SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
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
/ / Definitive Additional Materials
/X/ Soliciting Material Pursuant to Rule 14a-12
WESTERN RESOURCES, INC.
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(Name of Registrant as Specified In Its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1) 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 underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (set forth the amount on which the filing
fee is calculated and state how it is determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
/ / 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 or 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:
<PAGE>
[THIS FILING CONSISTS OF A REPORT FROM AN INTERNAL EMPLOYEE NEWSLETTER]
SYNERGY November 9, 2000
making life a little easier Volume 9, Number 45
[Excerpt]
Following this morning's announcement that Public Service Company of New Mexico
(PNM) and Western Resources have signed an agreement to merge utility
operations, employee meetings were conducted in Topeka.
David C. Wittig, Western Resources chairman of the board, president and CEO,
welcomed employees and introduced Bill Real, PNM executive vice president, power
production and energy services. Real told employees about his background, gave
an overview of PNM and addressed why the transaction makes excellent business
sense. Real will head the PNM integration process, which will involve employee
transition teams from both companies the coming months.
Following are some questions and answers concerning the agreement. Further Q & A
will be published as more meetings occur across the company territory over the
next weeks.
If I am a Western Resources shareholder, what can I expect to have after the
transaction?
At the close of the transaction, for each share of Western Resources stock you
own, you will receive a fractional share of stock in a new holding company, of
which Western Resources and PNM will be subsidiaries. You also will receive a
fractional share of Westar Industries, which will be distributed to you at
transaction close.
When will the shareholders vote on the transaction?
Shareholders are expected to vote on the transaction next spring. Shareholders
are not required to take any action before the shareholder meetings are
scheduled.
What is the dividend for the new company? For Westar Industries?
Shareholders of the combined company after the closing will receive PNM's
dividend. PNM's current dividend is $.80 per share. Westar Industries is not
expected to pay a dividend.
What happens to employee benefits?
The integration team will review best practices at both companies, including
benefit plans, to create a competitive package for employees. Benefit plans will
remain the same for at least two years following the merger.
When will the deal close?
The entire approval process is expected to be completed within 12-15 months.
What approvals are needed?
Western Resources and PNM shareholders will need to approve the merger, as will
the Kansas Corporation Commission, the New Mexico Public Regulatory Commission,
the Federal Energy Regulatory Commission, the Securities and Exchange Commission
and the Nuclear Regulatory Commission.
What happens to the management of the company?
Upon completion of the deal, Jeff Sterba will be chairman, president and CEO of
the combined company, and David C. Wittig will be chairman, president and CEO of
Westar Industries, which has our interests in Protection One, ONEOK and other
investments and will have an interest in the new combined company.
Will KGE and KPL merge into one operating company as a result of this
transaction?
At this point, no plans have been made to alter the current organizational
structures of KGE and KPL.
What facets of the business will be based in Wichita?
At this time, no plans have been made to alter business operations already
established in Wichita.
Which parts of Western Resources' businesses are affected?
PNM will acquire Western Resources' utility operations. Westar Industries will
include the non-utility assets, including its 85 percent stake in Protection.
One, its interest in ONEOK, other investments and an interest in the new
combined company, which will be split off to shareholders at the time of the
merger.
How will PNM's merger with Western Resources' utility businesses affect rates?
Western Resources will file a rate case on Nov. 27, 2000, and the Kansas
Corporation Commission will review the company's data and input from other
sources to determine whether rates will increase, decrease or remain the same
for KPL and KGE. The Kansas Corporation Commission should complete the rate case
review by July 2001.
How will customers be affected by the transaction?
Customers will continue to receive safe and reliable electric service and
benefit from technological innovations derived through the merger with PNM. In
1999, PNM was featured in a leading industry publication as one of the five most
technologically innovative utilities in the nation.
What are PNM's rates?
PNM's residential rates in 1999 were 7.7 cents/kwh.
What about the company's Shared Services division? Will it be retained or will
those jobs be lost?
PNM has a similar Shared Services structure and understands the cost savings and
efficiencies that can be achieved through such arrangements. At this time, no
plans have been made to alter Western Resources' Shared Services structure. The
shared services agreement with Protection One may be terminated two years after
the closing unless otherwise extended.
Will there be layoffs when the deal is closed? How many jobs will be lost and at
which locations?
While the combined company will seek sensible cost savings, it has no intention
to have involuntary work force reductions as a result of the transaction.
Will Westar Industries retain an investment in the new company as part of the
arrangement?
