August, 2003.AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON
DECEMBER 18, 1996. REGISTRATION NO. 333- - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------------ FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ------------------------ KCPL FINANCING I KCPL FINANCING II KANSAS CITY POWER & LIGHT KCPL FINANCING III COMPANY (ExactAugust __, 2003Registration No. 333-____________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________
Form S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
____________________
KCPL FINANCING II
KCPL FINANCING III
KANSAS CITY POWER & LIGHT COMPANY
(Exact name of registrant as specified in their Trust Agreements)
(Exact name of registrant as specified in its charter)
Delaware
Missouri
(State or other jurisdiction of incorporation or organization)
43-1764671
43-176467244-0308720
(I.R.S. Employer Identification No.)
1201 Walnut
Kansas City, Missouri 64106-2124
(816) 556-2200(Address, including zip code, and telephone number, including area code, of each registrant's principal executive offices)
Jeanie Sell Latz
Executive Vice President and Chief Legal Officer
1201 Walnut
Kansas City, Missouri 64106-2124
(816) 556-2936(Name, address, including zip code, and telephone
number, including area code, of agent for service for each registrant)
With copies to:
Steven R. Loeshelle
Dewey Ballantine LLP
1301 Avenue of the Americas
New York, New York 10019-6092Approximate date of
registrants as (Exact namecommencement ofregistrant as specified in their Trust Agreements) specified in its charter) DELAWARE MISSOURI (State or other jurisdictionproposed sale to the public: From time to time after the effective date ofincorporation or organization) (To be applied for) (I.R.S. Employer Identification Nos.) 44-0308720 Jeanie Sell Latz Senior Vice President and Chief Legal Officer 1201 Walnut Kansas City Power & Light Company Kansas City, Missouri 64106-2124 1201 Walnut (816) 556-2200 Kansas City, Missouri 64106-2124 (Address, including zip code, and (Name, Address, including zip code, and telephone number including area telephone number including area code, of code, of registrants' principal agent for service) executive offices) PLEASE SEND COPIES OF ALL CORRESPONDENCE TO: R. Todd Vieregg, P.C. Sidley & Austin One First National Plaza Chicago, IL 60603 APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: FROM TIME TO TIME AFTER THE REGISTRATION STATEMENT BECOMES EFFECTIVE, AS DETERMINED BY MARKET CONDITIONS AND OTHER FACTORS.this Registration Statement.If the only securities
beingregistered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box./ /If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, please check the following box.
/X/If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.
/ /If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.
/ /If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box.
/ / ------------------------CALCULATION OF REGISTRATION FEE
- ------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------ Proposed Maximum Proposed maximum Title of each class of Amount to offering price aggregate offering Amount of securities to be registered be registered (1) per unit (2) price (2) registration fee- ------------------------------------------------------------------------------------------------------------------------ KCPL Financing I KCPL Financing II KCPL Financing III Preferred Securities............ - ------------------------------------------------------------------------------------------------------------------------ Kansas City Power & Light Company Guarantees with respect to Preferred Securities (3)........ - ------------------------------------------------------------------------------------------------------------------------ Kansas City Power & Light Company Junior Subordinated Deferrable Interest Debentures............. - ------------------------------------------------------------------------------------------------------------------------ Total............................. $300,000,000 100% $300,000,000 $90,909 - ------------------------------------------------------------------------------------------------------------------------(1)
Title of each class of securities to be registered
Amount to be registered (1)
Proposed maximum aggregate offering price (1)
Amount of registration fee
Kansas City Power & Light Company Senior Debt Securities
Kansas City Power & Light Company Subordinated Debt Securities
KCPL Financing II Trust Preferred Securities
KCPL Financing III Trust Preferred Securities
Kansas City Power & Light Company Guarantees with respect to Trust Preferred Securities of KCPL Financing II and KCPL Financing III(2)
Total
$255,000,000
$255,000,000
$20,655
- There are being registered hereunder
asuch presently indeterminate principal amount or number of Senior Debt Securities, Subordinated Debt Securities and Trust Preferred Securities with an aggregate initial offering price not to exceed $255,000,000. Senior Debt Securities and Subordinated Debt Securities are collectively referred to as "Debt Securities." Debt Securities also may be issued to a trust in connection with the issuance and sale of Trust Preferred Securities and later distributed upon dissolution and distribution of the assets thereof, which would include such Debt Securities for which no separate consideration will be received. Pursuant to Rule 457(o) under the Securities Act of 1933, and General Instruction II.D. of Form S-3, which permits the registration fee to be calculated on the basis of the maximum aggregate offering price of all the securities listed, the table does not specify by each class information as to the amount to be registered, proposed max imum offering price per unit or proposed maximum aggregate offering price.- No separate consideration will be received for the Kansas City Power & Light Company Guarantees. Pursuant to Rule 457(n), no separate fee is payable in respect of the Kansas City Power & Light Company Guarantees.
Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.
[Subject to Completion, Dated August __, 2003]
[The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.]PROSPECTUS
$255,000,000
KANSAS CITY POWER & LIGHT COMPANY
Senior Debt Securities
Subordinated Debt Securities
__________
KCPLFinancing I,FINANCING II
KCPL FINANCING III
Trust Preferred Securities and Related Guarantees fully and unconditionally guaranteed, as set forth herein, by Kansas City Power & Light CompanyKansas City Power & Light Company (the "Company"), a wholly-owned subsidiary of Great Plains Energy Incorporated, and/or KCPL Financing II and KCPL Financing III
(togethermay offer and sell up to $255,000,000of these securities. This prospectus provides you with a general description of these securities. We will provide the specific information about the offering and the terms of these securities 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 securities unless accompanied by a prospectus supplement. You should read this prospectus and the relatedGuaranteessupplement before you invest in these securities.____________________
Our principal executive offices are located at 1201 Walnut, Kansas City, Missouri 64106-2124 and
Junior Subordinated Deferrable Interest Debenturesour telephone number is (816) 556-2200.____________________
Please refer to "Risk Factors" beginning on page 1 of this document for a discussion of certain risks associated with the Company.____________________
These securities have not been approved or disapproved by the Securities and Exchange Commission or any state securities commission nor have these organizations determined that this prospectus is accurate or complete. Any representation to the contrary is a criminal offense.
____________________The date of this prospectus is ______________, 2003.
TABLE OF CONTENTS
Page No.
Risk Factors
1
Cautionary Statements Regarding Certain Forward-Looking Information
2
Where You Can Find More Information
3
About This Prospectus
4
The Company
5
The Trusts
5
Accounting Treatment of Trusts
6
Use of Proceeds
7
Ratio of Earnings to Fixed Charges
7
Description of Debt Securities
7
Description of the Preferred Securities
20
Description of the Related Guarantees
22
Relationship Among the Preferred Securities, the Subordinated Debt Securities and the Guarantees
25
Book-Entry System
26
Plan of Distribution
29
Legal Matters
30
Experts
30
RISK FACTORS
You should carefully consider the risk factors described below, as well as the other information included or incorporated by reference in this prospectus, before making an investment in any of the securities being offered. The risks and uncertainties described below are not the only ones we face. Additional risks and uncertainties not presently known or that we currently believe to be immaterial may also adversely affect us.
We are exposed to commodity price risk. We engage in the wholesale and retail marketing of electricity and, accordingly, are exposed to risks associated with the price of electricity. In addition, we also purchase power as part of our load management operations. Further, since less than 1% of our revenues include an automatic fuel adjustment provision, we are exposed to risk from changes in the market prices of coal and natural gas used to generate power.
We manage one form of our exposure to commodity prices through the structure of our commercial contracts for purchase and delivery of coal, our predominant fuel source. About half of our delivered cost of coal is for rail transportation. We enter into long-term freight contracts to reduce the degree of variability in the delivered cost of coal. We also manage coal price risk in some cases by using short and intermediate-term fixed price contracts. We also manage commodity risk by establishing risk limits and entering into contracts to protect ourselves from volatility in the price of natural gas. However, we do not always hedge the entire exposure of our operations from commodity price volatility. To the extent that we do not do so or we are unsuccessful in doing so, our results of operations and financial position may be impacted as a result of changes in commodity prices.
The costs of compliance with new environmental laws and the incurrence of environmental liabilities could adversely affect our profitability. Our operations are subject to extensive regulation relating to environmental protection. New environmental laws and regulations affecting our operations may be adopted, and new interpretations of existing laws and regulations could be adopted or become applicable to us or our facilities, which may substantially increase our environmental expenditures in the future. In addition, we may not be able to recover all of our costs for environmental expenditures through rates at current levels in the future. Under current law, we are also generally responsible for any on-site liabilities associated with the environmental condition of our facilities that we have previously owned or operated, regardless of whether the liabilities arose befo re, during or after the time we owned or operated the facilities. The incurrence of a material environmental liability could have a material adverse effect on our results of operations and financial condition.
We have nuclear exposure.We own 47% of Wolf Creek Nuclear Operating Corporation, the operating company for the Wolf Creek Generating Station (Wolf Creek) located in Coffey County, Kansas. Our share of Wolf Creek's generating capacity is 550 megawatts which makes it our second largest generating facility, representing approximately 15% of 2002 generating capacity and about 26% of annual MWh generation over the past three years. Over this same period, the facility has operated at 92% average capacity.
Wolf Creek has the lowest fuel cost per mmBtu of any of our generating units. Its assets represent about 33% of our assets and its operating expenses represent about 19% of our operating expenses. An extended shut-down of Wolf Creek could have a substantial adverse effect on our business, financial condition and results of operations because of higher replacement power and other costs. Although not expected, the Nuclear Regulatory
Commission could impose an unscheduled plant shut-down, reacting to safety concerns at the plant or other similar nuclear units. If a long-term shut-down occurred, the state regulatory commissions could reduce rates by excluding the Wolf Creek investment from rate base.
Ownership and operation of a nuclear generating unit exposes us to risks regarding decommissioning costs at the end of the unit's life and to potential retrospective assessments and property losses in excess of insurance coverage. We contribute about $3 million annually to a tax-qualified trust fund to be used to decommission Wolf Creek. This funding level assumes a projected level of return on trust assets. If the actual return on trust assets is below the anticipated level, we could be responsible for the balance of funds required. However, if returns are lower than the expected level, we believe a rate increase would be allowed to ensure full recovery of decommissioning costs over the remaining life of the unit.
