==============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------------
SCHEDULE 14D-1
(Amendment No. 41)
Tender Offer Statement
(Pursuant to Section 14(d)(1) of the Securities Exchange Act of 1934)
---------------------------
Kansas City Power & Light Company
(Name of Subject Company)
Western Resources, Inc.
(Bidder)
Common Stock, Without Par Value
(Title of Class of Securities)
48513410
(CUSIP Number of Class of Securities)
John K. Rosenberg
Executive Vice President and General Counsel
Western Resources, Inc.
818 Kansas Avenue
Topeka, Kansas 66612
Phone: (913) 575-6300
(Name, Address, including Zip Code, and Telephone
Number, including Area Code, of Agent for Service)
---------------------------
Copies to:
Neil T. Anderson
Sullivan & Cromwell
125 Broad Street
New York, New York 10004
(212) 558-4000
William S. Lamb
LeBoeuf, Lamb, Greene & MacRae, L.L.P.
125 West 55th Street
New York, New York 10019
(212) 424-8000
================================================================================
<PAGE>
This Amendment No. 41 amends and supplements the Tender Offer Statement
on Schedule 14D-1 (the "Schedule 14D-1"), originally filed by Western Resources,
Inc., a Kansas corporation ("Western Resources"), on July 8, 1996 relating to
the exchange offer disclosed therein to exchange all of the outstanding Shares
for shares of Western Resources Common Stock upon the terms and subject to the
conditions set forth in the Prospectus, dated July 3, 1996, and the related
Letter of Transmittal. Capitalized terms used and not defined herein shall have
the meanings set forth in the Schedule 14D-1.
Item 11. Material to be Filed as Exhibits.
Item 11 is hereby amended and supplemented by adding thereto the
following:
(a)(2)(iii) Letter of Transmittal with respect to the Shares mailed on
or about October 11, 1996 to certain KCPL Shareholders.
(a)(113) Letters mailed on or about October 11, 1996 to KCPL
Shareholders.
(a)(114) Reproduced news articles mailed on or about October 11, 1996
to KCPL Shareholders.
<PAGE>
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this statement is true, complete and correct.
By: /s/ Jerry D. Courington
Name: Jerry D. Courington
Title: Controller
Dated: October 11, 1996
<PAGE>
EXHIBIT INDEX
Exhibit
No. Description
- -------- -----------
(a)(2)(iii) Letter of Transmittal with respect to the Shares mailed on or
about October 11, 1996 to certain KCPL Shareholders.
(a)(113) Letters mailed on or about October 11, 1996 to KCPL
Shareholders.
(a)(114) Reproduced news articles mailed on or about October 11, 1996 to
KCPL Shareholders.
LETTER OF TRANSMITTAL
[WESTERN RESOURCES LOGO]
John E. Hayes, Jr.
Chairman of the Board
and Chief Executive Officer
Dear KCPL Shareowner:
This Letter of Transmittal enables you to exchange each of your shares of
Common Stock of Kansas City Power & Light Company for $31.00 of Common Stock of
Western Resources, Inc.* Please follow the instructions in this letter in order
to exchange your shares and receive the benefits of our Offer. Simply complete
and sign pages 2 and 3 and return your certificate(s) in the enclosed envelope.
Our Offer will expire at 5:00 p.m., Eastern Daylight Time, on OCTOBER 25, 1996
(the "Expiration Date") unless extended. Shares which are tendered may be
withdrawn at any time prior to the Expiration Date.
For further information or assistance regarding our Offer please call our
representatives listed on the back.
Thank you for your time and support.
Sincerely,
/s/ John E. Hayes, Jr.
John E. Hayes, Jr.
* Assumes that Western Resources' average share price is between $28.18 and
$33.23 at the time of closing.
<PAGE>
IN ORDER TO TENDER YOUR SHARES, SIMPLY:
1. SIGN BY THE "X" IN THE BOX BELOW 2. COMPLETE THE SUBSTITUTE FORM W-9 ON PAGE
3.
PLEASE SIGN HERE.
Signature(s) of Shareholder(s) X
- -----------------------------------------
Dated: , 1996
(Must be signed by registered holder(s) exactly as name(s) appear(s) on stock
certificate(s) or on a security position listing or by person(s) authorized to
become registered holder(s) by certificate(s) and documents transmitted
herewith. If signature is by trustees, executors, administrators, guardians,
attorneys-in-fact, officers of corporations or others acting in a fiduciary or
representative capacity, please provide the following information and see
Instruction 5.)
I CERTIFY THAT I HAVE READ THE INSTRUCTIONS ENCLOSED WITH AND CONSTITUTING A
PART OF THIS LETTER OF TRANSMITTAL AND THAT I COMPLY WITH THE SHAREHOLDER
REPRESENTATION INCLUDED WITH SUCH INSTRUCTIONS.
Name(s)
(Please Print)
Capacity (Full Title)
Address
City/State/Zip Code
(Area Code and Telephone Number)
COMPLETE THE BOX BELOW ONLY IF YOU WISH TO TENDER LESS THAN ALL THE SHARES
EVIDENCED BY YOUR CERTIFICATE(S)
Certificates and Shares Tendered (Attach additional list if necessary)
- ----------------------------------------------------------------------
Certificate Total Number of Shares Number of
Number(s)* Evidenced by Certificate(s)* Shares Tendered**
- -----------------------------------------------------------
- -----------------------------------------------------------
- -----------------------------------------------------------
- -----------------------------------------------------------
- -----------------------------------------------------------
- -----------------------------------------------------------
- -----------------------------------------------------------
Total Shares
- -------------------------------------------------------------------------------
* Do not complete if delivering shares by book-entry transfer.
** You must indicate if you are tendering less than all Shares evidenced by any
certificate(s) delivered to the Exchange Agent. See Instruction 4.
2
<PAGE>
THIS PAGE MUST BE COMPLETED BY ALL TENDERING SHAREHOLDERS.
PLEASE FILL IN YOUR SOCIAL SECURITY NUMBER
AND SIGN BELOW.
Please see Instruction 9 for additional information.
PAYER'S NAME: HARRIS TRUST COMPANY OF NEW YORK
SUBSTITUTE
Form W-9
Department of the
Treasury
Internal Revenue Service
Payer's Request for Taxpayer
Identification Number (TIN)
PART 1-PLEASE PROVIDE YOUR TIN IN THE BOX AT RIGHT AND CERTIFY BY SIGNING AND
DATING BELOW.
Social Security Number or
Employer Identification Number
X
- ----------------
- -------------------------------------------------------------------------------
PART 2-Certificates-Under penalties of perjury, I certify that:
(1) The number shown on this form is my correct Taxpayer Identification Number
(or I am waiting for a number to be issued to me); and (2) I am not subject
to backup withholding because (i) I am exempt from backup
withholding, (ii) I have not been notified by the Internal Revenue Service
(the "IRS") that I am subject to backup withholding as a result of a failure
to report all interest or dividends, or (iii) the IRS has notified me that I
am no longer subject to backup withholding.
