SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 (FEE REQUIRED)
For the fiscal year ended December 31, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period from to
Commission file number 1-707
A. Full title of the Plan:
Kansas City Power & Light Company
Cash or Deferred Arrangement
(Employee Savings Plus Plan)
(hereinafter referred to as "Plan")
B. Name of issuer of the securities held
pursuant to the Plan and the address
of its principal executive office:
Kansas City Power & Light Company
1201 Walnut
Kansas City, Missouri 64106-2124
TABLE OF CONTENTS
Page
____
FINANCIAL STATEMENTS
Report of Independent Accountants............................. 1
Statements of Financial Condition, With Fund Information
December 31, 1997........................................... 2
December 31, 1996........................................... 4
Statements of Income and Changes in Plan Equity, With Fund
Information for the Year Ended
December 31, 1997........................................... 6
December 31, 1996........................................... 8
December 31, 1995........................................... 10
Notes to Financial Statements................................. 12
Signatures.................................................... 21
Consent of Independent Accountants............................ 22
(i)
REPORT OF INDEPENDENT ACCOUNTANTS
To the Administrative Committee,
Kansas City Power & Light Company
Cash or Deferred Arrangement Employee Savings Plus Plan
We have audited the accompanying statements of financial
condition of Kansas City Power & Light Company Cash or Deferred
Arrangement Employee Savings Plus Plan as of December 31, 1997
and 1996, and the related statements of income and changes in
Plan equity for each of the three years in the period ended
December 31, 1997. These financial statements are the
responsibility of the Plan's management. Our responsibility is
to express an opinion on these financial statements based on our
audits.
We conducted our audits in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An
audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that
our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above
present fairly, in all material respects, the financial condition
of the Plan as of December 31, 1997 and 1996, and the income and
changes in Plan equity for each of the three years in the period
ended December 31, 1997, in conformity with generally accepted
accounting principles.
Our audits were performed for the purpose of forming an opinion
on the basic financial statements taken as a whole. The fund
information in the statement of financial condition and the
statement of income and changes in Plan equity is presented for
purposes of additional analysis rather than to present the
financial condition and the income and changes in Plan equity of
each fund. The fund information has been subjected to the
auditing procedures applied in the audits of the basic financial
statements and, in our opinion, is fairly stated in all material
respects in relation to the basic financial statements taken as a
whole.
/s/Coopers & Lybrand L.L.P.
Kansas City, Missouri
June 17, 1998
1
Kansas City Power & Light Company
Cash or Deferred Arrangement Employee Savings Plus Plan
Statement of Financial Condition, With Fund Information
December 31, 1997
Fidelity Investment Funds
-------------------------
Asset OTC
ASSETS MIP Puritan Magellan Manager Portfolio Overseas
- ------ ---------- ----------- ----------- ---------- ---------- __________
Investments, at market:
Short term money market - $2,242 $2,242 $- $- $-
Kansas City Power & Light Co. Stock
2,897,546.2360 shares (cost $65,323,576) - - - - - -
Fidelity Managed Income Portfolio (MIP)
8,164,153 shares(cost $8,164,153) 8,164,153 - - - - -
Fidelity Puritan Fund
843,587.3407 shares (cost $13,687,603) - 16,348,723 - - - -
Fidelity Magellan Fund
375,422.0287 shares (cost $27,627,240) - - 35,766,457 - - -
Fidelity Asset Manager Fund
69,101.3070 shares (cost $1,149,625) - - - 1,268,009 - -
Fidelity OTC Portfolio Fund
89,621.1677 shares (cost $2,962,920) - - - - 2,997,828 -
Fidelity Overseas Fund
63,012.0582 shares (cost $1,950,196) - - - - - 2,050,412
Loans to participants - - - - - -
---------- ----------- ----------- ---------- ---------- ----------
Total investments 8,164,153 16,350,965 35,768,699 1,268,009 2,997,828 2,050,412
---------- ----------- ----------- ---------- ---------- ----------
Receivables:
Investment income - - - - - -
Money market interest 311 112 19 8 8 6
Commission reimbursement - - - - - -
---------- ----------- ----------- ---------- ---------- ----------
Total receivables 311 112 19 8 8 6
---------- ----------- ----------- ---------- ---------- ----------
TOTAL ASSETS $8,164,464 $16,351,077 $35,768,718 $1,268,017 $2,997,836 $2,050,418
---------- ----------- ----------- ---------- ---------- ----------
---------- ----------- ----------- ---------- ---------- ----------
LIABILITIES AND PLAN EQUITY
- ----------------------------
Liabilities:
Benefits payable to participants $14,844 $149,493 $490,765 $- $- $9,807
Plan Equity 8,149,620 16,201,584 35,277,953 1,268,017 $2,997,836 $2,040,611
---------- ----------- ----------- ---------- ---------- ----------
TOTAL LIABILITIES AND PLAN EQUITY $8,164,464 $16,351,077 $35,768,718 $1,268,017 $2,997,836 $2,050,418
---------- ----------- ----------- ---------- ---------- ----------
---------- ----------- ----------- ---------- ---------- ----------
The accompanying Notes to Financial Statements are an integral part of these statements.