CAUTIONARY STATEMENTS REGARDING
CERTAIN FORWARD-LOOKING INFORMATIONStatements made in this prospectus that are not based on historical facts are forward-looking, may involve risks and uncertainties, and are intended to be as of the date when made. In connection with the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, we are providing a number of important factors that could cause actual results to differ materially from provided forward-looking information. These important factors include:
*
future economic conditions in the regional, national and international markets
*
market perception of the energy industry and the Company
*
changes in business strategy, operations, or development plans
*
state and federal legislative and regulatory actions or developments, including deregulation, re-regulation and restructuring of the electric utility industry and constraints placed on the Company's actions by the Public Utility Holding Company Act of 1935
*
adverse changes in applicable laws, regulations, rules, principles or practices governing tax, accounting and environmental matters including, but not limited to, air quality
*
financial market conditions including, but not limited to, changes in interest rates and in availability and cost of capital
*
ability to maintain current credit ratings
*
inflation rates
*
effectiveness of risk management policies and procedures and the ability of counterparties to satisfy their contractual commitments
*
impact of terrorist acts
*
increased competition including, but not limited to, retail choice in the electric utility industry and the entry of new competitors
*
ability to carry out marketing and sales plans
*
weather conditions including weather-related damage
*
cost and availability of fuel
*
ability to achieve generation planning goals and the occurrence of unplanned generation outages
*
delays in the anticipated in-service dates of additional generating capacity
*nuclear operations
*
performance of projects undertaken by our non-regulated businesses and the success of efforts to invest in and develop new opportunities, and
*
other risks and uncertainties
This list of factors is not all-inclusive because it is not possible to predict all factors.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports, and proxy statements and other information with the Securities and Exchange Commission (the "SEC") through the SEC's Electronic Data Gathering, Analysis and Retrieval system and these filings are publicly available through the SEC's website (http://www.sec.gov). You may read and copy such material at the public reference facilities maintained by the SEC at Judiciary Plaza, 450 Fifth Street, N.W., 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. You may also obtain copies of such material at prescribed rates from the Public Reference Section of the SEC, 450 Fifth Street, N.W., Washington, D.C. 20549.
The SEC allows us to "incorporate by reference" into this prospectus the information we file with them. 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 (but not information filed or furnished to the SEC and not deemed incorporated) will automatically update and supercede 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 Exc hange Act of 1934 (excluding information deemed to be furnished and not filed with the SEC) until the offering of the securities described in this prospectus is completed:
*
Our Annual Report on Form 10-K for the year ended December 31, 2002, which we refer to herein as the "2002 Form 10-K".
*
Our Report on Form 8-K dated March 13, 2003.
*
Our Quarterly Report on Form 10-Q for the quarter ended March 31, 2003.
*
Our Quarterly Report on Form 10-Q for the quarter ended
June 30, 2003.
*
Our Reports on Form 8-K and Form 8-K/A dated August 14, 2003.
This prospectus is part of a registration statement we have filed with the SEC relating to our securities. As permitted by the SEC's rules, this prospectus does not contain all of the information included in the registration statement and the accompanying exhibits and schedules we file with the SEC. You should read the registration statement and the exhibits and schedules for more information about us and our securities. The registration statement, exhibits and schedules are also available at the SEC's Public Reference Section or through its website.
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, Kansas City, Missouri 64106-2124 (Telephone No.: 816-556-2200) Attention: Corporate Secretary, or by contacting us on our website (www.kcpl.com). Information on our website is not part of this prospectus.
No separate financial statements of any Trust are included in this prospectus. We believe that such statements would not be material to holders of the Preferred Securities because each Trust has no independent operations and exists for the sole purpose of investing the proceeds of the sale of its Trust Securities (as defined herein) in the subordinated debt securities.
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement we have filed with the SEC using a "shelf" registration process. By using this process, we may offer, in one or more transactions
* senior debt securities
* subordinated debt securities
and KCPL Financing II and KCPL Financing III (individually, a "Trust" and collectively, the "Trusts") may offer
* trust preferred securities or capital securities (the "Preferred Securities")
in one or more offerings up to a total dollar amount of $255,000,000. This prospectus provides you with a general description of the securities. Each time we offer securities, 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, you should carefully read this prospectus, the applicable prospectus supplement and the information contained in the documents we refer to in this prospectus under "Where You Can Find More Information."
References in this prospectus to the terms "we", "us" or other similar terms mean Kansas City Power & Light Company, unless the context clearly indicates otherwise. We are also referred to in this prospectus as "Kansas City Power & Light Company" and "the Company."
You should rely only on the information contained or incorporated by reference in this prospectus and any accompanying prospectus supplement. We have not authorized anyone else to provide you with any different information. If anyone provides you with different or inconsistent information, you should not rely on it. We are not making an offer
to sell securities in any jurisdiction where the offer or sale is not permitted. The information contained in this prospectus is current only as of the date of this prospectus.
THE COMPANY
Kansas City Power & Light Company engages in the generation, transmission, distribution, and sale of electricity and serves approximately 485,000 customers located in all or portions of 24 counties in western Missouri and eastern Kansas. Our customers include over 425,000 residences, almost 55,000 commercial firms, and almost 2,500 industrials, municipalities, and other electric utilities. Retail electric revenues accounted for approximately 91% of our total operating revenues over the last three 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 revenues recorded in the third quarter. In addition to our utility business, we have a wholly owned unregulated s ubsidiary called Home Service Solutions Inc. ("HSS"), which, through its subsidiary, provides primarily energy-related residential services.
Through a corporate restructuring consummated on October 1, 2001, Great Plains Energy Incorporated, a Missouri corporation incorporated in 2001 ("Great Plains Energy"), became the parent company and sole owner of Kansas City Power & Light Company's common stock. The restructuring was implemented through an Agreement and Plan of Merger whereby each outstanding share of Kansas City Power & Light Company stock was exchanged for
which no separate consideration will be received by anya share ofthe Registrants) all with an aggregate initial public offering price not to exceed $300,000,000. (2) Pursuant to Rule 457(n) and (o), the registration fee is calculated on the basis of the proposed aggregate maximum offering price of the Preferred Securities. (3) Includes the rights of holders of the Preferred Securities under the Guarantee Agreements and certain back-up undertakings as described in the Registration Statement. ------------------------THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.EXPLANATORY NOTE This Registration Statement containsGreat Plains Energy stock. As aprospectus and form of prospectus supplement to be used in connection with the offer and sale of Preferred Securities of KCPL Financing I, KCPL Financing II, and KCPL Financing III, each a Delaware business trust (collectively, the "Trusts").result, Great Plains Energy replaced Kansas City Power & Light Company as the listed entity on the New York Stock Exchange. Great Plains Energy is a public utility holding company registered with and subject, with its subsidiaries, including us, to regulation by theTrusts plan to consummate from time to time, transactions involving the sale of securities registered pursuant to this Registration Statement, provided that the proceeds therefrom will not exceed an aggregate amount of $300,000,000. No decisions have been made as to which securities will be issued or the timing or size of any offering of such securities. Such determinations will be made from time to time in the light of market and other conditions.Information contained in this prospectus supplement is subject to completion pursuant to Rule 424SEC under theSecuritiesPublic Utility Holding Company Act of1933. A registration statement relating1935 , as amended. In connection with the reorganization, we transferred tothese securities has been declared effectiveGreat Plains Energy our interest in two unregulated subsidiaries, Great Plains Power Incorporated and KLT Inc. For more details on the formation of the holding company and descriptions of the other Great Plains Energy subsidiaries, please refer to our 2002 Form 10-K, which is incorporated herein bythe Securities and Exchange Commission pursuant of Rule 415 under the Securities Act of 1933. A final prospectus supplement will be delivered to purchasers of these securities. This prospectus supplement and the prospectus shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there by any sale of these securities in any State in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such State. SUBJECT TO COMPLETION, DATED ______, 199_ PROSPECTUS SUPPLEMENT (TO PROSPECTUS DATED ________, 199_) PREFERRED SECURITIES % TRUST ORIGINATED PREFERRED SECURITIES-SM- ("TOPrS-SM-") KCPL FINANCING I (LIQUIDATION AMOUNT $25 PER PREFERRED SECURITY) FULLY AND UNCONDITIONALLY GUARANTEED BY KANSAS CITY POWER & LIGHT COMPANY ------------------- The %reference. Our principal executive office is located at 1201 Walnut, Kansas City, Missouri 64106 (Telephone: (816) 556-2200).THE TRUSTS
Each Trust
