect at the time Notice of
Termination is given, under the Cinergy Value Creation Plan of the Cinergy 1996
Long-Term Incentive Compensation Plan and the Cinergy Executive Supplemental
Life Insurance Program minus the present value (discounted at the Prime Rate) of
the benefits to which he is actually entitled under the above mentioned plans
and programs;
(3) the Corporation shall pay the value of all deferred compensation amounts
whether or not then payable; and
(4) the Corporation shall continue, until the end of the Employment Period,
medical and welfare benefits to the Executive and/or the Executive's family at
least equal to those which would have been provided if the Executive's
employment had not been terminated (excluding benefits to which the Executive
has waived his rights in writing), such benefits to be in accordance with the
most favorable medical and welfare benefit plans, practices, programs or
policies (the "M&W Plans") of the Corporation as in effect and applicable
generally to other senior executives of the Corporation and their families
during the ninety (90) day period immediately preceding the Date of Termination;
provided, however, that if the Executive becomes employed with another employer
and is eligible to receive medical or other welfare benefits under another
employer-provided plan, the benefits under the M&W Plans shall be secondary to
those provided under such other plan during such applicable period of
eligibility.
(iii) From and after the occurrence of a Change in Control and in the event of
Termination other than by reason of the Executive's death, then in lieu of any
further salary payments to the Executive for periods subsequent to the Date of
Termination and in lieu of any other benefits payable pursuant to Section
5(a)(ii) of this Agreement:
(1) The Corporation shall pay to the Executive a lump sum severance payment, in
cash, equal to the greater of:
(A) the present value of all amounts and benefits that would have been due under
Sections 5(a)(ii) of this Agreement, excluding Section 5(a)(ii)(4), and
(B) three (3) times the sum of (x) the higher of the Executive's Annual Base
Salary in effect immediately prior to the occurrence of the event or
circumstance upon which the Notice of Termination is based or in effect
immediately prior to the Change in Control, and (y) the higher of the amount
paid to the Executive pursuant to all incentive compensation or bonus plans or
programs maintained by the Corporation, in the year preceding that in which the
Date of Termination occurs or in the year preceding that in which the Change in
Control occurs; and
(2) For a thirty-six (36) month period after the Date of Termination, the
Corporation shall arrange to provide the Executive with life, disability,
accident and health insurance benefits substantially similar to those which the
Executive is receiving immediately prior to the Notice of Termination (without
giving effect to any reduction in such benefits subsequent to a Change in
Control which reduction constitutes Good Reason), except for any benefits that
were waived by the Executive in writing. Benefits otherwise receivable by the
Executive pursuant to this Section 5(a)(iii)(2) shall be reduced to the extent
comparable benefits are actually received by or made available to the Executive
without cost during the thirty-six (36) month period following the Executive's
termination of employment (and any such benefits actually received by the
Executive shall be reported to the Corporation by the Executive).
The Executive's employment shall be deemed to have been terminated following a
Change in Control of Cinergy without Cause or by the Executive for Good Reason
if, in addition to all other applicable Terminations, the Executive's employment
is terminated prior to a Change in Control without Cause at the direction of a
Person who has entered into an agreement with Cinergy or any of its subsidiaries
or affiliates, the consummation of which will constitute a Change in Control or
if the Executive terminates his employment for Good Reason prior to a Change in
Control if the circumstances or event which constitutes Good Reason occurs at
the direction of such Person.
b. Termination by the Corporation for Cause or by the Executive Other Than for
Good Reason. Subject to the provisions of Section 7 of this Agreement, if the
Executive's employment shall be terminated for Cause during the Employment
Period, or if the Executive terminates employment during the Employment Period
other than a termination for Good Reason, the Corporation shall have no further
obligations to the Executive under this Agreement other than the obligation to
pay to the Executive the Accrued Obligations and the amounts determined under
Section 5(c), plus any other earned but unpaid compensation, in each case to the
extent not previously paid.
c. Retirement Benefits on Termination. In addition to retirement benefits under
PSI's Pension Plan, PSI's Supplemental Retirement Plan, and PSI's Excess Benefit
Plan, or any successor thereto, and the Contractual Retirement Supplement, the
Executive shall also be eligible to participate in any supplemental executive
retirement plan (commonly referred to as a "SERP") sponsored by the Corporation.
d. Survival of Section 5(c). The provisions of Section 5(c) shall survive the
expiration or termination of this Agreement for any reason.
e. Certain Tax Consequences. In the event that the Executive becomes entitled to
the payments and benefits described in this Section 5 (the "Severance
Benefits"), if any of the Severance Benefits will be subject to any excise tax
(the "Excise Tax") imposed under Section 4999 of the Internal Revenue Code of
1986, as amended (the "Code"), the Corporation shall pay to the Executive an
additional amount (the "Gross-Up Payment") such that the net amount retained by
the Executive, after deduction of an Excise Tax on the Severance Benefits and
any federal, state and local income and employment tax and Excise Tax upon the
payment provided for by this Section 5, shall be equal to the Severance
Benefits. For purposes of determining whether any of the Severance Benefits will
be subject to the Excise Tax and the amount of such Excise Tax,
(i) any other payments or benefits received or to be received by the Executive
in connection with a Change in Control or the Executive's termination of
employment (whether pursuant to the terms of this Agreement or any other plan,
arrangement or agreement with the Corporation, any Person whose actions result
in a Change in Control or any Person affiliated with the Corporation or such
Person) shall be treated as "parachute payments" within the meaning of Section
280G(b)(2) of the Code, and all "excess parachute payments" within the meaning
of Section 280G(b)(1) of the Code shall be treated as subject to the Excise Tax,
unless in the opinion of tax counsel selected by the Corporation's independent
auditors and reasonably acceptable to the Executive such other payments or
benefits (in whole or in part) do not constitute parachute payments, including
by reason of Section 280G(b)(4)(A) of the Code, or such excess parachute
payments (in whole or in part) represent reasonable compensation for services
actually rendered, within the meaning of Section 280G(b)(4)(B) of the Code, in
excess of the Base Amount as defined in Section 280G(b)(3) of the Code allocable
to such reasonable compensation, or are otherwise not subject to the Excise Tax,
(ii) the amount of the Severance Benefits that shall be treated as subject to
the Excise Tax shall be equal to the lesser of
(1) the total amount of the Severance Benefits, or
(2) the amount of excess parachute payments within the meaning of Section
280G(b)(1) of the Code (after applying clause (i), above), and
(iii) the value of any non-cash benefits or any deferred payment or benefit
shall be determined by the Corporation's independent auditors in accordance with
the principles of Section 280G(d)(3) and (4) of the Code. For purposes of
determining the amount of the Gross-Up Payment, the Executive shall be deemed to
pay federal income taxes at the highest marginal rate of federal income taxation
in the calendar year in which the Gross-Up Payment is to be made and state and
local income taxes at the highest marginal rate of taxation in the state and
locality of the Executive's residence on the Date of Termination, net of the
maximum reduction in federal income taxes which would be obtained from deduction
of such state and local taxes. In the event that the Excise Tax is subsequently
determined to be less than the amount taken into account hereunder at the time
of termination of the Executive's employment, the Executive shall repay to the
Corporation, at the time that the amount of such reduction in Excise Tax is
finally determined, the portion of the Gross-Up Payment attributable to such
reduction (plus that portion of the Gross-Up Payment attributable to the Excise
Tax and federal, state and local income and employment tax imposed on the
Gross-Up Payment being repaid by the Executive to the extent that such repayment
results in a reduction in Excise Tax and/or a federal, state or local income or
employment tax deduction) plus interest on the amount of such repayment at the
rate provided in Section 1274(b)(2)(B) of the Code. In the event that the Excise
Tax is determined to exceed the amount taken into account hereunder at the time
of the termination of the Executive's employment (including by reason of any
payment the existence or amount of which cannot be determined at the time of the
Gross-Up Payment), the Corporation shall make an additional Gross-Up Payment in
respect of such excess (plus any interest, penalties or additions payable by the
Executive with respect to such excess) at the time that the amount of such
excess is finally determined. The Executive and the Corporation shall each
reasonably cooperate with the other in connection with any administrative or
judicial proceedings concerning the existence or amount of liability for Excise
Tax with respect to the Severance Benefits.
f. Other Fees and Expenses. The Corporation also shall pay to the Executive all
legal fees and expenses incurred by the Executive as a result of a termination
which entitles the Executive to the Severance Benefits (including all such fees
and expenses, if any, incurred in disputing any such termination or in seeking
in good faith to obtain or enforce any benefit or right provided by this
Agreement). Such payments shall be made within five (5) business days after
delivery of the Executive's written requests for payment accompanied with such
evidence of fees and expenses incurred as the Corporation reasonably may
require.
