e424b5
This preliminary prospectus supplement relates to an effective registration statement under
the Securities Act of 1933, as amended, but is not complete and may be changed. This preliminary
prospectus supplement and the accompanying prospectus are not offers to sell these securities and
are not soliciting an offer to buy these securities in any state where the offer or sale is not
permitted.
Subject to Completion
Preliminary Prospectus Supplement dated May 30, 2007
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PROSPECTUS SUPPLEMENT
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Filed Pursuant to Rule 424(b)(5) |
(To Prospectus dated May 30, 2007)
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Registration Statement No. 333-108215 |
$250,000,000
Kansas City Power & Light Company
% Notes due 2017
We
will pay interest on the notes on June 15 and
December 15 of each year, beginning
December 15, 2007. The notes will mature on June 15, 2017. We may redeem the notes at any
time in whole or from time to time in part at the price specified in this prospectus supplement.
The notes will be our senior unsecured obligations and will rank equally with our other
existing and future senior unsecured indebtedness. The notes will not be listed on any securities
exchange.
Investing in the notes involves risks that are described in the sections entitled Risk
Factors beginning on page S-5 of this prospectus supplement and page 1 of the accompanying
prospectus.
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Per Note |
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Total |
Public offering price (1) |
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% |
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$ |
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Underwriting discount |
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% |
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$ |
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Proceeds, before expenses, to KCP&L |
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% |
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$ |
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(1) |
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Plus accrued interest from June , 2007, if settlement occurs after that date. |
Neither the Securities and Exchange Commission nor any state securities commission has
approved or disapproved of these securities or determined if this prospectus supplement or the
accompanying prospectus is truthful or complete. Any representation to the contrary is a criminal
offense.
The notes will be ready for delivery in book-entry form only through The Depository Trust
Company on or about June , 2007.
Joint Book-Running Managers
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Banc of America Securities LLC
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Wachovia Securities |
Senior Co-Manager
BNP PARIBAS
Co-Managers
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BNY Capital Markets, Inc. |
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KeyBanc Capital Markets |
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Lazard Capital Markets |
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Scotia Capital |
The date of this prospectus supplement is May , 2007.
TABLE OF CONTENTS
Prospectus Supplement
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Page |
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ii |
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S-1 |
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S-5 |
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S-8 |
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S-8 |
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S-9 |
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S-12 |
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Prospectus
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Page |
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i |
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ii |
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1 |
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1 |
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1 |
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2 |
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10 |
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13 |
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13 |
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13 |
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14 |
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i
ABOUT THIS PROSPECTUS SUPPLEMENT
This document is in two parts. The first part is this prospectus supplement, which describes
the terms of the offering of the notes. The second part is the accompanying prospectus dated May
30, 2007, which we refer to as the accompanying prospectus. The accompanying prospectus contains
a description of the notes and gives more general information, some of which may not apply to the
notes.
You should rely only on the information contained or incorporated by reference in this
prospectus supplement and the accompanying prospectus or in any free writing prospectus. We have
not, and the underwriters have not, authorized anyone to provide you with different information.
If anyone provides you with different or inconsistent information, you should not rely on it. We
are not, and the underwriters are not, making an offer to sell these securities in any jurisdiction
where the offer or sale is not permitted. You should assume that the information appearing in this
prospectus supplement, the accompanying prospectus and the documents incorporated by reference is
accurate only as of their respective dates. Our business, financial condition, results of
operations and prospects may have changed materially since those dates.
Before you invest in the notes, you should carefully read the registration statement
(including the exhibits thereto) of which this prospectus supplement and the accompanying
prospectus form a part, this prospectus supplement, the accompanying prospectus and the documents
incorporated by reference into this prospectus supplement and accompanying prospectus. The
incorporated documents are described under Where You Can Find More Information.
As
described in more detail below under Where You Can Find More Information, we and our
parent company, Great Plains Energy Incorporated, separately file combined annual, quarterly and
current reports. However, only the information related to KCP&L and its consolidated subsidiaries
is incorporated by reference in this prospectus supplement and the accompanying prospectus. You
should not rely on any information relating solely to Great Plains Energy Incorporated or its
subsidiaries (other than the information provided separately by KCP&L or the subsidiaries of KCP&L)
in determining whether to invest in the notes. The notes are not guaranteed by Great Plains Energy
Incorporated or any of its or our subsidiaries. None of those entities has any obligation to make
any capital contribution or to advance funds to us for the purpose of paying the principal of, or premium, if any, and
interest on the notes or any other amount that may be required to be paid under the indenture or
the notes, preventing or curing an event of default under the terms of the indenture, complying
with any other obligation under the indenture or the notes or otherwise.
Unless the context otherwise requires or as otherwise indicated, when we refer to Kansas City
Power & Light, KCP&L, the Company, we, us or our in this prospectus supplement or when
we otherwise refer to ourselves in this prospectus supplement, we mean Kansas City Power & Light
Company and not any of its subsidiaries.
ii
PROSPECTUS SUPPLEMENT SUMMARY
Our Company
Kansas City Power & Light Company is an integrated, regulated electric utility, headquartered
in Kansas City, Missouri, that engages in the generation, transmission, distribution and sale of
electricity. As of December 31, 2006, we served over 505,000 customers located in all or portions
of 24 counties in western Missouri and eastern Kansas. Our customers included approximately 446,000
residences, over 57,000 commercial firms, and approximately 2,200 industrials, municipalities, and
other electric utilities as of December 31, 2006. Our retail revenues averaged approximately 81% of
our total operating revenues over the last three calendar years. Wholesale firm power, bulk power
sales and miscellaneous electric revenues accounted for the remainder of utility revenues. We are
significantly impacted by seasonality, with approximately one-third of our retail revenues recorded
in the third quarter.
Our principal executive offices are located at 1201 Walnut Street, Kansas City, Missouri
64106-2124 and our telephone number is (816) 556-2200.
Pending Great Plains Energy Incorporated Merger with Aquila, Inc.
On February 6, 2007, our parent company, Great Plains Energy Incorporated (Great Plains
Energy) entered into agreements with Aquila, Inc. (Aquila) and Black Hills Corporation (Black
Hills) for two separate, but related transactions. Aquila is an integrated electric and natural
gas utility headquartered in Kansas City, Missouri, with regulated electric utility operations in
Missouri and Colorado; regulated gas utility operations in Colorado, Iowa, Kansas and Nebraska; and
merchant energy services largely comprising a contractual entitlement to the energy produced by the
340-megawatt Crossroads gas-fired generating facility in Mississippi. Under the agreements:
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Great Plains Energy will acquire all of the outstanding shares of Aquila and its
Missouri-based electric utility operations and its merchant energy services for $1.80 in
cash plus 0.0856 of a share of Great Plains Energys common stock for each share of Aquila
common stock pursuant to an agreement and plan of merger (Merger Agreement) among Great
Plains Energy, Aquila and Black Hills; and |
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immediately prior to Great Plains Energys acquisition of Aquila, Black Hills will
acquire the assets and associated liabilities of Aquilas Colorado electric utility
operations and its Colorado, Iowa, Kansas and Nebraska gas utility operations for $940
million in cash, subject to adjustment, pursuant to an asset purchase agreement (Asset
Purchase Agreement) among Great Plains Energy, Aquila and Black Hills. |
After applying a portion of the cash proceeds from the sale to Black Hills under the Asset
Purchase Agreement, Great Plains Energy expects that Aquila will have approximately $1 billion of
net consolidated debt following completion of the transactions, which will become part of Great
Plains Energys consolidated debt. As a result of the transactions, Aquila will become a
wholly-owned subsidiary of Great Plains Energy. A simplified organizational chart of the Great
Plains Energy consolidated group (assuming completion of the Aquila transaction) follows:
S-1
The transactions contemplated by the agreements are subject to various conditions. Great
Plains Energys acquisition of Aquila pursuant to the Merger
Agreement is conditioned on the closing of the Asset Purchase
Agreement and is subject to the approval
of both its and Aquilas shareholders; regulatory approvals from the Missouri Public Service
Commission (MPSC), the Kansas Corporation Commission (KCC) and the Federal Energy Regulatory
Commission (FERC); antitrust review under the Hart-Scott-Rodino Antitrust Improvements Act (HSR
Act); and customary closing conditions. Black Hills purchase of the Aquila assets under the Asset
Purchase Agreement is conditioned on the closing of the Merger
Agreement and is subject to regulatory approvals from the MPSC, the KCC, the Colorado Public
Utilities Commission, the Nebraska Public Service Commission, the Iowa Utilities Board, and FERC;
antitrust review under the HSR Act; and customary closing conditions. On April 4, 2007, Aquila,
KCP&L and Great Plains Energy filed applications with the
MPSC and KCC seeking regulatory approval
of the merger. In addition, on April 4, 2007, Aquila and Black Hills filed applications with the
Colorado Public Utilities Commission, the KCC, the Nebraska Public Service
Commission and the Iowa Utilities Board seeking approval of the sale of assets to Black Hills.
None of these required regulatory approvals has been obtained as of the date of this prospectus
supplement. On May 8, 2007, Great Plains Energy filed with the Securities and Exchange Commission
a registration statement, including a joint proxy statement/prospectus with Aquila, in connection
with the Great Plains Energy and Aquila special shareholder meetings expected to occur in the third
quarter of 2007. Aquila, Black Hills, KCP&L and Great Plains
Energy filed an application with FERC on May 25, 2007 for
approval of the merger and the sale of Colorado electric assets to
Black Hills, among other things. Aquila and Great Plains Energy
expect to file the required
notification under the HSR Act during the second quarter of 2007. The transactions are expected to
close in the first quarter of 2008.
The MPSC and KCC applications filed by Aquila, KCP&L and Great Plains Energy requested
authorization to amortize acquisition costs plus transition-related costs, excluding
non-incremental labor costs, over a five-year period beginning January 1, 2008, or the month
immediately following consummation of the merger, whichever occurs later. These MPSC and KCC
applications proposed to regulators that synergy savings resulting from the transaction be shared
between retail electric customers and Great Plains Energy shareholders for a period of five years.
Additionally, the MPSC application requested approval for the use of the additional amortization
mechanism for Aquilas Missouri-based utilities, as implemented in KCP&Ls 2006 rate case, once
Aquila achieves financial metrics necessary to support an investment-grade credit rating. We
cannot assure you that any such regulatory treatment will be realized.