Originated Preferred Securities (the "Preferred Securities") offered hereby represent undivided preferred beneficial interests in the assets of KCPL Financing I,is a statutory business trustformedcreated under Delaware law pursuant to the filing of a certificate of trust with the Delaware Secretary of State on December 11, 1996. The business of each Trust is defined in a Declaration of Trust which will be amended and restated in its entirety by the Amended and Restated Declaration of Trust substantially in the form filed as an exhibit to the Registration Statement of which this prospectus forms a part (the "Trust Agreement"). Each Trust Agreement will be qualified as an indenture under thelawsTrust Indenture Act ofthe State of Delaware ("the "Trust"1939, as amended (the "1939 Act").Kansas City Power & LightThe Companya Missouri corporation ("KCPL"),will own allofthe common securities (the "Common Securities",and, together with the Preferred Securities, the "Trust Securities") of each Trust. The Trust Securities represent undivided beneficial interests in the assets of the respective Trusts. Each Trust exists for the exclusive purposes of (i) issuing its Trust Securities representing undivided beneficial interests in the assets ofthe Trust. Thesuch Trust,exists for the sole purpose of issuing the Trust Securities and(ii) investing theproceeds thereof in an equivalent amount of % Junior Subordinated Deferrable Interest Debentures due ____ (the "Subordinated Debentures") of KCPL. The Subordinated Debentures will mature on ,_____, which date may be shortened to a date not earlier than _______________, (such date, the "Stated Maturity"), in each (continued on next page) --------------------- SEE "RISK FACTORS" BEGINNING ON PAGE S-7 OF THIS PROSPECTUS SUPPLEMENT FOR CERTAIN INFORMATION RELEVANT TO AN INVESTMENT IN THE PREFERRED SECURITIES, INCLUDING THE PERIOD AND CIRCUMSTANCES DURING AND UNDER WHICH PAYMENTS OF DISTRIBUTIONS ON THE PREFERRED SECURITIES MAY BE DEFERRED AND THE RELATED UNITED STATES FEDERAL INCOME TAX CONSEQUENCES OF SUCH DEFERRAL. Application has been made to list the Preferred Securities on the New York Stock Exchange, Inc. (the "New York Stock Exchange"). If so approved, trading of the Preferred Securities on the New York Stock Exchange is expected to commence within a 30-day period after the initial delivery of the Preferred Securities. See "Underwriting." ----------------------- THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS TO WHICH IT RELATES. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- INITIAL PUBLIC UNDERWRITING PROCEEDS TO OFFERING PRICE (1) COMMISSION (2) TRUST (3)(4) Per Preferred Security $ (3) $ Total $ (3) $ - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- (1) Plus accrued distributions, if any, from _________ ____, 199_. (2) The Trust and KCPL have agreed to indemnify the several Underwriters against certain liabilities, including liabilities under the Securities Act of 1933, as amended. See "Underwriting." (3) In view of the fact that thegross proceeds of the sale of its Trust Securities in a related series of subordinated debt securities, and (iii) engaging inonly those other activities necessary or incidental to these purposes. The payment of periodic cash distributions on the Preferred Securities
will be invested in the Subordinated Debentures, KCPL has agreed to payof each Trust and payments on liquidation and redemption with respect to theUnderwriters as compensation (the "Underwriters' Compensation") for their arranging the investment therein of such proceeds $ per Preferred Security (or $ in the aggregate); provided, that such compensation for sales of 10,000 or morePreferred Securitiesto a single purchaser will be $ per Preferred Security. Therefore,of each Trust, in each case to the extentof such sales, the actual amount of Underwriters' Compensationeach Trust has funds available therefor, will beless thanguaranteed by theaggregate amount specified inCompany (individually, a "Guarantee" and collectively, thepreceding sentence. See "Underwriting." (4) Before deducting expenses"Guarantees") to the extent set forth under "Description of theofferingGuarantees."Each Trust's business and affairs will be conducted by its trustees, which
are payable by KCPL estimated at $ . ---------------- The Preferred Securities offered hereby are offered severallyshall be appointed by theUnderwriters,Company asspecified herein, subjectthe holder of the Common Securities: two officers of the Company as Administrative Trustees; The Bank of New York as Property Trustee; and The Bank of New York as Delaware Trustee (collectively, the "Securities Trustees"). The Property Trustee of each Trust will act as the indenture trustee with respect toreceipt and acceptance by them and subjectsuch Trust for purposes of compliance with the provisions of the 1939 Act.The principal place of business of each Trust shall be c/o the Company, 1201 Walnut, Kansas City, Missouri 64106-2124, telephone (816) 556-2200, Attn: Corporate Secretary.
Reference is made to
their rightthe prospectus supplement relating toreject any order in whole or in part. It is expected that delivery ofthe Preferred Securities of each Trust for further information concerning such Trust.ACCOUNTING TREATMENT OF TRUSTS
For financial reporting purposes, as currently treated, the Trusts will be
made onlytreated as subsidiaries of the Company and, accordingly, the accounts of the Trusts will be included inbook-entry form throughthefacilitiesconsolidated financial statements ofThe Depository Trustthe Companyon or about ,199_. ------------------- MERRILL LYNCH & CO. ------------------- The date(see below for potential effects ofthis Prospectus Supplementthe Financial Accounting Standards Board (FASB) Interpretation No. 46, "Consolidation of Variable Interest Entities"). If the Trusts are treated as subsidiaries of the Company, Statement of Financial Accounting Standards No. 150, "Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity", which is________ , 199_. - -SM-"Trust Originatedeffective July 1, 2003, for the Company, will require that the PreferredSecurities"Securities be presented as a separate line item in long-term debt in the consolidated statement of capitalization of the Company, and"TOPrS" are service marks of Merrill Lynch & Co., Inc. - -------------------------------------------------------------------------------- - --------------------------------------------------------------------------------(CONTINUED FROM PREVIOUS PAGE) case subject to satisfying certain conditions. The Subordinated Debentures when issuedappropriate disclosures concerning the Preferred Securit ies, the Guarantees and the subordinated debt securities will be included in the notes to the consolidated financial statements. For financial reporting purposes, the Company will record distributions payable on the Preferred Securities as an expense.In January 2003, the FASB issued Interpretation No. 46. The Interpretation clarifies the application of Accounting Research Bulletin (ARB) No. 51, "Consolidated Financial Statements", to certain entities in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties (Variable Interest Entities). FASB Interpretation No. 46 is effective July 1, 2003, for the Company. The Company is currently assessing the impact of FASB Interpretation No. 46 on Preferred Securities issued by a Trust. If, as a result of our assessment, we determine that under FASB Interpretation No. 46, the Company is not the primary beneficiary of the Trust, we would not be allowed to consolidate the Trust. This would result in the Company including its investment in the common stock of the Trust in its consolidated balance sheet. Additionally, the subordina ted debt securities issued by the Company and
held by the Trust would be presented as a separate line item in long-term debt in the consolidated statement of capitalization of the Company.
USE OF PROCEEDS
Each Trust will invest the proceeds received from the sale of its Preferred Securities in the Company's subordinated debt securities. 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 debt securities for general corporate purposes, including, among others:
*
Repayment of short term debt;
*
Repurchase, retirement or refinancing of other debt securities, trust preferred securities or leases;
*
Funding of construction expenditures; and
*
Acquisitions.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth our ratio of earnings to fixed charges for the periods indicated:
Six Months
Ended June 30,Year Ended December 31,
2003
2002
2001
2000
1999
1998
2.49
2.88
2.22
3.02
2.38
2.98
Our ratio of earnings to fixed charges includes our consolidated subsidiary HSS. In addition, the above ratios include KLT Inc. and Great Plains Power Incorporated for all periods prior to the October 1, 2001 reorganization.
For purposes of computing the ratio of earnings to fixed charges, "earnings" consists of net income from continuing operations before cumulative effect of changes in accounting principles, losses from equity investments and minority interests in consolidated subsidiaries with fixed charges, plus interest charges (excluding the reduction for capitalized interest), income taxes, and the estimated interest components of rents. "Fixed charges" consist of interest charges (excluding the reduction for capitalized interest) and the estimated interest components of rents.
DESCRIPTION OF DEBT SECURITIES
General. The senior debt securities and the subordinated debt securities, which we refer to collectively as the debt securities, will represent unsecured obligations of
KCPLthe Company. We may issue one or more series of debt securities directly to the public or to one or more Trusts. We expect that each series of senior debt securities or subordinated debt securities will be issued under a separate indenture, as each may be amended or supplemented from time to time. We will issue the senior debt securities in one or more series under a senior indenture that we will enter into with The Bank of New York, as trustee. We will issue the subordinated debt securities in one or more series under asubordinated indenture we will enter into with The Bank of New York, as trustee. The form of the senior indenture and the form of the subordinated indenture are filed as exhibits to the registration statement of which this prospectus is a part. Each indenture will be qualified under the Trust Indenture Act of 1939. The following summaries of certain provisions of the senior indenture, the subordinated indenture and the applicable debt securities do not purport to be complete and are subject to, and qualified in their entirety by, all of the provisions of the senior indenture, the subordinated indenture, including the definition of certain terms, and the applicable debt securities. You should carefully read the summary below and the provisions of the indentures that may be important to you before investing. Copies of the indentures will be available at the offices of the Trustee at 101 Barclay Street, 8th Floor West, New York, NY 10286.
We may authorize the issuance and provide for the terms of a series of debt securities as described in the indentures. There will be no requirement under either the senior indenture or the subordinated indenture that our future issuances of debt securities be issued exclusively under either indenture. We will be free to employ other indentures or documentation containing provisions different from those included in either indenture or applicable to one or more issuances of senior debt securities or subordinated debt securities, as the case may be, in connection with future issuances of other debt securities. The senior indenture and the subordinated indenture will provide that the applicable debt securities will be issued in one or more series, may be issued at various times, may have differing maturity dates and may bear interest at differing rates. We need not issue all debt securities of one series at the same time and, unless otherwise provided, we may reopen a series, without the consent of the holders of the senior debt securities or the subordinated debt securities of that series, as the case may be, for issuances of additional senior debt securities or subordinated debt securities of that series, as applicable. One or more series of the debt securities may be issued with the same or various maturities at par, above par or at a discount. Debt securities 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, neither indenture described above will limit the aggrega te 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 indentures. Both indentures 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 senior debt securities will be our direct unsecured general obligations and will rank equally with all of our other unsecured and unsubordinated debt. As of June 30, 2003, our aggregate outstanding debt that would have ranked equally with the senior debt securities was approximately $821.5 million. The subordinated debt securities will be our direct unsecured general obligations and will be junior in right of payment to our Senior Indebtedness
Unless otherwise provided in a prospectus supplement, the debt securities 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 June 30, 2003, there was approximately $213.8 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 & Poor's or Moody's 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 June 30, 2003, the proportion of secured debt to total indebtedness was ap proximately 21%.