6. Non-exclusivity of Rights. Nothing in this Agreement shall prevent or limit
the Executive's continuing or future participation in any benefit, plan,
program, policy or practice provided by the Corporation and for which the
Executive may qualify (except with respect to any benefit to which the Executive
has waived his rights in writing), nor shall anything herein limit or otherwise
affect such rights as the Executive may have under any other contract or
agreement entered into after the date hereof with the Corporation. Amounts which
are vested benefits or which the Executive is otherwise entitled to receive
under any benefit, plan, program, policy or practice of, or any contract or
agreement entered into after the date hereof with, the Corporation at or
subsequent to the Date of Termination, shall be payable in accordance with such
benefit, plan, program, policy or practice, or contract or agreement, except as
explicitly modified by this Agreement.
7. Full Settlement: Mitigation. Except as provided in Sections 5(a)(ii)(4) and
5(a)(iii)(2) of this Agreement, the Corporation's obligation to make the
payments provided for in this Agreement and otherwise to perform its obligations
under this Agreement shall not be affected by any set-off, counterclaim,
recoupment, defense or other claim, right or action which the Corporation may
have against the Executive or others. In no event shall the Executive be
obligated to seek other employment or take any other action by way of mitigation
of the amounts (including amounts for damages for breach) payable to the
Executive under any of the provisions of this Agreement and such amounts shall
not be reduced whether or not the Executive obtains other employment. If the
Executive finally prevails with respect to any dispute between the Corporation,
the Executive or others as to the interpretation, terms, validity or
enforceability of (including any dispute about the amount of any payment
pursuant to) this Agreement, the Corporation agrees to pay all legal fees and
expenses which the Executive may reasonably incur as a result of any such
dispute.
8. Confidential Information. The Executive shall hold in a fiduciary capacity
for the benefit of Cinergy, all of its subsidiary companies and affiliates, as
well as all successors and assigns thereof (the "Cinergy Companies"), all
secret, confidential, proprietary information, knowledge or data relating to the
Cinergy Companies, and their respective businesses, that shall have been
obtained by the Executive during the Executive's employment by the Corporation
and that shall not have been or now or subsequently have become public knowledge
(other than by acts by the Executive or representatives of the Executive in
violation of this Agreement). During the Employment Period and thereafter, the
Executive shall not, without the prior written consent of the Corporation or as
may otherwise by required by law or legal process, communicate or divulge any
such information, knowledge or data to anyone other than the Corporation and
those designated by it. The Executive understands that during the Employment
Period, the Cinergy Companies may be required from time to time to make public
disclosure of the terms or existence of the Executive's employment relationship
in order to comply with various laws and legal requirements. In addition to all
other remedies available to the Corporation in law and equity, this Agreement is
subject to termination by the Corporation for Cause under Section 4(b) in the
event the Executive violates any provision of this Section 8.
9. Successors.
a. This Agreement is personal to the Executive and, without the prior written
consent of the Corporation, shall not be assignable by the Executive otherwise
than by will or the laws of descent and distribution. This Agreement shall inure
to the benefit of and be enforceable by the Executive's legal representatives.
b. This Agreement shall inure to the benefit of and be binding upon the
Corporation, and its successors and assigns.
c. The Corporation shall require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of the
business and/or assets of the Corporation to assume expressly and agree to
perform this Agreement in the same manner and to the same extent that the
Corporation would be required to perform it if no such succession had taken
place.
10. Miscellaneous.
a. This Agreement shall be governed by and construed in accordance with the laws
of the State of Ohio, without reference to principles of conflict of laws. The
captions of this Agreement are not part of the provisions hereof and shall have
no force or effect. This Agreement may not be amended, modified, repealed,
waived, extended or discharged except by an agreement in writing signed by the
party against whom enforcement of such amendment, modification, repeal, waiver,
extension or discharge is sought. No person, other than pursuant to a resolution
of the Board or a committee thereof, shall have authority on behalf of the
Corporation to agree to amend, modify, repeal, waive, extend or discharge any
provision of this Agreement or anything in reference thereto.
b. All notices and other communications hereunder shall be in writing and shall
be given by hand delivery to the other party or by registered or certified mail,
return receipt requested, postage prepaid, addressed as follows:
If to the Executive:
Donald B. Ingle, Jr.
Cinergy Corp.
221 East Fourth Street
P. O. Box 960
Cincinnati, Ohio 45201-0960
If to the Corporation:
Cinergy Corp.
221 East Fourth Street
P. O. Box 960
Cincinnati, Ohio 45201-0960
Attn: Chief Executive Officer
or to such other address as either party shall have furnished to the other in
writing in accordance with this Agreement. All notices and communications shall
be effective when actually received by the addressee.
c. The invalidity or unenforceability of any provision of this Agreement shall
not affect the validity or enforceability of any other provision of this
Agreement.
d. The Corporation may withhold from any amounts payable under this Agreement
such federal, state or local taxes as shall be required to be withheld pursuant
to any applicable law or regulation.
e. The Executive's or the Corporation's failure to insist upon strict compliance
with any provision of this Agreement or the failure to assert any right the
Executive or the Corporation may have under this Agreement, including without
limitation the right of the Executive to terminate employment for Good Reason
pursuant to Section 4(c) of this Agreement, or the right of the Corporation to
terminate the Executive's employment for Cause pursuant to Section 4(b) of this
Agreement, shall not be deemed to be a waiver of such provision or right or any
other provision or right of this Agreement.
f. This instrument contains the entire agreement of the Executive and the
Corporation with respect to the subject matter hereof; and all promises,
representations, understandings, arrangements and prior agreements are merged
into this Agreement and accordingly superseded.
g. This Agreement may be executed in counterparts, each of which shall be deemed
to be an original but all of which together will constitute one and the same
instrument.
h. The Corporation and the Executive agree that Cinergy shall be authorized to
act for the Corporation with respect to all aspects pertaining to the
administration and interpretation of this Agreement.
IN WITNESS WHEREOF, the Executive and the Corporation have caused this Agreement
to be executed as of the day and year first above written.
CINERGY CORP., CINERGY SERVICES, INC.,
THE CINCINNATI GAS & ELECTRIC COMPANY,
AND PSI ENERGY, INC.
By: _________________________
James E. Rogers
Vice Chairman and Chief Executive Officer
EXECUTIVE
- --------------------------
Donald B. Ingle, Jr.
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>9
<DESCRIPTION>CINERGY 12/31/97 10-K
<TEXT>
AMENDED AND RESTATED SUPPLEMENTAL
EXECUTIVE RETIREMENT INCOME AGREEMENT
This Amended and Restated Supplemental Executive Retirement Income Agreement
("Agreement") is made as of the ___ day of ____________, 19__, by and between
The Cincinnati Gas & Electric Company ("CG&E") and _________________
("Executive").
WHEREAS, Executive and CG&E entered into a Supplemental Executive Retirement
Income Agreement on the ___ day of __________, 19__, as amended on the ___ day
of _____________, 19__;
WHEREAS, following the merger of PSI Resources, Inc. into Cinergy Corp.
("Cinergy") and Cinergy Sub, Inc. merging into CG&E, Executive remained an
Officer of CG&E; and
WHEREAS, CG&E and Executive have agreed to freeze the benefits payable
under the Agreement as part of the restructuring of the Executive's employment
benefits.
NOW, THEREFORE, the parties agree:
1. Supplemental Retirement Benefit. The annual Supplemental Retirement Benefit
of $____________ shall be paid to Executive or his Designee monthly for 180
months beginning ______________, in a monthly amount equal to $___________.
However, at the sole discretion of CG&E's Board of Directors, consistent with
the provisions of Section 5 of this Agreement, the Board may direct that the
Supplemental Retirement Benefit be made in a lump sum in the amount of
$__________ on ______________, or such other date as the Board may determine
provided that the lump sum is reduced by five percent (5%) for each year the
payment is accelerated, provided, however, that the maximum such reduction shall
not exceed twenty-five percent (25%).
2. Designee. Any payments to be made after the death of Executive shall be made
to the person or persons designated in writing to CG&E by Executive. In the
absence of such written designation, the term Designee shall mean, and payment
shall be made in the following descending order:
(i) Executive's surviving spouse while living;
(ii) Equally to Executive's children per stirpes; and
(iii) The estate of the last survivor of the persons named above.
3. Life Insurance Policies. In consideration of the benefits under this
Agreement, the ------------------------ Executive consents to and will assist
CG&E in the purchase of Key Person Life Insurance Policies on his life at any
time and in any amount determined by CG&E. Such life insurance policies shall be
owned by CG&E and shall be for the sole benefit of CG&E. Neither Executive nor
his Designee, heirs or administrators shall have any right, title, or interest
in the value or benefits under such policies.
4. Conditions. Executive will be entitled to the benefits herein even if
terminated, unless such termination is for Cause. For purposes of this Agreement
Cause shall mean:
(i) The commission of a felony; or
(ii) If Executive, without the written consent of CG&E, engages in any
activity which is adverse to the economic interests of CG&E, or if he
discloses any confidential information, not required by law, a court, or by the
regulatory hearing process.
If litigation shall be brought to enforce or interpret any provision contained
within the Agreement, CG&E hereby agrees to indemnify the Executive for his
reasonable attorneys' fees and disbursements incurred in such litigation and
hereby agrees to pay prejudgment interest on any money judgment obtained by the
Executive, calculated at the prime interest rate in effect in Cincinnati, Ohio,
from time to time and the earliest date that payment(s) to him should have been
made under this Agreement.
