-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, CxI7dWeNfdpVs4lvFFy+Mc0GE2mjIz6l8fje1zKAzZ0D619COFU1yVEwYIPJKeLk QFpaFX35hpCoSw5bNlo/dg== 0000054476-96-000068.txt : 19960719 0000054476-96-000068.hdr.sgml : 19960719 ACCESSION NUMBER: 0000054476-96-000068 CONFORMED SUBMISSION TYPE: DEFA14A PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 19960718 SROS: CSX SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: KANSAS CITY POWER & LIGHT CO CENTRAL INDEX KEY: 0000054476 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC SERVICES [4911] IRS NUMBER: 440308720 STATE OF INCORPORATION: MO FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: DEFA14A SEC ACT: 1934 Act SEC FILE NUMBER: 001-00707 FILM NUMBER: 96596289 BUSINESS ADDRESS: STREET 1: 1201 BALTIMORE AVE CITY: KANSAS CITY STATE: MO ZIP: 64106 BUSINESS PHONE: 8165562200 MAIL ADDRESS: STREET 1: PO BOX 418679 CITY: KANSAS CITY STATE: MO ZIP: 64141-9679 DEFA14A 1 SCHEDULE 14A INFORMATION PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES EXCHANGE ACT OF 1934 Filed by the Registrant [X] Filed by a Party other than the Registrant [ ] Check the appropriate box: [ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) [ ] Definitive Proxy Statement [X] Definitive Additional Materials [ ] Soliciting Material Pursuant to Rule 240.14a-11(c) or Rule 240.14a-12 KANSAS CITY POWER & LIGHT COMPANY (NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) Payment of Filing Fee (Check the appropriate box): [ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or Item 22(a)(2) of Schedule 14A. [ ] $500 per each party to the controversy pursuant to Exchange Act Rule 14a-6(i)(3). [ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11. (1) Title of each class of securities to which transaction applies: (2) Aggregate number of securities to which transaction applies: (3) Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11: (4) Proposed maximum aggregate value of transaction: (5) Total fee paid: [X] Fee paid previously with preliminary materials. [ ] Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. (1) Amount Previously Paid: (2) Form, Schedule or Registration Statement No.: (3) Filing Party: (4) Date Filed: #### [Advertisement appearing in newspapers commencing July 18, 1996] To [KCPL logo] Shareholders: WHAT WILL WESTERN'S STOCK REALLY BE WORTH? IS IT WORTH THE RISK? Western Resources is offering to exchange its stock for your KCPL shares. Western's forecast of 1998 earnings of a combined Western/KCPL is $2.52 per share. But we see a problem with Western's numbers. We think they just don't add up. ASK YOURSELF SOME IMPORTANT QUESTIONS In making any decision based on Western's projections, we think there are three very important questions that need to be asked. These questions and our answers are below: 1. Do Western's projections take into account the NO $105 million annual rate reduction recommended by the staff of the Kansas Corporation Commission (KCC)? 2. Do Western's projections accurately reflect the NO amount of merger-related savings achievable from a Western/KCPL combination? 3. Do Western's projections accurately reflect the NO percentage of merger-related savings which Kansas and Missouri would allow Western to retain? HERE'S HOW THE ANSWERS COULD IMPACT WESTERN'S STOCK PRICE Western's Own Forecast of 1998 Earnings Per $2.52 Share for Western/KCPL Combination(1) Adjustment to Reflect $105 Million Rate -0.22 Reduction Recommended by Kansas Corporation Commission Staff(2) Adjustment to Reflect Overstatement of -0.11 Merger-Related Savings by Western(3) ______ Adjustment to Reflect Total Overstatement -0.33 -0.33 of Western's Earnings Forecast _____ Revised Estimate of Western's 1998 Earnings $2.19 per Share for Western/KCPL Combination IMPLIED REDUCTION IN WESTERN COMMON STOCK -$3.80 VALUE IN 1998 BASED ON ASSUMED PRICE/ EARNINGS RATIO OF 11.5(4) If Western's per share earnings are overstated by $0.33 as shown in this chart, then multiplying the $0.33 overstatement by an assumed price/earnings ratio of 11.5 indicates that WESTERN'S 1998 STOCK PRICE COULD BE REDUCED BY APPROXIMATELY $3.80 PER SHARE. Even Western acknowledges in its own Prospectus dated July 3, 1996 that: "[T]here can be no assurance that the KCC staff's recommendations will not be adopted, or if adopted, will not have an adverse effect on Western Resources' consummation of the Offer and the Merger, on the Regulatory Plan or on Western Resources' ability to achieve its projected post-Merger dividend rates." IF WESTERN'S PROJECTED PER SHARE EARNINGS ARE OVERSTATED, DO YOU REALLY THINK WESTERN WILL BE ABLE TO PAY DIVIDENDS AT ITS PROMISED RATE? _________________________________________________________________ VOTE FOR THE KCPL/UTILICORP MERGER ON THE WHITE PROXY CARD TODAY _________________________________________________________________ If you have any questions or need assistance in completing the WHITE proxy card, please call KCPL Investor Relations, toll free, at 1-800-245-5275 or our proxy solicitor, D. F. King & Co., Inc., toll free, at 1-800-714-3312. July 18, 1996 KANSAS CITY POWER & LIGHT COMPANY (1)As reported in the Western Prospectus dated July 3, 1996 and excluding costs to achieve savings and transaction costs. In the Western Prospectus, Western estimated earnings per share for 1998 based on Western's closing stock price on July 2, 1996 resulting in an exchange ratio of 1.01224. (2)Assumes that Western underestimated the rate reduction by $46.3 million, derived by subtracting from Kansas Corporation Commission staff's recommended $105 million annual rate reduction both (i) Western's proposal for an $8.7 million rate reduction and (ii) Western's proposal for $50 million accelerated depreciation of its investment in the Wolf Creek nuclear plant. The $46.3 million adjustment as reduced by 40% to reflect the effect of taxes results in an after-tax adjustment of $27.78 million, which results in a reduction to earnings per share of approximately $0.22 based upon 128,136,000 shares outstanding. (3)Assumes that $70.421 million in first year savings claimed by Western in the Western Prospectus are overstated by $23.474 million. KCPL's analysis of Western's claimed merger-related savings indicates that Western overestimated total purchasing savings by 62.7% and overestimated total administrative savings by 48.5%. Applying such percentages to the first year purchasing and administrative savings in the Western Prospectus indicates that first year merger-related savings are overstated by slightly more than one-third. One-third of Western's estimate of $70.421 million equals $23.474 million. The $23.474 million adjustment as reduced by 40% to reflect the effect of taxes results in an after-tax adjustment of $14.084 million, which results in a reduction to earnings per share of approximately $0.11 based upon 128,136,000 shares outstanding. (4)Utility industry estimated average for 1996 as calculated in Merrill Lynch, Pierce, Fenner & Smith Incorporated report dated June 24, 1996. The foregoing materials contain certain statements of opinion and belief of KCPL. Certain information in these materials is provided to facilitate an analysis of the potential value of Western's proposal. The implied reduction, if any, in Western's common stock value may be greater or less than indicated above. -----END PRIVACY-ENHANCED MESSAGE-----