Provisions of a Particular Series. The prospectus supplement applicable to each issuance of debt securities will specify, among other things:
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the title and any limitation on aggregate principal amount of the debt securities;
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the original issue date of the debt securities;
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the date or dates on which the principal of any of the debt securities 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 debt securities, and the date from which interest will accrue;
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the terms, if any, regarding the optional or mandatory redemption of any debt securities, including the redemption date or dates, if any, and the price or prices applicable to such redemption;
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the denominations in which such debt securities will be issuable;
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the period or periods within which, the price or prices at which and the terms and conditions upon which any debt securities 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 debt securities shall be payable;
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the obligation, if any, of the Company to redeem, purchase, or repay the debt securities, 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 debt securities shall be redeemed, purchased, or repaid pursuant to such obligation;
*whether the debt securities 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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any addition, deletion or modification to the events of default applicable to that series of debt securities and the covenants for the benefit of the holders of that series;
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any remarketing features of the debt securities;
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any collateral, security, assurance, or guarantee for the debt security;
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if other than the principal amount thereof, the portion of the principal amount of the debt securities payable upon declaration of acceleration of the maturity of the debt securities;
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the securities exchange(s), if any, on which the debt securities will be listed;
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the terms, if any, pursuant to which debt securities may be converted into or exchanged for shares of our capital stock or other securities;
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any interest deferral or extension provisions;
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the applicability of or any change in the subordination provisions for a series of debt securities;
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the terms of any warrants we may issue to purchase debt securities; and
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any other terms of the debt securities not inconsistent with the provisions of the applicable indenture.
The terms of any subordinated debt securities issued to a Trust will correspond to those of the related Preferred Securities of such Trust as described in the prospectus supplement relating to such Preferred Securities.
Subordination. The subordinated debt securities will be subordinate and junior in right of payment to all of our Senior Indebtedness, as defined below.
In the event (a) of any insolvency or bankruptcy proceeding or any receivership, liquidation, reorganization or other similar proceedings in respect of the Company or a substantial part of its property or of any proceedings for liquidation, dissolution or other winding up of the Company, whether or not involving insolvency or bankruptcy, or (b) subject to the terms of the subordinated indenture, that a default shall have occurred with respect to the payment of principal or interest on any Senior Indebtedness, and such default shall have continued beyond the period of grace and shall not have been cured, waived or ceased to exist, or (c) that the principal of and accrued interest on the subordinated debt securities of any series shall have been declared due and
payable and such declaration shall not have been rescinded or annulled, then all Senior Indebtedness must be paid in full before the holders of the subordinated debt securities are entitled to receive any payment.
The rights of the holders of the subordinated debt securities will be subrogated to the rights of the holders of Senior Indebtedness to receive payments or distributions applicable to Senior Indebtedness until all amounts owing on the subordinated debt securities are paid in full. If provided in the applicable prospectus supplement, limited subordination periods may apply in the event of non-payment defaults relating to Senior Indebtedness in situations where there has not been an acceleration of Senior Indebtedness.
As defined in the subordinated indenture, the term "Senior Indebtedness" means:
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obligations (other than non-recourse obligations, the indebtedness issued under the subordinated indenture and other indebtedness which is either effectively by its terms or expressly made subordinate to or pari passu with the subordinated debt securities) of, or guaranteed (except to the extent our payment obligations under any such guarantee are subordinate to or pari passu with the subordinated debt securities) or assumed by, us for
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borrowed money, including both senior and subordinated indebtedness for borrowed money (other than the subordinated debt securities or other indebtedness which is expressly made subordinate to or pari passu with the subordinated debt securities); or
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the payment of money relating to any lease which is capitalized on our balance sheet in accordance with generally accepted accounting principles as in effect from time to time; or
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indebtedness evidenced by bonds, debentures, notes or other similar instruments, and
in each case, amendments, renewals, extensions, modifications and refundings of any such indebtedness or obligations with Senior Indebtedness, whether existing as of the date of the subordinated indenture or subsequently incurred by us.
The subordinated indenture will not limit the aggregate amount of Senior Indebtedness that we may issue. As of June 30, 2003, our outstanding Senior Indebtedness totaled approximately $1,035.3 million.
Certain Covenants. We will covenant in the subordinated indenture, for the benefit of the holders of each series of subordinated debt securities, that, (i) if at such time we shall have given notice of our election to extend an interest payment period for such series of subordinated debt securities and such extension shall be continuing, (ii) if at such time we shall be in default with respect to our payment or other obligations under the
Guarantee with respect to the Trust Securities, if any, related to such series of subordinated debt securities, or (iii) if at such time an Event of Default under the subordinated indenture with respect to such series of subordinated debt securities shall have occurred and be continuing, (a) we shall not declare or pay any dividend or make any distributions with respect to, or redeem, purchase, acquire or make a liquidation payment with respect to, any of our capital stock, (b) we shall not make any payment of interest, principal or premium, if any, on or repay, repurchase or redeem any debt securities (including guarantees other than the Guarantees) issued by us which rank equally with or junior to the subordinated debt securities, and (c) we shall not make guarantee payments with respect to the foregoing (other than pursuant to the Guarantees). None of the foregoing, however, shall restrict (i) any of the actions described in the preceding sentence resulting from a ny reclassification of our capital stock or the exchange or conversion of one class or series of our capital stock for another class or series of our capital stock; (ii) the purchase of fractional interests in shares of our capital stock pursuant to the conversion or exchange provisions of such capital stock or the security being converted or exchanged; or (iii) purchases or acquisitions of shares of Company common stock in connection with any employee benefit plans, any employee contracts or other similar arrangements with or for the benefit of any one or more employees, officers, directors or consultants or in connection with a dividend reinvestment or shareholders' stock purchase plan.
The subordinated indenture further will provide that, for so long as the Trust Securities of any Trust remain outstanding, we covenant (i) to directly or indirectly maintain 100% ownership of the Common Securities of such Trust; provided, however, that any permitted successor of us under the subordinated indenture may succeed to our ownership of such Common Securities; (ii) to not cause, as sponsor of such Trust, or permit, as holder of Common Securities of such Trust, the dissolution, winding-up, or termination of such Trust, except in connection with a distribution of subordinated debt securities as provided in the Trust Agreement and in connection with certain mergers, consolidations or amalgamations permitted by the Trust Agreement; and (iii) to use reasonable efforts to cause such Trust (a) to remain a statutory business trust, except in connection with the distr ibution of subordinated debt securities to the holders of Trust Securities in liquidation of such Trust, the redemption of all of the Trust Securities of such Trust, or certain mergers, consolidations or amalgamations, each as permitted by the related Trust Agreement, and (b) to otherwise continue to be classified as a grantor trust for United States federal income tax purposes.
Registration, Transfer and Exchange.Unless otherwise indicated in the applicable prospectus supplement, each series of debt securities, other
indebtednessthan debt securities issued to a Trust, will initially be issued in the form ofKCPL,one or more global securities, in registered form, without coupons, as describedherein.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 debt securities registered in their names, will not receive or be entitled to receive physical delivery of any debt securities and will not be considered the registered holders thereof under the applicable indenture.Debt securities of any series will be exchangeable for other debt securities of the same series of any authorized denominations and of a like aggregate principal amount
and tenor. Subject to the terms of the applicable indenture and the limitations applicable to global securities, debt securities 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 applicable indenture.
Unless otherwise indicated in the applicable prospectus supplement, the transfer agent will be the trustee under the applicable 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 debt securities of each series.
Payment and Paying Agents.Principal of and interest and premium, if any, on debt securities 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 debt securities of a particular series in the form of certificated securities will be payable at the office of the applicable trustee or at the authorized office of any paying agent or paying agents upon presentation and surrender of such debt securities. 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 debt securities of a particular series. Unless otherwise indicated in the applicable prospectus supplement, interest on the debt securities of a particular series, other than interest at maturity, that are in the form of certificated securities will be paid by ch eck payable in clearinghouse funds mailed to the person entitled thereto at such person's address as it appears on the register for such debt securities maintained by the applicable trustee. All monies we pay to a trustee or a paying agent for the payment of the principal of, and premium or interest, if any, on, any debt security 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 debt security 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 debt securities will be set forth in the applicable prospectus supplement. Unless otherwise indicated in the applicable prospectus supplement, debt securities 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 debt securities of a series are to be redeemed, the particular debt securities 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 debt securities 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 debt securities.
Consolidation, Merger and Sale or Disposition of Assets.We may, without the consent of the holders of any debt securities,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, provided that:
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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 the due and punctual payment of the principal of and premium and interest, if any, on all the debt securities outstanding under each indenture and the performance of every covenant of each indenture to be performed or observed by us;
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we have delivered to the trustees for such debt securities an officer's certificate and an opinion of counsel as will be provided in each of the indentures; 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 applicable 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 applicable indenture.
Certain of the indentures for our debt securities provide that the sale, conveyance or other transfer by the Company of its facilities for the generation of electric energy to any affiliate of the Company, shall not be subject to other restrictions on sales, conveyances, or other transfers provided that the facilities shall not in the aggregate represent assets with a depreciated value on the books of the Company in excess of 65% of the depreciated value of the Company's total assets as set forth in its most recent report filed on Form 10-K or 10-Q as of the date of the sale, conveyance, or other transfer.
Modification.Without the consent of any holder of debt securities, the trustee for such debt securities 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 debt securities of any series in any material respect;
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to change or eliminate any provision of the applicable indenture, provided that any such change or elimination will become effective with respect to such series only when there is no debt security 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 debt securities of such series issued after the effective date of such change or elimination;
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to establish the form or terms of debt securities of any series as permitted by the applicable indenture;
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to evidence the assumption of our covenants in the applicable indenture and the debt securities by any permitted successor;
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to grant to or confer upon the trustee for any debt securities for the benefit of the holders of such debt securities, any additional rights, remedies, powers or authority;
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to permit the trustee for any debt securities 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 debt securities, any authenticating agent and any paying agent, and to evidence the succession of a successor trustee as permitted under the applicable indenture;
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to add to our covenants for the benefit of the holders of all or any series of outstanding debt securities, to add to the security of all debt securities, to surrender any right or power conferred upon us by the applicable indenture or to add any additional events of default with respect to all or any series of outstanding debt securities; and
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to make any other change that is not prejudicial to the holders of any debt securities.
