Exhibit 99.02



                    DESCRIPTION OF CAPITAL STOCK - CIPS

     General.  The authorized capital stock of Central Illinois
Public Service Company (CIPS) consists of 2,000,000 shares of
Cumulative Preferred Stock, par value $100 per share, issuable in
series, of which 800,000 shares are outstanding; 2,600,000 shares
of Cumulative Preferred Stock without par value, issuable in
series, of which no shares are outstanding (both such classes of
preferred stock being hereinafter collectively referred to as the
"Preferred Stock"); and 45,000,000 shares of Common Stock without
par value of which 25,452,373 shares were outstanding (all of
which were held by CIPSCO) at December 31, 1995.
     
     The following statements, unless the context otherwise
indicates, are brief summaries of the substance or general effect
of certain provisions of CIPS' Restated Articles of Incorporation
and the resolutions establishing series of Preferred Stock
(collectively, the "Articles"), and of its Mortgage Indenture
securing its outstanding First Mortgage Bonds.  Such statements
make use of defined terms and are not complete; they are subject
to all the provisions of the Articles or the Mortgage Indenture,
as the case may be.

     Dividend Rights.  Whenever dividends on all outstanding
shares of the Preferred Stock of all series for all previous
quarter-yearly dividend periods and the current quarter-yearly
dividend period shall have been paid or declared and set apart
for payment, and whenever all amounts required to be set aside
for any sinking fund for the redemption or purchase of shares of
the Preferred Stock for all previous periods or dates shall have
been paid or set aside, and subject to the limitations summarized
below, the Board of Directors of CIPS may declare dividends on
the CIPS Common Stock out of any surplus or net profits of CIPS
legally available for the purpose.  Currently, none of the series
of the Preferred Stock have a sinking fund for the redemption or
purchase of shares of such series.  The Mortgage Indenture
provides, in effect, that CIPS will not declare or pay any
dividends (other than in stock) on CIPS Common Stock, or make any
other distribution on or purchase any Common Stock, unless the
total amount charged or provided for maintenance, repairs and
depreciation of the mortgaged properties subsequent to December
31, 1940, plus the surplus earned during the period and remaining
after any such dividend, distribution or purchase, shall equal at
least 15% of CIPS' total utility operating revenues for the
period, after deducting from such revenues the cost of
electricity and gas purchased for resale.  The Articles provide
in effect that, so long as any Preferred Stock is outstanding,
the total amount of all dividends or other distributions on CIPS
Common Stock (other than in stock) that may
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be paid, and purchases of Common Stock that may be made, during
any 12-month period shall not exceed (a) 75% of CIPS' net income
(as defined) for the 12-month period next preceding each such
dividend, distribution or purchase, if the ratio of "common stock
equity" to "total capital" (as defined) is 20% to 25%, or (b) 50%
of such net income if such ratio is less than 20%.  If such ratio
is in excess of 25%, no such dividends may be paid or
distributions or purchases made that would reduce such ratio to
less than 25% except to the extent permitted by clauses (a) and
(b).  At December 31, 1995, no amount of retained earnings was
restricted as to the payment of dividends on CIPS Common Stock
under the foregoing provisions of the Mortgage Indenture or the
Articles.

     Voting Rights.  Under Illinois law, each share of stock of
CIPS, common and preferred, is entitled to one vote on each
matter voted on at all meetings of shareholders, with the right
of cumulative voting in the election of directors and the right
to vote as a class on certain questions.  The Articles give to
holders of Preferred Stock certain special voting rights designed
to protect their interests with respect to specified corporate
action, including certain amendments to the Articles, the
issuance of Preferred Stock or parity stock, the issuance or
assumption of certain unsecured indebtedness, and mergers,
consolidations or sales or leases of substantially all of CIPS'
assets.

     Preemptive Rights. Holders of CIPS Common Stock have no
preemptive subscription rights.

     Liquidation Rights.  In the event of any liquidation or
dissolution of CIPS, holders of Common Stock are entitled to
share ratably in the net assets and profits of CIPS remaining
after the payment in full to the holders of the CIPS Preferred
Stock of the aggregate preferential amount payable in respect of
the Preferred Stock in any such event.

     Miscellaneous.  The Transfer Agents for the CIPS Common
Stock are Illinois Stock Transfer Company, Chicago, Illinois, and
Harris Trust and Savings Bank, Chicago, Illinois; and the
Registrar is Harris Trust and Savings Bank, Chicago, Illinois.

     CIPS reserves the right to increase, decrease or reclassify
its authorized capital stock or any class or series thereof, and
to amend or repeal any provisions in the Articles; and all rights
conferred on shareholders in the Articles are subject to this
reservation.
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