5. Acceleration of Benefit Payments. CG&E hereby reserves to its Board of
Directors the right to accelerate the payment of any of the benefits specified
herein without the consent of Executive.
6. Assignability. Except to the extent that this provision may be contrary to
law, no assignment, pledge, collateralization, or attachment of any of the
benefits under this Agreement shall be valid or recognized by CG&E.
7. Employment Rights. This Agreement creates no right in Executive to continue
in employment with CG&E for any specific length of time, nor does it create any
other rights in Executive or obligation on the part of CG&E, except those set
forth in this Agreement.
8. Binding Effect. The provisions of this Agreement shall insure to and be
binding upon the designee, heirs, executors, and administrators of Executive,
and upon the successors and assigns of CG&E, including any successor
organization which succeeds to substantially all of the assets and business of
CG&E. CG&E agrees that it will make appropriate provisions for the preservation
of Executive's rights under this Agreement in any agreement or plan which it may
enter into to effect any merger, consolidation, reorganization or transfer of
assets. Upon such a merger, consolidation, reorganization, or transfer of
assets, the term "CG&E" as used in this Agreement shall mean and shall refer to
the successor organization, and this Agreement shall continue in full force and
effect, binding on such successor organization.
9. Governing Law. This Agreement shall be governed by the laws of the State of
Ohio.
10. Amendment. This Agreement may be altered, amended, or revoked only by a
written instrument signed by both Executive and CG&E.
11. Prior Agreement. This Agreement supersedes any prior agreement between CG&E
and Executive regarding Supplemental Executive Retirement Income.
IN WITNESS WHEREOF, the parties have executed this Agreement effective on the
date first above written.
WITNESS: THE CINCINNATI GAS &
ELECTRIC COMPANY
___________________________________ By: ____________________________________
Jackson H. Randolph
Chairman and Chief Executive Officer
WITNESS:
- ----------------------------------- ------------------------------------
Executive
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>10
<DESCRIPTION>CINERGY 12/31/97 10-K
<TEXT>
Adopted by the Cinergy Corp.
Board of Directors on January 30, 1997
1997 AMENDMENTS TO VARIOUS
COMPENSATION AND BENEFIT PLANS
OF CINERGY CORP.
This document sets forth amendments to various compensation and benefit plans of
Cinergy Corp. with regard to the definition of "change in control" as contained
in each of the plans. All amendments are effective January 1, 1997. Amendments
to the following plans are set forth in this document:
- --------------------------------------------------------------------------------
NAME OF PLAN DATE PLAN ADOPTED
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Stock Option Plan October 18, 1994
- --------------------------------------------------------------------------------
Performance Shares Plan October 18, 1994
- --------------------------------------------------------------------------------
Employee Stock Purchase and Savings Plan October 18, 1994
- --------------------------------------------------------------------------------
Directors' Deferred Compensation Plan October 18, 1994
- --------------------------------------------------------------------------------
Retirement Plan for Directors October 18, 1994
- --------------------------------------------------------------------------------
Annual Incentive Plan October 18, 1994
- --------------------------------------------------------------------------------
1996 Long-Term Incentive Compensation January 25, 1996
Plan (Approved by shareholders April 26, 1996)
- --------------------------------------------------------------------------------
401(k) Excess Plan December 17, 1996
- --------------------------------------------------------------------------------
Nonqualified Deferred Incentive December 17, 1996
Compensation Plan
- --------------------------------------------------------------------------------
(1) Explanation of Amendments
The definition of "change in control" of Cinergy Corp. contained in each of the
above referenced plans, is a standard, uniform definition. Effective January 1,
1997, each of these plans is amended by substituting a new standard, uniform
definition of "change in control" of Cinergy Corp.
(2) Amendment to the Cinergy Corp. Stock Option Plan
(a) Section 18.11 as Amended
Section 18.11, as hereby amended, reads as follows:
"18.11 Change in Control.
Notwithstanding anything in the Plan to the contrary, in the event of a Change
in Control of CINergy each unexpired Option and Stock Appreciation Right shall
be exercisable, beginning immediately, as to all remaining shares subject to the
Option or subject to the Stock Appreciation Rights.
A 'Change in Control' of CINergy shall be deemed to have occurred if the event
set forth in any one of the following paragraphs shall have occurred:
(1) Any 'person' or 'group' (within the meaning of Subsection 13(d) and
Paragraph 14(d)(2) of the 1934 Act is or becomes the beneficial owner (as
defined in Rule 13d-3 under the 1934 Act), directly or indirectly, of securities
of CINergy (not including in the securities beneficially owned by such Person
any securities acquired directly from CINergy or its affiliates) representing
50% or more of the combined voting power of CINergy's then outstanding
securities, excluding any person who becomes such a beneficial owner in
connection with a transaction described in clause (i) of paragraph (2) below; or
(2) There is consummated a merger or consolidation of CINergy or any direct or
indirect subsidiary of CINergy with any other corporation, other than (i) a
merger or consolidation which would result in the voting securities of CINergy
outstanding immediately prior to such merger or consolidation continuing to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity or any parent thereof) at least 50% of the
combined voting power of the securities of CINergy or such surviving entity or
any parent thereof outstanding immediately after such merger or consolidation,
or (ii) a merger or consolidation effected to implement a recapitalization of
CINergy (or similar transaction) in which no person is or becomes the beneficial
owner, directly or indirectly, of securities of CINergy (not including in the
securities beneficially owned by such person any securities acquired directly
from CINergy or its affiliates other than in connection with the acquisition by
CINergy or its affiliates of a business) representing 25% or more of the
combined voting power of CINergy's then outstanding securities; or
(3) During any period of two consecutive years, individuals who at the beginning
of that period constitute CINergy's Board of Directors and any new director
(other than a director whose initial assumption of office is in connection with
an actual or threatened election contest, including but not limited to a consent
solicitation, relating to the election of directors of CINergy) whose
appointment or election by CINergy's Board of Directors or nomination for
election by CINergy's shareholders was approved or recommended by a vote of at
least two-thirds (2/3) of the directors then still in office who either were
directors at the beginning of that period or whose appointment, election or
nomination for election was previously so approved or recommended cease for any
reason to constitute a majority of CINergy's Board of Directors; or
(4) The shareholders of CINergy approve a plan of complete liquidation or
dissolution of CINergy or there is consummated an agreement for the sale or
disposition by CINergy of all or substantially all of CINergy's assets, other
than a sale or disposition by CINergy of all or substantially all of CINergy's
assets to an entity, at least 60% of the combined voting power of the voting
securities of which are owned by shareholders of CINergy in substantially the
same proportions as their ownership of CINergy immediately prior to such sale.
Notwithstanding the provisions of Article 13 (Amendment, Modification and
Termination of the Plan), the foregoing provisions of this Section may not be
amended by an amendment to the Plan effected within three years following a
Change in Control.
If the immediate exercisability of ISOs arising from a 'Change in Control' as
described above would cause the $100,000 limitation applicable to ISOs described
in Section 9.5 (ISOs) to be exceeded for an Optionee, the Committee shall
convert as of the effective date of the Change in Control all or a portion of
the outstanding ISOs held by the Optionee to NSOs to the extent necessary to
comply with the $100,000 limitation and to the extent permitted by Code
Subsection 422(d). However, if the Committee determines that conversion is not
permitted by the Code, the Committee shall not convert the Options and shall
take any and all other steps necessary to accelerate the exercisability of the
ISOs to the maximum extent possible under Code Subsection 422(d) without
exceeding the $100,000 limitation described above."
(3) Amendment to the Cinergy Corp. Performance Shares Plan
(a) Article 14 as Amended
Article 14, as hereby amended, reads as follows:
"ARTICLE 14
CHANGE IN CONTROL
Notwithstanding anything in the Plan to the contrary, if a Change in Control of
CINergy occurs, each Corporate Target Goal and Individual Goal in effect for any
applicable Performance Period of each Employer's Long-Term Program shall be
deemed achieved at the Incentive Factor level existing as of the date of the
Change in Control and each Participant shall be entitled to receive a
Performance Award adjusted to reflect the actual period of time between the
beginning of the Performance Period and the date of the Change in Control. In
addition, any installment of a Performance Award which has not been distributed
under Article 8 (Distribution) as of the date of a Change in Control shall be
immediately distributed to each Participant.