- -------------------------------------------------------------------------------
Certification Instructions-You must cross out item (2) in Part 2 above if you
have been notified by the IRS that you are subject to backup withholding because
of under-reporting interest or dividends on your tax return. However, if after
being notified by the IRS that you were subject to backup withholding you
received another notification from the IRS stating that you are no longer
subject to backup withholding, do not cross out item(2).
- --------------------------------------------
SIGNATURE X
DATE
NAME (Please Print)
Part 3 -
Awaiting TIN ~
NOTE: Failure to complete and return this form may result in backup withholding
of 31% of any cash payments made to you pursuant to the Offer. Please
review the enclosed guidelines for certification of Taxpayer
Identification Number on Substitute Form W-9 for additional details.
Complete the following certification ONLY if you checked the box in part 3 of
Substitute Form W-9.
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a Taxpayer Identification Number has
not been issued to me, and either (i) I have mailed or delivered an application
to receive a Taxpayer Identification Number to the appropriate Internal Revenue
Service Center or Social Security Administration Office or (ii) I intend to mail
or deliver an application in the near future. I understand that if I do not
provide a Taxpayer Identification Number within 60 days, 31% of all reportable
payments made to me thereafter will be withheld until I provide a number.
- ----------------------------
- ----------------------------
Signature
Date
- ----------------------------
Name (Please Print)
IMPORTANT TAX INFORMATION
Certain shareholders (including, among others, all corporations and certain
foreign individuals) are not subject to backup withholding. In order for a
foreign individual to qualify as an exempt recipient, that shareholder must
submit a Form W-8, signed under penalties of perjury, attesting to that
individual's exempt status. A Form W-8 can be obtained from the Exchange Agent.
See the enclosed Guidelines for Certification of Taxpayer Identification Number
on Substitute Form W-9 for additional instructions.
Backup withholding is not an additional tax. Rather, the tax liability of
persons subject to backup withholding will be reduced by the amount of tax
withheld. If withholding results in an overpayment of taxes, a refund may be
obtained from the Internal Revenue Service.
3
<PAGE>
OPTIONAL
If you would like shares of Western Resources Common Stock to be delivered to
a different address, complete the top box below.
If you would like shares of Western Resources Common Stock to be issued in a
different name, complete the bottom box below. You must include a signature
guarantee if you complete the box at the bottom of the page. The signature
guarantee process is more fully described in Instructions 1 and 5.
SPECIAL DELIVERY INSTRUCTIONS (See Instructions 1, 6 and 7)
To be completed ONLY if certificate(s) for the Western Resources Common Stock
and/or any check to be issued for cash in lieu of fractional shares of Western
Resources Common Stock are to be sent to someone other than the undersigned, or
to the undersigned at an address other than that shown on the address label.
Mail Western Resources Common Stock and/or any check to be issued for cash in
lieu of fractional shares of Western Resources Common Stock to:
Name
(Please Type or Print)
Address
City/State/Zip Code
SPECIAL ISSUANCE INSTRUCTIONS
(See Instructions 1, 5, 6 and 7)
To be completed ONLY if certificate(s) for the Western Resources Common Stock
and/or any check to be issued for cash in lieu of fractional shares of Western
Resources Common Stock are to be issued in the name of someone other than those
shown on your certificate(s).
Issue Western Resources Common Stock and/or any check to be issued for cash in
lieu of fractional shares of Western Resources Common Stock to:
Name
(Please Type or Print)
Address
City/State/Zip Code
(Social Security Number or Tax Identification Number)
GUARANTEE OF SIGNATURE(S)
Authorized Signature
Name
(Please Type or Print)
Address
City/State/Zip Code
Name of Firm
Dated: , 1996
4
<PAGE>
OPTIONAL
You may identify in the box below the Soliciting Dealer, if any, who solicited
your tender of Shares. By doing so you may entitle that Soliciting Dealer to
receive from Western Resources the fee described in Instruction 10.
In order to be paid the solicitation fee for Shares held in nominee name
tendered by a Soliciting Dealer on behalf of a customer who is the beneficial
owner of such Shares, the Soliciting Dealer must list each customer's name or
account number and the number of Shares tendered for such customer on the line
entitled "Name or Account Number of Beneficial Owner" and "Number of Shares
Tendered", respectively, provided for such purpose in the box below.
SOLICITED TENDERS
The undersigned represents that the Soliciting Dealer who solicited and
obtained the tender evidenced by this Letter of Transmittal is:
Name of Firm
(Please Print)
Name of Individual Broker
Address
City/State/Zip Code
The following to be completed ONLY if a customer's Shares held in nominee name
are tendered by a Soliciting Dealer.
Name or Account Number
of Beneficial Owner
Number of Shares Tendered
(Attach additional list if necessary)
5
<PAGE>
The Information Agent for the Offer is:
Georgeson & Company Inc.
Wall Street Plaza
New York, New York 10005
1-800-223-2064
The Exchange Agent for the Offer is:
HARRIS TRUST COMPANY OF NEW YORK
By Overnight Courier:
77 Water Street, 4th Floor
New York, NY 10005
By Mail:
Wall Street Station
P.O. Box 1010
New York, NY 10268-1010
By Facsimile Transmission
(for Eligible Institutions only):
Fax: (212) 701-7636
(212) 701-7637
Confirm by telephone:
(212) 701-7624
By Hand:
Receive Window
77 Water Street, 5th Floor
New York, N Y
The Dealer Manager for the Offer is:
Salomon Brothers Inc
Seven World Trade Center
New York, New York 10048
(212) 783-6593 (collect)
<PAGE>
[WESTERN RESOURCES LOGO]
INSTRUCTIONS TO LETTER OF TRANSMITTAL
Forming Part of the Terms and Conditions of the Offer
1. Guarantee of Signatures. No signature guarantee is required on the Letter
of Transmittal in cases where:
(a) the Letter of Transmittal is signed by the registered holder(s) of the
Shares (which term, for purposes of this document, shall include any
participant in one of the Book-Entry Transfer Facilities whose name appears
on a security position listing as the owner of Shares) tendered with the
Letter of Transmittal and such holder(s) have not completed the instruction
entitled "Special Issuance Instructions" on the Letter of Transmittal, or
(b) such Shares are tendered for the account of an Eligible Institution (as
defined below).
Otherwise, all signatures on the Letter of Transmittal must be guaranteed by a
financial institution (including most banks, savings and loan associations,
brokerage houses and credit unions) which is a participant in the Securities
Transfer Agents Medallion Program, the New York Stock Exchange Medallion
Signature Guarantee Program or the Stock Exchange Medallion Program (an
"Eligible Institution"). See Instruction 5.
2. Delivery of Letter of Transmittal and Certificates or Book-Entry
Confirmations. The Letter of Transmittal is to be used either:
(a) if certificates are to be forwarded with the Letter of Transmittal, or
(b) if tenders are to be made pursuant to the procedures for tender by
book-entry transfer set forth in "The Offer-Procedure for Tendering" in the
Prospectus (as defined herein), unless an Agent's Message is utilized.