2
Kansas City Power & Light Company
Cash or Deferred Arrangement Employee Savings Plus Plan
Statement of Financial Condition, With Fund Information
December 31, 1997
KCPL Loans to Total of
ASSETS Stock Fund Participants All Funds
- ------ ---------- ------------ -----------
Investments at Market:
Short term money market $- - $4,484
Kansas City Power & Light Co. Stock
2,897,546.2360(cost $65,323,576) 85,658,711 - 85,658,711
Fidelity Managed Income Portfolio (MIP)
8,164,153 shares (cost $8,164,153) - - 8,164,153
Fidelity Puritan Fund
843,587.3407 shares (cost $13,687,603) - - 16,348,723
Fidelity Magellan Fund
375,422.0287 shares (cost $27,627,240) - - 35,766,457
Fidelity Asset Manager Fund
69,101.3070 shares (cost $1,149,625) - - 1,268,009
Fidelity OTC Portfolio Fund
89,621.1677 shares (cost $2,962,920) - - 2,997,828
Fidelity Overseas Fund
63,012.0582 shares (cost $1,950,196) - - 2,050,412
Loans to participants - 5,938,460 5,938,460
---------- --------- -----------
Total investments 85,658,711 5,938,460 158,197,237
---------- --------- -----------
Receivables:
Investment income - - -
Money market interest 506 - 970
Commission reimbursement 47 - 47
---------- --------- -----------
Total receivables 553 - 1,017
---------- --------- -----------
TOTAL ASSETS $85,659,264 $5,938,460 $158,198,254
---------- --------- -----------
---------- --------- -----------
LIABILITIES AND PLAN EQUITY
- ----------------------------
Liabilities:
Benefits payable to participants $1,581,604 $- $2,246,513
Plan Equity 84,077,660 5,938,460 155,951,741
---------- --------- -----------
TOTAL LIABILITIES AND PLAN EQUITY $85,659,264 $5,938,460 $158,198,254
---------- --------- -----------
---------- --------- -----------
The accompanying Notes to Financial Statements are an integral part of these statements.
3
Kansas City Power & Light Company
Cash or Deferred Arrangement Employee Savings Plus Plan
Statement of Financial Condition, With Fund Information
December 31, 1996
Fidelity Investment Funds
Asset OTC
ASSETS MIP Puritan Magellan Manager Portfolio Overseas
- ------ --------- ---------- ---------- ------- --------- ---------
Investments, at market:
Short term money market $- $- $159,103 $- $- $-
Kansas City Power & Light Co. Stock
2,679,331.3966 shares (cost $57,271,426) - - - - - -
Fidelity Managed Income Portfolio (MIP)
7,492,939 shares (cost $7,492,939) 7,492,939 - - - - -
Fidelity Puritan Fund
726,829.5399 shares (cost $11,183,328) - 12,530,541 - - - -
Fidelity Magellan Fund
341,712.9438 shares (cost $23,746,811) - - 27,559,149 - - -
Fidelity Asset Manager Fund
45,883.8316 shares (cost $705,044) - - - 755,707 - -
Fidelity OTC Portfolio Fund
55,985.2874 shares (cost $1,717,316) - - - - 1,831,279 -
Fidelity Overseas Fund
48,895.7508 shares (cost $1,427,865) - - - - - 1,507,945
Loans to participants - - - - - -
--------- ---------- ---------- ------- --------- ---------
Total investments 7,492,939 12,530,541 27,718,252 755,707 1,831,279 1,507,945
--------- ---------- ---------- ------- --------- ---------
Reivables:
Investment income 37,621 - - - - -
Money market interest 26 50 100 6 33 10
Commission reimbursement - - - - - -
--------- ---------- ---------- ------- --------- ---------
Total receivables 37,647 50 100 6 33 10
--------- ---------- ---------- ------- --------- ---------
TOTAL ASSETS $7,530,586 $12,530,591 $27,718,352 $755,713 $1,831,312 $1,507,955
--------- ---------- ---------- ------- --------- ---------
--------- ---------- ---------- ------- --------- ---------
LIABILITIES AND PLAN EQUITY
- ---------------------------
Liabilities:
Benefits payable to participants $284,742 $246,498 $421,322 $- $1,519 -
Plan Equity 7,245,844 12,284,093 27,297,030 755,713 1,829,793 1,507,955
--------- ---------- ---------- ------- --------- ---------
TOTAL LIABILITIES AND PLAN EQUITY $7,530,586 $12,530,591 $27,718,352 $755,713 $1.831,312 $1,507,955
--------- ---------- ---------- ------- --------- ---------
--------- ---------- ---------- ------- --------- ---------
The accompanying Notes to Financial Statements are an integral part of these statements.
4
Kansas City Power & Light Company
Cash or Deferred Arrangement Employee Savings Plus Plan
Statement of Financial Condition, With Fund Information
December 31, 1996
KCPL Loans to Total of
ASSETS Stock Fund Participants All Funds
- ------ ---------- --------- -----------
Investments at Market:
Short term money market $- $237,500 $396,603
Kansas City Power & Light Co. Stock
2,679,331.3966 (cost $57,271,426) 76,360,945 - 76,360,945
Fidelity Managed Income Portfolio (MIP)
7,492,939 (cost $7,492,939) - - 7,492,939
Fidelity Puritan Fund
726,829.5399 shares (cost $11,183,328) - - 12,530,541
Fidelity Magellan Fund
341,712.9438 shares (cost $23,746,811) - - 27,559,149
Fidelity Asset Manager Fund
45,883.8316 shares (cost $705,044) - - 755,707
Fidelity OTC Portfolio Fund
55,985.2874 shares (cost $1,717,316) - - 1,831,279
Fidelity Overseas Fund
48,895.7508 shares (cost $1,427,865) - - 1,507,945
Loans to participants - 5,606,288 5,606,288
---------- --------- -----------
Total investments 76,360,945 5,843,788 134,041,396
---------- --------- -----------
Receivables:
Investment income - - 37,621
Money market interest 614 - 839
Commission reimbursement 391 - 391
---------- --------- -----------
Total receivables 1,005 - 38,851
---------- --------- -----------
TOTAL ASSETS $76,361,950 $5,843,788 $134,080,247
---------- --------- -----------
---------- --------- -----------
LIABILITIES AND PLAN EQUITY
- ---------------------------
Liabilities:
Benefits payable to participants $1,560,754 $41,141 $2,555,976
Plan Equity 74,801,196 5,802,647 131,524,271
---------- --------- -----------
TOTAL LIABILITIES AND PLAN EQUITY $76,361,950 $5,843,788 $134,080,247
---------- --------- -----------
---------- --------- -----------
The accompanying Notes to Financial Statements are an integral part of these statements.
