0000032689-95-000013.txt : 19950816 0000032689-95-000013.hdr.sgml : 19950816 ACCESSION NUMBER: 0000032689-95-000013 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 19950630 FILED AS OF DATE: 19950814 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: EMPIRE DISTRICT ELECTRIC CO CENTRAL INDEX KEY: 0000032689 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC SERVICES [4911] IRS NUMBER: 440236370 STATE OF INCORPORATION: KS FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-03368 FILM NUMBER: 95563918 BUSINESS ADDRESS: STREET 1: 602 JOPLIN ST CITY: JOPLIN STATE: MO ZIP: 64801 BUSINESS PHONE: 4176255100 MAIL ADDRESS: STREET 1: P.O. BOX 127 CITY: JOPLIN STATE: MO ZIP: 64802 10-Q 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended June 30, 1995 or Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from ______________ to ____________. Commission file number: 1-3368 THE EMPIRE DISTRICT ELECTRIC COMPANY (Exact name of registrant as specified in its charter) Kansas 44-0236370 (State of Incorporation) (I.R.S. Employer Identification No.) 602 Joplin Street, Joplin, Missouri 64801 (Address of principal executive offices) (zip code) Registrant's telephone number: (417) 623-4700 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No ___ Common stock outstanding as of August 1, 1995: 15,073,762 shares. THE EMPIRE DISTRICT ELECTRIC COMPANY INDEX Page Number Part I - Financial Information: Item 1. Financial Statements: a.Statements of Income 3 b.Balance Sheets 6 c.Statements of Cash Flows 7 d.Notes to Financial Statements 8 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 9 Part II - Other Information: Item 1. Legal Proceedings - (none) Item 2. Changes in Securities - (none) Item 3. Defaults Upon Senior Securities - (none) Item 4. Submission of Matters to a Vote of Security Holders - (none) Item 5. Other Information 14 Item 6. Exhibits and Reports on Form 8-K 14 Signatures 15 PART I. FINANCIAL INFORMATION Item 1. Financial Statements STATEMENTS OF INCOME (UNAUDITED)
Three Months Ended June 30, 1995 1994 Operating revenues: Electric $42,226,197 $41,354,841 Water 238,752 240,384 42,464,949 41,595,225 Operating revenue deductions: Operating expenses: Fuel 6,814,283 7,080,266 Purchased power 8,339,702 9,015,726 Other 7,827,310 7,557,958 Total operating expenses 22,981,295 23,653,950 Maintenance and repairs 3,374,389 2,581,982 Depreciation and amortization 4,826,221 4,588,054 Provision for income taxes 1,803,790 1,823,770 (Gain) Loss on Disposition of (31,328) - Allowances Other taxes 2,475,626 2,514,404 35,429,993 35,162,160 Operating income 7,034,956 6,433,065 Other income and deductions: Allowance for equity funds used 336,502 201,386 during construction Interest income 140,047 5,046 Other - net (122,453) 26,692 354,096 233,124 Income before interest charges 7,389,052 6,666,189 Interest charges: Long-term debt 3,873,631 3,174,683 Commercial paper 99,988 196,709 Allowance for borrowed funds used (400,971) (187,478) during construction Other 84,633 76,495 3,657,281 3,260,409 Net income 3,731,771 3,405,780 Preferred stock dividend requirements 604,085 258,586 Net income applicable to common stock $3,127,686 $3,147,194 Weighted average number of common 14,697,172 13,678,851 shares outstanding Earnings per weighted average share of $ 0.21 $ 0.23 common stock Dividends per share of common stock $ 0.32 $ 0.32 See accompanying Notes to Financial Statements.
STATEMENTS OF INCOME (UNAUDITED)
Six Months Ended June 30, 1995 1994 Operating revenues: Electric $84,860,719 $82,818,875 Water 472,861 449,116 84,860,580 83,267,991 Operating revenue deductions: Operating expenses: Fuel 14,205,348 14,347,005 Purchased power 16,238,250 17,602,092 Other 15,449,432 14,881,452 Total operating expenses 45,893,030 46,830,549 Maintenance and repairs 6,192,899 4,793,470 Depreciation and amortization 9,498,930 9,123,767 Provision for income taxes 3,820,545 4,021,470 (Gain) Loss on Disposition of (31,328) - Allowances Other taxes 5,004,243 5,072,818 70,378,319 69,842,074 Operating income 14,482,261 13,425,917 Other income and deductions: Allowance for equity funds used 739,947 323,874 during construction Interest income 169,192 15,901 Other - net (71,993) (74,844) 837,146 264,931 Income before interest charges 15,319,407 13,690,848 Interest charges: Long-term debt 7,466,347 6,350,066 Commercial paper 372,044 351,869 Allowance for borrowed funds used (959,498) (287,321) during construction Other 142,754 127,675 7,021,647 6,542,289 Net income 8,297,760 7,148,559 Preferred stock dividend requirements 1,208,170 354,858 Net income applicable to common stock $7,089,590 $6,793,701 Weighted average number of common 14,333,650 13,635,701 shares outstanding Earnings per weighted average share of $ 0.49 $ 0.50 common stock Dividends per share of common stock $ 0.64 $ 0.64 See accompanying Notes to Financial Statements.
STATEMENTS OF INCOME (UNAUDITED)
Twelve Months Ended June 30, 1995 1994 Operating revenues: Electric $178,380,726 $174,133,099 Water 968,822 867,816 179,349,548 175,000,915 Operating revenue deductions: Operating expenses: Fuel 30,259,513 30,643,769 Purchased power 33,246,801 37,966,028 Other 31,270,066 30,727,357 Total operating expenses 94,776,380 99,337,154 Maintenance and repairs 12,183,558 10,156,574 Depreciation and amortization 18,714,344 17,959,857 Provision for income taxes 10,478,075 8,167,840 (Gain) Loss on Disposition of (35,527) - Allowances Other taxes 10,167,619 10,076,055 146,284,449 145,697,480 Operating income 33,065,099 29,303,435 Other income and deductions: Allowance for equity funds used 1,146,432 323,874 during construction Interest income 244,977 72,712 Other - net (221,926) (179,675) 137,694 216,911 Income before interest charges 34,234,582 29,520,346 Interest charges: Long-term debt 14,072,923 12,975,892 Commercial paper 725,086 458,502 Allowance for borrowed funds used (1,656,722) (424,682) during construction Other 260,995 229,714 13,402,282 13,239,426 Net income 20,832,300 16,280,920 Preferred stock dividend requirements 2,409,382 547,403 Net income applicable to common stock $18,422,918 $15,733,517 Weighted average number of common 14,080,338 13,563,030 shares outstanding Earnings per weighted average share of $ 1.31 $ 1.16 common stock Dividends per share of common stock $ 1.28 $ 1.28 See accompanying Notes to Financial Statements.
BALANCE SHEETS
June 30, 1995 December 31, (Unaudited) 1994 ASSETS Utility plant, at original cost: Electric $659,409,631 $606,519,616 Water 4,979,986 4,863,228 Construction work in progress 16,264,887 45,317,772 680,654,504 656,700,616 Accumulated depreciation 216,567,348 210,858,722 464,087,156 445,841,894 Current assets: Cash and cash equivalents 3,339,291 3,362,653 Accounts receivable - trade, net 11,083,998 10,653,580 Accrued unbilled revenues 5,321,722 5,041,575 Accounts receivable - other 1,885,431 2,878,122 Fuel, materials and supplies 14,652,033 12,970,376 Prepaid expenses 745,671 708,253 37,028,146 35,614,559 Deferred charges: Regulatory asset 26,381,515 23,657,498 Unamortized debt expenses 14,822,324 13,166,603 Other 2,306,284 1,932,798 43,510,123 38,756,899 Total Assets $544,625,425 $520,213,352 CAPITALIZATION AND LIABILITIES: Common stock, $1 par value, 13,766,399 and 13,571,186 shares issued and outstanding, respectively $15,062,574 $13,941,531 Capital in excess of par value 122,841,368 106,055,389 Retained earnings (Note 3) 51,610,281 53,783,342 Total common stockholders' equity 189,514,223 173,780,262 Preferred stock (Note 4) 32,901,800 32,901,800 Long-term debt 194,859,882 184,976,950 417,275,905 391,659,012 Current liabilities: Accounts payable and accrued 12,060,584 11,459,243 liabilities Commercial paper 8,000,000 16,000,000 Customer deposits 2,458,386 2,385,182 Interest accrued 3,331,944 3,413,850 Taxes accrued, including income 4,389,810 1,557,744 taxes 30,240,724 34,816,019 Noncurrent liabilities and deferred credits: Regulatory liability 19,358,341 20,683,409 Deferred income taxes 61,222,985 56,229,391 Unamortized investment tax credits 10,544,280 10,741,000 Postretirement benefits other than 4,124,729 4,083,626 pensions Other 1,858,461 2,000,895 97,108,796 93,738,321 Total Capitalization and $544,625,425 $520,213,352 Liabilities See accompanying Notes to Financial Statements.