Certificates for all physically tendered Shares ("Share Certificates"), or
confirmation of any book-entry transfer into the Exchange Agent's account at one
of the Book-Entry Transfer Facilities of Shares tendered by book-entry transfer,
as well as the Letter of Transmittal or facsimile thereof, properly completed
and duly executed with any required signature guarantees, and any other
documents required by the Letter of Transmittal, must be received by the
Exchange Agent at one of its addresses set forth herein on or prior to the
Expiration Date (as defined in the Prospectus).
Shareholders whose certificates are not immediately available or who cannot
deliver their certificates and all other required documents to the Exchange
Agent on or prior to the Expiration Date or who cannot complete the procedures
for book-entry transfer on a timely basis may nevertheless tender their Shares
by properly completing and duly executing a Notice of Guaranteed Delivery
pursuant to the guaranteed delivery procedure set forth in "The Offer-Procedure
for Tendering" in the Prospectus.
In order to utilize the guaranteed delivery procedure: (i) your tender must be
made by or through an Eligible Institution; (ii) a properly completed and duly
executed Notice of Guaranteed Delivery substantially in the form made available
by Western Resources must be received by the Exchange Agent on or prior to the
Expiration Date; and (iii) the Share Certificates for all tendered Shares (or a
confirmation of a book-entry transfer of such securities into the Exchange
Agent's account at a Book-Entry Transfer Facility of Shares tendered by
book-entry transfer), in proper form for transfer, together with a properly
completed and duly executed Letter of Transmittal (or facsimile thereof) with
any required signature guarantees (or, in the case of a book-entry delivery, an
Agent's Message) and all other documents required by the Letter of Transmittal,
must be received by the Exchange Agent within three New York Stock Exchange,
Inc. trading days after the date of execution of such Notice of Guaranteed
Delivery.
If Share Certificates are forwarded separately to the Exchange Agent, a
properly completed and duly executed Letter of Transmittal must accompany each
such delivery.
1
<PAGE>
The method of delivery of Share Certificates and all other required documents,
including delivery through any Book-Entry Transfer Facility, is at the option
and risk of the tendering shareholder, and the delivery will be deemed made only
when actually received by the Exchange Agent. If delivery is by mail, registered
mail with return receipt requested, properly insured, is recommended. The
replacement cost of certificates for securities is generally 2% of market value.
In all cases, sufficient time should be allowed to ensure timely delivery.
No alternative, conditional or contingent tenders will be accepted and no
fractional Shares will be accepted. All tendering shareholders, by execution of
the Letter of Transmittal (or facsimile thereof), waive any right to receive any
notice of the acceptance of their Shares for exchange.
3. Inadequate Space. If the space provided herein is inadequate, the
certificate numbers and/or the number of Shares should be listed on a separate
piece of paper and returned with the Letter of Transmittal.
4. Partial Tenders (not applicable to shareholders who tender by book-entry
transfer). If fewer than all the Shares evidenced by any certificate submitted
are to be tendered, fill in the number of Shares which are to be tendered in the
box on page 2 of the Letter of Transmittal. In such cases, new certificate(s)
for the remainder of the Shares that were evidenced by your old certificate(s)
will be sent to you, unless otherwise indicated in the box marked "Special
Delivery Instructions" on page 4 of the Letter of Transmittal, as soon as
practicable after the Expiration Date. All Shares represented by certificates
delivered to the Exchange Agent will be deemed to have been tendered unless
otherwise indicated.
5. Signatures on Letter of Transmittal; Stock Powers and Endorsements. If the
Letter of Transmittal is signed by the registered holder(s) of the Shares
tendered, the signature must correspond with the name(s) as written on the face
of the certificates without alteration, enlargement or any change whatsoever.
If any of the Shares tendered are owned of record by two or more joint owners,
all such owners must sign the Letter of Transmittal.
If you wish to tender Shares and have more than one certificate and those
certificates are registered in more than one name, it will be necessary to
complete, sign and submit as many separate Letters of Transmittal as there are
different registrations of certificates.
If the Letter of Transmittal or any certificates or stock powers are signed by
trustees, executors, administrators, attorneys-in-fact, officers of corporations
or others acting in a fiduciary or representative capacity, such persons should
so indicate when signing, and proper evidence satisfactory to Western Resources
of their authority so to act must be submitted.
If the Letter of Transmittal is signed by the registered holder(s) of the
Shares transmitted with the Letter of Transmittal, no endorsements of
certificates or separate stock powers are required unless Western Resources
Common Stock or certificates for Shares not tendered or accepted are to be
issued in the name of a person other than the registered holder(s). Signatures
on such certificates or stock powers must be guaranteed by an Eligible
Institution.
If the Letter of Transmittal is signed by a person other than the registered
holder of the certificate(s) listed, the certificate(s) must be endorsed or
accompanied by appropriate stock powers, in either case signed exactly as the
name or names of the registered holder or holders appear on the certificates(s).
Signatures on such certificates or stock powers must be guaranteed by an
Eligible Institution.
6. Stock Transfer Taxes. Western Resources will pay or cause to be paid any
stock transfer taxes with respect to the transfer and sale of Shares to it or
its order pursuant to the Offer to the extent such taxes are a joint obligation
of the transferor and transferee. Western Resources will not pay or cause to be
paid any stock transfer taxes to the extent such taxes are the obligation solely
of the transferor. If, however, delivery of the consideration in respect of the
Offer is to be made to, or (in the circumstances permitted hereby) if
certificates for Shares not tendered or accepted are to be registered in the
name of any person other than the registered holder, or if tendered certificates
are registered in the name of any person other than the person(s) signing the
Letter of Transmittal, the tendering holder must provide satisfactory evidence
of the payment of any applicable transfer taxes (whether imposed on the
registered holder or such person) payable on account of the transfer to such
person prior to the delivery of the consideration pursuant to the Offer.
Except as provided in this Instruction 6, it will not be necessary for
transfer tax stamps to be affixed to the certificates listed in the Letter of
Transmittal.
2
<PAGE>
7. Special Issuance and Delivery Instructions. If certificates for Western
Resources Common Stock and/or any check to be issued for cash in lieu of
fractional shares of Western Resources Common Stock are to be issued in the name
of a person other than the signer of the Letter of Transmittal or if
certificates for Western Resources Common Stock and/or any check to be issued
for cash in lieu of fractional shares of Western Resources Common Stock are to
be mailed to someone other than the signer of the Letter of Transmittal or to an
address other than that shown on the address label, the boxes marked "Special
Issuance Instructions" or "Special Delivery Instructions" on page 4 of the
Letter of Transmittal should be completed.
8. Requests for Assistance or Additional Copies. Questions or requests for
assistance may be directed to, or additional copies of the Prospectus, the
Letter of Transmittal, the Notice of Guaranteed Delivery and other tender offer
materials may be obtained from, the Information Agent or the Dealer Manager at
their respective telephone numbers and/or addresses set forth on the back of the
Letter of Transmittal or from your broker, dealer, commercial bank or trust
company.