5
Kansas City Power & Light Company
Cash or Deferred Arrangement Employee Savings Plus Plan
Statement of Income and Changes in Plan Equity, With Fund Information
for the Year Ended December 31, 1997
Fidelity Investment Funds
Asset OTC
MIP Puritan Magellan Manager Portfolio Overseas
ADDITIONS
--------- ---------- ---------- ------- --------- ---------
Investment income:
Net appreciation (depreciation)
in the fair value of investments $- $1,573,140 $5,046,647 $91,409 $(1,016) 50,573
Dividends - 1,286,699 2,288,869 103,455 203,481 99,448
Interest:
Investments 427,430 - - - - -
Money market 2,466 1,499 1,924 116 431 200
Loans - - - - - -
Other - 91 2,525 358 27 4
--------- ---------- ---------- ------- --------- ---------
Net investment income 429,896 2,861,429 7,339,965 195,338 202,923 150,225
--------- ---------- ---------- ------- --------- ---------
Contributions:
Employee 730,252 1,267,863 2,293,002 158,129 523,531 371,858
Employer - - - - - -
Rollover 4,790 7,185 36,825 20,780 24,636 5,642
Reimbursed commissions - - - - - -
Forfeiture credits - - - - - -
--------- ---------- ---------- ------- --------- ---------
Total contributions 735,042 1,275,048 2,329,827 178,909 548,167 377,500
--------- ---------- ---------- ------- --------- ---------
TOTAL ADDITIONS 1,164,938 4,136,477 9,669,792 374,247 751,090 527,725
--------- ---------- ---------- ------- --------- ---------
DEDUCTIONS
Distributions to participants (626,786) (585,038) (979,935) (17,283) (42,734) (23,972)
Forfeited benefits - - - - - - -
--------- ---------- ---------- ------- --------- ---------
TOTAL DEDUCTIONS (626,786 (585,038) (979,935) (17,283) (42,734) (23,972)
--------- ---------- ---------- ------- --------- ---------
TRANSFERS
Due to participant elections 320,547 280,395 (711,871) 129,475 383,719 6,054
Due to participant loans 45,077 85,657 2,937 25,865 75,968 22,849
--------- ---------- ---------- ------- --------- ---------
TOTAL TRANSFERS 365,624 366,052 (708,934) 155,340 459,687 28,903
--------- ---------- ---------- ------- --------- ---------
NET CHANGE IN PLAN EQUITY 903,776 3,917,491 7,980,923 512,304 1,168,043 532,656
PLAN EQUITY, beginning of year 7,245,844 12,284,093 27,297,030 755,713 1,829,793 1,507,955
--------- ---------- ---------- ------- --------- ---------
PLAN EQUITY, end of year $8,149,620 $16,201,584 $35,277,953 $1,268,017 $2,997,836 $2,040,611
---------- ---------- ---------- ------- --------- ---------
---------- ---------- ---------- ------- --------- ---------
The accompanying Notes to Financial Statements are an integral part of these statements.
6
Kansas City Power & Light Company
Cash or Deferred Arrangement Employee Savings Plus Plan
Statement of Income and Changes in Plan Equity, With Fund Information
for the Year Ended December 31, 1997
KCPL Loans to Total of
Stock Fund Participants All Funds
ADDITIONS
---------- --------- -----------
Investment income:
Net appreciation (depreciation)
in the fair value of investments $2,545,025 $- $9,305,778
Dividends 4,492,971 - 8,474,923
Interest:
Investments - - 427,421
Money market 3,843 - 10,479
Loans - 590,128 590,128
Other (11) - 2,994
---------- --------- -----------
Net investment income 7,041,828 590,128 18,811,723
---------- --------- -----------
Contributions:
Employee 2,853,496 - 8,198,131
Employer 2,725,984 - 2,725,984
Rollover 16,923 - 116,781
Reimbursed commissions 45,530 - 45,530
Forfeiture credits 3,434 - 3,434
---------- --------- -----------
Total contributions 5,645,367 - 11,089,860
---------- --------- -----------
TOTAL ADDITIONS 12,687,195 590,128 29,901,592
---------- --------- -----------
DEDUCTIONS
Distributions to participants (3,037,910) (155,750) (5,469,408)
Forfeited benefits (4,714) - (4,714)
---------- --------- -----------
TOTAL DEDUCTIONS (3,042,624) (155,750) (5,474,122)
---------- --------- -----------
TRANSFERS
Due to participant elections (408,319) - -
Due to participant loans 40,212 (298,565) -
---------- --------- -----------
TOTAL TRANSFERS (368,107) (298,565) -
---------- --------- -----------
NET CHANGE IN PLAN EQUITY 9,276,464 135,813 24,427,470
PLAN EQUITY, beginning of year 74,801,196 5,802,647 131,524,271
---------- --------- -----------
PLAN EQUITY, end of year $84,077,660 $5,938,460 $155.951,741
---------- --------- -----------
---------- --------- -----------
The accompanying Notes to Financial Statements are an integral part of these statements.