We currently expect that most of the Aquila employees remaining after the sale to Black Hills
will become employees of KCP&L. Our employees will operate and manage both our properties and
Aquilas properties, and we will charge Aquila for the cost of these services. We also expect that
procurement of goods and services for both KCP&L and Aquila will be done by KCP&L, with the cost of
goods and services used by Aquila being billed to Aquila. These expected arrangements may pose
risks to us, including possible claims by Aquila or third parties arising from actions of our
employees in operating Aquilas properties and providing other services to Aquila. Our claims for
reimbursement for goods and services provided to Aquila will be unsecured and rank equally with
other unsecured obligations of Aquila. Our ability to be reimbursed for the costs we incur for the
benefit of Aquila depends on the financial ability of Aquila to make such payments. Although we
expect to be able to benefit to some degree from synergies that Great Plains Energy expects to
realize on a consolidated basis following completion of the merger, we cannot assure you that any
such synergies will be realized.
On February 7, 2007, Standard & Poors Ratings Services placed our securities on CreditWatch
with Negative implications and lowered our commercial paper rating to A-3 from A-2, citing the
proposed transactions with Aquila. On that date, Moodys Investors Service, Inc. reaffirmed our
ratings and outlook.
S-2
The Offering
The following summary contains basic information about the notes. It does not contain all the
information that is important to you. For a more complete understanding of the notes, please refer
to the sections of this prospectus supplement and the accompanying prospectus entitled Description
of the Notes.
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Issuer
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Kansas City Power & Light Company |
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Notes Offered
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$250,000,000 aggregate principal amount of % Notes due 2017. |
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Maturity
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June 15, 2017. |
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Interest
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The notes will bear interest from June , 2007 at the rate of % per year. |
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Interest Payment Dates
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June 15 and December 15 of
each year, beginning December 15, 2007. |
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Ranking
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The notes will be our senior unsecured obligations. They will rank equal in right
of payment with our existing and future senior unsecured obligations and will be senior in
right of payment to any existing and future subordinated indebtedness. The notes
will be effectively subordinated to all of our existing and future secured
indebtedness, including our general mortgage bonds, to the extent of the
collateral securing that indebtedness and to all existing and future liabilities,
including trade payables, of our subsidiaries. As of March 31, 2007, we had
outstanding $159.3 million of secured indebtedness. |
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Optional Redemption
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We may redeem the notes at any time in whole or from time to time in part at the
make-whole premium indicated under the section entitled Description of the
NotesOptional Redemption in this prospectus supplement. |
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Further Issuances
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We may create and issue further notes ranking equally and ratably with and having
the same terms as the notes offered by this prospectus supplement. Any additional
notes will, together with the notes offered by this prospectus supplement,
constitute a single series of notes under the indenture. |
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Use of Proceeds
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We expect to use the net proceeds of this offering to repay an intercompany loan
from Great Plains Energy, the proceeds of which were used to pay at maturity $225
million aggregate principal amount of our outstanding indebtedness and to repay a
portion of our outstanding commercial paper. See Use of Proceeds in this
prospectus supplement. |
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Risk Factors
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See Risk Factors beginning on page S-5 of this prospectus supplement and page 1
of the accompanying prospectus for important information regarding us and an
investment in the notes. |
S-3
Summary Consolidated Financial Data
The following summary financial data for the years ended December 31, 2004 through December
31, 2006 have been derived from our audited consolidated financial statements and related notes,
incorporated by reference in the accompanying prospectus and herein. The following summary
consolidated financial data for the three months ended March 31, 2007 and March 31, 2006 have been
derived from our unaudited financial statements and related notes, incorporated by reference in the
accompanying prospectus and herein. The information set forth below is qualified in its entirety by
reference to, and therefore, should be read together with, managements discussion and analysis of
financial condition and results of operations, the financial statements and related notes and other
financial information incorporated by reference herein.
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Three Months Ended March 31, |
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Year Ended December 31, |
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2007 |
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2006 |
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2006 |
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2005 |
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2004 |
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($ in thousands) |
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Income Statement Data: |
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Operating revenues |
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$ |
255,652 |
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$ |
240,390 |
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$ |
1,140,357 |
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$ |
1,130,905 |
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$ |
1,091,635 |
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Operating expenses |
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242,535 |
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208,683 |
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869,348 |
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881,453 |
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821,816 |
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Operating income |
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$ |
13,117 |
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$ |
31,707 |
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$ |
271,009 |
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$ |
249,452 |
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$ |
269,819 |
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Net income |
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$ |
1,998 |
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$ |
13,012 |
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$ |
149,321 |
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$ |
143,645 |
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$ |
145,028 |
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Cash Flow Data: |
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Cash flows from operating activities |
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$ |
41,379 |
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$ |
54,284 |
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$ |
299,235 |
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$ |
365,486 |
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$ |
316,259 |
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Cash flows from investing activities |
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(74,554 |
) |
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(76,395 |
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(470,062 |
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(327,793 |
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(163,539 |
) |
Cash flows from financing activities |
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33,710 |
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21,868 |
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169,654 |
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(86,351 |
) |
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(127,621 |
) |
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Other Financial Data: |
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Depreciation and amortization |
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$ |
43,011 |
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$ |
37,000 |
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$ |
152,714 |
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$ |
146,610 |
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$ |
145,246 |
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Amortization of: |
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Nuclear fuel |
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4,161 |
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3,890 |
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14,392 |
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13,374 |
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14,159 |
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Other |
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1,690 |
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1,650 |
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6,617 |
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7,681 |
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7,719 |
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Utility capital expenditures |
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67,627 |
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73,899 |
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475,931 |
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332,055 |
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190,548 |
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The following table sets forth our ratio of earnings to fixed charges for the periods
indicated.
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Three Months |
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Ended March 31, |
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Year Ended December 31, |
2007 |
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2006 |
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2005 |
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2004 |
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2003 |
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2002 |
(a)
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4.11x
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3.87x
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3.37x
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3.68x
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2.87x |
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(a) |
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A $2.9 million deficiency in earnings caused the ratio of earnings to fixed
charges for the three months ended March 31, 2007 to be less than 1.0. See
managements discussion and analysis of financial condition and results of operations
included in KCP&Ls quarterly report on Form 10-Q for the three months ended March 31,
2007 for additional information on factors that contributed to such deficiency in
earnings. |
For purposes of computing the ratios of earnings to fixed charges: (i) earnings consist of
income before deducting net provisions for income taxes, adjustment for minority interest in
subsidiaries and fixed charges; and (ii) fixed charges consist of interest on debt, amortization of
debt discount, premium and expense, and the estimated interest component of lease payments and
rentals.
S-4
RISK FACTORS
An investment in the notes is subject to various risks. These risks should be considered
carefully with the information provided elsewhere and incorporated by reference in this prospectus
supplement and the accompanying prospectus before deciding to invest in the notes. In addition,
please read the information included or incorporated by reference under Risk Factors and
Cautionary Statements Regarding Certain Forward-Looking Information in the accompanying
prospectus for a description of additional uncertainties associated with our business, results of
operations and financial condition and the forward-looking statements included or incorporated by
reference in this prospectus supplement and the accompanying prospectus.
Risks Relating to the Notes
IndebtednessOur indebtedness could adversely affect our ability to fulfill our obligations
under the notes and operate our business.
Our indebtedness and debt service obligations are significant. For the three months ended
March 31, 2007, our actual interest expense was $18.2 million. Our actual ratio of earnings to
fixed charges was less than 1.0 for the three months ended March 31, 2007 due to a deficiency in
earnings of $2.9 million. As of March 31, 2007, our total long-term debt, including current
maturities was $753 million, excluding unused commitments and contractual obligations and other
commitments, and our total shareholders equity was $1.4 billion. Adjusted for this offering, as
of March 31, 2007, our total debt would have been approximately $1 billion and our total
shareholders equity would have been unchanged. We may incur additional short and long-term debt
from time to time to finance our Comprehensive Energy Plan, other construction requirements,
pension benefit plan funding requirements, dividends to our parent company, working capital,
capital expenditures or other general corporate purposes, subject to the restrictions contained in
the credit agreement that governs our senior unsecured revolving credit facility and in any other
agreements under which we incur indebtedness. The indenture governing the notes will not restrict
our ability to incur additional debt or to guarantee debt of our affiliates.
Our debt could have important consequences to holders of the notes, including the following:
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we are required to use a substantial portion of our cash flow from operations to pay
principal and interest on our debt, thereby reducing the availability of our cash flow to
fund our Comprehensive Energy Plan and Collaboration Agreement, other construction
requirements, pension benefit plan funding requirements, dividends to our parent company,
working capital, capital expenditures and other general corporate requirements; |
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if prevailing interest rates increase, our interest expense could increase because a
substantial portion of our debt and any borrowings under our senior unsecured revolving
credit facility will bear interest at floating rates; |
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our leverage increases our vulnerability to economic downturns, and adverse competitive
and industry conditions could place us at a competitive disadvantage compared to those of
our competitors that are less leveraged; and |
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our debt service obligations could limit our flexibility in planning for, or reacting
to, changes in our business and our industry and could limit our ability to pursue other
business opportunities, borrow more money for operations or capital in the future and
implement our business strategies. |
Unsecured ObligationsBecause the notes are not secured and are effectively subordinated to
the rights of secured creditors, the notes will be subject to the prior claims of any
secured creditors, and if a default occurs, we may not have sufficient funds to fulfill our
obligations under the notes.
The
notes are senior unsecured obligations, ranking equally with other senior unsecured indebtedness. The
indenture governing the notes does not restrict us or our subsidiaries from incurring additional
secured or unsecured debt or from entering into sale and leaseback transactions. If we incur any
secured debt, our assets and those of our
S-5
subsidiaries will be subject to prior claims by our and their respective secured creditors. In
the event of our bankruptcy, insolvency, liquidation, reorganization, dissolution or other winding
up, assets that secure debt will be available to pay obligations on the notes only after all debt
secured by those assets has been repaid in full. Holders of the notes will participate in any
remaining assets ratably with all of our unsecured and unsubordinated creditors, including trade
creditors. If we incur any additional obligations that rank equally with the notes, including trade
payables, the holders of those obligations will be entitled to share ratably with the holders of
the notes in any proceeds distributed upon our bankruptcy, insolvency, liquidation, reorganization,
dissolution or other winding up. This may have the effect of reducing the amount of proceeds paid
to holders of the notes. If there are not sufficient assets remaining to pay all these creditors,
all or a portion of the notes then outstanding would remain unpaid.
No GuaranteesOur parent company is not guaranteeing the notes and you should not rely upon
information relating to our parent company in determining whether to invest in the notes.