9. Substitute Form W-9. Each tendering shareholder is required to provide the
Exchange Agent with a correct Taxpayer Identification Number ("TIN"), generally
the shareholder's social security or federal employer identification number, on
Substitute Form W-9 on page 3 of the Letter of Transmittal. If a shareholder
fails to provide a TIN to the Exchange Agent, such shareholder may be subject to
a $50 penalty imposed by the Internal Revenue Service. In addition, payments of
cash in lieu of fractional shares of Western Resources Common Stock that are
made to such shareholder with respect to Shares accepted pursuant to the Offer
may be subject to backup withholding of 31%. The box in Part 3 of the Substitute
Form W-9 may be checked if the tendering shareholder has not been issued a TIN
and has applied for a number or intends to apply for a number in the near
future. If the box in Part 3 is checked and the Exchange Agent is not provided
with a TIN within 60 days, the Exchange Agent will withhold 31% of all payments
of cash thereafter until a TIN is provided to the Exchange Agent. The
shareholder is required to give the Exchange Agent the social security number or
employer identification number of the record owner of the Shares or of the last
transferee appearing on the stock powers attached to, or endorsed on, the
Shares. If the Shares are in more than one name or are not in the name of the
actual owner, consult the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional guidance on which
number to report.
10. Soliciting Dealer. Western Resources will pay to certain designated
soliciting dealers that have properly executed a Soliciting Dealer Agreement
prior to the Expiration Date (each, a "Soliciting Dealer") a solicitation fee of
$0.125 per Share (i) for each Share properly tendered and not withdrawn pursuant
to the Offer, up to a maximum of $250.00 per beneficial owner of Shares, on the
first scheduled expiration date of the Offer on which a majority of the then
outstanding Shares have been properly tendered and not withdrawn pursuant to the
Offer and (ii) for each Share properly tendered and not withdrawn pursuant to
the Offer, up to a maximum of $250.00 per beneficial owner of Shares, for each
Share properly tendered and not withdrawn pursuant to the Offer on the earlier
of (a) the acceptance by Western Resources of Shares for exchange or (b) the
public announcement of a definitive merger agreement between Western Resources
and KCPL. Joint owners will be treated as a single owner for purposes of, and
only a single fee will be payable under each of clauses (i) and (ii) of, the
preceding sentence.
The acceptance of compensation by a Soliciting Dealer will constitute a
representation by it to Western Resources that (i) it has complied with the
applicable requirements of the Securities Act of 1933 and the Securities
Exchange Act of 1934, each as amended, and, in each such case, the applicable
rules and regulations thereunder, in connection with its solicitation of Shares,
and has undertaken such solicitation only in such states and other jurisdictions
where such solicitation activities may be lawfully undertaken and in accordance
with the laws thereof; (ii) it is entitled to such compensation for such
solicitation under the terms and conditions of the Offer and of a properly
executed Soliciting Dealer Agreement; (iii) in soliciting tenders of Shares it
has used no soliciting materials other than those authorized by Western
Resources; (iv) it has not charged a fee to a beneficial owner of Shares in
order for such Soliciting Dealer to complete, help complete or transmit a Letter
of Transmittal for such beneficial owner; and (v) it is a member in good
standing of the National Association of Securities Dealers, Inc. (the "NASD")
or, if it is a foreign broker or dealer not eligible for membership in the NASD
it has not solicited tenders of Shares within the United States or from
residents or nationals therein, and in each such case has conformed to the
Conduct Rules of the NASD.
Important: The Letter of Transmittal or a facsimile copy thereof (together
with Share Certificates or confirmation of book-entry transfer and all other
required documents) or the Notice of Guaranteed Delivery must be received by the
Exchange Agent on or prior to the Expiration Date.
3
<PAGE>
SHAREHOLDER REPRESENTATION
The shareholder executing the Letter of Transmittal, or on whose behalf the
Letter of Transmittal is executed (the "Tendering Shareholder"), delivers to
Western Resources, Inc., a Kansas corporation ("Western Resources"), the
above-described shares of common stock, without par value (the "Shares"), of
Kansas City Power & Light Company, a Missouri corporation ("KCPL"), pursuant to
Western Resources' offer to exchange a number of shares of common stock, par
value $5.00 per share, of Western Resources (the "Western Resources Common
Stock") equal to the Exchange Ratio (as such term is defined in the Prospectus
(as defined below)) for each outstanding Share, upon the terms and subject to
the conditions set forth in the Prospectus dated July 3, 1996 (the
"Prospectus"), receipt of which is acknowledged, and in the Letter of
Transmittal, including the Instructions and Shareholder Representation (which,
together with the Prospectus and any amendments thereto constitute the "Offer").
Upon the terms and subject to the conditions of the Offer, subject to, and
effective upon, acceptance of the Shares tendered with the Letter of Transmittal
in accordance with the terms of the Offer, the Tendering Shareholder sells,
assigns and transfers to, or upon the order of, Western Resources, all right,
title and interest in and to all of the Shares that are being tendered and any
and all Shares and other securities issued or issuable in respect thereof on or
after July 8, 1996 (collectively, "Distributions"), and irrevocably constitutes
and appoints the Exchange Agent the true and lawful agent and attorney-in-fact
of the Tendering Shareholder with respect to such Shares (and any
Distributions), with full power of substitution (such power of attorney being
deemed to be an irrevocable power coupled with an interest), to the full extent
of the Tendering Shareholder's rights with respect to such Shares (and any
Distributions), to (a) deliver such Share Certificates (as defined herein) (and
any Distributions) or transfer ownership of such Shares (and any Distributions)
on the account books maintained by a Book-Entry Transfer Facility, together in
either such case with all accompanying evidences of transfer and authenticity,
to or upon the order of Western Resources, (b) present such Shares (and any
Distributions) for transfer on the books of KCPL and (c) receive all benefits
and otherwise exercise all rights of beneficial ownership of such Shares (and
any Distributions), all in accordance with the terms and the conditions of the
Offer.
The Tendering Shareholder irrevocably appoints the designees of Western
Resources, and each of them, the attorneys-in-fact and proxies of the Tendering
Shareholder, each with full power of substitution, to vote in such manner as
each such attorney and proxy or any substitute thereof shall deem proper in the
sole discretion of such attorney-in-fact and proxy or such substitute, and
otherwise act (including pursuant to written consent) with respect to all the
Shares tendered (and any Distributions) which have been accepted by Western
Resources prior to the time of such vote or action, which the Tendering
Shareholder is entitled to vote at any meeting of shareholders (whether annual
or special and whether or not an adjourned meeting), of KCPL or otherwise. This
proxy and power of attorney is coupled with an interest in the Shares and is
irrevocable and is granted in consideration of, and is effective upon, the
acceptance of such Shares (and any Distributions) by Western Resources in
accordance with the terms of the Offer. Such acceptance for exchange shall
revoke any other proxy granted by the Tendering Shareholder at any time with
respect to such Shares (and any Distributions) and no subsequent proxies will be
given (or, if given, will not be deemed effective) with respect thereto by the
Tendering Shareholder. The Tendering Shareholder understands that in order for
Shares to be deemed validly tendered, immediately upon Western Resources'
acceptance of such Shares (and any Distributions) for exchange Western Resources
or its designee must be able to exercise full voting rights with respect to such
Shares (and any Distributions).