7
Kansas City Power & Light Company
Cash or Deferred Arrangement Employee Savings Plus Plan
Statement of Income and Changes in Plan Equity, With Fund Information
for the Year Ended December 31, 1996
Fidelity Investment Funds
Asset OTC
MIP Puritan Magellan Manager Portfolio Overseas
ADDITIONS
--------- ---------- ---------- ------- --------- ---------
Investment income:
Net appreciation (depreciation)
in the fair value of investments $- $199,817 $(1,219,051) $20,769 $69,080 $63,352
Dividends - 1,406,226 4,103,553 56,890 184,733 90,771
Interest:
Investments 407,767 - - - - -
Money market 360 668 1,326 63 310 144
Loans - - - - - -
Other - (120) 186 (1) 37 (4)
--------- ---------- ---------- ------- --------- ---------
Net investment income 408,127 1,606,591 2,886,014 77,721 254,160 154,263
--------- ---------- ---------- ------- --------- ---------
Contributions:
Employee 653,474 1,044,750 2,188,816 104,159 42,728 213,324
Employer - 265 2,180 - - -
Rollover 1,686 27,038 74,862 6,963 24,591 739
Reimbursed commissions - - - - - -
Forfeiture credits - - - - - -
--------- ---------- ---------- ------- --------- ---------
Total contributions 655,160 1,072,053 2,265,858 111,122 267,319 214,063
--------- ---------- ---------- ------- --------- ---------
TOTAL ADDITIONS 1,063,287 2,678,644 5,151,872 188,843 521,479 368,326
--------- ---------- ---------- ------- --------- ---------
DEDUCTIONS
Distributions to participants (427,468) (586,695) (1,056,057) (326) (2,175) (106)
Forfeited benefits - - - - - -
--------- ---------- ---------- ------- --------- ---------
TOTAL DEDUCTIONS (427,468) (586,695) (1,056,057) (326) (2,175) (106)
--------- ---------- ---------- ------- --------- ---------
TRANSFERS
Due to participant elections (73,157) (91,188) (1,377,381) 939 628,499 169,778
Due to participant loans 25,781 (74,621) (80,379) 1,782 19,219 (3,744)
--------- ---------- ---------- ------- --------- ---------
TOTAL TRANSFERS (47,376) (165,809) (1,457,760) 2,721 647,718 166,034
--------- ---------- ---------- ------- --------- ---------
NET CHANGE IN PLAN EQUITY 588,443 1,926,140 2,638,055 191,238 1,167,022 534,254
PLAN EQUITY, beginning of year 6,657,401 10,357,953 24,658,975 564,475 662,771 973,701
--------- ---------- ---------- ------- --------- ---------
PLAN EQUITY, end of year $7,245,844 $12,284,093 $27,297,030 $755,713 $1,829,793 $1,507,955
--------- ---------- ---------- ------- --------- ---------
--------- ---------- ---------- ------- --------- ---------
The accompanying Notes to Financial Statements are an integral part of these statements.
8
Kansas City Power & Light Company
Cash or Deferred Arrangement Employee Savings Plus Plan
Statement of Income and Changes in Plan Equity, With Fund Information
for the Year Ended December 31, 1996
KCPL Loans to Total of
Stock Fund Participants All Funds
ADDITIONS
---------- --------- -----------
Investment income:
Net appreciation (depreciation)
in the fair value of investments $5,291,582 $- $4,425,549
Dividends 4,033,672 - 9,875,845
Interest:
Investments - - 407,767
Money market 2,152 - 5,023
Loans - 533,818 533,818
Other 418 - 516
---------- --------- -----------
Net investment income 9,327,824 533,818 15,248,518
---------- --------- -----------
Contributions:
Employee 2,617,686 - 7,064,937
Employer 2,607,428 - 2,609,873
Rollovers 13,009 - 148,888
Reimbursed commissions 44,193 - 44,193
Forfeiture credits 3,284 - 3,284
---------- --------- -----------
Total contributions 5,285,600 - 9,871,175
---------- --------- -----------
TOTAL ADDITIONS 14,613,424 533,818 25,119,693
---------- --------- -----------
DEDUCTIONS
Distributions to participants (2,517,196) (95,647) (4,685,670)
Forfeited benefits (3,269) - (3,269)
---------- --------- -----------
TOTAL DEDUCTIONS (2,520,465) (95,647) (4,688,939)
---------- --------- -----------
TRANSFERS
Due to participant elections 742,510 - -
Due to participant loans (123,762) 235,724 -
---------- --------- -----------
TOTAL TRANSFERS 618,748 235,724 -
---------- --------- -----------
NET CHANGE IN PLAN EQUITY 12,711,707 673,895 20,430,754
PLAN EQUITY, beginning of year 62,089,489 5,128,752 111,093,517
---------- --------- -----------
PLAN EQUITY, end of year $74,801,196 $5,802,647 $131,524,271
---------- --------- -----------
---------- --------- -----------
The accompanying Notes to Financial Statements are an integral part of these statements.