As described in more detail below under Where You Can Find More Information, we and our
parent company, Great Plains Energy, separately file combined annual, quarterly and
current reports. However, only the information related to KCP&L and its consolidated subsidiaries
is incorporated by reference in this prospectus. You should not rely on any information relating
solely to Great Plains Energy or its subsidiaries (other than KCP&L and its
subsidiaries) in determining whether to invest in the notes. The notes are not guaranteed by Great
Plains Energy or any of its or our subsidiaries. None of those entities has any
obligation to make any capital contribution or distribution to us for the purpose of paying the
principal of, or premium, if any, and interest on the notes or any other amount that may be
required to be paid under the indenture or the notes, preventing or curing an event of default
under the terms of the indenture, complying with any other obligation under the indenture or the
notes or otherwise.
No Prior Market for the NotesThere is no prior market for the notes, and if a market
develops, it may not be liquid.
We do not intend to list the notes on any national securities exchange or to seek their
quotation on any automated dealer quotation system. We cannot assure holders of the notes that any
liquid market for the notes will ever develop or be maintained. The underwriters have advised us
that they currently intend to make a market in the notes following the offering. However, the
underwriters have no obligation to make a market in the notes and they may stop at any time.
Further, there can be no assurance as to the liquidity of any market that may develop for the
notes, holders ability to sell their notes or the price at which holders will be able to sell
their notes. Future trading prices of the notes will depend on many factors, including prevailing
interest rates, our financial condition and results of operations, the then-current ratings
assigned to the notes and the market for similar securities. Any trading market that develops would
be affected by many factors independent of and in addition to the foregoing, including:
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the time remaining to the maturity of the notes; |
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the outstanding amount of the notes; |
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the terms related to optional redemption of the notes; and |
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the level, direction and volatility of market interest rates generally. |
Rating of the NotesRatings of the notes may change after issuance and affect the market
price and marketability of the notes.
We currently expect that, upon issuance, the notes will be rated by Moodys Investors Service,
Inc. and Standard & Poors Ratings Services. Such ratings are limited in scope, and do not address
all material risks relating to an investment in the notes, but rather reflect only the view of each
rating agency at the time the rating is issued. An explanation of the significance of such rating
may be obtained from such rating agency. There is no assurance that such credit ratings will be
issued or remain in effect for any given period of time or that such ratings will not be decreased,
suspended or withdrawn entirely by the rating agencies, if, in each rating agencys judgment,
circumstances so warrant. KCP&Ls credit ratings could decrease as a result of events directly
affecting Great Plains
S-6
Energy and its subsidiaries (other than KCP&L), even though Great Plains Energy is not
guaranteeing the notes and is not generally obligated to provide credit support to us. For
example, on February 7, 2007, Standard & Poors Ratings Service placed our securities on
CreditWatch with Negative implications and lowered our commercial paper rating to A-3 from A-2,
citing Great Plains Energys proposed transactions with Aquila. The rating agencies indicated that
the ratings of Great Plains Energy and KCP&L could be negatively affected if:
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there is a substantial increase in leverage to fund additional capital expenditure
requirements under KCP&Ls Comprehensive Energy Plan or Collaboration Agreement or a
lack of regulatory support for, or significant delay in, recovery of additional capital
expenses incurred by KCP&L; |
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favorable regulatory approvals are not obtained; |
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problems arise relating to the integration of Aquila; |
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net debt assumed in the Aquila transaction is greater than expected; |
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Strategic Energys financial performance is weaker than projected; or |
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there is further deterioration of credit metrics, including if ratios of cash flow
from operations (before changes in working capital) to debt and interest fall below
specified thresholds. |
Many of the foregoing factors are not within our control. Holders of notes will have no recourse
against us or any other parties in the event of a change in or suspension or withdrawal of such
ratings. Any decrease, suspension or withdrawal of such ratings may have an adverse effect on the
market price or marketability of the notes.
S-7
USE OF PROCEEDS
We estimate the net proceeds to us from the sale of the notes will be approximately $248
million, after deducting the underwriters discounts and other expenses of the offering payable by
us. We expect to use the net proceeds of this offering (1) to repay an intercompany loan from
Great Plains Energy currently bearing interest at 8.25%, the proceeds of which were used to pay at
maturity $225 million aggregate principal amount of our outstanding 6.00% Senior Notes due 2007,
and (2) to repay a portion of our outstanding commercial paper bearing interest at a weighted
average interest rate of 5.52% as of March 31, 2007.
CAPITALIZATION AND SHORT-TERM DEBT
The following table sets forth our consolidated capitalization as of March 31, 2007, and as
adjusted to give effect to the issuance and sale of the notes and the use of the proceeds from this
offering as set forth under Use of Proceeds above. This table should be read in conjunction with
our consolidated financial statements and related notes incorporated by reference in this
prospectus supplement and the accompanying prospectus. See Where You Can Find More Information
in the accompanying prospectus.
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March 31, 2007 |
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Actual |
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As Adjusted |
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($ in millions) |
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Short-term debt (includes current maturities) |
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$ |
595.5 |
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$ |
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Long-term debt: |
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General Mortgage Bonds |
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7.95% Medium-Term Notes due 2007 |
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$ |
0.5 |
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$ |
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3.75%* EIRR bonds due 2012 - 2035 |
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158.8 |
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Senior Notes |
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6.50% due 2011 |
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150.0 |
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6.05% due 2035 |
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250.0 |
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Notes offered hereby |
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Unamortized discount |
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(1.6 |
) |
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EIRR bonds |
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4.75% Series A & B due 2015 |
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105.6 |
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4.75% Series D due 2017 |
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39.7 |
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4.65% Series 2005 due 2035 |
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50.0 |
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Total debt |
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753.0 |
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Less current maturities |
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(145.8 |
) |
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Total long-term debt |
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$ |
607.2 |
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$ |
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Shareholders equity: |
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Common stock (1,000 shares authorized without par
value; 1 share issued, stated value) |
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$ |
1,021.7 |
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$ |
1,021.7 |
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Retained earnings |
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322.6 |
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322.6 |
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Accumulated other comprehensive income |
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7.0 |
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7.0 |
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Total shareholders equity |
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$ |
1,351.3 |
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$ |
1,351.3 |
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|
|
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|
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|
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|
|
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Total capitalization and short-term debt |
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$ |
2,554.0 |
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$ |
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|
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* |
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Weighted-average interest rates at March 31, 2007. |
S-8
DESCRIPTION OF THE NOTES
The following description of the particular terms of the notes supplements and, to the extent
inconsistent therewith, replaces the description of the general terms and provisions of the notes
set forth in the accompanying prospectus, to which description reference is hereby made. Whenever
a defined term is referred to and not herein defined, the definition thereof is contained in the
accompanying prospectus or in the indenture referred to therein.
General
The notes constitute a single series of debt securities to be issued pursuant to a senior
indenture, dated as of May 1, 2007, between the Company and The Bank of New York Trust Company,
N.A., as Trustee. The notes will initially be limited to $250,000,000 aggregate principal amount
and will mature on June 15, 2017.
The notes will bear interest at the rate per year set forth on the cover page of this
prospectus supplement from the date of issuance or from the most recent interest payment date to
which interest has been paid or provided for, payable semiannually in
arrears on June 15 and
December 15 of each year, beginning December 15, 2007, to the persons in whose names the
notes are registered at the close of business on the immediately
preceding June 1 and
December 1, respectively, whether or not such day is a Business Day.
The notes will (i) be our unsecured obligations and will rank equally with our existing and
future senior unsecured indebtedness, (ii) be effectively subordinated (with respect to underlying
collateral) to secured indebtedness of the Company, and (iii) be structurally subordinated to all
indebtedness of the Companys subsidiaries.
The notes will be issued only in registered form in minimum denominations of $1,000 and in
integral multiples of $1,000.
We may create and issue further notes ranking equally and ratably with the notes offered by
this prospectus supplement, including notes having the same series designation and terms (except
for the initial public offering price and the issue date) as the notes offered hereby, without the
approval of the holders of the notes offered hereby. We may not, however, issue additional notes
of the same series as the notes offered by this prospectus supplement without delivering an opinion
of counsel to the trustee confirming that holders of the outstanding notes offered by this
prospectus supplement will be subject to federal income tax in the same amounts, in the same manner
and at the same times as would have been the case if such additional notes of the same series were
not issued. In such case, such additional notes will, together with the notes offered by this
prospectus supplement, constitute a single series of notes under the indenture.
Optional Redemption
The notes will be redeemable at any time in whole or from time to time in part, at our option,
each at a make-whole premium redemption price calculated by us equal to the greater of:
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100% of the principal amount of the notes to be redeemed; and |
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the sum of the present values of the remaining scheduled payments of principal and
interest thereon (not including any portion of such payments of interest accrued as of
the date of redemption), discounted to the date of redemption on a semi-annual basis
(assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate, plus
basis points, |
plus, in each case, accrued interest thereon to the date of redemption. Notwithstanding the
foregoing, installments of interest on notes that are due and payable on interest payment dates
falling on or prior to a redemption date will be payable on the interest payment date to the
registered holders as of the close of business on the relevant record date according to the notes
and the indenture.
Comparable Treasury Issue means the United States Treasury security selected by the
Quotation Agent as having a maturity comparable to the remaining term of the notes to be redeemed
that would be utilized, at the
S-9
time of selection and in accordance with customary financial practice, in pricing new issues
of corporate debt securities of comparable maturity to the remaining term of such notes.
Comparable Treasury Price means, with respect to any redemption date,
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the average of four Reference Treasury Dealer Quotations for such redemption date,
after excluding the highest and lowest such Reference Treasury Dealer Quotations, or |
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if the Quotation Agent obtains fewer than four such Reference Treasury Dealer
Quotations, the average of all such quotations, or |
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if only one Reference Treasury Dealer Quotation is received, such quotation. |
Quotation Agent means the Reference Treasury Dealer appointed by us.
Reference Treasury Dealer means
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Banc of America Securities LLC (or its affiliate that is a primary U.S. government
securities dealer (Primary Treasury Dealer)) and one other Primary Treasury Dealer
selected by Wachovia Capital Markets, LLC, or their respective successors; provided,
however, that if either of the foregoing shall cease to be a Primary Treasury Dealer,
we will substitute therefor another Primary Treasury Dealer, and |
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two other Primary Treasury Dealers that we select. |
Reference Treasury Dealer Quotations means, with respect to each Reference Treasury Dealer
and any redemption date, the average, as determined by the Quotation Agent, of the bid and asked
prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal
amount) quoted in writing to the Quotation Agent by such Reference Treasury Dealer at 5:00 p.m.,
New York City time, on the third business day preceding such redemption date.