Except as provided above, the consent of the holders of a majority in aggregate principal amount of either the senior debt securities or the subordinated debt securities, as the case may be, 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 applicable indenture pursuant to one or more supplemental indentures or of modifying or waiving in any manner the rights of the holders of the applicable debt securities; provided, however, that if less than all of the series of senior debt securities or subordinated debt securities outstanding, as the case may be, 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 debt securities 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 debt securities affected thereby:
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change the maturity date of the principal of any debt security;
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reduce the principal amount of, or premium payable on, any debt security;
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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 debt security;
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change the coin or currency of any payment of principal of, or any premium or interest on any debt security;
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change the date on which any debt security 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 debt security; or
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modify the foregoing requirements or reduce the percentage of outstanding debt securities necessary to modify or amend the applicable indenture or to waive any past default.
A supplemental indenture which changes or eliminates any covenant or other provision of the applicable indenture which has expressly been included solely for the benefit of one or more series of debt securities, or which modifies the rights of the holders of debt securities of such series with respect to such covenant or provision, will be deemed not to affect the rights under the applicable indenture of the holders of the debt securities of any other series.
Events of Default. Unless specifically deleted in a supplemental indenture or Board resolution under which a series of debt securities is issued, or modified in any such supplemental indenture, each of the following will constitute an event of default under the
Declaration (as defined below),senior indenture or the subordinated indenture with respect to senior debt securities or subordinated debt securities, as the case may be, of any series:
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failure to pay principal of or premium, if any, on any debt security of such series, as the case may be, within one day after the same becomes due and payable;
*failure to pay interest on the debt securities of such series within 30 days after the same becomes due and payable; provided, however, that a valid extension of the interest payment period or deferral of interest payment by us as contemplated in the subordinated indenture shall not constitute a failure to pay interest for this purpose; and provided, further, that with respect to subordinated debt securities, no such default shall be deemed to exist if, on or prior to the date on which such interest became due, we shall
have made a payment sufficient to pay such interest pursuant to the Guarantee related to the Trust Securities of the Trust owning the subordinated debt securities, and shall have delivered a notice to the Trustee to that effect;
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failure to perform or breach of any of our other covenants or warranties in the applicable indenture (other than a covenant or warranty solely for the benefit of one or more series of debt securities 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 debt securities 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 debt securities of a particular series.
No event of default with respect to the debt securities of a particular series necessarily constitutes an event of default with respect to the debt securities of any other series issued under the applicable indenture.
If an event of default with respect to any series of debt securities occurs and is continuing, then either the trustee for such series or the holders of
Preferred Securities will haveapreference overmajority in aggregate principal amount of the outstanding debt securities of such series, by notice in writing, may declare the principal amount of and interest on all of the debt securities 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 debt securities under a particular indenture, the trustee for such series or the holders of a majority in aggregate principal amount of the outstanding debt securities of all such series, considered as one class, may make such declaration of acceleration and not the holders of theCommon Securitiesdebt securities of any one of such series.At any time after an acceleration with respect to
paymentsthe debt securities ofdistributions and payments upon redemption, liquidation and otherwise. Holdersany series has been declared, but before a judgment or decree for the payment of thePreferred Securities aremoney 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 debt securities of such series, the principal of and premium, if any, on the debt securities of such series which have become due otherwise than by acceleration and interest thereon at the rate or rates specified in such debt securities, interest upon overdue installments of interest at the rate or rates specified in such debt securities, to the extent that payment of such interest is lawful, and all amounts due to the trustee for such series under the applicable indenture; and
*any other event or events of default with respect to the debt securities of such series, other than the nonpayment of the principal of and accrued
interest on the debt securities of such series which has become due solely by such acceleration, have been cured or waived as provided in the applicable 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 applicable 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 applicable 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 applicable indenture, the holders of a majority in aggregate principal amount of the outstanding debt securities 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 debt securities of that seri es; provided, however, that if an event of default occurs and is continuing with respect to more than one series of debt securities, the holders of a majority in aggregate principal amount of the outstanding debt securities of all those series, considered as one class, will have the right to make such direction, and not the holders of the debt securities of any one series. Any direction provided by the holders shall not be in conflict with any rule of law or with the senior indenture or the subordinated indenture, as the case may be, and will not involve the trustee in personal liability in circumstances where reasonable indemnity would not, in the trustee's 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 debt securities of any series may waive any past default under the applicable indenture on behalf of all holders of debt securities of that series with respect to the debt securities of that series, except a default in the payment of principal of or any premium or interest on such debt securities. No holder of debt securities of any series may institute any proceeding with respect to the applicable 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 debt securities of such series, the holders of a majority in aggregate principal amount of the outstanding debt securities 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 debt securities of any series will be entitled to
receive cumulative cash distributions at an annual rate of % of the liquidation amount of $25 per Preferred Security, accruing from the date of original issuance and payable quarterly in arrears on March 31, June 30, September 30 and December 31 of each year, commencing ("distributions"). The payment of distributions out of moneys held by the Trust and payments on liquidation of the Trust or the redemption of Preferred Securities, as set forth below, are guaranteed by KCPL (the "Preferred Securities Guarantee") to the extent described herein and under "Description of Preferred Securities Guarantees" in the accompanying Prospectus. The Preferred Securities Guarantee covers payments of distributions and other payments on the Preferred Securitiesinstitute any such action if and to the extent that such action would disturb or prejudice theTrustrights of other holders of those debt securities.Notwithstanding the foregoing, each holder of debt securities of any series has
funds available therefor,the right, whichwillis absolute and unconditional, to receive payment of the principal of and premium and interest, if any, on such debt securities when due and to institute suit for the enforcement of any such payment, and such rights may not be impaired without thecase unless KCPL has made paymentsconsent ofinterest or principal or other payments on the Subordinated Debentures held by the Trust as its sole asset.that holder of debt securities.The
Preferred Securities Guarantee, when taken together with KCPL's obligations under the Subordinated Debentures and the Indenture (as defined below) and its obligations under the Declaration, including its liabilities to pay costs, expenses, debts and obligationstrustee, within 90 days after it receives notice of theTrust (other thanoccurrence of a default with respect to theTrust Securities), provide a full and unconditional guaranteedebt securities ofamounts due onany series, is required to give thePreferred Securities. See "Risk Factors-Rights Under the Preferred Securities Guarantee" herein. The obligations of KCPL under the Preferred Securities Guarantee are subordinate and junior in right of payment to all other liabilities of KCPL and rank PARI PASSU with the most senior preferred stock issued from time to time by KCPL. The obligations of KCPL under the Subordinated Debentures are subordinate and junior in right of payment to all present and future Senior Indebtedness (as defined herein) of KCPL, which aggregated approximately $ at September 30, 1996, and rank PARI PASSU with KCPL's other general unsecured creditors. The Subordinated Debentures purchased by the Trust may be subsequently distributed pro rata toholders of thePreferred Securities and Common Securitiesdebt securities of that series notice of such default, unless cured or waived, but, except inconnection withthedissolutioncase ofthe Trust. The distribution rate and the distribution payment date and other payment dates for the Preferred Securities will correspond to the interest rate and interest payment date and other payment dates on the Subordinated Debentures, which will be the sole assets of the Trust. As a result, if principal or interest is not paid on the Subordinated Debentures, no amounts will be paid on the Preferred Securities. If KCPL does not make principal or interest payments on the Subordinated Debentures, the Trust will not have sufficient funds to make distributions on the Preferred Securities. In such event, the Preferred Securities Guarantee will not apply to such distributions until the Trust has funds available therefor. So long as KCPL is not indefault in the payment ofinterest on the Subordinated Debentures, KCPL has the right to defer paymentsprincipal of,interest on the Subordinated Debentures by extending the interest payment period on the Subordinated Debentures at any time for up to 20 consecutive quarters (each, an "Extension Period"), provided that an Extension Period may not extend beyond the Stated Maturity of the Subordinated Debentures. If interest payments are S-5so deferred, distributions on the Preferred Securities will also be deferred. During such Extension Period, distributions will continue to accrue with interest thereon (to the extent permitted by applicable law) at an annual rate of % percent per annum compounded quarterly, and during any Extension Period holders of Preferred Securities will be required to include deferred interest income in their gross income for United States federal income tax purposes in advance of receipt of the cash distributions with respect to such deferred interest payments. There could be multiple Extension Periods of varying lengths throughout the term of the Subordinated Debentures. See "Description of the Subordinated Debentures--Option to Extend Interest Payment Period," "Risk Factors--Option to Extend Interest Payment Period" and "United States Federal Income Taxation--Interest Income and Original Issue Discount." The Subordinated Debentures are redeemable by KCPL, in wholeorin part, from time to time, on or after , or, in whole but not in part, prior to , upon the occurrence of a Tax Event (as defined herein). If KCPL redeems Subordinated Debentures, the Trust must redeem Trust Securities on a pro rata basis having an aggregate liquidation amount equal to the aggregate principal amount of the Subordinated Debentures so redeemed at $25 per Preferred Security plus accrued and unpaid distributions thereon (the "Redemption Price") to the date fixed for redemption. See "Description of the Preferred Securities-Tax Event Redemption." The Preferred Securities will be redeemed upon maturity of the Subordinated Debentures. KCPL will have the right at any time to liquidate the Trust and cause the Subordinated Debentures to be distributed to the holders of the Trust Securities. If the Subordinated Debentures are distributed to the holders of the Preferred Securities, KCPL will use its best efforts to have the Subordinated Debentures listed on the New York Stock Exchange or on such other exchange as the Preferred Securities are then listed. See "Description of the Preferred Securities--Termination of the Trust and Distribution of Subordinated Debentures" and "Description of the Subordinated Debentures." In the event of the involuntary or voluntary dissolution, winding-up or termination of the Trust, the holders of the Preferred Securities will be entitled to receive for each Preferred Security a liquidation amount of $25 plus accrued and unpaid distributions thereon (including interest thereon) to the date of payment, unless, in connection with such dissolution, the Subordinated Debentures are distributed to the holders of the Preferred Securities. IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT TRANSACTIONS THAT STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SECURITIES OFFERED HEREBY AT LEVELS ABOVE THOSE THAT MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH TRANSACTIONS MAY BE EFFECTED ON THE NEW YORK STOCK EXCHANGE, IN THE OVER-THE-COUNTER MARKET OR OTHERWISE. SUCH STABILIZING TRANSACTIONS, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. S-6RISK FACTORS Prospective purchasers of Preferred Securities should carefully review the information contained elsewhere in this Prospectus Supplement and in the accompanying Prospectus and should particularly consider the following matters. ABSENCE OF PRIOR PUBLIC MARKET Prior to this offering, there has been no public market for the Preferred Securities. Although application has been made to list the Preferred Securities on the New York Stock Exchange, there can be no assurance that, once listed, an active trading market will develop for the Preferred Securities or that, if such market develops, the market price will equal or exceed the public offering price set forth on the cover page of this Prospectus Supplement. RANKING OF PREFERRED SECURITIES GUARANTEE AND SUBORDINATED DEBENTURES KCPL's obligations under the Guarantee are subordinate and junior in right of payment to all other liabilities of KCPL, including the Subordinated Debentures, and rank PARI PASSU with the most senior preferred stock issued from time to time by KCPL. The obligations of KCPL under the Subordinated Debentures are subordinate and junior in right of payment to all present and future Senior Indebtedness of KCPL and rank PARI PASSU with obligations to or rights of KCPL's other general unsecured creditors. No payment may be made of the principal of,premium, if any, or interest on, theSubordinated Debentures,debt securities 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 debt securities 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 applicable indenture, determined without regard to any period of grace or requirement of notice under such indenture.Defeasance and Discharge. Unless the applicable prospectus supplement states otherwise, we may elect either:
1.