STATEMENTS OF CASH FLOWS (UNAUDITED)
Six Months Ended June 30, 1995 1994 Operating activities: Net income $8,297,760 $7,148,559 Adjustments to reconcile net income to cash flows: Depreciation and amortization 10,056,015 9,569,630 Deferred income taxes - net 925,577 1,825,714 Investment tax credit - net (196,720) (240,320) Allowance for equity funds used (739,947) 323,874 during construction Issuance of common stock for 401(k) 332,584 324,475 plans Other (22,024) 851,603 Cash flows impacted by changes in: Receivables and accrued unbilled 282,126 (1,050,054) revenues Fuel, materials and supplies (1,681,657) (821,569) Prepaid expenses and deferred (3,402,448) (1,465,947) charges Accounts payable and accrued 601,341 687,143 liabilities Other liabilities and deferred 4,106,744 4,074,866 credits Net cash provided by operating 18,559,351 21,227,974 activities Investing activities: Construction expenditures (28,301,277) (34,694,183) Allowance for equity funds used 739,947 (323,874) during construction Net cash used in investing activities (27,561,330) (35,018,057) Financing activities: Proceeds from issuance of first 10,000,000 - mortgage bonds Proceeds from issuance of common 17,574,438 1,730,566 stock Proceeds from issuance of preferred - 25,000,000 stock Dividends (10,470,821) (8,920,887) Repayment of first mortgage bonds (125,000) - Net repayments (issuances) from (8,000,000) (4,000,000) short-term borrowings Net cash provided (used in) financing 8,978,617 13,809,679 activities Net increase (decrease) in cash and (23,362) 19,596 cash equivalents Cash and cash equivalents at beginning 3,362,653 2,802,957 of period Cash and cash equivalents at end of $3,339,291 $2,822,553 period See accompanying Notes to Financial Statements.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED) Note 1 - Summary of Significant Accounting Policies The accompanying interim financial statements do not include all disclosures included in the annual financial statements and therefore should be read in conjunction with the financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1994. The information furnished reflects all adjustments, consisting only of normal recurring adjustments, which are, in the opinion of the Company, necessary to present fairly the results for the interim periods presented. Note 2 - Accounting Matters Effective January 1, 1996 the Company will be required to adopt Statement of Financial Accounting Standards (SFAS) No. 121 "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed of." Adoption of this statement is not expected to have a material effect on the financial position, results of operations or cash flows of the Company. Note 3 - Retained Earnings
Second Quarter 1995 Balance at January 1, 1995 $ 53,783,342 Changes January 1 through March 31: Net Income 4,565,989 Quarterly cash dividends on common stock: $0.32 per share (4,465,481) Quarterly cash dividends on preferred stock: 8-1/8% cumulative - $0.203125 per share (507,812) 5% cumulative - $0.125 per share (48,773) 4-3/4% cumulative - $0.11875 per share (47,500) Total changes January 1 through March 31 (503,577) Balance April 1, 1994 53,279,765 Changes April 1 through June 30: Net Income 3,731,771 Quarterly cash dividends on common stock: $0.32 per share (4,797,170) Quarterly cash dividends on preferred stock: 8-1/8% cumulative - $0.203125 (507,812) 5% cumulative - $0.125 per share (48,773) 4-3/4% cumulative - $0.11875 per share (47,500) Total changes April 1 through June 30 (1,669,484) Balance June 30, 1994 $ 51,610,281
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations RESULTS OF OPERATIONS The following discussion analyzes significant changes in the results of operations for the three-month, six-month and twelve-month periods ended June 30, 1995, compared to the same periods ended June 30, 1994. Operating Revenues and Kilowatt-Hour Sales Of the Company's total electric operating revenues during the second quarter of 1995, approximately 38% were from residential customers, 32% from commercial, 19% from industrial, 5% from wholesale on-system customers and 2% from wholesale off-system customers. The remainder of such revenues were derived from miscellaneous sources such as public street and highway lighting and other municipal establishments. The percentage changes from the prior year in kilowatt-hour ("Kwh") sales and revenue by major customer class were as follows:
Operating Kwh Sales Revenues Six Twelve Six Twelve Second Months Months Second Months Months Quarter Ended Ended Quarter Ended Ended Residential (5.5) (2.3) (3.5) 4.4 5.5 4.0 Commercial (1.3) 1.4 2.1 (0.4) (0.3) 2.2 Industrial 2.7 3.7 5.1 2.5 0.1 3.6 Wholesale On- (0.1) 2.0 0.6 (2.3) (4.0) (3.6) System Total System (1.4) 0.7 0.6 2.2 2.1 2.9 Wholesale Off- (11.2) (17.0) (14.5) (16.6) (21.7) (17.0) System Total Sales (2.2) (0.6) (0.7) 1.6 1.5 2.3
Residential Kwh sales decreased 5.5% during the second quarter of 1995 compared to the second quarter of 1994. This decrease was due primarily to the effect of decreased cooling degree days and air conditioning load as a result of weather conditions which were cooler (principally during June) than the same period last year and approximately 30% cooler than long-term averages. The effect of the cooler weather was offset in part by an increase of 3.4% in the average number of residential customers served over the same period a year ago. Residential revenues were up 4.4% due mainly to the effect of electric rate increases and changes in the Company's rate design during 1994 in connection with the last Missouri electric rate case. This rate restructuring resulted, in part, in a greater rate increase for the Company's residential customers than for its commercial and industrial customers. Commercial Kwh sales and revenue declined during the second quarter of 1995 compared to the year ago period primarily due to cooler than normal weather during the second quarter of 1995. The weather impact more than offset an increase of 4.9% in the average number of commercial customers served over the same period last year. Industrial Kwh sales and related revenues were up during the second quarter of 1995 when compared to the year ago period as the Company's existing industrial customers continued to experience increased economic activity and business expansion. On-system wholesale Kwh sales decreased slightly during the period reflecting the weather conditions discussed above. On-system wholesale revenue decreased during the second quarter of 1995 due to the mild weather conditions experienced during the period and the operation of the fuel adjustment clause applicable to such FERC regulated sales. Revenues from Kwh sales to other electric systems (off- system) were down significantly during the second quarter of 1995 as compared to the same quarter a year ago, primarily as a result of a reduction in low-margin, pass-through sales of hydro energy to other electric systems. For the six and twelve months ended June 30, 1995, residential Kwh sales decreased slightly, reflecting the mild weather experienced during the first half of 1995 as compared with the first half of 1994. Residential revenues for the corresponding periods increased primarily as a result of the electric rate increases and electric rate restructuring discussed above. Total Kwh sales to the Company's commercial and industrial customers during the six and twelve months ended June 30, 1995 increased as strong customer growth in the Company's service territory continued. Revenues related to commercial and industrial sales remained relatively unchanged for the six-month period but were up slightly over the twelve- month period when compared to the same periods ending June 30, 1994, reflecting the restructuring of the Company's rates as discussed above. Revenues from on-system wholesale Kwh sales declined due to operation of the fuel adjustment clause applicable to such FERC regulated sales. Revenues from Kwh sales to other electric systems were down during the periods due to decreased low-margin, pass-through sales of hydro energy to other electric systems. On March 17, 1995, the Company filed a request with the Missouri Public Service Commission for an increase in rates for its Missouri electric customers in the amount of $8,543,910, or 5.3%. Any increase which might be granted as a result of this filing is not expected to be effective until late 1995 or early 1996. The Company anticipates filing for rate relief in its other jurisdictions later in 1995 or early in 1996. Operating Revenue Deductions During the second quarter of 1995, total operating and maintenance expenses increased approximately $0.1 million (0.5%) compared to the same period last year. Purchased power costs decreased approximately $0.7 million (7.5%) during the second quarter of 1995, primarily due to lower customer demand as a result of mild weather experienced during the quarter (particularly during June) and improved availability of the Company's jointly-owned Iatan Plant. Total fuel costs were down approximately $0.3 million (3.8%) during the second quarter of 1995, due primarily to a 5.0% decrease in fuel-generated kilowatt-hours reflecting a decrease in the demand for energy due to the mild weather experienced during the quarter. During the quarter, the Company substantially increased its generation from higher- cost, gas-fired combustion turbine units while experiencing lower coal prices at the Iatan Plant and lower natural gas prices when compared to the same period last year. Other operating expenses increased approximately $0.3 million (3.6%) during the second quarter, due primarily to increased work performed on the Company's distribution system and higher general and administrative costs. During the second quarter, the Company incurred costs associated with its involvement in the previously disclosed proceedings relating to the purchase of energy from Ahlstrom Development Corporation ("Ahlstrom") and with steps undertaken by the Company to improve its competitiveness in what it perceives to be an increasingly competitive environment ("Competitive Positioning Process"). As part of the Competitive Positioning Process, the Company is currently in the process of re-evaluating its existing structure with the goal of improving its efficiency. Any change in the structure from the re-evaluation is expected to be implemented in the fourth quarter of 1995. At this time the Company is not able to estimate the costs which may result from such a restructuring. In addition, the Company has offered an enhanced voluntary early retirement program to 53 of its 654 employees which could result in a pre-tax charge of approximately $5.4 million if all eligible employees accept the program. Costs associated with the program are anticipated to be recorded during the third quarter of 1995. The one-time costs are expected to be recovered over a period of approximately two years by reduced employee costs commencing in November 1995. Maintenance and repair expense increased approximately $0.8 million (30.7%) during the period, primarily due to increased distribution maintenance as well as increased maintenance at the Asbury and Riverton Plants. The Company placed Riverton Unit No. 7 (38 megawatts ["Mw"] of capacity) back in service on June 5, 1995 after an extended outage to remove cracks in the turbine rotor shaft which were discovered during the unit's scheduled five-year turbine inspection. Riverton Unit No. 7 was taken out of service on February 27, 1995. The total cost of the rotor shaft repair and turbine inspection of Riverton Unit No. 7 is expected to be approximately $0.4 million. In addition, more maintenance was performed during the scheduled spring maintenance outage at the Company's Asbury Plant during the second quarter of 1995 than was performed during the year ago period. Depreciation and amortization expense increased approximately $0.2 million (5.2%) during the second quarter of 1995 due to the additional plant and equipment placed in service, primarily at the Company's State Line Power Plant (see "Liquidity and Capital Resources" below). Total income taxes declined slightly during the period due primarily to lower taxable income. For the six months ended June 30, 1995, total operating expenses were down $0.9 million (2.0%) compared to the same period last year. Total purchased power costs decreased $1.4 million (7.8%) during the period, due primarily to decreased customer demand as a result of mild weather conditions during the period, greater availability of the Company's Iatan Unit and generation of energy at the Company's new State Line Unit No. 1 (98 Mw combustion turbine) which became commercially available on May 30, 1995. The effect of the decreased Kwh purchases was offset in part by increases in capacity charges compared to the prior year. Total fuel costs decreased approximately $0.1 million (1.0%), due primarily to significantly lower fuel costs at the Company's jointly-owned Iatan Plant and lower natural gas prices which were offset in part by significantly increased generation at the Company's higher-cost, gas-fired combustion turbine units. Other operating expenses during the six months ended June 30, 1995 increased approximately $0.6 million (3.8%), compared to the same period in 1994. This was due primarily to costs associated with Ahlstrom, increased work on the Company's distribution system and cost associated with the Competitive Positioning Process. Maintenance and repair expenses increased $1.4 million (29.2%), due primarily to increased maintenance performed at the Company's Asbury and Riverton Plants as previously discussed, as well as increased maintenance to the Company's distribution system. Depreciation and amortization expense increased approximately $0.4 million (4.1%) during the six months ended June 30, 1995, due to the additional plant and equipment placed in service. Total provision for income taxes decreased due to lower taxable income. During the twelve months ended June 30, 1995, total operating expenses decreased approximately $4.5 million (4.6%) compared to the same period ended June 30, 1994. Total purchased power costs were down approximately $4.7 million (12.4%). Purchased power costs were substantially higher during the year earlier period in large part because flooding reduced generation at a number of low-cost, coal-fired generating stations in the Midwest and because of planned outages of low-cost generating units at neighboring utilities. In addition, the Company experienced increased availability of its lower-cost generation units. Fuel costs decreased approximately $0.4 million (1.3%) during the twelve-month ending period, due primarily to the factors discussed for the second quarter and six months ended June 30, 1995. Other operating expenses during the twelve months ended June 30, 1995, increased slightly compared to the same period last year. Maintenance and repair expenses increased approximately $2.0 million (20.0%) during the period, due primarily to increased maintenance performed at the Company's Asbury and Riverton Plants as discussed above, as well as maintenance to the Company's Energy Center, and increased maintenance to the Company's transmission and distribution systems. Depreciation and amortization expense increased due to the additional plant and equipment placed in service. Total provision for income taxes increased during the period due to higher taxable income. Nonoperating Items Total allowance for funds used during construction (AFUDC) increased significantly during each of the periods presented compared to prior year levels, reflecting a higher level of construction work in progress, particularly due to construction of the Company's new State Line Power Plant, along with higher rates for AFUDC determined in accordance with formulas prescribed by the FERC. Interest income increased during each of the periods ended June 30, 1995, reflecting higher interest rates earned on investments and the temporary investment of the proceeds from the Company's issuance of a new series of First Mortgage Bonds prior to the redemption of another series of First Mortgage Bonds. Interest charges on first mortgage bonds increased compared to the same periods in the prior year due to additional issuances of the Company's First Mortgage Bonds. Earnings Earnings per common share for the second quarter and six months ended June 30, 1995, were $0.21 and $0.49, respectively, compared to $0.23 and $0.50 for the corresponding periods a year ago. Earnings for the current year were negatively impacted by the effects of mild weather during the first six months of 1995, increased dividend requirements resulting from the Company's issuance of preferred stock in June 1994, and the issuance of 900,000 shares of the Company's Common Stock on April 27, 1995. Earnings for the twelve months ending June 30, 1995, were $1.31 compared to $1.16 earned during the twelve months ending June 30, 1994. Increased earnings resulted from the rate increases received in Missouri, Kansas and Oklahoma and the substantial increase in AFUDC. LIQUIDITY AND CAPITAL RESOURCES The Company's construction-related expenditures totaled $14.2 million during the second quarter of 1995, compared to $19.9 million for the same period of 1994. Approximately $11.0 million of expenditures during the current period were related to the construction of Unit #1 at the State Line Power Plant, which was placed in service on May 30, 1995, and initial expenditures for a second 98 Mw combustion turbine unit scheduled for completion at that site in mid-1997. For the six months ended June 30, 1995, construction-related expenditures totaled $28.3 million compared to $27.5 million for the same period of 1994. Approximately one-half of construction expenditures for the first six months of 1995 were provided internally from operations; the remainder was provided from the sale to the public of the Company's Common Stock and First Mortgage Bonds, the issuance of commercial paper, and from the sale of common stock through the Company's Dividend Reinvestment Plan and Employee Stock Purchase Plan. The Company's construction expenditures are expected to total approximately $54.7 million in 1995, including approximately $13.5 million for new generation additions and approximately $25.9 million for additions to the Company's distribution system. The Company estimates that internally generated funds will provide approximately one-half of the remaining funds required for its 1995 construction expenditures. The Company expects to utilize the proceeds of issuances of short-term commercial paper, along with the sale of the Company's common stock pursuant to its Dividend Reinvestment Plan and Employee Stock Purchase Plan, to finance the remainder of its 1995 construction expenditures. The Company plans to continue to utilize short-term debt as needed to support normal operations and for other temporary requirements. On June 7, 1995, the Company sold to the public in an underwritten offering $30,000,000 aggregate principal amount of its First Mortgage Bonds, 7-3/4% Series due 2025, the proceeds of which were added to the Company's general funds and used to redeem on July 3, 1995, its First Mortgage Bonds, 9% Series due 2019 ($30,000,000 aggregate principal amount) at a redemption price of 105.00% of the principal amount thereof plus accrued interest to July 3, 1995. The bonds were defeased by the Company on June 30, 1995. PART II. OTHER INFORMATION Item 5. Other Information. At June 30, 1995, the ratio of earnings to fixed charges, and the ratio of earnings to fixed charges and preferred stock dividend requirements, were 3.08x and 2.49x, respectively. See Exhibit (12) hereto. Item 6. Exhibits and Reports on Form 8-K. (a) Exhibits. (4)Twenty-Seventh Supplemental Indenture dated as of June 1, 1995, to Indenture of Mortgage and Deed of Trust. (12) Computation of Ratio of Earnings to Fixed Charges and Earnings to Combined Fixed Charges and Preferred Stock Dividend Requirements. (27) Financial Data Schedule for June 30, 1995. (b) In a Current Report on Form 8-K, dated July 17, 1995, the Company filed, under Item 5. "Other Events," information concerning the Company's announcement of an enhanced voluntary early retirement program. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. THE EMPIRE DISTRICT ELECTRIC COMPANY Registrant By V. E. Brill ------------------------ V. E. Brill Vice President - Finance By G. A. Knapp ------------------------ G. A. Knapp Controller and Assistant Treasurer August 14, 1995 EX-12 2 EXHIBIT (12) COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES AND EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDEND REQUIREMENTS
Twelve Months Ended June 30, 1995 Income before provision for income taxes and fixed $46,699,691 charges (Note A) Fixed charges: Interest on first mortgage bonds $13,287,976 Amortization of debt discount and expense less 784,947 premium Interest on short-term debt 725,086 Other interest 260,995 Rental expense representative of an interest factor 115,697 (Note B) Total fixed charges 15,174,701 Preferred stock dividend requirements: Preferred stock dividend requirements not deductible 2,338,304 for tax purposes Ratio of income before provision for incomes taxes 1.513 to net income Nondeductible dividend requirements 3,537,854 Deductible dividends 78,036 Total preferred stock dividend requirements 3,615,890 Total combined fixed charges and preferred stock $18,790,591 dividend requirements Ratio of earnings to fixed charges 3.08x Ratio of earnings to combined fixed charges and preferred stock dividend requirements 2.49x
[FN] NOTE A:For the purpose of determining earnings in the calculation of the ratio, net income has been increased by the provision for income taxes, non-operating income taxes and by the sum of fixed charges as shown above. NOTE B:One-third of rental expense (which approximates the interest factor). EX-4 3 THE EMPIRE DISTRICT ELECTRIC COMPANY TO HARRIS TRUST AND SAVINGS BANK AND MERCANTILE BANK OF JOPLIN Trustees ___________________ Twenty-Seventh Supplemental Indenture Dated as of June 1, 1995 ___________________ (Supplemental to Indenture dated as of September 1, 1944) ___________________ $30,000,000 First Mortgage Bonds, 7-3/4% Series due 2025 TABLE OF CONTENTS1 PAGE PARTIES 1 RECITALS 1 FORM OF BOND 2 FORM OF PRINCIPAL TRUSTEE'S CERTIFICATE OF AUTHENTICATION 5 GRANTING CLAUSES 6 SUBSTATIONS AND SWITCHING STATIONS 6 PROPERTY NOW OWNED OR HEREAFTER ACQUIRED 6 SUBJECT TO PERMITTED ENCUMBRANCES, LIENS ON AFTER-ACQUIRED PROPERTY AND CERTAIN VENDORS' LIENS 7 HABENDUM 7 GRANT IN TRUST 7 DEFEASANCE 7 GENERAL COVENANT 7 ARTICLE I CREATION AND DESCRIPTION OF FIRST MORTGAGE BONDS, 7-3/4% SERIES DUE 2025 SECTION 1. New Series of Bonds 7 Bonds to be dated as of authentication date 7 Record Date 7 Denominations 8 Registrable and interchangeable, tax or government charge 8 No service charge on exchange or transfer 8 Book-entry procedures 8 SECTION 2. Issue of Bonds of the New Series limited to $30,000,000. All or a portion of the Bonds of the New Series may be authenticated prior to recording of this Supplemental Indenture 10 ARTICLE II REDEMPTION OF BONDS OF THE NEW SERIES SECTION 1. Rights of Redemption 10 SECTION 2. Manner and Method of Redemption 10 SECTION 3. Bondholder agrees to accept payment upon terms of this Article 10 (1) This Table of Contents is not a part of the annexed Supplemental Indenture as executed. ARTICLE III NO SINKING AND IMPROVEMENT FUND FOR BONDS OF THE NEW SERIES There shall be no Sinking and Improvement Fund for the Bonds of the New Series 10 ARTICLE IV DIVIDEND COVENANTS Covenants in Section 4.11 of the Original Indenture to continue in effect so long as any Bonds of the New Series are outstanding 10 ARTICLE V THE TRUSTEES The Trustees accept the trusts created by this Supplemental Indenture and agree to perform the same upon terms set forth in the Original Indenture as supplemented 11 ARTICLE VI MISCELLANEOUS PROVISIONS SECTION 1. Provision regarding legal holidays 11 SECTION 2. Original Indenture, as supplemented and amended, ratified and confirmed 11 SECTION 3. This Supplemental Indenture may be executed in counterparts 11 SECTION 4. Rights conferred only on holder of bonds, Company and Trustees 11 TESTIMONIUM 12 SIGNATURES AND SEALS 12 ACKNOWLEDGMENTS 15 TWENTY-SEVENTH SUPPLEMENTAL INDENTURE, dated as of June 1, 1995, between The Empire District Electric Company, a corporation organized and existing under the laws of the State of Kansas (hereinafter called the "Company"), party of the first part, and Harris Trust and Savings Bank, a corporation organized and existing under the laws of the State of Illinois and having its principal place of business at 111 West Monroe Street, in the City of Chicago, Illinois, and Mercantile Bank of Joplin (successor to The Joplin National Bank and Trust Company), a bank organized and existing under the laws of the State of Missouri and having its principal place of business in the City of Joplin, Missouri (hereinafter sometimes called respectively the "Principal Trustee" and the "Missouri Trustee" and together the "Trustees" and each thereof a "Trustee"), as Trustees, parties of the second part. WHEREAS the Company has heretofore executed and delivered to the Trustees its Indenture of Mortgage and Deed of Trust, dated as of September 1, 1944 (hereinafter sometimes referred to as the "Original Indenture"), to secure an issue of First Mortgage Bonds of the Company, issuable in series, and created thereunder a series of bonds designated as First Mortgage Bonds, 3-1/2% Series due 1969, being the initial series of bonds issued under the Original Indenture; and WHEREAS the Company has heretofore executed and delivered to the Trustees twenty-six Supplemental Indentures supplemental to the Original Indenture as follows: Title Dated First Supplemental Indenture as of June 1, 1946 Second Supplemental Indenture as of January 1, 1948 Third Supplemental Indenture as of December 1, 1950 Fourth Supplemental Indenture as of December 1, 1954 Fifth Supplemental Indenture as of June 1, 1957 Sixth Supplemental Indenture as of February 1, 1968 Seventh Supplemental Indenture as of April 1, 1969 Eighth Supplemental Indenture as of May 1, 1970 Ninth Supplemental Indenture as of July 1, 1976 Tenth Supplemental Indenture as of November 1, 1977 Eleventh Supplemental Indenture as of August 1, 1978 Twelfth Supplemental Indenture as of December 1, 1978 Thirteenth Supplemental Indenture as of November 1, 1979 Fourteenth Supplemental Indenture as of September 15, 1983 Fifteenth Supplemental Indenture as of October 1, 1988 Sixteenth Supplemental Indenture as of November 1, 1989 Seventeenth Supplemental Indenture as of December 1, 1990 Eighteenth Supplemental Indenture as of July 1, 1992 Nineteenth Supplemental Indenture as of May 1, 1993 Twentieth Supplemental Indenture as of June 1, 1993 Twenty-First Supplemental Indenture as of October 1, 1993 Twenty-Second Supplemental Indenture as of November 1, 1993 Twenty-Third Supplemental Indenture as of November 1, 1993 Twenty-Fourth Supplemental Indenture as of March 1, 1994 Twenty-Fifth Supplemental Indenture as of November 1, 1994 Twenty-Sixth Supplemental Indenture as of April 1, 1995 some for the purpose of creating an additional series of bonds and of conveying additional property of the Company, and some for the purpose of modifying or amending provisions of the Original Indenture (the Original Indenture, all said Supplemental Indentures and this Supplemental Indenture are herein collectively called the "Indenture"); and WHEREAS the Company has acquired certain additional property hereinafter described or mentioned and, in compliance with its covenants in the Original Indenture, desires, by this Twenty-Seventh Supplemental Indenture, to evidence the subjection of such additional property to the lien of the Indenture; and WHEREAS as provided by the Original Indenture, the Board of Directors of the Company, by resolution, has authorized a new series of bonds, to mature June 1, 2025, and to be designated as "First Mortgage Bonds, 7-3/4% Series due 2025," and has authorized provisions permitted by the Original Indenture in respect of the bonds of said series; and WHEREAS the Board of Directors of the Company has authorized the Company to enter into this Twenty-Seventh Supplemental Indenture (herein sometimes referred to as "this Twenty-Seventh Supplemental Indenture" or "this Supplemental Indenture") conveying to the Trustees and subjecting to the lien of the Indenture the property hereinafter described or mentioned, creating and designating the new series of bonds, and specifying the form and provisions of the