Treasury Rate means, with respect to any redemption date, the rate per annum equal to the
semi-annual equivalent yield to maturity of the Comparable Treasury Issue, assuming a price for the
Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the
Comparable Treasury Price for such redemption date.
Notice of any redemption will be mailed at least 30 days but not more than 60 days before the
redemption date to each holder of the notes to be redeemed. Unless we default in payment of the
redemption price, on and after the redemption date, interest will cease to accrue on the notes or
portions thereof called for redemption. If less than all of the notes are to be redeemed, the
particular notes or portions of such notes to be redeemed will be selected by The Depository Trust
Company in such manner as it shall determine.
Notwithstanding the foregoing, any notice of redemption at our option may state that such
redemption will be conditional upon receipt by the trustee on or prior to the date fixed for such
redemption, of money sufficient to pay the principal of and premium, if any, and interest on, such
notes and that if such money has not been so received, such notice will be of no force and effect
and we will not be required to redeem such notes.
No Guarantees
The notes are not guaranteed by our parent company, Great Plains Energy, or any
of its or our subsidiaries. None of those entities has any obligation to make any capital
contribution or distributions to KCP&L for the purpose of paying the principal of, or premium, if
any, and interest on the notes or any other amount that may be required to be paid under the
indenture or the notes, preventing or curing an event of default under the terms of the indenture,
complying with any other obligation under the indenture or the notes or otherwise.
S-10
Book-Entry System
Upon issuance, the notes will be represented by one or more global securities deposited with,
or on behalf of the depositary. The global securities representing the notes will be registered in
the name of the depositary or its nominee. Except under the circumstances described in the
accompanying prospectus under Book-Entry System, the notes will not be issuable in definitive
form. So long as the notes are represented by one or more global securities, the depositary or its
nominee will be considered the sole owner or holder of such notes for all purposes under the
indenture, and the beneficial owners of such notes will be entitled only to those rights and
benefits afforded to them in accordance with the depositarys regular operating procedures. The
depositary has confirmed to the Company, the underwriters and the Trustee that it intends to follow
such procedures with respect to the notes. A further description of the depositarys procedures
with respect to global securities is set forth in the accompanying prospectus under Book-Entry
System.
S-11
UNDERWRITING
Subject to the terms and conditions of the underwriting agreement, the underwriters named
below, for whom Banc of America Securities LLC and Wachovia Capital Markets, LLC are acting as
representatives, have severally agreed to purchase from us, and we have agreed to sell, the
principal amount of notes listed opposite their names below at the public offering price less the
underwriting discount set forth on the cover page of this prospectus supplement:
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Principal Amount |
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Underwriter |
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of Notes |
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Banc of America Securities LLC |
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$ |
|
|
Wachovia Capital Markets, LLC |
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BNP Paribas Securities Corp. |
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BNY Capital Markets, Inc. |
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KeyBanc Capital Markets Inc. |
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Lazard Capital Markets LLC |
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Scotia Capital (USA) Inc. |
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Total |
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$ |
250,000,000 |
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|
The underwriting agreement provides that the obligations of the several underwriters to
purchase the notes offered hereby are subject to certain conditions and that the underwriters will
purchase all of the notes offered by this prospectus supplement if any of these notes are
purchased.
We have been advised by the representatives that the underwriters propose to offer the notes
directly to the public at the public offering price set forth on the cover page of this prospectus
supplement and to certain dealers at such price less a concession not in excess of % of the
principal amount of the notes. The underwriters may allow, and such dealers may re-allow, a
concession not in excess of % of the principal amount of the notes to certain other dealers.
After the initial public offering, representatives of the underwriters may change the offering
price and other selling terms.
We estimate that our share of the total expenses of this offering, excluding the underwriting
discount, will be approximately $0.5 million.
We have agreed to indemnify the underwriters against certain liabilities, including
liabilities under the Securities Act of 1933, and to contribute to payments the underwriters may be
required to make in respect of any of these liabilities.
The notes are a new issue of securities with no established trading market. The notes will not
be listed on any securities exchange or on any automated dealer quotation system. The underwriters
may make a market in the notes after completion of the offering, but will not be obligated to do so
and may discontinue any market-making activities at any time without notice. No assurance can be
given as to the liquidity of the trading market for the notes or that an active public market for
the notes will develop. If an active public trading market for the notes does not develop, the
market price and liquidity of the notes may be adversely affected.
In connection with the offering of the notes, the representatives may engage in transactions
that stabilize, maintain or otherwise affect the price of the notes. Specifically, the
representatives may overallot in connection with the offering, creating a short position. In
addition, the representatives may bid for, and purchase, the notes in the open market to cover
short positions or to stabilize the price of the notes. Any of these activities may stabilize or
maintain the market price of the notes above independent market levels, but no representation is
made hereby of the magnitude of any effect that the transactions described above may have on the
market price of the notes. The underwriters will not be required to engage in these activities, and
may engage in these activities, and may end any of these activities at any time without notice.
Affiliates of certain of the underwriters are lenders under revolving credit agreements
entered into separately with Great Plains Energy and KCP&L in May 2006. In connection with each of
these arrangements,
S-12
Banc of America Securities LLC acted as joint-lead arranger; Bank of America, N.A. acted as a
lender and administrative agent; Wachovia Bank, N.A. and BNP Paribas each acted as a lender and
co-documentation agent; and Bank of New York, Keybank National Association and the Bank of Nova
Scotia each acted as a lender. The underwriters and their affiliates have provided and in the
future may continue to provide investment banking, commercial banking and other financial services,
including the provision of credit facilities, to us and our affiliates in the ordinary course of
business for which they have received and will receive customary compensation.
Lazard Capital Markets LLC (Lazard Capital Markets) has entered into an agreement with
Mitsubishi UFJ Securities (USA), Inc. (MUS(USA)) pursuant to which MUS(USA) provides certain
advisory and/or other services to Lazard Capital Markets, including in respect of this offering.
In return for the provision of such services by MUS(USA) to Lazard Capital Markets, Lazard Capital
Markets will pay to MUS(USA) a mutually agreed upon fee. The Bank of
Tokyo-Mitsubishi UFJ, Ltd., an affiliate of MUS(USA), has entered into a receivable securitization facility with a
wholly-owned subsidiary of the Company, and is also a lender under the revolving credit agreements
referenced in the preceding paragraph.
S-13
PROSPECTUS
KANSAS CITY POWER & LIGHT COMPANY
Notes
Kansas City Power & Light Company, or the Company, may offer and sell, from time to time,
notes in one or more offerings. We may offer the notes simultaneously or at different times, in
one or more separate series, in amounts, at prices and on terms to be determined at or prior to the
time or times of sale.
This prospectus provides you with a general description of these notes. We will provide
specific information about the offering and the terms of these notes in one or more supplements to
this prospectus. The supplements may also add, update or change information contained in this
prospectus. This prospectus may not be used to offer and sell our notes unless accompanied by a
prospectus supplement. You should read this prospectus and the related supplements before you
invest in these notes.
Our principal executive offices are located at 1201 Walnut Street, Kansas City, Missouri
64106-2124 and our telephone number is (816) 556-2200.
Investing in these notes involves risks. You should carefully consider the information
referred to under the heading Risk Factors beginning on page 1 of this prospectus.
Neither the Securities and Exchange Commission nor any state securities commission has
approved or disapproved of these securities or determined if this prospectus is truthful or
complete. Any representation to the contrary is a criminal offense.
We may offer and sell these notes through one or more underwriters or agents. We will set
forth in the related prospectus supplement the name of the underwriters or agents, the discount or
commission received by them from us as compensation, our other expenses for the offering and sale
of these notes, and the net proceeds we receive from the sale. See Plan of Distribution.
The
date of this prospectus is May 30, 2007.
TABLE OF CONTENTS
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Page No. |
ABOUT THIS PROSPECTUS |
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i |
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CAUTIONARY STATEMENTS REGARDING CERTAIN FORWARD-LOOKING INFORMATION |
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ii |
KANSAS CITY POWER & LIGHT COMPANY |
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1 |
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RISK FACTORS |
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1 |
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USE OF PROCEEDS |
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1 |
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DESCRIPTION OF THE NOTES |
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2 |
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BOOK-ENTRY SYSTEM |
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10 |
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PLAN OF DISTRIBUTION |
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13 |
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LEGAL MATTERS |
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13 |
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EXPERTS |
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13 |
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WHERE YOU CAN FIND MORE INFORMATION |
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14 |
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ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement we have filed with the Securities and
Exchange Commission, or SEC, using a shelf registration process. By using this process, we may,
from time to time, sell the notes described in this prospectus in one or more offerings.
This prospectus provides you with a general description of the notes we may offer. Each time
we sell notes, we will provide you with a supplement to this prospectus that will describe the
specific terms of that offering. The prospectus supplement may also add, update or change the
information contained in this prospectus. If there is any inconsistency between the information in
this prospectus and the prospectus supplement, you should rely on the information in the prospectus
supplement. The registration statement we filed with the SEC includes exhibits that provide more
detail on descriptions of the matters discussed in this prospectus. Before you invest in our notes,
you should carefully read the registration statement (including the exhibits) of which this
prospectus forms a part, this prospectus, the applicable prospectus supplement and the documents
incorporated by reference into this prospectus. The incorporated documents are described under
Where You Can Find More Information.
You should rely only on the information contained or incorporated by reference in this
prospectus or in any free writing prospectus. We have not, and the underwriters have not,
authorized anyone to provide you with different information and neither we nor the underwriters of
any offering of notes will authorize anyone else to provide you with different information. If
anyone provides you with different or inconsistent information, you should not rely on it. We are
not, and the underwriters are not, making an offer to sell these notes in any jurisdiction where
the offer or sale is not permitted. You should assume that the information appearing in this
prospectus and the documents incorporated by reference is accurate only as of their respective
dates. Our business, financial condition, results of operations and prospects may have changed
materially since those dates.
As described in more detail below under Where You Can Find More Information, we and Great
Plains Energy Incorporated, our parent company, separately file combined annual, quarterly and
current reports. However, we are incorporating by reference into this prospectus only the
information related to KCP&L and its consolidated subsidiaries. You should not rely on any
information relating solely to Great Plains Energy Incorporated or its subsidiaries (other than the
information provided separately by KCP&L or the subsidiaries of KCP&L) in determining whether to
invest in any notes offered hereby.