A 'Change in Control' of CINergy shall be deemed to have occurred if the event
set forth in any one of the following paragraphs shall have occurred:
(1) Any 'person' or 'group' (within the meaning of Subsection 13(d) and
Paragraph 14(d)(2) of the 1934 Act is or becomes the beneficial owner (as
defined in Rule 13d-3 under the 1934 Act), directly or indirectly, of securities
of CINergy (not including in the securities beneficially owned by such Person
any securities acquired directly from CINergy or its affiliates) representing
50% or more of the combined voting power of CINergy's then outstanding
securities, excluding any person who becomes such a beneficial owner in
connection with a transaction described in clause (i) of paragraph (2) below; or
(2) There is consummated a merger or consolidation of CINergy or any direct or
indirect subsidiary of CINergy with any other corporation, other than (i) a
merger or consolidation which would result in the voting securities of CINergy
outstanding immediately prior to such merger or consolidation continuing to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity or any parent thereof) at least 50% of the
combined voting power of the securities of CINergy or such surviving entity or
any parent thereof outstanding immediately after such merger or consolidation,
or (ii) a merger or consolidation effected to implement a recapitalization of
CINergy (or similar transaction) in which no person is or becomes the beneficial
owner, directly or indirectly, of securities of CINergy (not including in the
securities beneficially owned by such person any securities acquired directly
from CINergy or its affiliates other than in connection with the acquisition by
CINergy or its affiliates of a business) representing 25% or more of the
combined voting power of CINergy's then outstanding securities; or
(3) During any period of two consecutive years, individuals who at the beginning
of that period constitute CINergy's Board of Directors and any new director
(other than a director whose initial assumption of office is in connection with
an actual or threatened election contest, including but not limited to a consent
solicitation, relating to the election of directors of CINergy) whose
appointment or election by CINergy's Board of Directors or nomination for
election by CINergy's shareholders was approved or recommended by a vote of at
least two-thirds (2/3) of the directors then still in office who either were
directors at the beginning of that period or whose appointment, election or
nomination for election was previously so approved or recommended cease for any
reason to constitute a majority of CINergy's Board of Directors; or
(4) The shareholders of CINergy approve a plan of complete liquidation or
dissolution of CINergy or there is consummated an agreement for the sale or
disposition by CINergy of all or substantially all of CINergy's assets, other
than a sale or disposition by CINergy of all or substantially all of CINergy's
assets to an entity, at least 60% of the combined voting power of the voting
securities of which are owned by shareholders of CINergy in substantially the
same proportions as their ownership of CINergy immediately prior to such sale.
Notwithstanding the provisions of Article 17 (Amendment and Termination), the
provisions of this Article may not be amended by an amendment to the Plan
effected within three years following a Change in Control."
(4) Amendment to the Cinergy Corp. Employee Stock Purchase and Savings Plan
(a) Section 9.14 as Amended
Section 9.14, as hereby amended, reads as follows:
"9.14 Change in Control
Notwithstanding anything in the Plan to the contrary, if a Change in Control of
CINergy occurs, an Eligible Employee shall have the right within three months
from the Change in Control (unless the Purchase Date shall first occur in which
event the right may be exercised only on or prior to the Purchase Date) to elect
to purchase all or fewer than all of the shares which he is entitled to purchase
as a result of his participation in the offering with the funds, including
interest, if any, then on deposit in his Purchase Savings Account or to receive
the funds in cash.
A 'Change in Control' of CINergy shall be deemed to have occurred if the event
set forth in any one of the following paragraphs shall have occurred:
(1) Any 'person' or 'group' (within the meaning of Subsection 13(d) and
Paragraph 14(d)(2) of the 1934 Act is or becomes the beneficial owner (as
defined in Rule 13d-3 under the 1934 Act), directly or indirectly, of securities
of CINergy (not including in the securities beneficially owned by such Person
any securities acquired directly from CINergy or its affiliates) representing
50% or more of the combined voting power of CINergy's then outstanding
securities, excluding any person who becomes such a beneficial owner in
connection with a transaction described in clause (i) of paragraph (2) below; or
(2) There is consummated a merger or consolidation of CINergy or any direct or
indirect subsidiary of CINergy with any other corporation, other than (i) a
merger or consolidation which would result in the voting securities of CINergy
outstanding immediately prior to such merger or consolidation continuing to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity or any parent thereof) at least 50% of the
combined voting power of the securities of CINergy or such surviving entity or
any parent thereof outstanding immediately after such merger or consolidation,
or (ii) a merger or consolidation effected to implement a recapitalization of
CINergy (or similar transaction) in which no person is or becomes the beneficial
owner, directly or indirectly, of securities of CINergy (not including in the
securities beneficially owned by such person any securities acquired directly
from CINergy or its affiliates other than in connection with the acquisition by
CINergy or its affiliates of a business) representing 25% or more of the
combined voting power of CINergy's then outstanding securities; or
(3) During any period of two consecutive years, individuals who at the beginning
of that period constitute CINergy's Board of Directors and any new director
(other than a director whose initial assumption of office is in connection with
an actual or threatened election contest, including but not limited to a consent
solicitation, relating to the election of directors of CINergy) whose
appointment or election by CINergy's Board of Directors or nomination for
election by CINergy's shareholders was approved or recommended by a vote of at
least two-thirds (2/3) of the directors then still in office who either were
directors at the beginning of that period or whose appointment, election or
nomination for election was previously so approved or recommended cease for any
reason to constitute a majority of CINergy's Board of Directors; or
(4) The shareholders of CINergy approve a plan of complete liquidation or
dissolution of CINergy or there is consummated an agreement for the sale or
disposition by CINergy of all or substantially all of CINergy's assets, other
than a sale or disposition by CINergy of all or substantially all of CINergy's
assets to an entity, at least 60% of the combined voting power of the voting
securities of which are owned by shareholders of CINergy in substantially the
same proportions as their ownership of CINergy immediately prior to such sale.
Notwithstanding the provisions of Article 11 (Amendments), the foregoing
provisions of this Section may not be amended by an amendment to the Plan
effected within three years following a Change in Control."
(5) Amendment to the Directors' Deferred Compensation Plan
(a) Article 12 as Amended
Article 12, as hereby amended, reads as follows:
"ARTICLE 12
CHANGE IN CONTROL
Notwithstanding any other Article, if a Change in Control of CINergy occurs, the
Committee in its sole discretion may elect to accelerate the distribution of all
Fees deferred under the Plan so that all deferred Fees shall be distributed to
each Director and former Director (or, in the event of his death, to his
Beneficiary) in a single lump sum payment no later than 30 days after the Change
in Control occurs.
A 'Change in Control' of CINergy shall be deemed to have occurred if the event
set forth in any one of the following paragraphs shall have occurred:
(1) Any 'person' or 'group' (within the meaning of Subsection 13(d) and
Paragraph 14(d)(2) of the 1934 Act is or becomes the beneficial owner (as
defined in Rule 13d-3 under the 1934 Act), directly or indirectly, of securities
of CINergy (not including in the securities beneficially owned by such Person
any securities acquired directly from CINergy or its affiliates) representing
50% or more of the combined voting power of CINergy's then outstanding
securities, excluding any person who becomes such a beneficial owner in
connection with a transaction described in clause (i) of paragraph (2) below; or
(2) There is consummated a merger or consolidation of CINergy or any direct or
indirect subsidiary of CINergy with any other corporation, other than (i) a
merger or consolidation which would result in the voting securities of CINergy
outstanding immediately prior to such merger or consolidation continuing to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity or any parent thereof) at least 50% of the
combined voting power of the securities of CINergy or such surviving entity or
any parent thereof outstanding immediately after such merger or consolidation,
or (ii) a merger or consolidation effected to implement a recapitalization of
CINergy (or similar transaction) in which no person is or becomes the beneficial
owner, directly or indirectly, of securities of CINergy (not including in the
securities beneficially owned by such person any securities acquired directly
from CINergy or its affiliates other than in connection with the acquisition by
CINergy or its affiliates of a business) representing 25% or more of the
combined voting power of CINergy's then outstanding securities; or
(3) During any period of two consecutive years, individuals who at the beginning
of that period constitute CINergy's Board of Directors and any new director
(other than a director whose initial assumption of office is in connection with
an actual or threatened election contest, including but not limited to a consent
solicitation, relating to the election of directors of CINergy) whose
appointment or election by CINergy's Board of Directors or nomination for
election by CINergy's shareholders was approved or recommended by a vote of at
least two-thirds (2/3) of the directors then still in office who either were
directors at the beginning of that period or whose appointment, election or
nomination for election was previously so approved or recommended cease for any
reason to constitute a majority of CINergy's Board of Directors; or
(4) The shareholders of CINergy approve a plan of complete liquidation or
dissolution of CINergy or there is consummated an agreement for the sale or
disposition by CINergy of all or substantially all of CINergy's assets, other
than a sale or disposition by CINergy of all or substantially all of CINergy's
assets to an entity, at least 60% of the combined voting power of the voting
securities of which are owned by shareholders of CINergy in substantially the
same proportions as their ownership of CINergy immediately prior to such sale.
Notwithstanding the provisions of Article 11 (Amendment and Termination), the
provisions of this Article may not be amended by an amendment effected within
three years following a Change in Control."
(6) Amendment to the Cinergy Corp. Retirement Plan for Directors
(a) Article 15 as Amended
Article 15, as hereby amended, reads as follows:
"ARTICLE 15
PAYMENTS UPON CHANGE IN CONTROL
Notwithstanding anything contained in the Plan to the contrary, following a
Change in Control of CINergy, each Participant (or Beneficiary, if appropriate)
shall be entitled to receive a lump sum payment of the actuarial equivalent of
benefits accrued and remaining unpaid as of the date of the Change in Control.