9
Kansas City Power & Light Company
Cash or Deferred Arrangement Employee Savings Plus Plan
Statement of Income and Changes in Plan Equity, With Fund Information
for the Year Ended December 31, 1995
Fidelity Investment Funds
Asset OTC
MIP Puritan Magellan Manager Portfolio Overseas
ADDITIONS
--------- ---------- ---------- ------- --------- ---------
Investment income:
Net appreciation
in the fair value of investments $- $1,250,219 $5,356,260 $64,495 $88,298 $52,833
Dividends - 547,145 1,447,394 14,860 34,872 21,681
Interest:
Investments 369,126 - - - - -
Money market 8 388 725 57 104 99
Loans - - - - - -
Other - 2 (60) 2 - -
--------- ---------- ---------- ------- --------- ---------
Net investment income (loss) 369,134 1,797,754 6,804,319 79,414 123,274 74,613
--------- ---------- ---------- ------- --------- ---------
Contributions:
Employee 655,886 993,120 2,158,252 101,883 133,448 226,330
Employer - - - - - -
Rollover - 8,796 11,945 2,124 - 1,345 7,139
Reimbursed commissions - - - - - -
Forfeiture credits - - - - - -
--------- ---------- ---------- ------- --------- ---------
Total contributions 655,886 1,001,916 2,170,197 104,007 134,793 233,469
--------- ---------- ---------- ------- --------- --------
--------- ---------- ---------- ------- --------- ---------
TOTAL ADDITIONS 1,025,020 2,799,670 8,974,516 183,421 258,067 308,082
--------- ---------- ---------- ------- --------- ---------
DEDUCTIONS
Distributions to participants (594,334) (345,139) (800,329) (19,377) (17,637) (11,194)
Forfeited benefits - - - - - -
--------- ---------- ---------- ------- --------- ---------
TOTAL DEDUCTIONS (594,334) (345,139) (800,329) (19,377) (17,637) (11,194)
--------- ---------- ---------- ------- --------- ---------
TRANSFERS
Due to participant elections 782,883 27,745 (1,834,727) 26,100 157,510 37,459
Due to participant loans (52,414) (20,156) (169,554) 8,179 16,653 18,573
--------- ---------- ---------- ------- --------- ---------
TOTAL TRANSFERS 730,469) 7,589 (2,004,281) 34,279 174,163 56,032
--------- ---------- ---------- ------- --------- ---------
NET CHANGE IN PLAN EQUITY 1,161,155 2,462,120 6,169,906 198,323 414,593 352,920
PLAN EQUITY, beginning of year 5,496,246 7,895,833 18,489,069 366,152 248,178 620,781
--------- ---------- ---------- ------- --------- ---------
PLAN EQUITY, end of year $6,657,401 $10,357,953 $24,658,975 $564,475 $662,771 $973,701
--------- ---------- ---------- ------- --------- ---------
--------- ---------- ---------- ------- --------- ---------
The accompanying Notes to Financial Statements are an integral part of these statements.
10
Kansas City Power & Light Company
Cash or Deferred Arrangement Employee Savings Plus Plan
Statement of Income and Changes in Plan Equity, With Fund Information
for the Year Ended December 31, 1995
KCPL Loans to Total of
Stock Fund Participants All Funds
ADDITIONS
---------- --------- -----------
Investment income:
Net appreciation
in the fair value of investments $6,292,588 $- $13,104,693
Dividends 3,502,951 - 5,568,903
Interest:
Investments - - 369,126
Money market 2,056 - 3,437
Loans - - 436,646
Other (85) - (141)
---------- --------- -----------
Net investment income 9,797,510 436,646 19,482,664
---------- --------- -----------
Contributions:
Employee 2,392,233 - 6,661,152
Employer 2,524,326 - 2,524,326
Rollover 13,023 - 44,372
Reimbursed commissions 46,713 - 46,713
Forfeiture credits 4,118 - 4,118
---------- --------- -----------
Total contributions 4,980,413 - 9,280,681
---------- --------- -----------
TOTAL ADDITIONS 14,777,923 436,646 28,763,345
---------- --------- -----------
DEDUCTIONS
Distributions to participants (2,406,800) (145,975) (4,340,785)
Forfeited benefits (4,118) - (4,118)
---------- --------- -----------
TOTAL DEDUCTIONS (2,410,918) (145,975) (4,344,903)
---------- --------- -----------
TRANSFERS
Due to participant elections 803,030 - -
Due to participant loans (230,542) 429,261 -
---------- --------- -----------
TOTAL TRANSFERS 572,488 429,261 -
---------- --------- -----------
NET CHANGE IN PLAN EQUITY 12,939,493 719,932 24,418,442
PLAN EQUITY, beginning of year 49,149,996 4,408,820 86,675,075
---------- --------- -----------
PLAN EQUITY, end of year $62,089,489 $5,128,752 $111,093,517
---------- --------- -----------
---------- --------- -----------
The accompanying Notes to Financial Statements are an integral part of these statements.
11
KANSAS CITY POWER & LIGHT COMPANY
CASH OR DEFERRED ARRANGEMENT
EMPLOYEE SAVINGS PLUS PLAN
NOTES TO FINANCIAL STATEMENTS
DESCRIPTION OF THE PLAN
The following description of the Kansas City Power & Light
Company's Cash or Deferred Arrangement, alternatively known as
Employee Savings Plus Plan (the Plan) provides only general
information regarding the Plan. Participants should refer to the
Plan Agreement for more complete information.
The Plan is designed to encourage and assist employees of Kansas
City Power & Light Company and Subsidiary (Company) to adopt a
regular savings and investment program for long term needs,
especially retirement. The Company is the Plan Administrator and
UMB Bank, n.a. (UMB) is the Trustee. The Administrative
Committee is the fiduciary of the Plan and has the responsibility
of establishing the rules under which the Plan is run.
1. Eligibility and Employee Contributions - Employees are
immediately eligible to make elective contributions to the
Plan. If the employee begins employment during the first 15
days of a month, they can begin participating in the Plan
the first day of the following month. If an employee's
first day of employment is after the 15th of the month, they
are eligible to participate in the Plan the first day of the
next following month.
Participants can contribute any whole percentage of their
base pay from 2% to 12% (prior to April 1, 1997, the maximum
percentage was 10%) to the Plan, except that contributions
may not exceed the maximum allowable under the law. The
maximum individual contribution allowed for 1997 and 1996
was $9,500; and for 1995 was $9,240. Other special
limitations may reduce the participant elective and Company
matching maximum contribution amounts for highly compensated
employees.
2. Company Matching Contributions - The Company contributes an
amount equal to 50% of the employee's elective contribution,
not to exceed 3% of base pay as defined in the Plan.
Company contributions may be made in cash, Company stock, or
a combination thereof. Company contributions will at all
times be invested in the common stock of the Company. The
Company will begin matching employee contributions when the
employee completes one year of service.