bonds of said series provided or permitted by the Indenture; and WHEREAS the texts of the First Mortgage Bonds, 7-3/4% Series due 2025, and of the Principal Trustee's Certificate of Authentication to be endorsed thereon are to be substantially in the forms following, respectively: [FORM OF BOND] [FACE] THE EMPIRE DISTRICT ELECTRIC COMPANY FIRST MORTGAGE BOND 7-3/4% SERIES DUE 2025 DUE JUNE 1, 2025 No. $ THE EMPIRE DISTRICT ELECTRIC COMPANY, a corporation organized and existing under the laws of the State of Kansas (hereinafter sometimes called the "Company"), for value received, hereby promises to pay to or registered assigns, on June 1, 2025, Dollars ($ ) at its office or agency in the City of Chicago, Illinois, and to pay interest thereon at said office or agency at the rate per annum specified in the title hereof from June 7, 1995 or from the most recent interest payment date to which interest has been paid or duly provided for on the bonds of this series, semi-annually on June 1 and December 1 in each year, commencing on December 1, 1995, until the Company's obligation with respect to such principal sum shall be discharged. The principal of and the interest on this bond shall be payable in any coin or currency of the United States of America which at the time of payment shall be legal tender for the payment of public and private debts. The interest so payable on any June 1 or December 1 will, subject to certain exceptions provided in the Twenty-Seventh Supplemental Indenture referred to on the reverse hereof, be paid to the person in whose name this bond is registered at the close of business on the May 15 or November 15 next preceding such June 1 or December 1. Notwithstanding anything in the Original Indenture or this Supplemental Indenture to the contrary, so long as the bonds of this series are in a book-entry only system, payment of principal of and interest on this bond will be in accordance with arrangements with The Depository Trust Company, a New York corporation ("DTC"). Reference is made to the further provisions of this bond set forth on the reverse hereof. Such further provisions shall for all purposes have the same effect as though fully set forth at this place. This bond shall not be valid or become obligatory for any purpose until the certificate of authentication endorsed hereon shall have been signed by Harris Trust and Savings Bank, or its successor, as a Trustee under the Indenture referred to on the reverse hereof. IN WITNESS WHEREOF, THE EMPIRE DISTRICT ELECTRIC COMPANY has caused this bond to be signed in its name by the facsimile signature of its President or a Vice President, and its corporate seal to be imprinted hereon and attested by the facsimile signature of its Secretary or an Assistant Secretary. Dated: THE EMPIRE DISTRICT ELECTRIC COMPANY, By President. Attest: Secretary. [FORM OF BOND] [REVERSE] This bond is one of an issue of bonds of the Company, known as its First Mortgage Bonds, issued and to be issued in one or more series under and equally and ratably secured (except as any sinking, amortization, improvement or other fund, established in accordance with the provisions of the indenture hereinafter mentioned may afford additional security for the bonds of any particular series) by a certain indenture of mortgage and deed of trust, dated as of September 1, 1944, made by the Company to Harris Trust and Savings Bank and The Joplin National Bank and Trust Company (now Mercantile Bank of Joplin), as Trustees (hereinafter called the "Trustees"), and certain indentures supplemental thereto, including a Third Supplemental Indenture, a Sixth Supplemental Indenture, a Seventh Supplemental Indenture, an Eighth Supplemental Indenture, a Fourteenth Supplemental Indenture, a Twenty-Fourth Supplemental Indenture and a Twenty-Seventh Supplemental Indenture (dated respectively as of December 1, 1950, February 1, 1968, April 1, 1969, May 1, 1970, September 15, 1983, March 1, 1994 and June 1, 1995) made by the Company to the Trustees (said indenture of mortgage and deed of trust and all indentures supplemental thereto being hereinafter collectively called the "Indenture"), to which Indenture reference is hereby made for a description of the property mortgaged, the nature and extent of the security, the rights and limitations of rights of the Company, the Trustees, and the holders of said bonds, and the terms and conditions upon which said bonds are secured, to all of the provisions of which Indenture, including the provisions permitting the issuance of bonds of any series for property which, under the restrictions and limitations therein specified, may be subject to liens prior to the lien of the Indenture, the holder, by accepting this bond, assents. To the extent permitted by, and as provided in, the Indenture, the rights and obligations of the Company and of the holders of said bonds may be changed and modified, with the consent of the Company, by the holders of at least 60% in aggregate principal amount of the bonds then outstanding, such percentage being determined as provided in the Indenture, or in the event that one or more but less than all of the series of bonds then outstanding are affected by such change or modification, by the holders of 60% in aggregate principal amount of the outstanding bonds of such one or more series so affected. Without the consent of the holder hereof no change or modification of the rights and obligations of the Company and of the holders of the bonds shall be made which will extend the time of payment of the principal of or the interest on this bond or reduce the principal amount hereof or the rate of interest hereon or will otherwise modify the terms of payment of such principal or interest (other than changes in any sinking or other fund) or will permit the creation of any lien ranking prior to or on a parity with the lien of the Indenture on any of the mortgaged property, or will deprive any non-assenting bondholder of a lien upon the mortgaged property for the security of such bondholder's bonds, subject to certain exceptions, or will reduce the percentage of bonds required for the aforesaid action under the Indenture. This bond is one of a series of bonds designated as the First Mortgage Bonds, 7-3/4% Series due 2025, of the Company. The bonds of this series are subject to redemption prior to maturity, upon not less than 30 nor more than 60 days' prior notice, all as more fully provided in the Indenture, at the option of the Company, at any time on and after June 1, 2005, as a whole or from time to time in part, at the principal amount thereof, with accrued interest to the date fixed for redemption and the applicable premium (expressed as a percentage of the principal amount) set forth in the table below for the twelve- month period beginning June 1 in the appropriate year under the heading "Redemption Premium": Redemption Redemption Year Premium Year Premium 2005 3.8750% 2010 1.9375% 2006 3.4875 2011 1.5500 2007 3.1000 2012 1.1625 2008 2.7125 2013 0.7750 2009 2.3250 2014 0.3875 ; and without premium if redeemed on or after June 1, 2015. If this bond shall be called for redemption in whole or in part, and payment of the redemption price shall be duly provided by the Company as specified in the Indenture, interest shall cease to accrue hereon (or on the portion hereof to be redeemed) from and after the date of redemption fixed in the notice thereof. The principal of this bond may be declared or may become due before the maturity hereof, on the conditions, in the manner and at the times set forth in the Indenture, upon the happening of a default as therein defined. This bond is transferable by the registered owner hereof in person or by his duly authorized attorney at the office or agency of the Company in the City of Chicago, Illinois, upon surrender and cancellation of this bond, and thereupon a new bond of this series, for a like principal amount, will be issued to the transferee in exchange therefor, as provided in the Indenture. If this bond is transferred or exchanged between a record date, as defined in the aforementioned Twenty-Seventh Supplemental Indenture, and the interest payment date in respect thereof, the new bond or bonds will bear interest from such interest payment date unless the interest payable on such date is not duly paid or provided for on such date. The Company and the Trustees and any paying agent may deem and treat the person in whose name this bond is registered as the absolute owner hereof for the purpose of receiving payment as herein provided and for all other purposes. This bond, alone or with other bonds of this series, may in like manner be exchanged at such office or agency for one or more new bonds of this series in authorized denominations, of the same aggregate principal amount, all as provided in the Indenture. Upon each such transfer or exchange the Company may require the payment of any stamp or other tax or governmental charge incident thereto. No recourse under or upon any covenant or obligation of the Indenture, or of any bonds thereby secured, or for any claim based thereon, or otherwise in any manner in respect thereof, shall be had against any incorporator, subscriber to the capital stock, stockholder, officer or director, as such, of the Company, whether former, present or future, either directly, or indirectly through the Company or the Trustees or either of them, by the enforcement of any subscription to capital stock, assessment or otherwise, or by any legal or equitable proceeding by virtue of any statute or otherwise (including, without limiting the generality of the foregoing, any proceeding to enforce any claimed liability of stockholders of the Company based upon any theory of disregarding the corporate entity of the Company or upon any theory that the Company was acting as the agent or instrumentality of the stockholders), any and all such liability of incorporators, stockholders, subscribers, officers and directors, as such, being released by the holder hereof, by the acceptance of this bond, and being likewise waived and released by the terms of the Indenture under which this bond is issued. Whenever the beneficial ownership of this Bond is determined by a book-entry at a securities depository for the Bonds, the foregoing requirements of holding, delivering or transferring this Bond shall be modified to require the appropriate person or entity to meet the requirements of the securities depository as to registering or transferring the book- entry to produce the same effect. [FORM OF PRINCIPAL TRUSTEE'S CERTIFICATE OF AUTHENTICATION] This bond is one of the bonds, of the series designated therein, described in the within-mentioned Indenture. HARRIS TRUST AND SAVINGS BANK, As Trustee, By Authorized Officer and WHEREAS the Company represents that all acts and things necessary have happened, been done, and been performed, to make the First Mortgage Bonds, 7-3/4% Series due 2025, when duly executed by the Company and authenticated by the Principal Trustee, and duly issued, the valid, binding and legal obligations of the Company, and to make the Original Indenture, the aforementioned twenty-six Supplemental Indentures and this Supplemental Indenture valid and binding instruments for the security thereof, in accordance with their terms; NOW, THEREFORE, THIS TWENTY-SEVENTH SUPPLEMENTAL INDENTURE WITNESSETH: That The Empire District Electric Company, the Company herein named, in consideration of the premises and of One Dollar ($1.00) to it duly paid by the Trustees at or before the ensealing and delivery of these presents, the receipt whereof is hereby acknowledged, and in order to secure the payment of the principal of and the interest on all bonds from time to time outstanding under the Indenture, according to the terms of said bonds and of the coupons attached thereto, has granted, bargained, sold, warranted, aliened, remised, released, conveyed, assigned, transferred, mortgaged, pledged, set over and confirmed, and by these presents does grant, bargain, sell, warrant, alien, remise, release, convey, assign, transfer, mortgage, pledge, set over and confirm unto Harris Trust and Savings Bank and Mercantile Bank of Joplin, as Trustees, and their respective successor or successors in the trust, and its or their assigns forever, the following property, with the same force and effect and subject to the same reservations and exceptions, as though specifically described in the granting clauses of the Original Indenture, that is to say: SUBSTATIONS AND SWITCHING STATIONS Taney County, Missouri 1. Land for New Riverside Substation #438: Land located in the County of Taney, State of Missouri: ALL THAT PART OF THE N 1/2 OF THE NE 1/4 OF SECTION 24, TOWNSHIP 22, RANGE 22, DESCRIBED AS BEGINNING AT THE NE CORNER OF SAID N 1/2 NE 1/4, THENCE SOUTH ALONG THE EAST LINE THEREOF 400 FEET; THENCE WEST 300 FEET; THENCE NORTH 400 FEET TO THE NORTH LINE OF SAID NE 1/4; THENCE EAST 300 FEET ALONG SAID NORTH LINE TO THE POINT OF BEGINNING. ALSO all other property, whether real, personal or mixed (except as in the Original Indenture expressly excepted) of every nature and kind and wheresoever situated now owned or hereafter acquired by the Company; TOGETHER with all and singular the tenements, hereditaments and appurtenances belonging or in anywise appertaining to the aforesaid mortgaged property or any part thereof, with the reversion and reversions, remainder and remainders and (subject to the provisions of 8.01 of the Original Indenture) the tolls, rents, revenues, issues, earnings, income, products and profits thereof, and all the estate, right, title and interest and claim whatsoever, at law as well as in equity, which the Company now has or may hereafter acquire in and to the aforesaid mortgaged property, and every part and parcel thereof; SUBJECT, HOWEVER, to permitted encumbrances as defined in the Original Indenture and, as to any property hereafter acquired by the Company, to any lien thereon existing, and to any liens for unpaid portions of the purchase money placed thereon at the time of such acquisition, and also subject to the provisions of Article 12 of the Original Indenture. TO HAVE AND TO HOLD the same, unto the Trustees and their and each of their respective successors and assigns forever; IN TRUST, NEVERTHELESS, upon the terms and trusts set forth in the Indenture, so that the same shall be held specifically by the Trustees under and subject to the terms of the Indenture in the same manner and for the same trusts, uses and purposes as if said properties had been specifically contained and described in the Original Indenture; PROVIDED, HOWEVER, and these presents are upon the condition that, if the Company, its successors or assigns, shall pay or cause to be paid unto the holders of the bonds the principal and interest, and premium, if any, to become due in respect thereof at the times and in the manner stipulated therein and in the Indenture and shall keep, perform and observe all and singular the covenants and promises in said bonds and in the Indenture expressed to be kept, performed and observed by or on the part of the Company, then the Indenture and the estate and rights thereby granted shall cease, determine and be void, otherwise to be and remain in full force and effect. AND THE COMPANY, for itself and its successors, does hereby covenant and agree to and with the Trustees, for the benefit of those who shall hold the bonds and the coupons appertaining thereto, or any of them, issued or to be issued under the Indenture, as follows: ARTICLE I CREATION AND DESCRIPTION OF FIRST MORTGAGE BONDS, 7-3/4% SERIES DUE 2025 Section 1. A new series of bonds to be issued under and secured by the Indenture is hereby created, to be designated as First Mortgage Bonds, 7-3/4% Series due 2025 (hereinafter sometimes called the "Bonds of the New Series" or "Bonds"). The Bonds of the New Series shall be limited to an aggregate principal amount of Thirty Million Dollars ($30,000,000), excluding any Bonds of the New Series which may be authenticated in lieu of or in substitution or exchange for other Bonds of the New Series pursuant to the provisions of Article 2 or of 15.09 of the Original Indenture. Said Bonds and the certificate of authentication of the Principal Trustee to be endorsed upon the Bonds shall be substantially in the forms hereinbefore recited, respectively. Each Bond shall be dated as of the date of its authentication and all Bonds of the New Series shall mature June 1, 2025 and shall bear interest at the rate of 7-3/4% per annum, payable semi-annually on June 1 and December 1 in each year, commencing December 1, 1995; both principal and interest shall be payable at the office or agency of the Company in the City of Chicago, Illinois, and in any coin or currency of the United States of America which at the time of payment shall be legal tender for the payment of public and private debts. The holder of any Bond on any record date (as hereinbelow defined) with respect to any interest payment date shall be entitled to receive the interest payable on such interest payment date notwithstanding the cancellation of such Bond upon any exchange or transfer thereof subsequent to the record date and prior to such interest payment date, except if and to the extent that the Company shall default in the payment of the interest due on such interest payment date, in which case such defaulted interest shall be paid to the person in whose name such Bond (or any Bond or Bonds issued upon transfer or exchange thereof) is registered on a date fixed by the Company, which shall be not more than 15 and not less than 10 days before the date of payment of such defaulted interest. The term "record date" as used in this Section with respect to any interest payment date shall mean the close of business on the May 15 or November 15, as the case may be, next preceding such interest payment date, whether or not such May 15 or November 15 shall be a legal holiday or a day on which banking institutions in the City of Chicago, Illinois are authorized by law to remain closed. Bonds of the New Series shall be registered Bonds in book-entry form or in definitive form without coupons in denominations of $1,000 and any integral multiple of $1,000 which may be executed by the Company and delivered to the Principal Trustee for authentication and delivery. The Bonds of the New Series shall be registrable and interchangeable at the office or agency of the Company in the City of Chicago, Illinois, in the manner and upon the terms set forth in 2.05 of the Original Indenture, upon payment of such an amount as shall be sufficient to reimburse the Company for, or to pay, any stamp or other tax or governmental charge incident thereto. Notwithstanding the provisions of 2.08 of the Original Indenture, no service or other charge will be made for any exchange or transfer of any Bond of the New Series. If the Bonds of the New Series are to be issued in book- entry form only, notwithstanding any provision of the Indenture to the contrary, unless the Company shall otherwise direct (which direction shall promptly