to defease and be discharged from any and all obligations in respect of the debt securities of any series then outstanding under the applicable indenture (except for certain obligations to register the transfer or exchange of the debt securities of such series, replace stolen, lost or mutilated notes, maintain paying agencies and hold monies for payment in trust); or
2.
to be released from the obligations of the senior indenture with respect to the senior debt securities of any series or the subordinated indenture with respect to the subordinated debt securities of any series under any covenants applicable to the debt securities 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), we are required to deposit, in trust, with the applicable 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 debt securities of such series on the dates payments are due (which may include one or more redemption dates designated by us). This trust may only be established if, among other things, (A) 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 applicable indenture has occurred and is continuing on the date of the deposit, and 91 days have passed after the deposit has been made and, during that period, certain events of default have not occurred and are continuing as of the end of that period, (B) the deposit will not cause the trustee to have any conflicting interest with respect to our other securities and (C) we 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 is 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.
We may exercise our defeasance option under paragraph (1) with respect to debt securities of any
redemption, retirement, purchase or other acquisitionseries notwithstanding our prior exercise of our covenant defeasance option under paragraph (2). If we exercise our defeasance option for debt securities of any series, payment of the debt securities of such series may not be accelerated because of a subsequent event of default. If we exercise our covenant defeasance option for debt securities of any series, payment of the debt securities of such series may not be accelerated by reference to a subsequent breach of any of theSubordinated Debentures,covenants noted under clause (2) in the preceding paragraph. In the event we fail to comply with our remaining obligations with respect to the debt securities of any series under the applicable indenture after exercising our covenant defeasance option and the debt securities of such serie s 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 debt securities 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
when (i) thereupon 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 debt securities 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 debt securities 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 debt security outstanding and the trustee, and appoint a successor trustee.Concerning the Trustee. As of June 30, 2003, The Bank of New York, which will be the Senior Indenture Trustee, the Subordinated Indenture Trustee, the Senior Property Trustee and the Guarantee Trustee, was the trustee for $ 991.9 million of the Company's secured and unsecured debt under seven separate indentures. The Bank of New York is also a depository for funds and performs other services for, and transacts other banking business with our affiliates and us in the
paymentnormal course and may do so in the future.Each indenture will provide 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 ofprincipal, premium, interestthe applicable debt securities upon the property and funds held orany other payment duecollected by the trustee as such.Governing Law. The senior indenture, the subordinated indenture and the related debt securities will be governed by New York law.
DESCRIPTION OF THE PREFERRED SECURITIES
Each Trust may issue only one series of Preferred Securities having terms described in the prospectus supplement relating thereto. The Trust Agreement of each Trust will authorize the Administrative Trustees, on
any Senior Indebtedness, or (ii)behalf of thematurity of any Senior Indebtedness has been accelerated because of a default. As of September 30, 1996, Senior Indebtedness of KCPL aggregated approximately $____ million. There are no terms inTrust, to issue the Preferred Securities of such Trust. The Preferred Securities of each Trust will have such terms, including distributions, redemption, voting, liquidation rights and such other preferred,deferral or other special rights or such restrictions as shall be set forth in the
Subordinated Debentures or the Guarantee that limit KCPL's ability to incur additional indebtedness, including indebtedness which ranks seniorTrust Agreement of such Trust. Reference is made to theSubordinated Debentures and the Guarantee. See "Description ofprospectus supplement relating to the Preferred SecuritiesGuarantees--Statusof a Trust for specific terms, including:
*
the distinctive designation of such Preferred Securities;
*
the number of Preferred Securities issued by such Trust;
*
the annual distribution rate (or method of determining such rate) for Preferred Securities of such Trust and the date or dates on which such distributions shall be payable;
*
whether distributions on such Preferred Securities shall be cumulative and, in the case of Preferred Securities having cumulative distribution rights, the date or dates, or method of determining the date or dates, from which distributions on such Preferred Securities shall be cumulative;
*
the amount or amounts that shall be paid out of the assets of such Trust to the holders of the Preferred Securities of such Trust upon voluntary or involuntary dissolution, winding-up or termination of such Trust;
*
the obligation, if any, of such Trust to purchase or redeem such Preferred Securities and the price or prices at which, the period or periods within which, and the terms and conditions upon which such Preferred Securities shall be purchased or redeemed, in whole or in part, pursuant to such obligation;
*
the voting rights, if any, of such Preferred Securities in addition to those required by law, including the number of votes per Preferred Security and any requirement for the approval by the holders of Preferred Securities as a condition to specified action or amendments to the Trust Agreement of such Trust;
*
the rights, if any, to defer distributions on the Preferred Securities by extending the interest payment period on the related subordinated debt securities; and
*
any other relative rights, preferences, privileges, limitations or restrictions of such Preferred Securities not inconsistent with the Trust Agreement of such Trust or applicable law.
All Preferred Securities offered hereby will be guaranteed by the Company to the extent set forth under ""Description of the Guarantees.'' Any material United States federal income tax considerations applicable to an offering of Preferred Securities
Guarantees"will be described in the prospectus supplement relating thereto.DESCRIPTION OF THE RELATED GUARANTEES
Set forth below is a summary of information concerning the Guarantees that will be executed and
"Descriptiondelivered by the Company for the benefit of theSubordinated Debentures" in the accompanying Prospectus, and "Descriptionholders of Preferred Securities of theSubordinated Debentures--Subordination" herein. RIGHTS UNDER THE PREFERRED SECURITIES GUARANTEE The Preferred Securitiesrespective Trusts from time to time. Each Guarantee will be qualified as an indenture under theTrust Indenture1939 Act. TheFirst NationalBank ofChicagoNew York will act asindenturetrustee under each Guarantee (the "Guarantee Trustee'') for purposes of the 1939 Act. The terms of the respective Guarantees will be those set forth therein and those made part thereof by the 1939 Act. The following summary does not purport to be complete and is subject in all respects to the provisions of, and is qualified in its entirety by reference to, the Guarantees, the form of which is filed as an exhibit to the Registration Statement of which this prospectus forms a part, and the 1939 Act. Each Guarantee will be held by the Guarantee Trustee for the benefit of holders of the Preferred Securities to which it relates.General. Pursuant to each Guarantee,
forthepurposes of compliance withCompany will irrevocably and unconditionally agree, to theprovisionsextent set forth therein, to pay in full, to the holders of the related Preferred Securities, the Guarantee Payments (as defined herein), to the extent not paid by, or on behalf of, the related Trust,Indenture Act (the "Guarantee Trustee").as and when due, regardless of any defense, right of set-off or counterclaim that the Company may have or assert against any person. TheGuarantee Trustee will holdfollowing payments or distributions with respect to the Preferred Securities of any Trust to the extent not paid or made by, or on behalf of, such Trust will be subject to the Guarantee related thereto (without duplication):
*
any accrued and unpaid distributions required to be paid on the Preferred Securities of such Trust but if and only if and to the extent that such Trust has funds available therefor;
*
the redemption price, including all accrued and unpaid distributions to the date of redemption (the ""Redemption Price''), with respect to any Preferred Securities called for redemption by such Trust, but if and only to the extent such Trust has funds available therefor; and
*
upon a dissolution, winding-up or termination of such Trust (other than in connection with the distribution of subordinated debt securities to the holders of Trust Securities of such Trust or the redemption of all of the Preferred Securities of such Trust), the lesser of
-
the aggregate of the liquidation amount and all accrued and unpaid distributions on the Preferred Securities of such Trust to the date of payment, to the extent such Trust has funds available therefore; and
-
the amount of assets of such Trust remaining available for distribution to holders of Preferred Securities of such Trust in liquidation of such Trust
(the "Guarantee Payments'').
The Company's obligation to make a Guarantee Payment may be satisfied by direct payment of the required amounts by the Company to the holders of the related Preferred Securities or by causing the related Trust to pay such amounts to such holders.
Each Guarantee will be a guarantee of the Guarantee Payments with respect to the related Preferred Securities from the time of issuance of such Preferred Securities, but will not apply to the payment of distributions and other payments on such Preferred Securities when the related Trust does not have sufficient funds available to make such distributions or other payments.If the Company does not make interest payments on the subordinated debt securities held by the Property Trustee under any Trust, such Trust will not make distributions on its Preferred Securities.
Subordination. The Company's obligations under each Guarantee to make the Guarantee Payments will constitute an unsecured obligation of the Company and will rank:
*
subordinate and junior in right of payment to all other liabilities of the Company, including the subordinated debt securities, except those liabilities of the Company made pari passu or subordinate by their terms,
*
pari passu with the most senior preferred stock now or hereafter issued by the Company and with any guarantee now or hereafter entered into by the Company in respect of any preferred securities of any affiliate of the Company, and
*
senior to all common stock of the Company.