The lump sum equivalent shall be calculated assuming the interest rate used by
the Pension Benefit Guaranty Corporation in determining the value of immediate
benefits as of the immediately preceding January 1.
A 'Change in Control' of CINergy shall be deemed to have occurred if the event
set forth in any one of the following paragraphs shall have occurred:
(1) Any 'person' or 'group' (within the meaning of Subsection 13(d) and
Paragraph 14(d)(2) of the 1934 Act is or becomes the beneficial owner (as
defined in Rule 13d-3 under the 1934 Act), directly or indirectly, of securities
of CINergy (not including in the securities beneficially owned by such Person
any securities acquired directly from CINergy or its affiliates) representing
50% or more of the combined voting power of CINergy's then outstanding
securities, excluding any person who becomes such a beneficial owner in
connection with a transaction described in clause (i) of paragraph (2) below; or
(2) There is consummated a merger or consolidation of CINergy or any direct or
indirect subsidiary of CINergy with any other corporation, other than (i) a
merger or consolidation which would result in the voting securities of CINergy
outstanding immediately prior to such merger or consolidation continuing to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity or any parent thereof) at least 50% of the
combined voting power of the securities of CINergy or such surviving entity or
any parent thereof outstanding immediately after such merger or consolidation,
or (ii) a merger or consolidation effected to implement a recapitalization of
CINergy (or similar transaction) in which no person is or becomes the beneficial
owner, directly or indirectly, of securities of CINergy (not including in the
securities beneficially owned by such person any securities acquired directly
from CINergy or its affiliates other than in connection with the acquisition by
CINergy or its affiliates of a business) representing 25% or more of the
combined voting power of CINergy's then outstanding securities; or
(3) During any period of two consecutive years, individuals who at the beginning
of that period constitute CINergy's Board of Directors and any new director
(other than a director whose initial assumption of office is in connection with
an actual or threatened election contest, including but not limited to a consent
solicitation, relating to the election of directors of CINergy) whose
appointment or election by CINergy's Board of Directors or nomination for
election by CINergy's shareholders was approved or recommended by a vote of at
least two-thirds (2/3) of the directors then still in office who either were
directors at the beginning of that period or whose appointment, election or
nomination for election was previously so approved or recommended cease for any
reason to constitute a majority of CINergy's Board of Directors; or
(4) The shareholders of CINergy approve a plan of complete liquidation or
dissolution of CINergy or there is consummated an agreement for the sale or
disposition by CINergy of all or substantially all of CINergy's assets, other
than a sale or disposition by CINergy of all or substantially all of CINergy's
assets to an entity, at least 60% of the combined voting power of the voting
securities of which are owned by shareholders of CINergy in substantially the
same proportions as their ownership of CINergy immediately prior to such sale.
Notwithstanding the provisions of Article 12 (Amendment and Termination), the
provisions of this Article may not be amended by an amendment to the Plan
effected within three years following a Change in Control."
(7) Amendment to the Cinergy Corp. Annual Incentive Plan
(a) Article 14 as Amended
Article 14, as hereby amended, reads as follows:
"ARTICLE 14
CHANGE IN CONTROL
Notwithstanding anything in the Plan to the contrary, if a Change in Control of
CINergy occurs, each Corporate Target Goal and Individual Goal of each
Employer's Annual Program shall be deemed to have been fully satisfied at the
Maximum Incentive level and each Participant shall be entitled to receive an
Incentive Award in the same manner as though the Maximum Incentive level had
been obtained for the full Performance Period.
A 'Change in Control' of CINergy shall be deemed to have occurred if the event
set forth in any one of the following paragraphs shall have occurred:
(1) Any 'person' or 'group' (within the meaning of Subsection 13(d) and
Paragraph 14(d)(2) of the 1934 Act is or becomes the beneficial owner (as
defined in Rule 13d-3 under the 1934 Act), directly or indirectly, of securities
of CINergy (not including in the securities beneficially owned by such Person
any securities acquired directly from CINergy or its affiliates) representing
50% or more of the combined voting power of CINergy's then outstanding
securities, excluding any person who becomes such a beneficial owner in
connection with a transaction described in clause (i) of paragraph (2) below; or
(2) There is consummated a merger or consolidation of CINergy or any direct or
indirect subsidiary of CINergy with any other corporation, other than (i) a
merger or consolidation which would result in the voting securities of CINergy
outstanding immediately prior to such merger or consolidation continuing to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity or any parent thereof) at least 50% of the
combined voting power of the securities of CINergy or such surviving entity or
any parent thereof outstanding immediately after such merger or consolidation,
or (ii) a merger or consolidation effected to implement a recapitalization of
CINergy (or similar transaction) in which no person is or becomes the beneficial
owner, directly or indirectly, of securities of CINergy (not including in the
securities beneficially owned by such person any securities acquired directly
from CINergy or its affiliates other than in connection with the acquisition by
CINergy or its affiliates of a business) representing 25% or more of the
combined voting power of CINergy's then outstanding securities; or
(3) During any period of two consecutive years, individuals who at the beginning
of that period constitute CINergy's Board of Directors and any new director
(other than a director whose initial assumption of office is in connection with
an actual or threatened election contest, including but not limited to a consent
solicitation, relating to the election of directors of CINergy) whose
appointment or election by CINergy's Board of Directors or nomination for
election by CINergy's shareholders was approved or recommended by a vote of at
least two-thirds (2/3) of the directors then still in office who either were
directors at the beginning of that period or whose appointment, election or
nomination for election was previously so approved or recommended cease for any
reason to constitute a majority of CINergy's Board of Directors; or
(4) The shareholders of CINergy approve a plan of complete liquidation or
dissolution of CINergy or there is consummated an agreement for the sale or
disposition by CINergy of all or substantially all of CINergy's assets, other
than a sale or disposition by CINergy of all or substantially all of CINergy's
assets to an entity, at least 60% of the combined voting power of the voting
securities of which are owned by shareholders of CINergy in substantially the
same proportions as their ownership of CINergy immediately prior to such sale.
Notwithstanding the provisions of Article 18 (Amendment and Termination), the
provisions of this Article may not be amended by an amendment to the Plan
effected within three years following a Change in Control."
(8) Amendment to the Cinergy Corp. 1996 Long-Term Incentive Compensation Plan
(a) Section 21.11 as Amended
Section 21.11, as hereby amended, reads as follows:
"21.11 Change in Control.
Notwithstanding anything in the Plan to the contrary, in the event of a Change
in Control of Cinergy, unless otherwise provided in the related Award Agreement:
(i) each unexpired Option and Stock Appreciation Right shall become exercisable
in full, (ii) all restrictions (other than restrictions imposed by law) and
conditions of all Restricted Stock (other than Restricted Stock subject to
Performance Measures), Dividend Equivalents and Other Stock-Based Awards then
outstanding shall be deemed satisfied subject to any holding period limitations,
(iii) all Performance Measures of all Performance Shares and Performance Awards,
Restricted Stock, Dividend Equivalents and Other Stock-Based Awards shall be
deemed fully satisfied at the maximum criteria levels.
A 'Change in Control' of CINergy shall be deemed to have occurred if the event
set forth in any one of the following paragraphs shall have occurred:
(1) Any 'person' or 'group' (within the meaning of Subsection 13(d) and
Paragraph 14(d)(2) of the 1934 Act is or becomes the beneficial owner (as
defined in Rule 13d-3 under the 1934 Act), directly or indirectly, of securities
of CINergy (not including in the securities beneficially owned by such Person
any securities acquired directly from CINergy or its affiliates) representing
50% or more of the combined voting power of CINergy's then outstanding
securities, excluding any person who becomes such a beneficial owner in
connection with a transaction described in clause (i) of paragraph (2) below; or
(2) There is consummated a merger or consolidation of CINergy or any direct or
indirect subsidiary of CINergy with any other corporation, other than (i) a
merger or consolidation which would result in the voting securities of CINergy
outstanding immediately prior to such merger or consolidation continuing to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity or any parent thereof) at least 50% of the
combined voting power of the securities of CINergy or such surviving entity or
any parent thereof outstanding immediately after such merger or consolidation,
or (ii) a merger or consolidation effected to implement a recapitalization of
CINergy (or similar transaction) in which no person is or becomes the beneficial
owner, directly or indirectly, of securities of CINergy (not including in the
securities beneficially owned by such person any securities acquired directly
from CINergy or its affiliates other than in connection with the acquisition by
CINergy or its affiliates of a business) representing 25% or more of the
combined voting power of CINergy's then outstanding securities; or
(3) During any period of two consecutive years, individuals who at the beginning
of that period constitute CINergy's Board of Directors and any new director
(other than a director whose initial assumption of office is in connection with
an actual or threatened election contest, including but not limited to a consent
solicitation, relating to the election of directors of CINergy) whose
appointment or election by CINergy's Board of Directors or nomination for
election by CINergy's shareholders was approved or recommended by a vote of at
least two-thirds (2/3) of the directors then still in office who either were
directors at the beginning of that period or whose appointment, election or
nomination for election was previously so approved or recommended cease for any
reason to constitute a majority of CINergy's Board of Directors; or
(4) The shareholders of CINergy approve a plan of complete liquidation or
dissolution of CINergy or there is consummated an agreement for the sale or
disposition by CINergy of all or substantially all of CINergy's assets, other
than a sale or disposition by CINergy of all or substantially all of CINergy's
assets to an entity, at least 60% of the combined voting power of the voting
securities of which are owned by shareholders of CINergy in substantially the
same proportions as their ownership of CINergy immediately prior to such sale.