be given at the written request of The Depository Trust Company ("DTC")), all Bonds of the New Series shall be registered in the name of Cede & Co., as nominee of DTC, as registered owner of the Bonds of the New Series, and held in the custody of DTC. Unless otherwise requested by DTC, a single certificate will be issued and delivered to DTC. Beneficial owners of Bonds of the New Series will not receive physical delivery of Bond certificates except as hereinafter provided. For so long as DTC shall continue to serve as securities depository for the Bonds of the New Series as provided herein, all transfers of beneficial ownership interests will be made by book-entry only, and no investor or other party purchasing, selling or otherwise transferring beneficial ownership of Bonds of the New Series is to receive, hold or deliver any Bond certificate. With respect to Bonds of the New Series registered in the name of Cede & Co., as nominee of DTC, the Trustees and the Company shall have no responsibility or obligation to the securities brokers and dealers, banks, trust companies, clearing corporations and certain other organizations on whose behalf DTC was created to hold securities to facilitate the clearance and settlement of securities transactions among DTC participants ("DTC Participants") or to any person on whose behalf a DTC Participant holds an interest in the Bonds of the New Series. Without limiting the immediately preceding sentence, the Trustees and the Company shall have no responsibility or obligation with respect to (i) the accuracy of the records of DTC, Cede & Co. or any DTC Participant with respect to any ownership interest in the Bonds of the New Series, (ii) the delivery to any DTC Participant or any other person, other than the registered owner of the Bonds of the New Series, of any notice with respect to the Bonds of the New Series, including any notice of redemption, or (iii) the payment to any DTC Participant or any other person, other than the registered owner of the Bonds of the New Series, of any amount with respect to principal of or premium, if any, or interest on the Bonds of the New Series. If the Bonds of the New Series are to be issued in book- entry form only, replacement Bonds may be issued directly to beneficial owners of Bonds of the New Series other than DTC, or its nominee, but only in the event that (i) DTC determines not to continue to act as securities depository for the Bonds of the New Series (which determination shall become effective by the giving of reasonable notice to the Company or the Principal Trustee); or (ii) the Company has advised DTC of its determination (which determination is conclusive as to DTC and beneficial owners of the Bonds of the New Series) to terminate the services of DTC as securities depository for the Bonds of the New Series; or (iii) the Company has determined (which determination is conclusive as to DTC and the beneficial owners of the Bonds of the New Series) that the interests of the beneficial owners of the Bonds of the New Series might be adversely affected if such book-entry only system of transfer is continued. Upon occurrence of the event set forth in (i) above, the Company shall use its best efforts to attempt to locate another qualified securities depository. If the Company fails to locate another qualified securities depository to replace DTC, the Company shall direct the Principal Trustee to cause to be authenticated and delivered replacement Bonds of the New Series, in certificated form, to the beneficial owners of the Bonds of the New Series. In the event that the Company makes the determination described in (ii) or (iii) above (provided that the Company undertakes no obligation to make any investigation to determine the occurrence of any events that would permit the Company to make any such determination), and has made provisions to notify the beneficial owners of Bonds of the New Series of such determination by mailing an appropriate notice to DTC, the Company shall cause to be issued replacement Bonds of the New Series in certificated form to beneficial owners of the Bonds of the New Series as shown on the records of DTC provided to the Trustee and the Company. Whenever, during the term of the Bonds of the New Series, the beneficial ownership thereof is determined by a book- entry at DTC, the requirements in the Original Indenture or this Supplemental Indenture relating to holding, delivering or transferring Bonds or selection of Bonds to be redeemed shall be deemed modified to require the appropriate person or entity to meet the requirements of DTC as to registering or transferring the book-entry to produce the same effect. If the Bonds of the New Series are to be issued in book- entry form only, notwithstanding any provision of the Original Indenture or this Supplemental Indenture to the contrary, all Bonds of the New Series issued hereunder, if DTC so requires, shall bear a legend substantially to the following effect: Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation ("DTC"), to the Company or its agent for registration of transfer, exchange, or payment, and any 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. If the Bonds of the New Series are to be issued in book- entry form only, the Company and the Principal Trustee shall enter into a letter of representations with DTC to implement the book-entry only system of Bond registration described above. If at any time DTC ceases to hold the Bonds of the New Series, all references herein to DTC shall be of no further force or effect. Section 2. The Bonds of the New Series described in Section 1 of this Article, in the aggregate principal amount of Thirty Million Dollars ($30,000,000), shall be executed by the Company and delivered to the Principal Trustee and, upon compliance with all the provisions and requirements of the Original Indenture in respect thereof, all or any portion of the Bonds of the New Series may, from time to time, be authenticated by the Principal Trustee and delivered (without awaiting the filing or recording of this Supplemental Indenture) in accordance with the written order or orders of the Company. ARTICLE II Redemption of Bonds of the New Series Section 1. The Bonds of the New Series, in the manner provided in Article 5 of the Original Indenture, shall be redeemable at any time on or after June 1, 2005, and prior to maturity, in whole or in part, at the option of the Company, at the principal amount of the Bonds so to be redeemed and accrued interest to the date fixed for redemption together with any applicable premium as specified under the heading "Redemption Premium" in the form of Bond set forth in this Supplemental Indenture. The Bonds of the New Series shall not be redeemable through the operation of any sinking fund. Section 2. The provisions of 5.03, 5.04 and 5.05 of the Original Indenture shall be applicable to Bonds of the New Series. The principal amount of Bonds of the New Series registered in the name of any holder and to be redeemed on any partial redemption shall be $1,000, or a multiple thereof. Section 3. The holder of each and every Bond of the New Series issued hereunder hereby, and by accepting the Bond, agrees to accept payment thereof prior to maturity on the terms and conditions provided for in this Article II. ARTICLE III No Sinking and Improvement Funds for Bonds of the New Series There shall be no Sinking and Improvement Fund for the Bonds of the New Series. ARTICLE IV Dividend Covenants The Company hereby covenants that, so long as any of the Bonds of the New Series shall remain outstanding, the covenants and agreements of the Company set forth in Section 4.11 of the Original Indenture as heretofore supplemented shall be and remain in full force and effect and be duly observed and complied with by the Company, notwithstanding that no First Mortgage Bonds, 3-1/2 % Series due 1969, remain outstanding. ARTICLE V The Trustees The Trustees accept the trusts created by this Supplemental Indenture upon the terms and conditions hereof and agree to perform such trusts upon the terms and conditions set forth in the Original Indenture as heretofore supplemented and in this Supplemental Indenture set forth. In general, each and every term and condition contained in Article 13 of the Original Indenture shall apply to this Supplemental Indenture with the same force and effect as if the same were herein set forth in full, with such omissions, variations and modifications thereof as may be appropriate to make the same conform to this Supplemental Indenture. ARTICLE VI Miscellaneous Provisions Section 1. If the date for making any payment of principal or interest or premium or the last date for performance of any act or the exercising of any right, as provided in this Supplemental Indenture, shall be a legal holiday or a day on which banking institutions in the City of Chicago, Illinois, are authorized by law to remain closed, such payment may be made or act performed or right exercised on the next succeeding day not a legal holiday or a day on which such banking institutions are authorized by law to remain closed, with the same force and effect as if done on the nominal date provided in this Supplemental Indenture, and no interest shall accrue for the period after such nominal date. Section 2. The Original Indenture as heretofore and hereby supplemented and amended is in all respects ratified and confirmed; and the Original Indenture, this Supplemental Indenture and all other indentures supplemental to the Original Indenture shall be read, taken and construed