The terms of the Preferred Securities will provide that each holder of Preferred Securities by acceptance thereof agrees to the subordination provisions and other terms of the Guarantee related thereto. The Company has outstanding common stock that ranks junior to the Guarantees.
Each Guarantee will constitute a guarantee of payment and not of collection (that is, the guaranteed party may institute a legal proceeding directly against the guarantor to enforce its rights under the guarantee without first instituting a legal proceeding against any other person or entity).
Amendments and Assignment. Except with respect to any changes that do not materially and adversely affect the rights of holders of the related Preferred Securities (in which case no consent will be required), each Guarantee may be amended only with the prior approval of the holders of not less than 66 2/3% in liquidation amount of all of such outstanding Preferred Securities. The manner of obtaining any such approval of holders of the Preferred Securities will be as set forth in an accompanying prospectus supplement. All guarantees and agreements contained in each Guarantee shall bind the successors, assigns, receivers, trustees and representatives of the Company and shall inure to the benefit of the holders of the
Preferred Securities. Therelated Preferred Securities then outstanding.Termination. Each Guarantee
guaranteeswill terminate and be of no further force and effect as to the related Preferred Securities upon full payment of the Redemption Price of allsuch Preferred Securities, upon distribution of subordinated debt securities to the holders of
thesuch Preferred Securitiesthein exchange for all such Preferred Securities, or upon full payment of(i) any accrued and unpaid distributions that are requiredthe amounts payable upon liquidation of the related Trust. Each Guarantee will continue to bepaid oneffective or will be reinstated, as the case may be, if at any time any holder of the related Preferred Securitiesto the extent the Trust has funds available therefor, (ii) the Redemption Price, including all accrued and unpaid distributionsmust restore payment of any sums paid with respect to such Preferred Securitiescalled for redemptionor under such Guarantee.Events of Default. An event of default under each Guarantee will occur upon the failure by the
Trust,Company tothe extent the Trust has funds available therefor, and (iii) upon a voluntaryperform any of its payment orinvoluntary dissolution, winding-up or termination of the Trust (other than in connection with the distribution of Subordinated Debentures to the holders of Preferred S-7Securities or a redemption of all the Preferred Securities), the lesser of (a) the aggregate of the liquidation amount and all accrued and unpaid distributions on the Preferred Securities to the date of the payment to the extent the Trust has funds available therefor or (b) the amount of assets of the Trust remaining available for distribution to holders of the Preferred Securities in liquidation of the Trust.other obligations thereunder. The holders of a majority in liquidation amount of the Preferred Securities to which any Guarantee relates have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Guarantee Trustee in respect of such Guarantee orto direct the exercise ofexercising any trust or power conferred upon the Guarantee Trustee underthe Preferred Securitiessuch Guarantee.Notwithstanding the foregoing, anyAny holder of the related Preferred Securities may institute a legal proceeding directly againstKCPLthe Company to enforcesuch holder'sits rights underthe Preferred Securitiessuch Guarantee without first instituting a legal proceeding againstthe Trust,or requesting or directing that action be taken by the Guarantee Trustee or any otherperson or entity. If KCPL were to defaultperson. The holders of a majority in liquidation amount of Preferr ed Securities of any series may, by vote, onits obligation to pay amounts payable onbehalf of theSubordinated Debentures or otherwise, the Trust would lack available funds for the paymentholders ofdistributions or amounts payable on redemption ofall the Preferred Securities of such series, waive any past event of default and its consequences.Information Concerning the Guarantee Trustee. The Guarantee Trustee, prior to the occurrence of any event of default with respect to any Guarantee and after the curing or
otherwise,waiving of all events of default with respect to such Guarantee, will undertake to perform only such duties as are specifically set forth in such Guarantee and, in case an event of default has occurred (that has not been cured or waived), the Guarantee Trustee shall exercise suchevent,of the rights and powers vested in it by such Guarantee and use the same degree of care and skill as a prudent individual would exercise or use in the conduct of his or her own affairs. Subject to such provisions, the Guarantee Trustee is under no obligation to exercise any of the rights or powers vested in it by any Guarantee at the request or direction of any holder of the related Preferred Securities, unless offered reasona ble indemnity against the costs, expenses and liabilities which might be incurred thereby.The Bank of New York, the Guarantee Trustee, also serves as Property Trustee, the Senior Indenture Trustee, and the Subordinated Indenture Trustee.
Governing Law. Each Guarantee will be governed by, and construed in accordance with, the internal laws of the State of New York.
The Agreements as to Expenses and Liabilities. Pursuant to an Agreement as to Expenses and Liabilities to be entered into by the Company under each Trust Agreement, the Company will irrevocably and unconditionally guarantee to each person or entity to whom each Trust becomes indebted or liable the full payment of any indebtedness, expenses or liabilities of such Trust, other than obligations of such Trust to pay to the holders of the related Preferred Securities
would not be able to rely uponor other similar interests in such Trust thePreferred Securities Guarantee for payment ofamounts due suchamounts. Instead,holdersof the Preferred Securities would rely on the enforcement (1) by the Property Trustee (as defined herein) of its rights as registered holder of the Subordinated Debentures against KCPLpursuant to the terms of such Preferred Securities or such other similar interests, as theSubordinated Debentures or (2) bycase may be.RELATIONSHIP AMONG THE PREFERRED SECURITIES,
THE SUBORDINATED DEBT SECURITIES AND THE GUARANTEESAs long as payments of interest and other payments are made when due on each series of subordinated debt securities issued to a Trust, such
holders of their right against KCPLpayments will be sufficient toenforcecover distributions and payments due on theSubordinated Debentures. Seerelated Trust Securities of such Trust primarily because (i) the aggregate principal amount of each series of subordinated debt securities will be at least equal to the sum of the aggregate stated liquidation amount of the related Trust Securities; (ii) the interest rate and interest and other payment dates on each series of subordinated debt securities will match the distribution rate and distribution and other payment dates for the related Preferred Securities; (iii) the Company shall pay for all costs and expenses of each Trust pursuant to the Agreements as to Expenses and Liabilities; and (iv) each Trust Agreement provides that the Securities Truste es under each Trust Agreement shall not cause or permit the Trust to, among other things, engage in any activity that is not consistent with the purposes of the Trust.Payments of distributions (to the extent funds for such purpose are available) and other payments due on the Preferred Securities (to the extent funds for such purpose are legally and immediately available) will be guaranteed by the Company as and to the extent set forth under "Description of the Guarantees.'' If the Company does not make interest payments on any series of subordinated debt securities, it is not expected that the related Trust will have sufficient funds to pay distributions on its Preferred
Securities Guarantees"Securities. Each Guarantee is a guarantee from the time of its issuance, but does not apply to any payment of distributions unless and"Descriptionuntil the related Trust has sufficient funds available for the payment of such distributions.If the
Subordinated Debentures"Company fails to make interest or other payments on any series of subordinated debt securities when due (taking into account any extension period as described in theaccompanying Prospectus. The Declaration provides that each holder of Preferred Securities, by acceptance thereof, agrees to the provisions of the Preferred Securities Guarantee, including the subordination provisions thereof, and the Indenture. ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF PREFERRED SECURITIES If a Declaration Event of Default (as defined herein) occurs and is continuing, thenapplicable prospectus supplement), the holders of the related Preferred Securitieswouldmay rely on the enforcement by the Property Trusteeof its rightsas a holder of subordinated debt securities against theSubordinated Debentures against KCPL. In addition, theCompany. Such holdersof a majority in liquidation amount of the Preferred Securities will have the right to direct the time, method, and place of conducting any proceeding for any remedy available to the Property Trustee or to direct the exercise of any trust or power conferred upon the Property Trustee under the Declaration, including the right tomay direct the Property Trustee toexerciseenforce its rights under theremedies availablesubordinated debt securities of such series, including proceeding directly against the Company toit as a holder of the Subordinated Debentures.enforce such subordinated debt securities. If the Property Trustee fails to enforce its rights under any series of subordinated debt securities, to theSubordinated Debentures, afullest extent permitted by applicable law, any holder of related Preferred Securities may institute a legal proceeding directly againstKCPLthe Company to enforce the Property Trustee's rights underthe Subordinated Debenturessuch series of subordinated debt securities without first instituting any legal proceeding against the Property Trustee or any other person or entity. Notwithstanding the foregoing,if a Declaration Event of Default has occurred and is continuing, and such event is attributable to the failure of KCPL to pay interest or principal on the Subordinated Debentures on the date such interest or principal is otherwise payable (or in the case of redemption, on the redemption date), thena holder of Preferred Securities maydirectlyinstitute a legal proceeding directly against the Company, without first instituting a legal proceeding against the Property Trustee or any other person or entity, for enforcement of payment to such holder oftheprincipal of or interest on subordinated debt securities of theSubordinated Debenturesrelated series having a principal amount equal to the aggregateliquidation amount of the Preferred Securities of such holder (a "Direct Action") on or after the respective due date specified in the Subordinated Debentures. In connection with such Direct Action, KCPL will be subrogated to the rights of such holder of S-8Preferred Securities under the Declaration to the extent of any payment made by KCPL to such holder of Preferred Securities in such Direct Action. The holders of Preferred Securities will not be able to exercise directly any other remedy available to the holders of the Subordinated Debentures. See "Description of the Preferred Securities-Declaration Events of Default." OPTION TO EXTEND INTEREST PAYMENT PERIOD KCPL has the right under the Indenture to defer payments of interest on the Subordinated Debentures by extending the interest payment period at any time, and from time to time, on the Subordinated Debentures. As a consequence of such an extension, quarterly distributions on the Preferred Securities would be deferred (but would continue to accrue, despite such deferral, with interest thereon compounded quarterly) by the Trust during any such Extension Period. Such right to extend the interest payment period for the Subordinated Debentures is limited to a period not exceeding 20 consecutive quarters, but no such Extension Period may extend beyond the Stated Maturity of the Subordinated Debentures. During any Extension Period, (a) KCPL may not declare or pay dividends on, or make a distribution with respect to, or redeem, purchase or acquire, or make a liquidation