Notwithstanding the provisions of Article 16 (Amendment, Modification and
Termination of the Plan), the foregoing provisions of this Section may not be
amended by an amendment to the Plan effected within three years following a
Change in Control.
If the immediate exercisability of ISOs arising from a Change in Control as
described above would cause the $100,000 limitation applicable to ISOs described
in Section 8.1 (Types of Option) to be exceeded for an Optionee, the Committee
shall convert as of the effective date of the Change in Control all or a portion
of the outstanding ISOs held by the Optionee to NSOs to the extent necessary to
comply with the $100,000 limitation and to the extent permitted by Code
Subsection 422(d). However, if the Committee determines that conversion is not
permitted by the Code, the Committee shall not convert the Options and shall
take any and all other steps necessary to accelerate the exercisability of the
ISOs to the maximum extent possible under Code Subsection 422(d) without
exceeding the $100,000 limitation described above."
(9) Amendment to the Cinergy Corp. 401(k) Excess Plan
(a) Section 5.2 as Amended
Section 5.2, as hereby amended, reads as follows:
"5.2 Distribution Upon a Change in Control.
Notwithstanding any other Section, if a Change in Control occurs, the Committee
in its sole discretion may elect to accelerate the distribution of a
Participant's Accounts so that a Participant's Accounts shall be distributed to
the Participant (or, in the event of his death, to his Beneficiary) in a single
lump sum payment no later than 30 days after the Change in Control occurs.
A 'Change in Control' of the Company shall be deemed to have occurred if the
event set forth in any one of the following paragraphs shall have occurred:
(1) Any 'person' or 'group' (within the meaning of Subsection 13(d) and
Paragraph 14(d)(2) of the 1934 Act is or becomes the beneficial owner (as
defined in Rule 13d-3 under the 1934 Act), directly or indirectly, of securities
of the Company (not including in the securities beneficially owned by such
Person any securities acquired directly from the Company or its affiliates)
representing 50% or more of the combined voting power of the Company's then
outstanding securities, excluding any person who becomes such a beneficial owner
in connection with a transaction described in clause (i) of paragraph (2) below;
or
(2) There is consummated a merger or consolidation of the Company or any direct
or indirect subsidiary of the Company with any other corporation, other than (i)
a merger or consolidation which would result in the voting securities of the
Company outstanding immediately prior to such merger or consolidation continuing
to represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity or any parent thereof) at least 50% of the
combined voting power of the securities of the Company or such surviving entity
or any parent thereof outstanding immediately after such merger or
consolidation, or (ii) a merger or consolidation effected to implement a
recapitalization of the Company (or similar transaction) in which no person is
or becomes the beneficial owner, directly or indirectly, of securities of the
Company (not including in the securities beneficially owned by such person any
securities acquired directly from the Company or its affiliates other than in
connection with the acquisition by the Company or its affiliates of a business)
representing 25% or more of the combined voting power of the Company's then
outstanding securities; or
(3) During any period of two consecutive years, individuals who at the beginning
of that period constitute the Board of Directors and any new director (other
than a director whose initial assumption of office is in connection with an
actual or threatened election contest, including but not limited to a consent
solicitation, relating to the election of directors of the Company) whose
appointment or election by the Board of Directors or nomination for election by
the Company's shareholders was approved or recommended by a vote of at least
two-thirds (2/3) of the directors then still in office who either were directors
at the beginning of that period or whose appointment, election or nomination for
election was previously so approved or recommended cease for any reason to
constitute a majority of the Board of Directors; or
(4) The shareholders of the Company approve a plan of complete liquidation or
dissolution of the Company or there is consummated an agreement for the sale or
disposition by the Company of all or substantially all of the Company's assets,
other than a sale or disposition by the Company of all or substantially all of
the Company's assets to an entity, at least 60% of the combined voting power of
the voting securities of which are owned by shareholders of the Company in
substantially the same proportions as their ownership of the Company immediately
prior to such sale."
(10) Amendment to the Cinergy Corp. Nonqualified Deferred Incentive Compensation
Plan
a) Section 5.2 as Amended
Section 5.2, as hereby amended, reads as follows:
"5.2 Distribution Upon a Change in Control.
Notwithstanding any other Section, if a Change in Control occurs, the Committee
in its sole discretion may elect to accelerate the distribution of a
Participant's Account so that a Participant's Account shall be distributed to
the Participant (or, in the event of his death, to his Beneficiary) in a single
lump sum payment no later than 30 days after the Change in Control occurs.
A 'Change in Control' of the Company shall be deemed to have occurred if the
event set forth in any one of the following paragraphs shall have occurred:
(1) Any 'person' or 'group' (within the meaning of Subsection 13(d) and
Paragraph 14(d)(2) of the 1934 Act is or becomes the beneficial owner (as
defined in Rule 13d-3 under the 1934 Act), directly or indirectly, of securities
of the Company (not including in the securities beneficially owned by such
Person any securities acquired directly from the Company or its affiliates)
representing 50% or more of the combined voting power of the Company's then
outstanding securities, excluding any person who becomes such a beneficial owner
in connection with a transaction described in clause (i) of paragraph (2) below;
or
(2) There is consummated a merger or consolidation of the Company or any direct
or indirect subsidiary of the Company with any other corporation, other than (i)
a merger or consolidation which would result in the voting securities of the
Company outstanding immediately prior to such merger or consolidation continuing
to represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity or any parent thereof) at least 50% of the
combined voting power of the securities of the Company or such surviving entity
or any parent thereof outstanding immediately after such merger or
consolidation, or (ii) a merger or consolidation effected to implement a
recapitalization of the Company (or similar transaction) in which no person is
or becomes the beneficial owner, directly or indirectly, of securities of the
Company (not including in the securities beneficially owned by such person any
securities acquired directly from the Company or its affiliates other than in
connection with the acquisition by the Company or its affiliates of a business)
representing 25% or more of the combined voting power of the Company's then
outstanding securities; or
(3) During any period of two consecutive years, individuals who at the beginning
of that period constitute the Board of Directors and any new director (other
than a director whose initial assumption of office is in connection with an
actual or threatened election contest, including but not limited to a consent
solicitation, relating to the election of directors of the Company) whose
appointment or election by the Board of Directors or nomination for election by
the Company's shareholders was approved or recommended by a vote of at least
two-thirds (2/3) of the directors then still in office who either were directors
at the beginning of that period or whose appointment, election or nomination for
election was previously so approved or recommended cease for any reason to
constitute a majority of the Board of Directors; or
(4) The shareholders of the Company approve a plan of complete liquidation or
dissolution of the Company or there is consummated an agreement for the sale or
disposition by the Company of all or substantially all of the Company's assets,
other than a sale or disposition by the Company of all or substantially all of
the Company's assets to an entity, at least 60% of the combined voting power of
the voting securities of which are owned by shareholders of the Company in
substantially the same proportions as their ownership of the Company immediately
prior to such sale."
These Amendments are executed and approved by the duly authorized officers of
Cinergy Corp., effective as of January 1, 1997.
CINERGY CORP.
By: _____________________________
James E. Rogers
Vice Chairman and
Chief Executive Officer
Dated: ___________________________
Approved:
By: _____________________________
Cheryl M. Foley
Vice President, General Counsel
and Corporate Secretary
Dated: ___________________________
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-21
<SEQUENCE>11
<DESCRIPTION>CINERGY 12/31/97 10-K
<TEXT>
Subsidiary Listing
The following is a listing of the subsidiaries of each registrant and their
state of incorporation or organization indented to show degree of remoteness
from registrant.
State of Organization
Name of Company or Incorporation
Cinergy Corp. Delaware
The Cincinnati Gas & Electric Company Ohio
The Union Light, Heat and Power Company Kentucky
Lawrenceburg Gas Company Indiana
The West Harrison Gas and Electric Company Indiana
Miami Power Corporation Indiana
KO Transmission Company Kentucky
Tri-State Improvement Company Ohio
PSI Energy, Inc. Indiana
South Construction Company, Inc. Indiana
PSI Energy Argentina, Inc.* Indiana
Cinergy Services, Inc. Delaware
Cinergy Investments, Inc. Delaware
Cinergy-Cadence, Inc. Indiana
Cadence Network LLC (33 1/3%) Delaware
Cinergy Capital & Trading, Inc. Indiana
CinCap IV, LLC Delaware
Cinergy Communications, Inc. Delaware
Cinergy Engineering, Inc. Ohio
Cinergy International, Inc. Indiana
Cinergy Global Power, Inc. Delaware
Cinergy Global Hydrocarbons Pakistan
Cinergy MPI II, Inc. Cayman Islands
Cinergy MPI III, Inc. Cayman Islands
Cinergy MPI IV, Inc. Cayman Islands
Cinergy MPI V, Inc. Cayman Islands
Cinergy MPI VI, Inc. Cayman Islands
Cinergy MPI VII, Inc. Cayman Islands
Cinergy MPI VIII, Inc. Cayman Islands
Cinergy MPI IX, Inc. Cayman Islands
Cinergy MPI X, Inc. Cayman Islands
Cinergy MPI XI, Inc. Cayman Islands
Cinergy MPI XII, Inc. Cayman Islands
Cinergy MPI XIII, Inc. Cayman Islands
Cinergy MPI XIV, Inc. Cayman Islands
Cinergy MPI XV, Inc. Cayman Islands
MPII (Zambia) B.V. The Netherlands
Copperbelt Energy Corporation PLC (39%)* Zambia
MPI International Limited England
Cinergy Resources, Inc. Delaware
Cinergy Solutions, Inc. Delaware
(In Illinois d/b/a Cinergy Solutions of Illinois, Inc.,
In Ohio d/b/a Cinergy Solutions of Ohio, Inc.)