The Tendering Shareholder represents and warrants that the Tendering
Shareholder has full power and authority to tender, sell, assign and transfer
the Shares (and any Distributions) tendered and that when the same are accepted
for exchange by Western Resources, Western Resources will acquire good,
marketable and unencumbered title thereto, free and clear of all liens,
restrictions, claims, charges and encumbrances, and the same will not be subject
to any adverse claim. The Tendering Shareholder will, upon request, execute and
deliver any additional documents deemed by the Exchange Agent or Western
Resources to be necessary or desirable to complete the sale, assignment, and
transfer of the Shares (and any Distributions) tendered.
4
<PAGE>
All authority conferred or agreed to be conferred pursuant to the Letter of
Transmittal shall not be affected by and shall survive the death or incapacity
of the Tendering Shareholder and any obligation of the Tendering Shareholder
hereunder shall be binding upon the heirs, personal representatives, successors
and assigns of the Tendering Shareholder. Subject to the withdrawal rights set
forth under "The Offer-Withdrawal Rights" in the Prospectus, the tender of
Shares made is irrevocable.
The Tendering Shareholder understands that tenders of Shares pursuant to any
one of the procedures described under "The Offer-Procedure for Tendering" in the
Prospectus and in the instructions to the Letter of Transmittal and acceptance
of such Shares will constitute a binding agreement between the Tendering
Shareholder and Western Resources upon the terms and subject to the conditions
set forth in the Offer.
Unless otherwise indicated on page 4 of the Letter of Transmittal under
"Special Issuance Instructions," please issue the shares of Western Resources
Common Stock and/or any check to be issued for cash in lieu of fractional shares
of Western Resources Common Stock in the name(s) of the registered holder(s).
Similarly, unless otherwise indicated on page 4 of the Letter of Transmittal
under "Special Delivery Instructions," please mail the Western Resources Common
Stock and/or any check to be issued for cash in lieu of fractional shares of
Western Resources Common Stock to the address of the registered holder(s). The
Tendering Shareholder recognizes that Western Resources has no obligation,
pursuant to the Special Issuance Instructions, to transfer any Shares from the
name of the registered holder thereof if Western Resources does not accept any
of the Shares so tendered.
5
<PAGE>
The Information Agent for the Offer is:
Georgeson & Company Inc.
Wall Street Plaza
New York, New York 10005
1-800-223-2064
The Exchange Agent for the Offer is:
HARRIS TRUST COMPANY OF NEW YORK
By Overnight Courier:
77 Water Street, 4th Floor
New York, NY 10005
By Mail:
Wall Street Station
P.O. Box 1010
New York, NY 10268-1010
By Facsimile Transmission
(for Eligible Institutions only):
Fax: (212) 701-7636
(212) 701-7637
Confirm by telephone:
(212) 701-7624
By Hand:
Receive Window
77 Water Street, 5th Floor
New York, N Y
The Dealer Manager for the Offer is:
Salomon Brothers Inc
Seven World Trade Center
New York, New York 10048
(212) 783-6593 (collect)
[WESTERN RESOURCES LOGO]
October 11, 1996
Dear KCPL Shareowner:
When you voted against the UtiliCorp merger proposal, you joined a
majority of voting shareowners who demanded a better future for KCPL. In fact,
62 percent of all KCPL shares did not go along with the UtiliCorp plan.
As you know, the KCPL board has still refused to meet with us, in spite
of the rejection of the UtiliCorp proposal and the encouragement of many of its
shareowners. Western Resources is committed to this combination and the surest
way to quickly end the cost and diversion of management's attention is to tender
your shares to us by October 25.
It is now time for you to take action to help bring this merger offer
to completion and begin building shareowner value. Even with the KCPL board's
inaction, you can still "vote" on our offer by tendering your shares now.
Simplified papers for tendering shares are enclosed. Our offer remains friendly
to KCPL shareowners in terms of value per share and projected dividend.
Individual shareowners such as yourself hold the vast majority of shares in both
companies, so it is up to you to create a large, financially solid company
poised for the changes in the energy marketplace.
Tender now and you can get ...
... a projected dividend of more than $2 per KCPL share that could be
as much as 45 percent over KCPL's current dividend.*
... a tax-free exchange of each of your KCPL shares for $31 of Western
Resources stock, provided the average stock price stays within the
range it has been for the last two years.*
... a combined company with the size, strength, and vision to compete
in the new deregulated marketplace.
... product diversity and international reach for your KCPL
investment.
By your vote in August, you clearly showed that you look at your
investment decisions carefully. You know by now that hundreds of millions of
dollars in savings for shareowner value are only available through a merger with
Western Resources. Western Resources has the track record of keeping our
promises of savings in a major merger and, with our joint interests in assets
and our neighboring service territories with KCPL, the savings opportunities are
clear and real.
<PAGE>
-2-
We are also enclosing some news clippings from various publications to
give you more information on the status of this merger.
Western Resources is the right partner for KCPL. KCPL is the right
partner for Western Resources. We believe combining the two makes your
investment stronger by creating a company able to meet the challenges of the
changing energy market.
You can take the action needed to grow your investment. The time is now
to tender your shares. Follow the instructions in the enclosed letter of
transmittal. If you have any questions, feel free to call us toll-free at
1-800-223-2064.
Thank you for your vote in August, which is helping to give all KCPL
shareowners the opportunity to accept our offer. Let's act now and get on with
the business of building the best energy company in America.
Sincerely,
/s/ John E. Hayes, Jr.
John E. Hayes, Jr.
* Dividend per KCPL share is based upon Western Resources projected annual
dividend rate of $2.14 per share of Western Resources common stock in the
first year after the merger and the exchange ratio in Western Resources'
offer. Price per KCPL share (payable in Western Resources common stock)
assumes that Western Resources' average share price is between $28.18 and
$33.23 at the time of closing.
This letter is neither an offer to exchange nor a solicitation of an offer
to exchange shares of common stock of KCPL. Such offer is made solely by the
Prospectus dated July 3, 1996, and the related Letter of Transmittal, and is
not being made to, nor will tenders be accepted from or on behalf of,
holders of shares of common stock of KCPL in any jurisdiction in which the
making of such offer or the acceptance thereof would not be in compliance
with the laws of such jurisdiction. In any jurisdiction where securities,
blue sky or other laws require such offer to be made by a licensed broker or
dealer, such offer shall be deemed to be made on behalf of Western
Resources, Inc., by Salomon Brothers Inc or one or more registered brokers
or dealers licensed under the laws of such jurisdiction.
<PAGE>
[WESTERN RESOURCES LOGO]
October 11, 1996
Dear KCPL Shareowner:
The opportunity is now for you to take action to help bring Western
Resources' merger offer to completion and begin building shareowner value.
Individual shareowners such as yourself hold the vast majority of shares in both
companies, so it is up to you to create a larger, financially solid company
poised for the changes in the energy marketplace.
As you know, the KCPL board has still refused to meet with us, in spite
of the rejection of the UtiliCorp proposal and the encouragement of many of its
shareowners. Western Resources is committed to this combination and the surest
way to quickly end the cost and diversion of management's attention is to tender
your shares to us by October 25.