Unless the context otherwise requires or as otherwise indicated, when we refer to Kansas City
Power & Light, KCP&L, the Company, we, us or our in this prospectus or when we otherwise
refer to ourselves in this prospectus, we mean Kansas City Power & Light Company and not any of its
subsidiaries.
i
CAUTIONARY STATEMENTS REGARDING
CERTAIN FORWARD-LOOKING INFORMATION
This prospectus and the documents incorporated or deemed incorporated by reference as
described under the heading Where You Can Find More Information contain forward-looking
statements that are not based on historical facts. In some cases, you can identify forward-looking
statements by use of the words may, should, expect, plan, anticipate, estimate,
predict, potential, or continue. Forward-looking statements include, but are not limited to,
statements regarding projected delivery volumes and margins, the outcome of regulatory proceedings,
cost estimates for our Comprehensive Energy Plan and other matters affecting future operations.
These forward-looking statements are based on assumptions, expectations, and assessments made by
our management in light of their experience and their perception of historical trends, current
conditions, expected future developments and other factors they believe to be appropriate. Any
forward-looking statements are not guarantees of our future performance and are subject to risks
and uncertainties, including those described or referred to under the heading Risk Factors in
this prospectus, in any prospectus supplement, and in our other SEC filings. These risks and
uncertainties could cause actual results, developments and business decisions to differ materially
from those contemplated or implied by forward-looking statements. Consequently, you should
recognize these statements for what they are and we caution you not to rely upon them as facts. We
claim the protection of the safe harbor for forward-looking statements contained in the Private
Securities Litigation Reform Act of 1995 for all forward-looking statements. We disclaim any duty
to update the forward-looking statements, which apply only as of the date of this prospectus. Some
of the factors that may cause actual results, developments and business decisions to differ
materially from those contemplated by these forward-looking statements include the following:
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future economic conditions in the regional, national and international markets,
including but not limited to regional and national wholesale electricity markets |
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market perception of the energy industry and the Company |
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changes in business strategy, operations or development plans |
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effects of current or proposed state and federal legislative and regulatory actions
or developments, including, but not limited to, deregulation, re-regulation and
restructuring of the electric utility industry |
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decisions of regulators regarding rates the Company can charge for electricity |
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adverse changes in applicable laws, regulations, rules, principles or practices
governing tax, accounting and environmental matters including, but not limited to, air
and water quality |
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financial market conditions and performance including, but not limited to, changes
in interest rates and in availability and cost of capital and the effects on pension
plan assets and costs |
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credit ratings |
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inflation rates |
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effectiveness of risk management policies and procedures and the ability of
counterparties to satisfy their contractual commitments |
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impact of terrorist acts |
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increased competition including, but not limited to, retail choice in the electric
utility industry and the entry of new competitors |
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ability to carry out marketing and sales plans |
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weather conditions including weather-related damage |
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cost, availability, quality and deliverability of fuel |
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ability to achieve generation planning goals and the occurrence and duration of
unplanned generation outages |
ii
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delays in the anticipated in-service dates and cost increases of additional generating capacity |
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nuclear operations |
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workforce risks including compensation and benefits costs |
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other risks and uncertainties |
This list of factors is not all-inclusive because it is not possible to predict all factors. You
should also carefully consider the information referred to under the heading Risk Factors in this
prospectus, any prospectus supplement, and in our other SEC filings.
iii
KANSAS CITY POWER & LIGHT COMPANY
Kansas City Power & Light Company is an integrated, regulated electric utility, headquartered
in Kansas City, Missouri, that engages in the generation, transmission, distribution and sale of
electricity. As of December 31, 2006, we served over 505,000 customers located in all or portions
of 24 counties in western Missouri and eastern Kansas. Our customers included approximately 446,000
residences, over 57,000 commercial firms, and approximately 2,200 industrials, municipalities, and
other electric utilities as of December 31, 2006. Our retail revenues averaged approximately 81% of
our total operating revenues over the last three fiscal years. Wholesale firm power, bulk power
sales and miscellaneous electric revenues accounted for the remainder of utility revenues. We are
significantly impacted by seasonality, with approximately one-third of our retail revenues recorded
in the third quarter.
RISK FACTORS
Investing in our notes involves risks. Our business is influenced by many factors that are
difficult to predict, involve uncertainties that may materially affect actual results and are often
beyond our control. You should carefully consider the information under the heading Risk Factors
in:
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any prospectus supplement relating to any notes we are offering; |
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our annual report on Form 10-K for the fiscal year ended December 31, 2006, which is
incorporated by reference into this prospectus; |
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our quarterly report on Form 10-Q for the three months ended March 31, 2007, which
is incorporated by reference into this prospectus; and |
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documents we file with the SEC after the date of this prospectus and which are
deemed incorporated by reference into this prospectus. |
USE OF PROCEEDS
Unless we inform you otherwise in a supplement to this prospectus, we anticipate using any net
proceeds received by us from the issuance of any of the offered notes for general corporate
purposes, including, among others:
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repayment of debt, including intercompany loans from our parent, Great Plains Energy
Incorporated; |
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repurchase, retirement or refinancing of other securities; |
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funding of construction expenditures; and |
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acquisitions. |
Pending such uses, we may also invest the proceeds in certificates of deposit, United States
government securities or certain other interest-bearing securities. If we decide to use the net
proceeds from a particular offering of notes for a specific purpose, we will describe that in the
related prospectus supplement.
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DESCRIPTION OF THE NOTES
General. The notes will represent unsecured obligations of the Company. We will issue the
notes in one or more series under a senior indenture with The Bank of New York Trust Company, N.A.,
as trustee. The form of the indenture is filed as an exhibit to the registration statement of which
this prospectus is a part. The indenture is qualified under the Trust Indenture Act of 1939. The
following summaries of certain provisions of the indenture and the notes do not purport to be
complete and are subject to, and qualified in their entirety by, all of the provisions of the
indenture, including the definition of certain terms, and the notes. You should carefully read the
summary below and the provisions of the indenture that may be important to you before investing.
Copies of the indenture will be available at the offices of the trustee at 2 North LaSalle Street,
Suite 1020, Chicago, Illinois 60602.
We may authorize the issuance and provide for the terms of a series of notes as described in
the indenture. There will be no requirement under the indenture that our future issuances of notes
be issued exclusively under the indenture. We will be free to employ other indentures or
documentation containing provisions different from those included in the indenture or applicable to
one or more issuances of notes in connection with future issuances of other notes. The indenture
will provide that the notes will be issued in one or more series, may be issued at various times,
may have differing maturity dates, may bear interest at differing rates and may have other
differing terms and conditions, as described below. We need not issue all notes of one series at
the same time and, unless otherwise provided, we may reopen a series, without the consent of the
holders of the notes of that series for issuances of additional notes. One or more series of the
notes may be issued with the same or various maturities at par, above par or at a discount. Notes
bearing no interest or interest at a rate which, at the time of issuance, is below the market rate
(Original Issue Discount Securities) will be sold at a discount (which may be substantial) below
their stated principal amount. Federal income tax consequences and other special considerations
applicable to any such Original Issue Discount Securities will be described in the prospectus
supplement relating thereto. Unless otherwise described in the applicable prospectus supplement,
the indenture described above will not limit the aggregate amount of debt, including secured debt,
we or our subsidiaries may incur. There is no limitation of the amount of debt we may issue under
the indenture. The indenture will also permit us to merge or consolidate or to transfer or lease
our assets, subject to certain conditions (see Consolidation, Merger and Sale below).
Ranking. The notes will be our direct unsecured general obligations and will rank equally with
all of our other unsecured and unsubordinated debt. As of March 31, 2007, our aggregate outstanding
debt that would have ranked equally with the notes was approximately $593.7 million.
Unless otherwise provided in a prospectus supplement, the notes will effectively rank junior
to our first mortgage bonds (General Mortgage Bonds) which were issued under the General Mortgage
Indenture and Deed of Trust, dated as of December 1,1986, between us and United Missouri Bank of
Kansas City, N.A., as supplemented (Mortgage Indenture). The Mortgage Indenture constitutes a
first mortgage lien upon substantially all of our fixed property and franchises. At March 31, 2007,
there was approximately $159.3 million aggregate principal amount of General Mortgage Bonds
outstanding. We have agreed with the issuer of certain bond insurance policies to not issue
additional General Mortgage Bonds if, after giving effect to such additional General Mortgage
Bonds, the proportion of secured debt to total indebtedness exceeded 75%. Additionally, if the long
term rating for such General Mortgage Bonds by Standard & Poors or Moodys Investors Service would
be at or below A- or A3, respectively, such agreements would prohibit us from issuing additional
General Mortgage Bonds if, after giving effect to such additional General Mortgage Bonds, the
proportion of secured debt to total indebtedness exceeded 50%. At March 31, 2007, the proportion of
secured debt to total indebtedness was approximately 21%.
Provisions of a Particular Series. The prospectus supplement applicable to each issuance of
notes will specify, among other things:
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the title and any limitation on aggregate principal amount of the notes; |
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the original issue date of the notes; |
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the date or dates on which the principal of any of the notes is payable; |
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the fixed or variable interest rate or rates, or method of calculation of such rate
or rates, for the notes, and the date from which interest will accrue; |
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the terms, if any, regarding the optional or mandatory redemption of any notes,
including the redemption date or dates, if any, and the price or prices applicable to
such redemption; |
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whether the notes are to be issued in whole or in part in the form of one of more
global securities and, if so, the identity of the Depositary for such global security
or global securities; |
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the denominations in which such notes will be issuable; |
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the maximum annual interest rate, if any, of the notes; |
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the period or periods within which, the price or prices at which and the terms and
conditions upon which any notes may be repaid, in whole or in part, at the option of
the holder thereof; |
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the place or places where the principal of, and premium, if any, and interest, if
any, on the notes shall be payable; |
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any addition, deletion or modification to the events of default applicable to that
series of notes and the covenants for the benefit of the holders of that series; |
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the terms, if any, pursuant to which notes may be converted into or exchanged for
shares of our capital stock or other securities; |
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our obligation, if any, to redeem, purchase, or repay the notes, including, but not
limited to, pursuant to any sinking fund or analogous provision or at the option of a
holder thereof and the period or periods within which, the price or prices at which,
and the terms and conditions upon which the notes shall be redeemed, purchased, or
repaid pursuant to such obligation; |
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any remarketing features of the notes; |
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any collateral, security, assurance, or guarantee for the note; |
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if other than the principal amount thereof, the portion of the principal amount of
the notes payable upon declaration of acceleration of the maturity of the notes; |
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the securities exchange(s), if any, on which the notes will be listed; |
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any interest deferral or extension provisions; |
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the terms of any warrants we may issue to purchase notes; |
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the right, if any, for us to extend the interest payment periods of the notes,
including the maximum duration of any extension and additional interest payable upon
exercise of such right; and |
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any other terms of the notes not inconsistent with the provisions of the indenture. |
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Registration, Transfer and Exchange. Unless otherwise indicated in the applicable prospectus
supplement, each series of notes will initially be issued in the form of one or more global
securities, in registered form, without coupons, as described under Book-Entry System. The global
securities will be registered in the name of a depository, or its nominee, and deposited with, or
on behalf of, the depository. Except in the circumstances described under Book-Entry System,
owners of beneficial interests in a global security will not be entitled to have notes registered
in their names, will not receive or be entitled to receive physical delivery of any notes and will
not be considered the registered holders thereof under the indenture.