Trigen-Cinergy Solutions LLC (50%) Delaware
Trigen-Cinergy Solutions of Cincinnati LLC (51%) Ohio
Trigen-Cinergy Solutions of Illinois LLC (49%) Delaware
Cinergy Supply Network, Inc. Delaware
Cinergy Technology, Inc. Indiana
Cinergy UK, Inc. Delaware
Avon Energy Partners Holdings (50%) England
Avon Energy Partners PLC England
Midlands Electricity plc England
Enertech Associates, Inc. Ohio
PSI Argentina, Inc.* Indiana
Costanera Power Corp.* Indiana
PSI Power Resource Development, Inc. Indiana
PSI Sunnyside, Inc. Indiana
PSI T&D International, Inc. Indiana
PSI Yacyreta, Inc. Indiana
*EWG or foreign utility company
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-23
<SEQUENCE>12
<DESCRIPTION>CINERGY 12/31/97 10K
<TEXT>
Consent of Independent Public Accountants
As independent public accountants, we hereby consent to the
incorporation by reference of our report, dated January 27, 1998,
included in this Annual Report on Form 10-K for the year ended
December 31, 1997, into (i) Cinergy Corp.'s previously filed
Registration Statement Nos. 33-55267, 33-55291, 33-55293, 33-
55713, 33-56067, 33-56089, 33-56091, 33-56093, 33-56095 and 333-
17531; (ii) PSI Energy, Inc.'s previously filed Registration
Statement Nos. 33-48612, 33-57064 and 333-10899; (iii) The
Cincinnati Gas & Electric Company's previously filed Registration
Statement Nos. 33-45116, 33-52335 and 33-58967; and (iv) The
Union Light, Heat and Power Company's previously filed
Registration Statement Nos. 33-40245 and 33-58965.
Arthur Andersen LLP
Cincinnati, Ohio,
March 26, 1998
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-24
<SEQUENCE>13
<DESCRIPTION>CINERGY 12/31/97 10-K
<TEXT>
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the undersigned hereby constitutes and
appoints each of James E. Rogers and Madeleine W. Ludlow, or either of them, the
undersigned's true and lawful attorney-in-fact and agent to execute for and on
behalf of the undersigned, in the undersigned's capacity as a director of
Cinergy Corp., the Form 10-K Annual Report of said corporation for the fiscal
year ended December 31, 1997, and to deliver said Form 10-K Annual Report so
signed for filing with the Securities and Exchange Commission.
The undersigned does hereby ratify and confirm all that said
attorneys-in-fact and agents, or either of them, shall lawfully do by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto caused this Power of
Attorney to be executed on this 3rd day of February, 1998.
/s/ Neil A. Armstrong
Neil A. Armstrong
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the undersigned hereby constitutes and
appoints each of James E. Rogers and Madeleine W. Ludlow, or either of them, the
undersigned's true and lawful attorney-in-fact and agent to execute for and on
behalf of the undersigned, in the undersigned's capacity as a director of each
of Cinergy Corp. and PSI Energy, Inc., the Form 10-K Annual Report of each
corporation for the fiscal year ended December 31, 1997, and to deliver said
Form 10-K Annual Reports so signed for filing with the Securities and Exchange
Commission.
The undersigned does hereby ratify and confirm all that said
attorneys-in-fact and agents, or either of them, shall lawfully do by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto caused this Power of
Attorney to be executed on this 29th day of January, 1998.
/s/ James K. Baker
James K. Baker
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the undersigned hereby constitutes and
appoints each of James E. Rogers and Madeleine W. Ludlow, or either of them, the
undersigned's true and lawful attorney-in-fact and agent to execute for and on
behalf of the undersigned, in the undersigned's capacity as a director of each
of Cinergy Corp. and PSI Energy, Inc., the Form 10-K Annual Report of each
corporation for the fiscal year ended December 31, 1997, and to deliver said
Form 10-K Annual Reports so signed for filing with the Securities and Exchange
Commission.
The undersigned does hereby ratify and confirm all that said
attorneys-in-fact and agents, or either of them, shall lawfully do by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto caused this Power of
Attorney to be executed on this 23rd day of January, 1998.
/s/ Michael G. Browning
Michael G. Browning
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the undersigned hereby constitutes and
appoints each of James E. Rogers and Madeleine W. Ludlow, or either of them, the
undersigned's true and lawful attorney-in-fact and agent to execute for and on
behalf of the undersigned, in the undersigned's capacity as a director of
Cinergy Corp., the Form 10-K Annual Report of said corporation for the fiscal
year ended December 31, 1997, and to deliver said Form 10-K Annual Report so
signed for filing with the Securities and Exchange Commission.
The undersigned does hereby ratify and confirm all that said
attorneys-in-fact and agents, or either of them, shall lawfully do by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto caused this Power of
Attorney to be executed on this 3rd day of February, 1998.
/s/ Phillip R. Cox
Phillip R. Cox
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the undersigned hereby constitutes and
appoints each of James E. Rogers and Madeleine W. Ludlow, or either of them, the
undersigned's true and lawful attorney-in-fact and agent to execute for and on
behalf of the undersigned, in the undersigned's capacity as a director of
Cinergy Corp., the Form 10-K Annual Report of said corporation for the fiscal
year ended December 31, 1997, and to deliver said Form 10-K Annual Report so
signed for filing with the Securities and Exchange Commission.
The undersigned does hereby ratify and confirm all that said
attorneys-in-fact and agents, or either of them, shall lawfully do by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto caused this Power of
Attorney to be executed on this 26th day of January, 1998.
/s/ Kenneth M. Duberstein
Kenneth M. Duberstein
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the undersigned hereby constitutes and
appoints each of James E. Rogers and Madeleine W. Ludlow, or either of them, the
undersigned's true and lawful attorney-in-fact and agent to execute for and on
behalf of the undersigned, in the undersigned's capacity as a director of The
Union Light, Heat and Power Company, the Form 10-K Annual Report of said
corporation for the fiscal year ended December 31, 1997, and to deliver said
Form 10-K Annual Report so signed for filing with the Securities and Exchange
Commission.
The undersigned does hereby ratify and confirm all that said
attorneys-in-fact and agents, or either of them, shall lawfully do by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto caused this Power of
Attorney to be executed on this 27th day of January, 1998.
/s/ Cheryl M. Foley
Cheryl M. Foley
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the undersigned hereby constitutes and
appoints each of James E. Rogers and Madeleine W. Ludlow, or either of them, the
undersigned's true and lawful attorney-in-fact and agent to execute for and on
behalf of the undersigned, in the undersigned's capacity as a director of each
of The Cincinnati Gas & Electric Company and The Union Light, Heat and Power
Company, the Form 10-K Annual Report of each corporation for the fiscal year
ended December 31, 1997, and to deliver said Form 10-K Annual Reports so signed
for filing with the Securities and Exchange Commission.
The undersigned does hereby ratify and confirm all that said
attorneys-in-fact and agents, or either of them, shall lawfully do by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto caused this Power of
Attorney to be executed on this 23rd day of January, 1998.
/s/ William J. Grealis
William J. Grealis
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the undersigned hereby constitutes and
appoints each of James E. Rogers and Madeleine W. Ludlow, or either of them, the
undersigned's true and lawful attorney-in-fact and agent to execute for and on
behalf of the undersigned, in the undersigned's capacity as a director of each
of Cinergy Corp. and PSI Energy, Inc., the Form 10-K Annual Report of each
corporation for the fiscal year ended December 31, 1997, and to deliver said
Form 10-K Annual Reports so signed for filing with the Securities and Exchange
Commission.
The undersigned does hereby ratify and confirm all that said
attorneys-in-fact and agents, or either of them, shall lawfully do by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto caused this Power of
Attorney to be executed on this 26th day of January, 1998.
/s/ John A. Hillenbrand II
John A. Hillenbrand II
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the undersigned hereby constitutes and
appoints each of James E. Rogers and Madeleine W. Ludlow, or either of them, the
undersigned's true and lawful attorney-in-fact and agent to execute for and on
behalf of the undersigned, in the undersigned's capacity as a director of
Cinergy Corp., the Form 10-K Annual Report of said corporation for the fiscal
year ended December 31, 1997, and to deliver said Form 10-K Annual Report so
signed for filing with the Securities and Exchange Commission.