as one and the same instrument. Neither the execution of this Supplemental Indenture nor anything herein contained shall be construed to impair the lien of the Original Indenture as heretofore supplemented on any of the property subject thereto, and such lien shall remain in full force and effect as security for all bonds now outstanding or hereafter issued under the Indenture. All terms defined in Article 1 of the Original Indenture, as heretofore supplemented, for all purposes of this Supplemental Indenture, shall have the meanings therein specified, unless the context otherwise requires. Section 3. This Supplemental Indenture may be simultaneously executed in any number of counterparts, and all said counterparts executed and delivered, each as an original, shall constitute but one and the same instrument. Section 4. Nothing in this Supplemental Indenture contained, shall, or shall be construed to, confer upon any person other than a holder of bonds issued under the Indenture, the Company and the Trustees any right or interest to avail himself of any benefit under any provision of the Indenture, as heretofore supplemented and amended, or of this Supplemental Indenture. IN WITNESS WHEREOF, The Empire District Electric Company, party of the first part, has caused its corporate name to be hereunto affixed and this instrument to be signed by its President or a Vice President, and its corporate seal to be hereunto affixed and attested by its Secretary or an Assistant Secretary for and in its behalf; and Harris Trust and Savings Bank and Mercantile Bank of Joplin, parties of the second part, have each caused its corporate name to be hereunto affixed, and this instrument to be signed by its President or a Vice President and its corporate seal to be hereunto affixed and attested by its Secretary or an Assistant Secretary for and in its behalf, all as of the day and year first above written. The Empire District Electric Company By /s V.E. Brill Name: V.E. Brill Title: Vice President-Finance [Corporate Seal] Attest: /s/ G.C. Hunter Name: G.C. Hunter Title: Secretary-Treasurer Signed, sealed and delivered by The Empire District Electric Company in the presence of: /s/ D.W. Gibson Name: D.W. Gibson /s/ K.S. Walters Name: K.S. Walters Harris Trust and Savings Bank, as Trustee, By /s/ F.A. Pierson Name: F.A. Pierson Title: Vice President [Corporate Seal] Attest: /s/ C. Potter Name: C. Potter Title: Assistant Secretary Signed, sealed and delivered by Harris Trust and Savings Bank in the presence of: /s/ F. Daguinsin Name: F. Daguinsin /s/ R. Johnson Name: R. Johnson Mercantile Bank of Joplin, as Trustee, By /s/ Douglas Hauser Name: Douglas Hauser Title: Vice President [Corporate Seal] Attest: /s/ C.E. Jardon Name: C.E. Jardon Title: Secretary Signed, sealed and delivered by Mercantile Bank of Joplin in the presence of: /s/ D.W. Gibson Name: D.W. Gibson /s/ K.S. Walters Name: K.S. Walters State of Missouri } SS.: County of Jasper Be It Remembered, and I do hereby certify, that on this 1st day of June, 1995, before me, a Notary Public in and for the County and State aforesaid, personally appeared V.E. Brill, the Vice President-Finance of The Empire District Electric Company, a Kansas corporation, and G.C. Hunter, the Secretary-Treasurer of said corporation, who are both to me personally known, and both personally known to me to be such officers and to be the identical persons whose names are subscribed to the foregoing instrument as such Vice President-Finance and Secretary-Treasurer, respectively, and as the persons who subscribed the name and affixed the seal of said The Empire District Electric Company, one of the makers thereof, to the foregoing instrument as its Vice President-Finance and Secretary-Treasurer, and they each acknowledged to me that they, being thereunto duly authorized, executed the same for the uses, purposes and consideration therein set forth and expressed, and in the capacities therein stated, as their free and voluntary act and deed, and as the free and voluntary act and deed of said corporation. And the said V.E. Brill and G.C. Hunter, being each duly sworn by me, severally deposed and said: that they reside in the City of Joplin, Missouri and Webb City, Missouri, respectively; that they were at that time Vice President-Finance and Secretary-Treasurer, of said corporation; that they knew the corporate seal of said corporation, and that the seal affixed to said instrument was such corporate seal, and was thereto affixed by said Secretary-Treasurer, and the said instrument was signed by said Vice President-Finance, in pursuance of the power and authority granted them by the By-Laws of said corporation, and by authority of the Board of Directors thereof. In Testimony Whereof, I have hereunto set my hand and affixed my official and notarial seal at my office in said County and State the day and year last above written. My commission expires February 3, 1998. [Notary Seal] /s/ Linda S. Johnson Linda S. Johnson Notary Public State of Illinois } SS.: County of Cook Be It Remembered, and I do hereby certify, that on the 1st day of June, 1995, before me, a Notary Public in and for the County and State aforesaid, personally appeared F.A. Pierson, Vice President of Harris Trust and Savings Bank, an Illinois corporation, and C. Potter, Assistant Secretary of said corporation, who are both to me personally known, and both personally known to me to be such officers and to be the identical persons whose names are subscribed to the foregoing instrument as such Vice President and Assistant Secretary, respectively, and as the persons who subscribed the name and affixed the seal of said Harris Trust and Savings Bank, one of the makers thereof, to the foregoing instrument as its Vice President and Assistant Secretary, and they each acknowledged to me that they, being thereunto duly authorized, executed the same for the uses, purposes and consideration therein set forth and expressed, and in the capacities therein stated, as their free and voluntary act and deed, and as the free and voluntary act and deed of said corporation. And the said F.A. Pierson and C. Potter, being each duly sworn by me, severally deposed and said: that they reside in Chicago, Illinois, that they were at that time respectively Vice President and Assistant Secretary, of said corporation; that they knew the corporate seal of said corporation, and that the seal affixed to said instrument was such corporate seal, and was thereto affixed by said Assistant Secretary, and the said instrument was signed by said Vice President, in pursuance of the power and authority granted them by the By-Laws of said corporation, and by authority of the Board of Directors thereof. In Testimony Whereof, I have hereunto set my hand and affixed my official and notarial seal at my office in said County and State the day and year last above written. My commission expires December 14, 1997. [Notary Seal] /s/ Kimberly Lange Kimberly Lange Notary Public State of Missouri } SS.: County of Jasper Be It Remembered, and I do hereby certify, that on this 1st day of June, 1995, before me, a Notary Public in and for the County and State aforesaid, personally appeared Douglas Hauser, Vice President of Mercantile Bank of Joplin, a bank organized under the laws of the State of Missouri, and C.E. Jardon, Secretary of said corporation, who are both to me personally known, and both personally known to me to be such officers and to be the identical persons whose names are subscribed to the foregoing instrument as such Vice President and Secretary, respectively, and as the persons who subscribed the name and affixed the seal of said Mercantile Bank of Joplin, one of the makers thereof, to the foregoing instrument as its Vice President and Secretary, and they each acknowledged to me that they, being thereunto duly authorized, executed the same for the uses, purposes and consideration therein set forth and expressed, and in the capacities therein stated, as their free and voluntary act and deed, and as the free and voluntary act and deed of said corporation. And the said Douglas Hauser and C.E. Jardon, being each duly sworn by me, severally deposed and said: that they reside in the City of Joplin, Missouri; that they were at the time respectively Vice President and Secretary of said corporation; that they knew the corporate seal of said corporation, and that the seal affixed to said instrument was such corporate seal, and was thereto affixed by said Secretary, and the said instrument was signed by said Vice President, in pursuance of the power and authority granted them by the By-Laws of said corporation, and by authority of the Board of Directors thereof. In Testimony Whereof, I have hereunto set my hand and affixed my official and notarial seal at my office in said County and State the day and year last above written. My commission expires March 10, 1997. [Notary Seal] /s/ Andrena W. Roark Andrena W. Roark Notary Public EX-27 4
ut THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE SHEET AT JUNE 30, 1995 AND THE STATEMENT OF INCOME AND THE STATEMENT OF CASH FLOWS FOR THE SIX MONTHS ENDED JUNE 30, 1995 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS. 6-MOS Dec-31-1995 Jun-30-1995 PER-BOOK 464,087,156 0 37,028,146 43,510,123 0 544,625,425 15,062,574 122,841,368 51,610,281 189,514,223 0 32,901,800 194,859,882 0 0 8,000,000 0 0 0 0 119,349,520 544,625,425 84,860,580 3,820,545 66,557,774 70,378,319 14,482,261 837,146 15,319,407 7,021,647 8,297,760 1,208,170 7,089,590 9,262,651 7,466,347 18,559,351 0.49 0.49