Even with the KCPL board's inaction, you can still "vote" on our offer
by tendering your shares now. Simplified papers for tendering shares are
enclosed. Our offer remains friendly to KCPL shareowners in terms of value per
share and projected dividend.
Tender now and you can get ...
... a projected dividend of more than $2 per KCPL share that could be
as much as 45 percent over KCPL's current dividend.*
... a tax-free exchange of each of your KCPL shares for $31 of Western
Resources stock, provided the average stock price stays within the
range it has been for the last two years.*
... a combined company with the size, strength, and vision to compete
in the new deregulated marketplace.
... product diversity and international reach for your KCPL
investment.
We are a dynamic, growing, financially strong company. As you know, we
have always paid dividends and our dividends have increased each year for the
last 20 years. There are hundreds of millions of dollars in savings available
for shareowner value in this merger. These savings are not available without
this merger. Western Resources has the track record of keeping our promises of
savings in a major merger and, with our joint interests in assets and our
neighboring service territories with KCPL, the savings opportunities are clear
and real.
<PAGE>
-2-
We are also enclosing some news clippings from various publications to
give you more information on the status of this merger.
Western Resources is the right partner for KCPL. KCPL is the right
partner for Western Resources. We believe combining the two makes your
investment stronger by creating a company able to meet the challenges of the
changing energy market.
You can take the action needed to grow your investment. The time is now
to tender your shares. To tender your shares please contact your bank or broker
today. If you have any questions, call us toll-free at 1-800-223-2064.
Thanks to the shareholders' vote in August, all KCPL shareowners now
have the opportunity to accept our offer. Let's act now and get on with the
business of building the best energy company in America.
Sincerely,
/s/ John E. Hayes, Jr.
John E. Hayes, Jr.
* Dividend per KCPL share is based upon Western Resources projected annual
dividend rate of $2.14 per share of Western Resources common stock in the
first year after the merger and the exchange ratio in Western Resources'
offer. Price per KCPL share (payable in Western Resources common stock)
assumes that Western Resources' average share price is between $28.18 and
$33.23 at the time of closing.
This letter is neither an offer to exchange nor a solicitation of an offer
to exchange shares of common stock of KCPL. Such offer is made solely by the
Prospectus dated July 3, 1996, and the related Letter of Transmittal, and is
not being made to, nor will tenders be accepted from or on behalf of,
holders of shares of common stock of KCPL in any jurisdiction in which the
making of such offer or the acceptance thereof would not be in compliance
with the laws of such jurisdiction. In any jurisdiction where securities,
blue sky or other laws require such offer to be made by a licensed broker or
dealer, such offer shall be deemed to be made on behalf of Western
Resources, Inc., by Salomon Brothers Inc or one or more registered brokers
or dealers licensed under the laws of such jurisdiction.
<PAGE>
[WESTERN RESOURCES LOGO]
October 11, 1996
Dear Shareowner of KCPL and Western Resources:
By deciding to own shares in these two strong companies, you have
already determined that the two make a good combination.
There is now an opportunity to create a more lucrative investment with
both stocks in a combined KCPL and Western Resources. Individual shareowners
such as yourself hold the vast majority of shares in both companies, so it is up
to you to create a larger, financially solid company poised for the changes in
the energy marketplace.
As you know, the KCPL board has still refused to meet with us, in spite
of the rejection of the UtiliCorp proposal and the encouragement of many of its
shareowners. Even with the KCPL board's inaction, you can still "vote" on our
offer by tendering your shares now. Western Resources is committed to this
combination, and the surest way to quickly end the cost and diversion of
management's attention is to tender your shares to us by October 25. Simplified
papers for tendering your shares are enclosed.
Tender now and you can get ...
... a projected dividend of more than $2 per KCPL share that could be
as much as 45 percent over KCPL's current dividend.*
... a tax-free exchange of each of your KCPL shares for $31 of Western
Resources stock, provided the average stock price stays within the
range it has been for the last two years.* This will give you a
significantly greater investment position in a new stronger
Western Resources.
... a combined company with the size, strength, and vision to compete
in the new deregulated marketplace.
... product diversity and international reach for your KCPL
investment.
You know our record. We are a dynamic, growing, financially strong
company. As you know, we have always paid dividends and our dividends have
increased each year for the last 20 years. There are hundreds of millions of
dollars in savings available for shareowner value in this merger. This large
amount of savings is not available without a merger with Western Resources. Your
company, Western Resources, has the track record of keeping its
<PAGE>
-2-
promises of savings in a major merger and, with our joint interests in assets
and our neighboring service territories with KCPL, the savings opportunities are
clear and real.
We are also enclosing some news clippings from various publications to
give you more information on the status of this merger.
The combination of KCPL and Western Resources has been good for you. We
believe combining the two makes your investment stronger by creating a company
able to meet the challenges of the changing energy market.
You can take the action needed to grow your investment. The time is now
to tender your shares. Follow the instructions in the enclosed letter of
transmittal. If you have any questions, feel free to call us toll-free at
1-800-223-2064.
Thank you for investing in Western Resources. I look forward to working
with you as we combine KCPL and Western Resources into a major national energy
company.
Sincerely,
/s/ John E. Hayes, Jr.
John E. Hayes, Jr.
* Dividend per KCPL share is based upon Western Resources projected annual
dividend rate of $2.14 per share of Western Resources common stock in the
first year after the merger and the exchange ratio in Western Resources'
offer. Price per KCPL share (payable in Western Resources common stock)
assumes that Western Resources' average share price is between $28.18 and
$33.23 at the time of closing.
This letter is neither an offer to exchange nor a solicitation of an offer
to exchange shares of common stock of KCPL. Such offer is made solely by the
Prospectus dated July 3, 1996, and the related Letter of Transmittal, and is
not being made to, nor will tenders be accepted from or on behalf of,
holders of shares of common stock of KCPL in any jurisdiction in which the
making of such offer or the acceptance thereof would not be in compliance
with the laws of such jurisdiction. In any jurisdiction where securities,
blue sky or other laws require such offer to be made by a licensed broker or
dealer, such offer shall be deemed to be made on behalf of Western
Resources, Inc., by Salomon Brothers Inc or one or more registered brokers
or dealers licensed under the laws of such jurisdiction.
<PAGE>
[WESTERN RESOURCES LOGO]
October 11, 1996
Dear KCPL Shareowner:
The opportunity is now for you to take action to help bring Western
Resources' merger offer to completion and begin building shareowner value.
Individual shareowners such as yourself hold the vast majority of shares in both
companies, so it is up to you to create a larger, financially solid company
poised for the changes in the energy marketplace.
As you know, the KCPL board has still refused to meet with us, in spite of
the rejection of the UtiliCorp proposal and the encouragement of many of its
shareowners. Western Resources is committed to this combination and the surest
way to quickly end the cost and diversion of management's attention is to tender
your shares to us by October 25.
Even with the KCPL board's inaction, you can still "vote" on our offer by
tendering your shares now. Simplified papers for tendering shares are enclosed.
Our offer remains friendly to KCPL shareowners in terms of value per share and
projected dividend.
Tender now and you can get ...