The undersigned does hereby ratify and confirm all that said
attorneys-in-fact and agents, or either of them, shall lawfully do by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto caused this Power of
Attorney to be executed on this 26th day of January, 1998.
/s/ George C. Juilfs
George C. Juilfs
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the undersigned hereby constitutes and
appoints each of James E. Rogers and Madeleine W. Ludlow, or either of them, the
undersigned's true and lawful attorney-in-fact and agent to execute for and on
behalf of the undersigned, in the undersigned's capacity as a director of The
Union Light, Heat and Power Company, the Form 10-K Annual Report of said
corporation for the fiscal year ended December 31, 1997, and to deliver said
Form 10-K Annual Report so signed for filing with the Securities and Exchange
Commission.
The undersigned does hereby ratify and confirm all that said
attorneys-in-fact and agents, or either of them, shall lawfully do by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto caused this Power of
Attorney to be executed on this 28th day of January, 1998.
/s/ J. Wayne Leonard
J. Wayne Leonard
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the undersigned hereby constitutes and
appoints each of James E. Rogers and Madeleine W. Ludlow, or either of them, the
undersigned's true and lawful attorney-in-fact and agent to execute for and on
behalf of the undersigned, in the undersigned's capacity as a director of PSI
Energy, Inc., the Form 10-K Annual Report of said corporation for the fiscal
year ended December 31, 1997, and to deliver said Form 10-K Annual Report so
signed for filing with the Securities and Exchange Commission.
The undersigned does hereby ratify and confirm all that said
attorneys-in-fact and agents, or either of them, shall lawfully do by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto caused this Power of
Attorney to be executed on this 26th day of January, 1998.
/s/ John M. Mutz
John M. Mutz
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the undersigned hereby constitutes and
appoints each of James E. Rogers and Madeleine W. Ludlow, or either of them, the
undersigned's true and lawful attorney-in-fact and agent to execute for and on
behalf of the undersigned, in the undersigned's capacity as a director of
Cinergy Corp., the Form 10-K Annual Report of said corporation for the fiscal
year ended December 31, 1997, and to deliver said Form 10-K Annual Report so
signed for filing with the Securities and Exchange Commission.
The undersigned does hereby ratify and confirm all that said
attorneys-in-fact and agents, or either of them, shall lawfully do by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto caused this Power of
Attorney to be executed on this 23rd day of January, 1998.
/s/ Melvin Perelman
Melvin Perelman
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the undersigned hereby constitutes and
appoints each of James E. Rogers and Madeleine W. Ludlow, or either of them, the
undersigned's true and lawful attorney-in-fact and agent to execute for and on
behalf of the undersigned, in the undersigned's capacity as a director of
Cinergy Corp., the Form 10-K Annual Report of said corporation for the fiscal
year ended December 31, 1997, and to deliver said Form 10-K Annual Report so
signed for filing with the Securities and Exchange Commission.
The undersigned does hereby ratify and confirm all that said
attorneys-in-fact and agents, or either of them, shall lawfully do by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto caused this Power of
Attorney to be executed on this 23rd day of January, 1998.
/s/ Thomas E. Petry
Thomas E. Petry
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the undersigned hereby constitutes and
appoints each of James E. Rogers and Madeleine W. Ludlow, or either of them, the
undersigned's true and lawful attorney-in-fact and agent to execute for and on
behalf of the undersigned, in the undersigned's capacity as a director of each
of Cinergy Corp., The Cincinnati Gas & Electric Company, The Union Light, Heat
and Power Company, and PSI Energy, Inc., the Form 10-K Annual Report of each
corporation for the fiscal year ended December 31, 1997, and to deliver said
Form 10-K Annual Reports so signed for filing with the Securities and Exchange
Commission.
The undersigned does hereby ratify and confirm all that said
attorneys-in-fact and agents, or either of them, shall lawfully do by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto caused this Power of
Attorney to be executed on this 28th day of January, 1998.
/s/ Jackson H. Randolph
Jackson H. Randolph
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the undersigned hereby constitutes and
appoints each of James E. Rogers and Madeleine W. Ludlow, or either of them, the
undersigned's true and lawful attorney-in-fact and agent to execute for and on
behalf of the undersigned, in the undersigned's capacity as a director of
Cinergy Corp., the Form 10-K Annual Report of said corporation for the fiscal
year ended December 31, 1997, and to deliver said Form 10-K Annual Report so
signed for filing with the Securities and Exchange Commission.
The undersigned does hereby ratify and confirm all that said
attorneys-in-fact and agents, or either of them, shall lawfully do by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto caused this Power of
Attorney to be executed on this 27th day of January, 1998.
/s/ John J. Schiff, Jr.
John J. Schiff, Jr.
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the undersigned hereby constitutes and
appoints each of James E. Rogers and Madeleine W. Ludlow, or either of them, the
undersigned's true and lawful attorney-in-fact and agent to execute for and on
behalf of the undersigned, in the undersigned's capacity as a director of
Cinergy Corp., the Form 10-K Annual Report of said corporation for the fiscal
year ended December 31, 1997, and to deliver said Form 10-K Annual Report so
signed for filing with the Securities and Exchange Commission.
The undersigned does hereby ratify and confirm all that said
attorneys-in-fact and agents, or either of them, shall lawfully do by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto caused this Power of
Attorney to be executed on this 28th day of January, 1998.
/s/ Philip R. Sharp
Philip R. Sharp
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the undersigned hereby constitutes and
appoints each of James E. Rogers and Madeleine W. Ludlow, or either of them, the
undersigned's true and lawful attorney-in-fact and agent to execute for and on
behalf of the undersigned, in the undersigned's capacity as a director of each
of Cinergy Corp. and PSI Energy, Inc., the Form 10-K Annual Report of each
corporation for the fiscal year ended December 31, 1997, and to deliver said
Form 10-K Annual Reports so signed for filing with the Securities and Exchange
Commission.
The undersigned does hereby ratify and confirm all that said
attorneys-in-fact and agents, or either of them, shall lawfully do by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto caused this Power of
Attorney to be executed on this 23rd day of January, 1998.
/s/ Van P. Smith
Van P. Smith
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the undersigned hereby constitutes and
appoints each of James E. Rogers and Madeleine W. Ludlow, or either of them, the
undersigned's true and lawful attorney-in-fact and agent to execute for and on
behalf of the undersigned, in the undersigned's capacity as a director of
Cinergy Corp., the Form 10-K Annual Report of said corporation for the fiscal
year ended December 31, 1997, and to deliver said Form 10-K Annual Report so
signed for filing with the Securities and Exchange Commission.
The undersigned does hereby ratify and confirm all that said
attorneys-in-fact and agents, or either of them, shall lawfully do by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto caused this Power of
Attorney to be executed on this 26th day of January, 1998.
/s/ Dudley S. Taft
Dudley S. Taft
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the undersigned hereby constitutes and
appoints each of James E. Rogers and Madeleine W. Ludlow, or either of them, the
undersigned's true and lawful attorney-in-fact and agent to execute for and on
behalf of the undersigned, in the undersigned's capacity as a director of The
Union Light, Heat and Power Company, the Form 10-K Annual Report of said
corporation for the fiscal year ended December 31, 1997, and to deliver said
Form 10-K Annual Report so signed for filing with the Securities and Exchange
Commission.
The undersigned does hereby ratify and confirm all that said
attorneys-in-fact and agents, or either of them, shall lawfully do by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto caused this Power of
Attorney to be executed on this 26th day of January, 1998.
/s/ Larry E. Thomas
Larry E. Thomas
POWER OF ATTORNEY
KNOW ALL BY THESE PRESENTS, that the undersigned hereby constitutes and
appoints each of James E. Rogers and Madeleine W. Ludlow, or either of them, the
undersigned's true and lawful attorney-in-fact and agent to execute for and on
behalf of the undersigned, in the undersigned's capacity as a director of
Cinergy Corp., the Form 10-K Annual Report of said corporation for the fiscal
year ended December 31, 1997, and to deliver said Form 10-K Annual Report so
signed for filing with the Securities and Exchange Commission.
The undersigned does hereby ratify and confirm all that said
attorneys-in-fact and agents, or either of them, shall lawfully do by virtue
hereof.
IN WITNESS WHEREOF, the undersigned has hereunto caused this Power of
Attorney to be executed on this 3rd day of February, 1998.
/s/ Oliver W. Waddell
Oliver W. Waddell
</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-27
<SEQUENCE>14
<DESCRIPTION>CINERGY 12/31/97 10-K
<TEXT>
<ARTICLE> UT
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED BALANCE SHEETS, CONSOLIDATED STATEMENTS OF INCOME AND CONSOLIDATED
STATEMENTS OF CASH FLOWS AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> DEC-31-1997
<PERIOD-TYPE> 12-MOS
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 6,297,103
<OTHER-PROPERTY-AND-INVEST> 0
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