Notes of any series will be exchangeable for other notes of the same series of any authorized
denominations and of a like aggregate principal amount and tenor. Subject to the terms of the
indenture and the limitations applicable to global securities, notes may be presented for exchange
or registration of transfer duly endorsed or accompanied by a duly executed instrument of
transfer at the office of any transfer agent we may designate for such purpose, without service
charge but upon payment of any taxes and other governmental charges, and upon satisfaction of such
other reasonable requirements as are described in the indenture.
Unless otherwise indicated in the applicable prospectus supplement, the transfer agent will be
the trustee under the indenture. We may at any time designate additional transfer agents or rescind
the designation of any transfer agent or approve a change in the office through which any transfer
agent acts, except that we will be required to maintain a transfer agent in each place of payment
for the notes of each series.
Payment and Paying Agents. Principal of and interest and premium, if any, on notes issued in
the form of global securities will be paid in the manner described under Book-Entry System.
Unless otherwise indicated in the applicable prospectus supplement, the principal of and any
premium and interest on notes of a particular series in the form of certificated securities will be
payable at the office of the trustee or at the authorized office of any paying agent or paying
agents upon presentation and surrender of such notes. We may at any time designate additional
paying agents or rescind the designation of any paying agent or approve a change in the office
through which any paying agent acts, except that we will be required to maintain a paying agent in
each place of payment for the notes of a particular series. Unless otherwise indicated in the
applicable prospectus supplement, interest on the notes of a particular series, other than interest
at maturity, that are in the form of certificated securities will be paid by check payable in
clearinghouse funds mailed to the person entitled thereto at such persons address as it appears on
the register for such notes maintained by the trustee. All monies we pay to the trustee or a
paying agent for the payment of the principal of, and premium or interest, if any, on, any note
which remain unclaimed at the end of two years after such principal, premium or interest shall have
become due and payable will be repaid to us, and the holder of such note thereafter may look only
to us for payment thereof. However, any such payment shall be subject to escheat pursuant to state
abandoned property laws.
Redemption. Any terms for the optional or mandatory redemption of the notes will be set forth
in the applicable prospectus supplement. Unless otherwise indicated in the applicable prospectus
supplement, notes will be redeemable by us only upon notice by mail not less than 30 nor more than
60 days prior to the date fixed for redemption, and, if less than all the notes of a series are to
be redeemed, the particular notes to be redeemed will be selected by such method as shall be
provided for any particular series, or in the absence of any such provision, by the trustee in such
manner as it shall deem fair and appropriate.
Any notice of redemption at our option may state that such redemption will be conditional upon
receipt by the trustee or the paying agent or agents, on or prior to the date fixed for such
redemption, of money sufficient to pay the principal of and premium, if any, and interest on, such
notes and that if such money has not been so received, such notice will be of no force and effect
and we will not be required to redeem such notes.
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Consolidation, Merger and Sale or Disposition of Assets. We may not, without the consent of
the holders of any notes, consolidate with or merge into any other corporation or sell, transfer,
lease or otherwise dispose of our properties as or substantially as an entirety to any person,
unless:
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the successor or transferee corporation or the person which receives such properties
pursuant to such sale, transfer, lease or other disposition is a corporation organized
and existing under the laws of the United States of America, any state thereof or the
District of Columbia; |
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the successor or transferee corporation or the person which receives such properties
pursuant to such sale, transfer, lease or other disposition assumes by supplemental
indenture, in a form reasonably satisfactory to the trustee, the due and punctual
payment of the principal of and premium and interest, if any, on all the notes
outstanding under the indenture and the performance of every covenant of the indenture
to be performed or observed by us; |
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we have delivered to the trustees for such notes an officers certificate and an
opinion of counsel, each stating that the transaction complies with the indenture and
the applicable conditions precedent; and |
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immediately after giving effect to the transaction, no Event of Default (see Events
of Default) or event that, after notice or lapse of time, or both, would become an
Event of Default, shall have occurred and be continuing. |
Upon any such consolidation, merger, sale, transfer, lease or other disposition of our
properties as or substantially as an entirety, the successor corporation formed by such
consolidation or into which we are merged or the person to which such sale, transfer, lease or
other disposition is made shall succeed to, and be substituted for, and may exercise every right
and power of, us under the indenture with the same effect as if such successor corporation or
person had been named as us therein, and we will be released from all obligations under the
indenture.
Modification. Without the consent of any holder of notes, the trustee for such notes and we
may enter into one or more supplemental indentures for any of the following purposes:
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to supply omissions, cure any ambiguity or inconsistency or correct defects, which
actions, in each case, are not prejudicial to the interests of the holders of notes of
any series in any material respect; |
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to change or eliminate any provision of the indenture, provided that any such change
or elimination will become effective with respect to such series only when there is no
note of such series outstanding created prior to the execution of such supplemental
indenture which is entitled to the benefit of such provision, or such change or
elimination is applicable only to notes of such series issued after the effective date
of such change or elimination; |
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to establish the form or terms of notes of any series as permitted by the indenture; |
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to evidence the succession of another corporation to us, and the assumption of our
covenants in the indenture and the notes by any permitted successor; |
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to grant to or confer upon the trustee for any notes for the benefit of the holders
of such notes, any additional rights, remedies, powers or authority; |
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to permit the trustee for any notes to comply with any duties imposed upon it by
law; |
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to specify further the duties and responsibilities of, and to define further the
relationship among, the trustee for any notes, any authenticating agent and any paying
agent, and to evidence the succession of a successor trustee as permitted under the
indenture; |
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to add to our covenants for the benefit of the holders of all or any series of
outstanding notes, to add to the security of all notes, to surrender any right or power
conferred upon us by the indenture or to add any additional events of default with
respect to all or any series of outstanding notes; and |
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to make any other change that is not prejudicial to the holders of any notes. |
Except as provided above, the consent of the holders of a majority in aggregate principal
amount of the notes of all series then outstanding, considered as one class, is required for the
purpose of adding any provisions to, or changing in any manner, or eliminating any of the
provisions of, the indenture pursuant to one or more supplemental indentures or of modifying or
waiving in any manner the rights of the holders of the notes; provided, however, that if less than
all of the series of notes outstanding are directly affected by a proposed supplemental indenture,
then the consent only of the holders of a majority in aggregate principal amount of the outstanding
applicable notes of all series so directly affected, considered as one class, will be required.
Notwithstanding the foregoing, no such amendment or modification may, without the consent of
each holder of outstanding notes affected thereby:
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change the maturity date of the principal of any note; |
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reduce the rate of interest or change the method of calculating such rate, or extend
the time of payment of interest, on any note; |
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reduce the principal amount of, or premium payable on, any note; |
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change the coin or currency of any payment of principal of, or any premium or
interest on any note; |
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change the date on which any note may be redeemed or adversely affect the rights of
a holder to institute suit for the enforcement of any payment of principal of or any
premium or interest on any note; or |
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modify the foregoing requirements or reduce the percentage of outstanding notes
necessary to modify or amend the indenture or to waive any past default. |
A supplemental indenture which changes or eliminates any covenant or other provision of the
indenture which has expressly been included solely for the benefit of one or more series of notes,
or which modifies the rights of the holders of notes of such series with respect to such covenant
or provision, will be deemed not to affect the rights under the indenture of the holders of the
notes of any other series.
Events of Default. Unless specifically deleted in a supplemental indenture or Board resolution
under which a series of notes is issued, or modified in any such supplemental indenture, each of
the following will constitute an event of default under the indenture with respect to notes of any
series:
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failure to pay interest on the notes of such series within 30 days after the same
becomes due and payable; |
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failure to pay principal of or premium, if any, on any note of such series, as the
case may be, within one day after the same becomes due and payable; |
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failure to perform or breach of any of our other covenants or warranties in the
indenture (other than a covenant or warranty solely for the benefit of one or more
series of notes other than such series) for 60 days after written notice to us by the
trustee or to us and the trustee by the holders of at least 33% in aggregate principal
amount of the outstanding applicable notes of such series; |
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certain events of bankruptcy, insolvency, reorganization, assignment or
receivership; or |
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any other event of default specified in the applicable prospectus supplement with
respect to notes of a particular series. |
No event of default with respect to the notes of a particular series necessarily constitutes an
event of default with respect to the notes of any other series issued under the indenture.
If an event of default with respect to any series of notes occurs and is continuing, then
either the trustee for such series or the holders of a majority in aggregate principal amount of
the outstanding notes of such series, by notice in writing, may declare the principal amount of and
interest on all of the notes of such series to be due and payable immediately; provided, however,
that if an event of default occurs and is continuing with respect to more than one series of notes
under the indenture, the trustee for such series or the holders of a majority in aggregate
principal amount of the outstanding notes of all such series, considered as one class, may make
such declaration of acceleration and not the holders of the notes of any one of such series.
At any time after an acceleration with respect to the notes of any series has been declared,
but before a judgment or decree for the payment of the money due has been obtained, the event or
events of default giving rise to such acceleration will be waived, and the acceleration will be
rescinded and annulled, if
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we pay or deposit with the trustee for such series a sum sufficient to pay all
matured installments of interest on all notes of such series, the principal of and
premium, if any, on the notes of such series which have become due otherwise than by
acceleration and interest thereon at the rate or rates specified in such notes,
interest upon overdue installments of interest at the rate or rates specified in such
notes, to the extent that payment of such interest is lawful, and all amounts due to
the trustee for such series under the indenture; and |
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any other event or events of default with respect to the notes of such series, other
than the nonpayment of the principal of and accrued interest on the notes of such
series which has become due solely by such acceleration, have been cured or waived as
provided in the indenture. |
However, no such waiver or rescission and annulment shall extend to or shall affect any subsequent
default or impair any related right.