... a projected dividend of more than $2 per KCPL share that could be as
much as 45 percent over KCPL's current dividend.*
... a tax-free exchange of each of your KCPL shares for $31 of Western
Resources stock, provided the average stock price stays within the
range it has been for the last two years.*
... a combined company with the size, strength, and vision to compete in
the new deregulated marketplace.
... product diversity and international reach for your KCPL investment.
We are a dynamic, growing, financially strong company. As you know, we have
always paid dividends and our dividends have increased each year for the last 20
years. There are hundreds of millions of dollars in savings available for
shareowner value in this merger. These savings are not available without this
merger. Western Resources has the track record of keeping our promises of
savings in a major merger and, with our joint interests in assets and our
neighboring service territories with KCPL, the savings opportunities are clear
and real.
<PAGE>
We are also enclosing some news clippings from various publications to give
you more information on the status of this merger.
Western Resources is the right partner for KCPL. KCPL is the right partner
for Western Resources. We believe combining the two makes your investment
stronger by creating a company able to meet the challenges of the changing
energy market.
You can take the action needed to grow your investment. The time is now to
tender your shares. Follow the instructions in the enclosed letter of
transmittal. If you have any questions, call us toll-free at 1-800-223-2064.
Thanks to the shareholders' vote in August, all KCPL shareowners now have
the opportunity to accept our offer. Let's act now and get on with the business
of building the best energy company in America.
Sincerely,
/s/ John E. Hayes, Jr.
John E. Hayes, Jr.
* Dividend per KCPL share is based upon Western Resources projected annual
dividend rate of $2.14 per share of Western Resources common stock in the
first year after the merger and the exchange ratio in Western Resources'
offer. Price per KCPL share (payable in Western Resources common stock)
assumes that Western Resources' average share price is between $28.18 and
$33.23 at the time of closing.
This letter is neither an offer to exchange nor a solicitation of an offer
to exchange shares of common stock of KCPL. Such offer is made solely by
the Prospectus dated July 3, 1996, and the related Letter of Transmittal,
and is not being made to, nor will tenders be accepted from or on behalf
of, holders of shares of common stock of KCPL in any jurisdiction in which
the making of such offer or the acceptance thereof would not be in
compliance with the laws of such jurisdiction. In any jurisdiction where
securities, blue sky or other laws require such offer to be made by a
licensed broker or dealer, such offer shall be deemed to be made on behalf
of Western Resources, Inc., by Salomon Brothers Inc or one or more
registered brokers or dealers licensed under the laws of such jurisdiction.
THE TOPEKA CAPITAL-JOURNAL
September 23, 1996
WESTERN TO HELP CHINA
BOOST ITS POWER PLANTS
$500 million deal will give utility partial ownership of 7 Chinese plants.
By Jim McLean
The Capital-Journal
In a formal ceremony that had all the trappings of a major diplomatic
event, Western Resources on Wednesday entered into a partnership with China to
upgrade power plants in that nation's central provinces.
Western officials said the $500 million agreement will position the
Topeka-based company ahead of other utilities in the scramble to capitalize on
China's rapidly expanding economy.
"Together, we are making a moment in history," said John Hayes Jr.,
Western's chairman and chief executive officer. "For Western Resources, the
partnership significantly broadens our global reach, further signaling the
company's expansion into the world's power market and strengthening our future."
The partnership between Western and a subsidiary of the government-run
China Power Investment Corp. will give Western partial ownership of seven
existing power plants. The companies are planning to increase the generating
capacities of the plants to a combined 2,000 megawatts, enough to provide power
to about 1.5 million homes.
The bulk of Western's investment -- approximately $400 million -- will
be raised through bank loans and the issuance of bonds.
David Wittig, Western's president, said that about 50 other utilities
had tried and failed to strike similar deals with the Chinese.
"I'm certain that any other electric company in this country as well as
the world would be envious of the position we've established," Wittig said.
The deal was negotiated by the Wing Group, a Western subsidiary
headquartered in Houston that specializes in development of international power
projects.
"For the U.S. to be winners in the electric business worldwide, we must
win in China," said John Wing, chairman of the Company that bears his name.
<PAGE>
The U.S. Energy Information Administration has reported that China's
demand for electricity more than quadrupled from 1971 to 1990. It is expected to
double again by 2010.
Wing said flatly that he didn't believe recent tensions between the
governments of the United States and China should deter American businesses from
investing in China.
"The United States and China must be friends," Wing said.
The best way to accomplish that is for the nations "to establish strong
economic interdependence," he said.
Li Xiaolin, one of three CPI officials on hand for the signing ceremony
conducted in a lavishly decorated meeting room in Western's downtown
headquarters, said the agreement establishes a "family" relationship between
Western and the Chinese company.
Borrowing a sentiment from the Kansas motto -- "To the stars through
difficulty" -- Li said she had lofty expectations for the partnership.
"I'm sure that we can reach the stars together," she said, speaking
from hand-written notes.
If all goes according to plan, Western shareholders and ratepayers also
will see benefits.
Wittig said the transaction is expected to add 10 cents a share to
Western's earnings in 1997 and another 25 cents a share by the end of 1996.
Western's earnings per share for the 12-month period ending June 30 were $2.84.
"Any time you can make more money, it's good for both the shareholders
and the ratepayers," Wittig said.
Nodding his head in agreement, Hayes added, "It simply enhances our
ability to continue to provide service at among the lowest rates in the nation."
Analysts who monitor the electric industry as it prepares for
deregulation said Western's increased emphasis on international ventures will
pay dividends when competition comes to the domestic market.
"I think that companies that do not have at least an awareness of
what's going on internationally could be at a competitive disadvantage in the
U.S.," said Gregory Enholm, the director of research at Redwood Securities Group
in San Francisco.
-2-
<PAGE>
The joint venture by Western and CPI will be managed through an office
to be established in Hong Kong.
Reprinted for informational purposes only with permission from the
Topeka-Capital Journal
-3-
<PAGE>
The following newspaper articles are provided for your information and are used
with the expressed permission of the original publishers. The beliefs and
opinions expressed in these articles are solely those of the newspapers which
originally published them.
THE KANSAS CITY STAR.
October 2, 1996
WESTERN PUSHES TAKEOVER HARDER
KCP&L STOCKHOLDERS are mailed guidebooks
for tendering their shares.
By Martin Rosenberg
Staff Writer
Western Resources Inc. said Tuesday that it was stepping up its hostile
takeover campaign against Kansas City Power & Light Co.
The Topeka-based utility, which blocked KCP&L's planned merger with
UtiliCorp United Inc., is mailing KCP&L shareholders a guidebook to help them
tender their shares.
Several weeks ago, Western disclosed that about 2 percent of KCP&L
shares had been tendered. Western spokeswoman Michel' Philipp declined to
provide an updated figure. KCP&L Chairman Drue Jennings has said he was pleased
with the low level of support for Western's offer by KCP&L shareholders.
However, Philipp said there had been an upswing in the number of shares
tendered since KCP&L and UtiliCorp officially ended their merger plan Sept. 17.