3. Rollovers - Participants may elect to transfer funds from
another qualified retirement plan to the Plan, with
permission from the Administrative Committee.
4. Vesting and Forfeitures
12
KANSAS CITY POWER & LIGHT COMPANY
CASH OR DEFERRED ARRANGEMENT
EMPLOYEE SAVINGS PLUS PLAN
NOTES TO FINANCIAL STATEMENTS
a) Elective Contribution and Rollover Accounts -
Participants are at all times 100% vested in their
elective contribution and rollover accounts.
b) Company Match Account - Participants who retire after
age 55, die, or become totally and permanently disabled
while an employee of the Company are considered 100%
vested in the Company Match Account, regardless of
their length of service with the Company.
Vesting of the Company Match Account for participants who
leave the Company for a reason other than death, disability,
or retirement is based upon Years of Service for Vesting. A
year of service for Plan purposes is defined as any year in
which an employee completes at least 1,000 hours of service
with the Company. Generally, all years of service with the
Company are taken into account in computing Years of Service
for Vesting. Participants who accrue two years of service
prior to termination of employment are 20% vested.
Participants are credited with 20% additional vesting each
year thereafter, with full vesting after six years of
service.
The portion of Company Match Accounts that is not vested is
forfeited by terminating participants. Forfeitures are used
to reduce future Company matching contributions. The 1997,
1996 and 1995 forfeited benefits were $4,714, $3,269, and
$4,118, respectively. The Company used forfeiture credits
of $3,434, $3,284, and $4,118 for 1997, 1996 and 1995,
respectively, to reduce the matching contributions.
5. Investment of Accounts
a) Investment of Elective Contribution and Rollover
Accounts - Participants may direct (in 5% increments)
the investment of their elective contribution and
rollover accounts in one or more of the following seven
investment funds:
i) KCPL Stock Fund - a fund designed to invest solely
in the Company's common stock.
ii) Fidelity Managed Income Portfolio (MIP) - a
collective investment trust that seeks to preserve
capital and provide a competitive level of income
over time.
iii) Fidelity Puritan Fund - a growth and income fund
that seeks income consistent with preservation of
capital by investing in a broadly diversified
portfolio of common stocks,
13
KANSAS CITY POWER & LIGHT COMPANY
CASH OR DEFERRED ARRANGEMENT
EMPLOYEE SAVINGS PLUS PLAN
NOTES TO FINANCIAL STATEMENTS
preferred stocks, and bonds, including lower-quality, high-yield
debt securities.
iv) Fidelity Magellan Fund - a growth fund that seeks
long term capital appreciation by investing in
stocks of companies with potentially above average
growth potential and a corresponding higher level
of risk.
v) Fidelity Asset Manager Fund - an asset allocation
fund that seeks high total return with reduced
risk over the long term by investing in domestic
and foreign equities, bonds and short term
instruments.
vi) Fidelity OTC Portfolio Fund - a growth fund that
seeks long term capital appreciation by investing
in securities traded on the over-the-counter
securities market.
vii) Fidelity Overseas Fund - an international growth
fund that seeks long term capital growth by
investing in foreign securities that includes
common stock, securities convertible into common
stock and debt instruments.
b) Investment of Company Match Account - This account will
at all times be invested in the common stock of the
Company.
As of December 31, 1997, 1,826 employees were participating
in the Plan, 1,044 of whom were investing their elective
contributions in more than one of the available options of
the Plan. There were 78 employees contributing only to
Fidelity MIP, 35 employees contributing only to the Fidelity
Puritan Fund, 152 employees contributing only to the
Fidelity Magellan Fund, 5 employees contributing only to the
Fidelity Asset Manager Fund, 46 employees contributing only
to the Fidelity OTC Portfolio Fund, 19 employees
contributing only to the Fidelity Overseas Fund, and 447
employees contributing only to the KCPL Stock Fund.
Participants also have the opportunity to change how their
past savings in their elective and rollover accounts are
invested. Participants can make such changes on a daily
basis. Participants making such elections will have their
fund shares sold, and the proceeds transferred and fund
shares purchased per their request.
The non-participant directed portion of the KCPL Stock Fund
consisted of 1,278,593.0940 shares valued at $37,798,408 and
1,164,914.9967 shares valued at $33,200,077 at December 31,
1997 and 1996, respectively.
14
KANSAS CITY POWER & LIGHT COMPANY
CASH OR DEFERRED ARRANGEMENT
EMPLOYEE SAVINGS PLUS PLAN
NOTES TO FINANCIAL STATEMENTS
6. Allocation of Investment Income - The Trustee allocates
investment income based on the shares held by participants
in their individual accounts. Individual accounts are
valued on each business day by the Trustee to reflect the
current market value of the investments.
If contributions or participant transfers received by the
Trustee cannot be immediately invested in the investment
funds, the moneys are held in an interest bearing UMB Money
Market Fund. Some distributions may also be invested in the
money market fund prior to payment to the participant. Any
interest earned is allocated back to the investment accounts
based on the amounts originally transferred.
The money market interest receivable represents interest
earned in the money market accounts for December 1997 and
1996.
7. Termination Payments - Participants who leave the Company as
a result of termination, retirement, or permanent disability
may receive the entire amount of their account in one lump-
sum payment, rollover their account to another trustee, or
elect to defer distribution until age 62 or retirement,
whichever is later. Upon death, distributions will be made
to beneficiaries in a lump sum or in installment payments
over a period of no more than three years. Payment will
commence no later than 60 days after the December 31
coinciding with or next following the date of the
participant's death.
Benefits Payable to Participants represents an accrual for
those participants who had terminated service during the
year and had not received their distribution by December 31.