Subject to the provisions of the indenture relating to the duties of the trustee in case an
event of default shall occur and be continuing, the trustee generally will be under no obligation
to exercise any of its rights or powers under the indenture at the request or direction of any of
the holders unless such holders have offered to the trustee reasonable security or indemnity
satisfactory to it. Subject to such provisions for the indemnification of the trustee and certain
other limitations contained in the indenture, the holders of a majority in aggregate principal
amount of the outstanding notes of any series will have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the trustee, or of exercising any
trust or power conferred on the trustee, with respect to the notes of that series; provided,
however, that if an event of default occurs and is continuing with respect to more than one series
of notes, the holders of a majority in aggregate principal amount of the outstanding notes of all
those series, considered as one class, will have the right to make such direction, and not the
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the notes of any one series. Any direction provided by the holders shall not be in conflict
with any rule of law or with the indenture and will not involve the trustee in personal liability
in circumstances where reasonable indemnity would not, in the trustees sole discretion, be
adequate and the trustee may take any other action it deems proper that is not inconsistent with
such direction.
The holders of a majority in aggregate principal amount of the outstanding notes of any series
may waive any past default under the indenture on behalf of all holders of notes of that series
with respect to the notes of that series, except a default in the payment of principal of or any
premium or interest on such notes. No holder of notes of any series may institute any proceeding
with respect to the indenture, or for the appointment of a receiver or a trustee, or for any other
remedy, unless such holder has previously given to the trustee for such series written notice of a
continuing event of default with respect to the notes of such series, the holders of a majority in
aggregate principal amount of the outstanding notes of all series in respect of which an event of
default has occurred and is continuing, considered as one class, have made written request to the
trustee for such series to institute such proceeding and have offered reasonable indemnity, and the
trustee for such series has failed to institute such proceeding within 60 days after such notice,
request and offer. Furthermore, no holder of notes of any series will be entitled to institute any
such action if and to the extent that such action would disturb or prejudice the rights of other
holders of those notes.
Notwithstanding the foregoing, each holder of notes of any series has the right, which is
absolute and unconditional, to receive payment of the principal of and premium, if any, and
interest on such notes when due and to institute suit for the enforcement of any such payment, and
such rights may not be impaired without the consent of that holder of notes.
The trustee, within 90 days after it receives notice of the occurrence of a default with
respect to the notes of any series, is required to give the holders of the notes of that series
notice of such default, unless cured or waived, but, except in the case of default in the payment
of principal of, or premium, if any, or interest on, the notes of that series, the trustee may
withhold such notice if it determines in good faith that it is in the interest of such holders to
do so. We will be required to deliver to the trustees for the notes each year a certificate as to
whether or not, to the knowledge of the officers signing such certificate, we are in compliance
with all conditions and covenants under the indenture, determined without regard to any period of
grace or requirement of notice under the indenture.
Defeasance and Discharge. Unless the applicable prospectus supplement states otherwise, we may
elect either:
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to defease and be discharged from any and all obligations in respect of the
notes of any series then outstanding under the indenture (except for certain
obligations to register the transfer or exchange of the notes of such series, replace
stolen, lost or mutilated notes, maintain paying agencies and hold monies for payment
in trust); or |
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to be released from the obligations of the indenture with respect to the notes
of any series under any covenants applicable to the notes of such series which are
subject to covenant defeasance as described in the indenture, supplemental indenture or
other instrument establishing such series. |
In the case of either (1) or (2), the following conditions must be met:
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we will be required to deposit, in trust, with the trustee money or U.S. government
obligations, which through the payment of interest on those obligations and principal
of those obligations in accordance with their terms will provide money, in an amount
sufficient, without reinvestment, to pay all the principal of, premium, if any, and
interest on the notes of such series on the dates payments are due (which may include
one or more redemption dates designated by us), |
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no event of default or event which with the giving of notice or lapse of time, or
both, would become an event of default under the indenture must have occurred and be
continuing on the date of the deposit, and 91 days must have passed after the deposit
has been made and, during that period, certain events of default must not have occurred
and be continuing as of the end of that period, |
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the deposit must not cause the trustee to have any conflicting interest with respect
to our other securities, |
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we must have delivered an opinion of counsel to the effect that the holders will not
recognize income, gain or loss for federal income tax purposes (and, in the case of
paragraph (1) above, such opinion of counsel must be based on a ruling of the Internal
Revenue Service or other change in applicable federal income tax law) as a result of
the deposit or defeasance and will be subject to federal income tax in the same
amounts, in the same manner and at the same times as if the deposit and defeasance had
not occurred, and |
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we must have delivered an officers certificate to the trustee as provided in the
indenture. |
We may exercise our defeasance option under paragraph (1) with respect to notes of any series
notwithstanding our prior exercise of our covenant defeasance option under paragraph (2). If we
exercise our defeasance option for notes of any series, payment of the notes of such series may not
be accelerated because of a subsequent event of default. If we exercise our covenant defeasance
option for notes of any series, payment of the notes of such series may not be accelerated by
reference to a subsequent breach of any of the covenants noted under clause (2) in the preceding
paragraph. In the event we fail to comply with our remaining obligations with respect to the notes
of any series under the indenture after exercising our covenant defeasance option and the notes of
such series are declared due and payable because of the subsequent occurrence of any event of
default, the amount of money and U.S. government obligations on deposit with the trustee may be
insufficient to pay amounts due on the notes of such series at the time of the acceleration
resulting from that event of default. However, we will remain liable for those payments.
Resignation or Removal of Trustee. The trustee may resign at any time upon written notice to
us specifying the day upon which the resignation is to take effect and such resignation will take
effect immediately upon the later of the appointment of a successor trustee and such specified day.
The trustee may be removed at any time with respect to notes of any series by an instrument or
concurrent instruments in writing filed with the trustee and signed by the holders, or their
attorneys-in-fact, of a majority in aggregate principal amount of that series of notes then
outstanding. In addition, so long as no event of default or event which, with the giving of notice
or lapse of time or both, would become an event of default has occurred and is continuing, we may
remove the trustee upon notice to the holder of each note outstanding and the trustee, and appoint
a successor trustee.
Concerning the Trustee. As of March 31, 2007, the trustee and its affiliates were the trustee
for $753 million of our secured and unsecured debt under thirteen separate indentures, including
Environmental Improvement Revenue Refunding debt issued by certain governmental entities. In
addition, an affiliate of the trustee is one of the lenders under credit agreements with us and our
parent under which an aggregate of $1 billion may be borrowed. An affiliate of the trustee is also
a depository for funds and performs other services for, and transacts other banking business with
our affiliates and us in the normal course and may do so in the future. The Indenture provides that
our obligations to compensate the trustee and reimburse the trustee for expenses, disbursements and
advances will be secured by a lien prior to that of the notes upon the property and funds held or
collected by the trustee as such, except funds held in trust for the benefit of the holders of
particular notes.
Governing Law. The indenture and the related notes will be governed by New York law.
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BOOK-ENTRY SYSTEM
Unless otherwise indicated in the applicable prospectus supplement, each series of notes will
initially be issued in the form of one or more global securities, in registered form, without
coupons. The global security will be deposited with, or on behalf of, the depository, and
registered in the name of the depository or a nominee of the depository. Unless otherwise indicated
in the applicable prospectus supplement, the depository for any global securities will be The
Depository Trust Company, or DTC.
DTC will act as depository for the global securities. The global securities will be issued as
fully-registered securities registered in the name of Cede & Co., DTCs partnership nominee, or
such other name as may be requested by an authorized representative of DTC. One fully-registered
global security certificate will be issued for each issue of the global securities, each in the
aggregate principal amount of such issue, and will be deposited with DTC.
The following descriptions of operations and procedures of DTC are provided solely as a matter
of convenience. These operations and procedures are solely within DTCs control and are subject to
changes by DTC from time to time. We take no responsibility for these operations and procedures
and urge you to contact DTC or its participants directly to discuss these matters. DTC has advised
us as follows:
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DTC is a limited-purpose trust company organized under the New York Banking Law, a
banking organization within the meaning of the New York Banking Law, a member of the
Federal Reserve System, a clearing corporation within the meaning of the New York
Uniform Commercial Code, and a clearing agency registered pursuant to the provisions
of Section 17A of the Securities Exchange Act of 1934. |
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DTC holds and provides asset servicing for securities that its direct participants
deposit with DTC. DTC also facilitates the post-trade settlement among direct
participants of sales and other securities transactions in deposited securities through
electronic computerized book-entry transfers and pledges between direct participants
accounts. This eliminates the need for physical movement of securities certificates. |
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Direct participants include both U.S. and non-U.S. securities brokers and dealers,
banks, trust companies, clearing corporations and certain other organizations. |
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DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation, or
DTCC. DTCC, in turn, is owned by a number of direct participants of DTC and Members of
the National Securities Clearing Corporation, Fixed Income Clearing Corporation, and
Emerging Markets Clearing Corporation, each also a subsidiary of DTCC, as well as by
the New York Stock Exchange, Inc., the American Stock Exchange LLC, and the National
Association of Securities Dealers, Inc. |
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Access to the DTC system is also available to others such as both U.S. and non-U.S.
securities brokers and dealers, banks, trust companies and clearing corporations that
clear through or maintain a custodial relationship with a direct participant, either
directly or indirectly, which are referred to as indirect participants and, together
with the direct participants, the participants. The underwriters, dealers or agents of
any of the securities may be direct participants of DTC. |
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DTC has Standard & Poors highest rating: AAA. The DTC rules applicable to its
participants are on file with the SEC. More information about DTC can be found at
www.dtcc.com and www.dtc.org. |
Purchases of global securities under the DTC system must be made by or through direct
participants, which will receive a credit for such purchases of global securities on DTCs records.
The ownership interest of each actual purchaser of each global security, or the beneficial owner,
is in turn to
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be recorded on the direct and indirect participants records. Beneficial owners will not
receive written confirmation from DTC of their purchase. Beneficial owners are, however, expected
to receive written confirmations providing details of the transaction, as well as periodic
statements of their holdings, from the direct or indirect participant through which the beneficial
owner entered into the transaction. Transfers of ownership interests in the global securities are
to be accomplished by entries made on the books of direct and indirect participants acting on
behalf of beneficial owners. Beneficial owners will not receive certificates representing their
ownership interests in the global securities, except in the event that use of the book-entry system
for the global securities is discontinued.