"With the mailing that should be hitting mailboxes of shareholders
(this week), we will be aggressively pursuing the exchange process," Philipp
said.
KCP&L is regrouping and developing new strategies to achieve its growth
objectives, Jennings said.
But its management and board of directors have steadfastly refused to
discuss a possible merger with Western.
Industry experts say KCP&L probably will seek a merger with a friendly
"white knight," such as Union Electric Co. of St. Louis. But KCP&L is expected
to have a hard time orchestrating a deal that would top Western's offer of $31
worth of Western stock per KCP&L share.
-4-
<PAGE>
Western showed sensitivity to shareholders' concerns about excessive
mailings tied to the utility merger battles.
"We will significantly limit the mail they receive about the offer,"
Western Chairman John E. Hayes Jr. said.
At recent shareholders' meetings, some investors complained about an
unending barrage of mailings and telephone calls from the utilities and their
representatives.
Western's offer is to expire at 5 p.m. Oct. 25 but could be extended.
Western is expected to release a tally of tendered shares at that time.
Under Missouri law, Western needs to secure at least 90 percent of
KCP&L shares to force a merger. But at the very least, Western is seeking to get
more than 50 percent of KCP&L shares tendered to force KCP&L's management and
board to discuss a deal, Philipp said.
Reprinted for informational purposes only with permission from The
Kansas City Star.
-5-
<PAGE>
Kansas City
BUSINESS JOURNAL(R)
September 20-26, 1996
Months of furious battle leaves
KCP&L bleeding
By Tom Linafelt
Staff Writer
The defeat of its proposed merger with UtiliCorp United could cost the
Kansas City Power & Light Co. $75 million.
After spending five months and more than $28 million, official of KCP&L
and UtiliCorp conceded defeat after their proposed $1.7 billion merger failed to
get the support of those holding most of KCP&L's shares.
The defeat is especially costly to KCP&L, which is attempting to fend
off a hostile takeover bid from Topeka-based Western Resources. Western is
attempting the first hostile takeover in the utility industry.
"KCP&L shareowners proved they're not the nitwits Drue Jennings and the
KCP&L management has made them out to be," Western President David Wittig said.
"They own stocks. They know about business transactions. They can recognize a
better deal when they see one. That's what happened."
KCP&L officials did not respond to Wittig's comments, but stressed that
the outcome of the vote and termination of the UtiliCorp merger was not a
victory for Western.
"Of course Western would like people to believe that we're out of
options and their offer is the only one out there," said KCP&L spokeswoman Pam
Levetzow. "That is not the case. Our board continues to recommend that
shareholders do not tender their shares to Western."
Because its shareholders rejected the UtiliCorp proposal, KCP&L must
pay UtiliCorp $5 million under terms of the defeated merger agreement. In
addition, if KCP&L merges with another company in the next two-and-a-half years,
KCP&L must pay UtiliCorp an additional $53 million.
"The $5 million will be a wire transfer. Any termination payments
beyond that are speculation," KCP&L's Levetzow said.
Such breakup fees are commonly included in merger agreements to show
each company's commitment to the combination and to
-6-
<PAGE>
compensate companies for time and money spent preparing for a failed merger.
KCP&L officials did not dispute the fees.
KCP&L is likely to merge with another company as part of a trend toward
consolidation in the energy utility industry. About $23 billion worth of utility
mergers have been announced in 1996, according to Securities Data Co. That
figure already tops 1995's $17.9 billion in utility deals.
But, should Western win control of KCP&L, the $53 million termination
fee might become the topic of legal action, according to Western President
Wittig.
"We certainly wouldn't take over the (KCP&L) board and turn around and
write UtiliCorp a $53 million check," Wittig said. "We might challenge the fee
based on the breach of fiduciary duty that agreement represents."
"The agreement is straightforward," UtiliCorp spokesman Jerry Cosley
said. "There was no breach of fiduciary duty."
Wittig, who oversaw more than 150 mergers before joining Western, said
companies have succeeded in getting termination payments reduced or eliminated
in the courts. The $53 million termination fee also makes KCP&L less attractive
to potential buyers of KCP&L who, because of their location, could not match the
$1 billion merger savings available in a Western/KCP&L merger, Wittig said.
Western and KCP&L service areas border each other, and the companies share
ownership of three power plants.
Any "white knight" looking to combine with KCP&L to save it from
Western's hostile bid would need deep resources, Wittig said.
"Any company looking to buy (KCP&L) is looking at paying UtiliCorp $53
million and topping our offer by 10 percent."
KCP&L and UtiliCorp officials said a successful merger would have cost
the two companies a combined $40 million. A Western/KCP&L combination would cost
$30 million, Wittig said.
The battle has cost the three companies a total of more than $48
million.
Western spent $20 million in its effort to derail the KCP&L/UtiliCorp
merger, Wittig said.
Through mid-August, UtiliCorp had spent $12 million on the merger
proposal, according to spokesman Cosley.
-7-
<PAGE>
During July court proceedings, Jennings said his company had spent $11
million on the UtiliCorp proposal and $5 million defending itself against
Western's hostile bid through June. Expenses for July and August have not been
tabulated, KCP&L officials said.
But KCP&L's financial adviser, Merrill Lynch Pierce Fenner & Smith,
collected more than $4.6 million in two installments. The company collected $2.3
million when the merger agreement was signed in January, and a second $2.3
million after the Aug. 16 shareholder vote. Merrill Lynch would have collected
an additional $2.3 million upon closure of the KCP&L/UtiliCorp merger.
KCP&L also hired New York-based attorneys Skadden Arps Slate Meagher &
Flom as its legal adviser; D.F. King & Co. as its proxy solicitor; and Abernathy
MacGregor Scanlon as its public relations consultant.
UtiliCorp hired Donaldson Lufkin & Jenrette Securities Corp. as its
financial advisor.
Local law firms cashing in on the merger battle include Bryan Cave,
which represented KCP&L, Stinson Mag & Fizzell, which represented Western
Resources, and Blackwell Sanders Matheny Weary & Lombardi, which represented
UtiliCorp.
KCP&L officials said they would take several months to explore the
company's options.
Now that the UtiliCorp merger has been defeated, Western will step up
its offer to exchange $31 worth of Western stock for each share of KCP&L
stock,which has hovered around $27.50. The deadline for the exchange offer is
Oct. 25, but it could be extended.
"We didn't want to confuse shareowners with several different
messages," said Wittig. "The first step was to defeat the UtiliCorp merger. Now
our exchange offer is the only issue facing the KCP&L share owner."
Results certified Tuesday indicate that KCP&L shareholders owning 38
percent of the company's shares supported the UtiliCorp merger. The merger
proposal needed a majority to move forward.
THIS ARTICLE APPEARED IN VOLUME 15, NUMBER 1 OF THE KANSAS CITY
BUSINESS JOURNAL ON SEPTEMBER 20-26, 1996. IT HAS BEEN REPRINTED WITH PERMISSION
FROM THE KANSAS CITY BUSINESS JOURNAL AND FURTHER REPRODUCTION BY ANY OTHER
PARTY IS STRICTLY PROHIBITED. COPYRIGHT 1996.
-8-