This amount, however, does not include an accrual for those
terminated employees that elected to defer their
distribution until age 62, except for those that will reach
age 62 during 1997 and 1996. The deferred to age 62 totals
for participants not required to receive distributions in
the next calendar year are $9,868,502 and $8,015,135 for
December 31, 1997 and 1996, respectively.
8. Loans to Participants - The Plan allows participants to
borrow against their vested account balance to obtain either
an installment or residential loan. Other than by obtaining
a loan, the Plan does not provide for in-service withdrawals
from elective accounts, rollover accounts, or Company Match
accounts. Distributions are made only upon retirement,
disability, termination of employment, or death.
15
KANSAS CITY POWER & LIGHT COMPANY
CASH OR DEFERRED ARRANGEMENT
EMPLOYEE SAVINGS PLUS PLAN
NOTES TO FINANCIAL STATEMENTS
An installment loan may be used for any purpose, whereas a
residential loan must be used for the purchase of the
participant's primary residence. The maximum loan terms for
installment and residential loans are 5 and 15 years,
respectively. A participant may have no more than one of
each type of loan outstanding at the same time.
For all loans issued through October 1989, if the
participant's account balance was $20,000 or less, then a
maximum of 80% of the vested account balance, not to exceed
$10,000, could be borrowed. If the account balance was more
than $20,000, then 50% of the vested account balance, not to
exceed $50,000 could be borrowed. The interest rate for
these loans was based on the Fidelity GIC Group Trust
interest rate of 8.31%.
For loans issued after November 1, 1989, the maximum amount
that a participant can borrow is 50% of their vested account
balance, not to exceed $50,000. The interest rate for these
loans is UMB's prime rate plus 2%. The minimum amount a
participant can borrow is $1,000.
Principal and interest on all loans is repaid to the
participant's individual accounts based on their current
contribution allocation election. All loans are repaid by
payroll deduction except when paid in full in advance or the
unpaid principal is deducted from a total distribution which
results from a death, disability, retirement, or
termination.
Loans to Participants represents the total of the
outstanding loans issued from the investment funds. The
1997 Loans to Participants total of $5,938,460 was comprised
of $1,063,545 of residential and $4,874,915 of installment
loans. The 1996 Loans to Participants total of $5,606,288
was comprised of $804,508 of residential and $4,801,780 of
installment loans.
9. Commissions and Administrative Expenses - Total 1997, 1996
and 1995 commissions were $45,530, $44,193, and $46,713,
respectively, of which the Company owed the Plan $47 at
December 31, 1997, and $391 at December 31, 1996.
Commissions paid by the Plan for purchases and sales of
Company common stock are reimbursed by the Company.
Administrative expenses are also paid by the Company.
During the year ended December 31, 1997, a net of $14,174 in
costs for the administration of the Plan were billed to the
Company by the Trustee after deducting plan expense
reimbursements from Fidelity Investments. The net
16
KANSAS CITY POWER & LIGHT COMPANY
CASH OR DEFERRED ARRANGEMENT
EMPLOYEE SAVINGS PLUS PLAN
NOTES TO FINANCIAL STATEMENTS
administrative costs paid by the Company for 1996 and 1995
were $26,030 and $53,085, respectively.
10. Voluntary Early Retirement Program - On March 8, 1994, the
Board of Directors of the Company authorized the Company to
offer a Voluntary Early Retirement Program. Of the 411
eligible employees, 312 employees with a Plan account
elected to participate in the program and retired from the
Company on June 30, 1994. Retiring employees who
participated in the Plan could elect any of the termination
payment options described in Note 7.
11. Related Party and Party-In-Interest Transactions - The
Trustee is authorized under contract provisions and ERISA
regulations, to invest in funds under its control and in
securities of the Company.
In 1997 there were 463,521 shares purchased and 246,392
shares sold in the KCPL Stock Fund under the Trustee's
control totaling $13,341,965 and $6,612,130 respectively.
In 1996 there were 473,425 shares purchased and 152,278
shares sold totaling $12,826,028 and $4,063,353,
respectively.
Temporary cash balances are invested on a daily basis in
short-term investment funds under the Trustee's control.
Although those temporary cash balances are not material to
the Plan's financial statements, there were 567 purchases
and 549 sales in the UMB Money Market Fund totaling
$22,918,041 and $22,851,172, respectively in 1997. In 1996
there were 540 purchases and 474 sales totaling $16,855,503
and $16,808,414, respectively.
12. AMENDED AND RESTATED PLAN OF MERGER WITH WESTERN RESOURCES -
Western Resources, Inc. (Western Resources) delivered an
unsolicited exchange offer and an amended offer to KCPL's Board
of Directors during the second quarter of 1996. After careful
consideration, KCPL's Board of Directors rejected both offers.
In July 1996 Western Resources commenced an exchange offer for
KCPL Common Stock. In late 1996 KCPL began discussing a possible
merger with Western Resources leading to a February 7, 1997,
agreement.
In December 1997 KCPL canceled its previously scheduled
special meeting of shareholders to vote on the transaction
because Western Resources advised KCPL that its investment
bankers, Salomon Smith Barney, had indicated that it was
unlikely that Salomon would be in a position to issue a
fairness opinion for the merger transaction on the basis of
the February 7, 1997, agreement.
17
KANSAS CITY POWER & LIGHT COMPANY
CASH OR DEFERRED ARRANGEMENT
EMPLOYEE SAVINGS PLUS PLAN
NOTES TO FINANCIAL STATEMENTS
On March 18, 1998, KCPL and Western Resources entered into
an Amended and Restated Agreement and Plan of Merger
(Amended Agreement). This Amended Agreement provides for
the combination of the regulated electric utilities of KCPL
and Western Resources into Westar Energy, a new company,
using purchase accounting. Westar Energy will be owned
approximately 80.1% by Western Resources and approximately
19.9% by KCPL shareholders. At closing, KCPL shareholders
will receive for every share of KCPL Common Stock one share
of Westar energy Common Stock and a fraction of a share of
Western Resources Common Stock worth not less than $21.50
and not more than $26.50 pursuant to a collar adjustment
mechanism. The estimated trading value per share of Westar
Energy Common Stock to be issued to KCPL shareholders in
connection with the Amended Agreement is estimated to be in
the range of $10 to $11 per share based on current market
conditions. Since Westar Energy will be a newly formed
entity with no trading history, there can be no assurance
that Westar Energy will trade at such levels.