To facilitate subsequent transfers, all global securities deposited by direct participants
with DTC are registered in the name of DTCs partnership nominee, Cede & Co. or such other name as
may be requested by an authorized representative of DTC. The deposit of global securities with DTC
and their registration in the name of Cede & Co. or such other nominee do not effect any change in
beneficial ownership. DTC has no knowledge of the actual beneficial owners of the global
securities; DTCs records reflect only the identity of the direct participants to whose accounts
such global securities are credited, which may or may not be the beneficial owners. The
participants will remain responsible for keeping account of their holdings on behalf of their
customers.
Conveyance of notices and other communications by DTC to direct participants, by direct
participants to indirect participants, and by direct participants and indirect participants to
beneficial owners will be governed by arrangements among them, subject to any statutory or
regulatory requirements as may be in effect from time to time. Beneficial owners of global
securities may wish to take certain steps to augment transmission to them of notices of significant
events with respect to the global securities, such as redemptions, tenders, defaults, and proposed
amendments to the security documents. For example, beneficial owners of global securities may wish
to ascertain that the nominee holding the global securities for their benefit has agreed to obtain
and transmit notices to beneficial owners; in the alternative, beneficial owners may wish to
provide their names and addresses to the registrar and request that copies of the notices be
provided directly to them.
If the global securities are redeemable, redemption notices shall be sent to DTC. If less than
all of the global securities within an issue are being redeemed, DTCs practice is to determine by
lot the amount of the interest of each direct participant in such issue to be redeemed.
Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote with respect to
the global securities unless authorized by a direct participant in accordance with DTCs
procedures. Under its usual procedures, DTC mails an omnibus proxy to us as soon as possible after
the record date. The omnibus proxy assigns Cede & Co.s consenting or voting rights to those direct
participants whose accounts the global securities are credited on the record date, identified in a
listing attached to the omnibus proxy.
Principal, interest and premium payments, if any, on the global securities will be made to
Cede & Co., or such other nominee as may be requested by an authorized representative of DTC. DTCs
practice is to credit direct participants accounts upon DTCs receipt of funds and corresponding
detail information from us or the trustee, on the payable date in accordance with the respective
holdings shown on DTCs records. Payments by participants to beneficial owners will be governed by
standing instructions and customary practices, as is the case with securities held for the accounts
of customers in bearer form or registered in street name, and will be the responsibility of such
participant and not of DTC, its nominee, the trustee, or us, subject to any statutory or regulatory
requirements as may be in effect from time to time. Payment of principal, interest and premium, if
any, on any of the aforementioned securities represented by global securities to Cede & Co. (or
such other nominee as may be requested by an authorized representative of DTC) is the
responsibility of the trustee and us. Disbursement of such payments to direct participants will be
the responsibility of DTC, and disbursement of such payments to the beneficial owners will be the
responsibility of the participants.
DTC may discontinue providing its services as securities depository with respect to the global
securities at any time by giving reasonable notice to us or the trustee. Under such circumstances,
in the
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event that a successor securities depository is not obtained, certificates representing the
securities are required to be printed and delivered.
The information in this section concerning DTC and DTCs book-entry system has been obtained
from sources, including DTC, that we believe to be reliable, but we take no responsibility for the
accuracy thereof.
None of the trustee, any successor trustee, us or any agent for payment on or registration of
transfer or exchange of any global security will have any responsibility or liability for any
aspect of the records relating to or payments made on account of beneficial interests in such
global security or for maintaining, supervising or reviewing any records relating to such
beneficial interests.
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PLAN OF DISTRIBUTION
We may sell the notes in one or more of the following ways from time to time: (i) to
underwriters for resale to the public or to institutional investors; (ii) directly to institutional
investors; or (iii) through agents to the public or to institutional investors. The prospectus
supplement with respect to each series of notes will set forth the terms of the offering of such
notes, including the name or names of any underwriters or agents, the purchase price of such notes,
and the proceeds to us from such sale, any underwriting discounts or agency fees and other items
constituting underwriters or agents compensation, any initial public offering price, any
discounts or concessions allowed or reallowed or paid to dealers and any securities exchange on
which such notes may be listed.
If underwriters participate in the sale, such notes will be acquired by the underwriters for
their own account and may be resold from time to time in one or more transactions, including
negotiated transactions, at a fixed public offering price or at varying prices determined at the
time of sale.
Unless otherwise set forth in the prospectus supplement, the obligations of the underwriters
to purchase any series of notes being offered will be subject to certain conditions precedent and
the underwriters will be obligated to purchase all of such series of notes, if any are purchased.
Underwriters and agents may be entitled under agreements entered into with us to
indemnification against certain civil liabilities, including liabilities under the Securities Act
of 1933, as amended. Underwriters and agents may engage in transactions with, or perform services
for, us in the ordinary course of business.
Each series of notes will be a new issue of securities and will have no established trading
market. Any underwriters to whom notes are sold for public offering and sale may make a market in
such notes, but such underwriters will not be obligated to do so and may discontinue any market
making at any time without notice. The notes may or may not be listed on a national securities
exchange.
LEGAL MATTERS
Unless otherwise specified in the applicable prospectus supplement, legal matters with respect
to the notes offered under this prospectus will be passed upon for us by Mark English, General
Counsel and Assistant Corporate Secretary of our parent, Great Plains Energy Incorporated, and
Sidley Austin LLP, Chicago, Illinois, and for the underwriters, dealers, purchasers or agents by
Davis Polk & Wardwell, Menlo Park, California. At May 1, 2007, Mr. English owned beneficially
6,317 shares of our common stock, including restricted stock, and 6,479 performance shares, which
may be paid in shares of common stock at a later date based on the performance of our parent.
EXPERTS
The consolidated financial statements, the related financial statement schedules and
managements report on the effectiveness of internal control over financial reporting of Kansas
City Power & Light Company and its subsidiaries, incorporated by reference in this prospectus from
the Annual Report on Form 10-K of Kansas City Power & Light Company, have been audited by Deloitte
& Touche LLP, an independent registered public accounting firm, as stated in their reports (which
reports (1) express an unqualified opinion on the consolidated financial statements and financial
statement schedules and include an explanatory paragraph regarding the adoption of new accounting
standards SFAS No. 158, Employers Accounting for Defined Benefit Pension and Other Postretirement
Plans, FASB Staff Position (FSP) No. AUG-AIR1, Accounting for Planned Major Maintenance Activities,
and FIN 47, Accounting for Conditional Asset Retirement Obligations, (2) express an unqualified
opinion on managements assessment regarding the effectiveness of internal control over financial
reporting, and (3) express an unqualified opinion on the effectiveness of internal control over
financial reporting), which are incorporated herein by reference, and have been so incorporated in
reliance upon the reports of such firm given upon their authority as experts in accounting and
auditing.
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WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports and other information with the SEC through the
SECs Electronic Data Gathering, Analysis and Retrieval system and these filings are publicly
available through the SECs website (http://www.sec.gov). You may read and copy such material at
the Public Reference Room of the SEC at 100 F Street, N.E., Washington, D.C. 20549. You may obtain
information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330.
The SEC allows us to incorporate by reference into this prospectus the information we file
with it. This means that we can disclose important information to you by referring you to the
documents containing the information. The information we incorporate by reference is considered to
be included in and an important part of this prospectus and should be read with the same care.
Information that we file later with the SEC that is incorporated by reference into this prospectus
will automatically update and supersede this information. We are incorporating by reference into
this prospectus the following documents that we have filed with the SEC and any subsequent filings
we make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of
1934 (excluding information deemed to be furnished and not filed with the SEC) until the offering
of the notes described in this prospectus is completed:
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Our Annual Report on Form 10-K for the year ended December 31, 2006 |
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Our Quarterly Report on Form 10-Q for the quarter ended March 31, 2007 |
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Our Current Reports on Form 8-K dated: |
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February 1, 2007 and filed with the SEC on February 2, 2007; |
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March 1, 2007 and filed with the SEC on March 1, 2007; |
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March 1, 2007 and filed with the SEC on March 2, 2007; |
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March 2, 2007 and filed with the SEC on March 2, 2007; |
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March 15, 2007 and filed with the SEC on March 20, 2007; |
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March 19, 2007 and filed with the SEC on March 20, 2007; and |
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April 30, 2007 and filed with the SEC on May 4, 2007. |
We and our parent company, Great Plains Energy Incorporated, separately filed the combined
Annual Report on Form 10-K, the Quarterly Report on Form 10-Q and the Current Reports on Form 8-K
listed above. However, the information contained in those combined reports relating solely to our
parent and its subsidiaries (other than KCP&L and its consolidated subsidiaries), including
Strategic Energy, was separately filed by Great Plains Energy Incorporated on its behalf, and the
information contained in those combined reports relating solely to KCP&L and its consolidated
subsidiaries was separately filed by us. We do not intend to incorporate by reference into this
prospectus the information relating to Great Plains Energy Incorporated and its subsidiaries (other
than KCP&L and its consolidated subsidiaries), and we make no representation as to the information
relating to Great Plains Energy Incorporated and its subsidiaries (other than KCP&L and its
consolidated subsidiaries) contained in such combined reports. The only information you should
rely upon in determining whether to invest in the notes offered hereby is the information of KCP&L
and its consolidated subsidiaries contained in this prospectus, the information separately provided
by KCP&L and its consolidated subsidiaries in the documents incorporated by reference herein and
any free writing prospectus used in connection with the offering of notes described in this
prospectus.
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Our
website is www.kcpl.com. Information contained on our website is not incorporated herein.
We make available, free of charge, on or through our website, our annual reports on Form 10-K,
quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed
or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 as soon as
reasonably practicable after we electronically file such material with, or furnish it to, the SEC.
In addition, we make available on or through our website all other reports, notifications and
certifications filed electronically with the SEC. You may obtain a free copy of our filings with
the SEC by writing or telephoning us at the following address: Kansas City Power & Light Company,
1201 Walnut Street, Kansas City, Missouri 64106-2124 (Telephone No.: 816-556-2200), Attention:
Corporate Secretary, or by contacting us on our website.
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$250,000,000
Kansas City Power & Light Company
% Notes due 2017
PROSPECTUS SUPPLEMENT
May , 2007
Joint Book-Running Managers
Banc of America Securities LLC
Wachovia Securities
Senior Co-Manager
BNP PARIBAS
Co-Managers
BNY Capital Markets, Inc.
KeyBanc Capital Markets
Lazard Capital Markets
Scotia Capital