Yes. Westar Industries will have an ownership interest in the combined company
following the conversion of certain intercompany obligations prior to
consummation of the transaction. In addition, Westar Industries has the option
of making additional equity infusions into Western Resources that will be used
to reduce its net debt balance prior to closing. Up to $407 million of such
equity infusions may be used to purchase additional new holding company common
and convertible preferred stock.
Will Western Resources have representation on the new company's board of
directors?
Yes. The board of directors for the new company will be comprised of six current
PNM board members and three additional directors, two of whom will be selected
by PNM from a pool of candidates nominated by Western Resources and one person
nominated by Westar Industries.
Why did Western Resources choose PNM as a partner?
o Growth opportunities
o Comparable corporate philosophy with regard to power generation and
wholesale marketing
o Charitable commitment to communities
o Strong environmental stewardship
o Commitment to diversity Who were the other bidders?
The negotiations between Western Resources and interested parties were
confidential exchanges. PNM fulfilled the criteria Western Resources initially
set forth in looking for a partner, and the company is pleased with the
agreement reached with PNM.
Where will the new company be housed?
The new holding company will be located in Albuquerque, New Mexico. The Kansas
utility operations will remain in Topeka, as will Westar Industries.
What is the timetable for integration? How will the system work?
Bill Real will lead the PNM integration team, which will be established in the
coming weeks. The teams will be made up of representatives of both companies.
When will the Western Resources' board of directors vote to pursue the
transaction?
The Western Resources and PNM boards of directors voted unanimously to approve
the transactions on Nov. 8.
Are PNM's electric and gas utility employees represented by unions?
About 650 power plant and operations employees are IBEW members.
*****************************************************************************
Western Resources will be filing a proxy statement and other relevant
documents concerning the merger with the United States Securities and
Exchange Commission (the "SEC"). WE URGE INVESTORS TO READ THE PROXY
STATEMENT AND ANY OTHER RELEVANT DOCUMENTS TO BE FILED WITH THE SEC,
BECAUSE THEY CONTAIN IMPORTANT INFORMATION. Investors will be able to
obtain the documents free of charge at the SEC's website,
http://www.sec.gov or at the SEC's public reference room at 450 Fifth
Street, N.W., Washington, D.C. 20549. In addition, documents filed with the
SEC by Western Resources will be available free of charge by contacting
Western Resources at the following address and telephone number: Carl A.
Ricketts, Vice President, Investor Relations, Western Resources, Inc., 818
South Kansas Avenue, Topeka, KS 66612, telephone: 785-575-8424, fax:
785-575-1774, e-mail: [email protected]. Documents filed with the SEC
by PNM can be obtained by contacting PNM at the following address and
telephone number: Barbara L. Barsky, Senior Vice President, Planning and
Investor Services, telephone: 505-241-2662, fax: 505-241-2368, e-mail:
[email protected].
PLEASE READ THE PROXY STATEMENT CAREFULLY BEFORE MAKING A DECISION
CONCERNING THE MERGER.
This document does not constitute a solicitation by Western Resources or
its board of directors of any approval or action of its shareholders.
Western Resources and its board of directors will be soliciting proxies
from Western Resources shareholders in favor of the merger. You can obtain
information about Western Resources' directors and officers and their
beneficial interests in Western Resources' common stock from the SEC's
website, http://www.sec.gov, and Western Resources' website,
http://www.wr.com. Updated information with respect to the security
holdings of these individuals, and their interests in the transaction and
the solicitation, will be included in the final proxy statement to be filed
with the SEC.
CAUTIONARY STATEMENT -- Certain information in this document concerning the
transaction with PNM is forward-looking, including statements regarding the
consideration per share that Western Resources' shareholders are projected to
receive from the transaction and Western Resources' expectation as to the
closing date of the transaction. Forward-looking information is based on
management's estimates, assumptions and projections, and is subject to
significant uncertainties, many of which are beyond Western Resources' control.
Important risk factors could cause the actual future results to differ
materially from those currently estimated by management. Risk factors that could
materially affect statements made concerning the PNM transaction include, but
are not limited to: the timely receipt of necessary shareholder, regulatory and
other consents and approvals needed to complete the transaction, which could be
delayed for a variety of reasons related or not related to the transaction
itself; the fulfillment of all of the closing conditions specified in the
transaction documents; the dollar equivalent of the market price of PNM ordinary
shares; and other factors described from time to time in the reports filed be
Western Resources under the Exchange Act.