The transaction is subject to several closing conditions,
including approval by each Company's shareholders, approval
by a number of regulatory and governmental agencies,
confirmation from Kansas tax authorities that no sales or
use tax is payable in connection with the proposed
transactions and dissenting KCPL common shares constitute
less than 5.5% of outstanding shares. If the merger has not
been closed by December 31, 1999, either party may terminate
the Amended Agreement as long as they did not contribute to
the delay. If Western Resources Index Price is less than or
equal to $29.78 five trading days prior to closing, either
party can terminate this Amended Agreement.
The Amended Agreement allows the KCPL Board discretion to
make changes (including increases) in the KCPL Common Stock
dividend consistent with past practice exercising good
business judgment. It also requires KCPL to redeem all
outstanding shares of cumulative preferred stock prior to
consummation of the proposed transactions. If the Amended
Agreement is terminated under certain other circumstances
and KCPL, within two and one-half years following
termination, agrees to consummate a business combination
with a third party that made a proposal to combine prior to
termination, a payment of $50 million will be due Western
Resources. Under certain circumstances, if KCPL determines
not to consummate its merger into Westar Energy due to its
inability to receive a favorable tax opinion from its legal
counsel, it must pay Western Resources $5 million. Western
Resources will pay KCPL $5 million to $35 million if
18
KANSAS CITY POWER & LIGHT COMPANY
CASH OR DEFERRED ARRANGEMENT
EMPLOYEE SAVINGS PLUS PLAN
NOTES TO FINANCIAL STATEMENTS
the Amended Agreement is terminated and all closing conditions
are satisfied other than conditions relating to Western
Resources receiving a favorable tax opinion from its legal
counsel, favorable statutory approvals or an exemption from
the Public Utility Holding Company Act of 1935. The effect
of the merger on the Plan is not known at this time.
13. Summary of Other Significant Accounting Policies
Basis of Accounting - The Plan's financial statements are
maintained on the accrual basis. Plan records are
maintained on a calendar year basis. The Trustee uses an
average dollar costing methodology to cost investments and
values investments at quoted market prices on the last
business day of the Plan year. In accordance with the
policy of stating investments at fair market value, the Plan
presents in the statement of changes in net assets available
for Plan benefits the net appreciation (depreciation) in the
fair value of its investments which consists of the realized
gains and losses and the unrealized appreciation
(depreciation) on those investments.
Tax Status - The Plan has been approved by the Internal
Revenue Service as a "qualified" plan under the Internal
Revenue Code. The Plan is exempt from Federal taxes on its
income, and the participants in the Plan are not subject to
taxes on either the income or the Company's contributions
until such time as distributions are received. The Plan has
been amended since receiving the last tax determination
letter from the Internal Revenue Service. However, the
Administrative Committee believes the Plan is currently
designed and operated in compliance with the applicable
requirements of the Code. The Administrative Committee
believes the Plan is qualified and tax-exempt, as described
above, as of December 31, 1997 and 1996.
Amendment and Termination - Although the Company intends to
continue the Plan indefinitely, it reserves the right to
amend or terminate the Plan or cease Company contributions
to it. If the Plan is terminated, participants will receive
the amounts credited to their accounts and will
automatically be fully vested in the Company Match Account
regardless of the participant's years of service for
vesting.
Management's Estimates - The preparation of financial
statements in conformity with generally accepted accounting
principles requires management to make estimates and
assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements
19
KANSAS CITY POWER & LIGHT COMPANY
CASH OR DEFERRED ARRANGEMENT
EMPLOYEE SAVINGS PLUS PLAN
NOTES TO FINANCIAL STATEMENTS
and the reported amounts of additions to and deductions from the
Plan during the reporting period. Actual results could
differ from those estimates.
14. Risks and Uncertainties - The Plan provides for various
investment options in any combination of stocks, bonds,
fixed income securities, mutual funds, and other investment
securities. Investment securities are exposed to various
risks, such as interest rate, market and credit. Due to the
level of risk associated with certain investment securities
and the level of uncertainty related to changes in the value
of investment securities, it is at least reasonably possible
that changes in risks in the near term would materially
affect participants' account balances and the amounts
reported in the statement of net assets available for Plan
benefits and the statement of changes in net assets
available for Plan benefits.
20
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the Administrative Committee of the Employee Savings
Plus Plan has duly caused this annual report to be signed on its
behalf by the undersigned hereunto duly authorized.
EMPLOYEE SAVINGS PLUS PLAN
(
(
(By: /s/B. M. Tate
( B. M. Tate, Chairman
(
(
( /s/F. L. Branca
( F. L. Branca, Member
(
(
( /s/J. S. Latz
( J. S. Latz, Member
June 26, 1998
21
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration
statement of Kansas City Power & Light Company on Form S-8 (File
No. 33-58917) of our report dated June 17, 1998, on our audit of
the financial statements of the Kansas City Power & Light Company
Cash or Deferred Arrangement Employee Savings Plus Plan as of
December 31, 1997, and 1996, and for the years ended December 31,
1997, 1996, and 1995, which report is included in this Annual
Report on Form 11-K.
/s/ Coopers & Lybrand L.L.P.
COOPERS & LYBRAND L.L.P.
Kansas City, Missouri
June 17, 1998
22