payment with respect to, any of its capital stock (other than (i) purchases or acquisitions of shares of KCPL common stock in connection with the satisfaction by KCPL of its obligations under any employee benefit plans or any other contractual obligation of KCPL (other than a contractual obligation ranking PARI PASSU with or junior to the Subordinated Debentures), (ii) as a result of a reclassification of KCPL capital stock or the exchange or conversion of one class or series of KCPL capital stock for another class or series of KCPL capital stock or (iii) the purchase of fractional interests in shares of KCPL capital stock pursuant to the conversion or exchange provisions of such KCPL capital stock or the security being converted or exchanged), (b) KCPL may not make any payment of interest, principal or premium, if any, on or repay, repurchase or redeem any debt securities issued by KCPL that rank PARI PASSU with or junior to the Subordinated Debentures, and (c) KCPL may not make any guarantee payments with respect to the foregoing (other than pursuant to the Preferred Securities Guarantee). Prior to the termination of any such Extension Period, KCPL may further extend the interest payment period; provided, that such Extension Period, together with all such previous and further extensions thereof, may not exceed 20 consecutive quarters or extend beyond the maturity of the Subordinated Debentures. Upon the termination of any Extension Period and the payment of all amounts then due, KCPL may commence a new Extension Period, subject to the above requirements. See "Description of the Preferred Securities-Distributions" and "Description of the Subordinated Debentures-Option to Extend Interest Payment Period." Should KCPL exercise its right to defer payments of interest by extending the interest payment period, each holder of Preferred Securities would be required to accrue income (as original issue discount ("OID")) in respect of the interest payable thereafter allocable to its Preferred Securities for United States federal income tax purposes, which would be allocated but not distributed to holders of record of Preferred Securities. As a result, each such holder of Preferred Securities would recognize income for United States federal income tax purposes in advance of the receipt of cash and would not receive the cash from the Trust related to such income if such holder disposed of its Preferred Securities prior to the record date for the date on which distributions of such amounts were made. See United States Federal Income Taxation -- Interest Income and Original Issue Discount. KCPL has no current intention of exercising its right to defer payments of interest by extending the interest payment period on the Subordinated Debentures. However, should KCPL determine to exercise such right in the future, the market price of the Preferred Securities is likely to be affected. A holder that disposes of its Preferred S-9Securities during an Extension Period, therefore, might not receive the same return on its investment as a holder that continues to hold its Preferred Securities. In addition, as a result of the existence of KCPL's right to defer interest payments, the market price of the Preferred Securities (which represent an undivided beneficial interest in the Subordinated Debentures) may be more volatile than other securities that do not have such rights. See "United States Federal Income Taxation--Sales of Preferred Securities." POSSIBLE TAX LAW CHANGES On March 19, 1996, the Revenue Reconciliation Bill of 1996 (the "Bill") was released, which would, among other things, generally deny interest deductions for United States federal income tax purposes for interest on an instrument, issued by a corporation, that has a maximum weighted average maturity of more than 40 years. The Bill would also generally deny interest deductions for interest on an instrument, issued by a corporation, that has a maximum term of more than 20 years and that is not shown as indebtedness on the separate balance sheet of the issuer or, where the instrument is issued to a related party (other than a corporation), where the holder or some other related party issues a related instrument that is not shown as indebtedness on the issuer's consolidated balance sheet. The above-described provisions of the Bill were proposed to be effective generally for debt instruments issued on or after December 7, 1995. If either provision were to apply to the Subordinated Debentures, KCPL would be unable to deduct interest on the Subordinated Debentures for United States federal income tax purposes. However, on March 29, 1996, the Chairmen of the Senate Finance and House Ways and Means Committees issued a joint statement to the effect that it was their intention that the effective date of the President's legislative proposals, if adopted, will be no earlier than the date of appropriate Congressional action. KCPL believes that, under current law, it will be able to deduct interest on the Subordinated Debentures. There can be no assurance, however, that current or future legislative proposals or final legislation will not affect the ability of KCPL to deduct interest on the Subordinated Debentures. Such a change could give rise to a Tax Event, which may permit KCPL to cause a redemption of the Preferred Securities. See "Description of the Preferred Securities -- Tax Event Redemption" and "United States Federal Income Taxation -- Possible Tax Law Changes." There can be no assurance as to the market prices for the Preferred Securities or the Subordinated Debentures that may be distributed in exchange for Preferred Securities if a dissolution or liquidation of the Trust were to occur. Accordingly, the Preferred Securities that an investor may purchase, or the Subordinated Debentures that the investor may receive on dissolution and liquidation of the Trust, may trade at a discount to the price that the investor paid to purchase the Preferred Securities offered hereby. Because holders of Preferred Securities may receive Subordinated Debentures upon the occurrence of a Tax Event, or in other circumstances, prospective purchasers of Preferred Securities are also making an investment decision with regard to the Subordinated Debentures and should carefully review all the information regarding the Subordinated Debentures and KCPL contained herein and in the accompanying Prospectus. See "Description of the Preferred Securities -- Tax Event Redemption" and "Description of the Subordinated Debentures". S-10REDEMPTION OR DISTRIBUTION OF THE SUBORDINATED DEBENTURES KCPL will have the right at any time to terminate the Trust and, after satisfaction of claims of creditors as provided by applicable law, to cause the Subordinated Debentures to be distributed to the holders of the Trust Securities. In certain circumstances, KCPL will have the right to redeem the Subordinated Debentures, in whole or in part, in which event the Trust will redeem the Trust Securities on a pro rata basis to the same extent as the Subordinated Debentures are redeemed by KCPL. See "Description of the Preferred Securities--Tax Event Redemption" and "United States Federal Income Taxation." Under current United States federal income tax law, a distribution of Subordinated Debentures upon the dissolution of the Trust would not be a taxable event to holders of the Preferred Securities. If, however, the Trust is characterized for United States federal income tax purposes as an association taxable as a corporation at the time of dissolution of the Trust, the distribution of the Subordinated Debentures would be a taxable event to holders of Preferred Securities. Moreover, the redemption of the Subordinated Debentures upon occurrence of a Tax Event, or a dissolution of the Trust in which holders of the Preferred Securities receive cash would be a taxable event to such holders. See "United States Federal Income Taxation -- Receipt of Subordinated Debentures or Cash Upon Liquidation of the Trust." There can be no assurance as to the market prices for the Preferred Securities or the Subordinated Debentures that may be distributed in exchange for Preferred Securities if a dissolution or liquidation of the Trust were to occur. Accordingly, the Preferred Securities or the Subordinated Debentures may trade at a discount to the price that the investor paid to purchase the Preferred Securities offered hereby. Because holders of Preferred Securities may receive Subordinated Debentures, prospective purchasers of Preferred Securities are also making an investment decision with regard to the Subordinated Debentures and should carefully review all the information regarding the Subordinated Debentures contained herein and in the accompanying Prospectus. See "Description of the Preferred Securities--Tax Event Redemption" and "Description of the Subordinated Debentures-General." SHORTENING THE STATED MATURITY OF THE SUBORDINATED DEBENTURES KCPL will have the right at any time to shorten the maturity of the Subordinated Debentures to a date not earlier than ____________, ____________. LIMITED VOTING RIGHTS Holders of Preferred Securities will have limited voting rights and will not be entitled to vote to appoint, remove or replace, or to increase or decrease the number of, KCPL Trustees, which voting rights are vested exclusively in the holder of the Common Securities. See "Description of Preferred Securities--Voting Rights." TRADING PRICE OF PREFERRED SECURITIES The Preferred Securities may trade at a price that does not fully reflect the value of accrued but unpaid interest with respect to the underlying Subordinated Debentures. A holder of Preferred Securities who uses the accrual method of accounting for tax purposes (and a cash method holder, if the Subordinated Debentures are deemed to have been issued with OID) and S-11who disposes of such Preferred Securities between record dates for payments of distributions thereon will be required to include accrued but unpaid interest on the Subordinated Debentures through the date of disposition in income as ordinary income (i.e., interest or possibly OID), and to add such amount to the adjusted tax basis in its pro rata share of the underlying Subordinated Debentures deemed disposed of. To the extent the selling price is less than the holder's adjusted tax basis (which will include, all accrued but unpaid interest), a holder will recognize a capital loss. Subject to certain limited exceptions, capital losses cannot be applied to offset ordinary income for United States federal income tax purposes. See United States Federal Income Taxation -- Interest Income and Original Issue Discount" and "-- Sales of Preferred Securities." CONSEQUENCES OF HIGHLY LEVERAGED TRANSACTION The Indenture does not contain provisions that afford holders of the Subordinated Debentures protection in the event of a highly leveraged transaction, including a change of control, or other similar transactions involving KCPL that may adversely affect such holders. See "Description of the Subordinated Debentures." KANSAS CITY POWER & LIGHT COMPANY Kansas City Power & Light Company, a Missouri corporation, is a medium-size electric utility, headquartered in downtown Kansas City, which generates and distributes electricity to over 430,000 customers in a 4,700-square mile area located in 23 counties in western Missouri and eastern Kansas. Customers include 380,000 residences, 50,000 commercial firms, and over 3,000 industries, municipalities and other electric utilities. About two-thirds of total Kwh sales and revenue are from Missouri customers and the remainder from Kansas customers. The address of the principal executive office is 1201 Walnut, Kansas City, Missouri 64106-2124 (Telephone: (816) 556-2200. THE TRUST The Trust is a statutory business trust formed under Delaware law pursuant to the filing of a certificate of trust with the Delaware Secretary of State on December __, 1996. The business of the Trust is defined in a declaration of trust executed by KCPL, as sponsor (the "Sponsor"), and the Trustees (as defined herein). Such declaration will be amended and restated in its entirety (as so amended and restated, the "Declaration") substantially in the form filed as an exhibit to the Registration Statement of which this Prospectus Supplement and the accompanying Prospectus form a part. The Declaration will be qualified as an indenture under the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"). Upon issuance of the Preferred Securities, the purchasers thereof will own all of the Preferred Securities. See "Description of the Preferred Securities-Book-Entry Only Issuance-The Depository Trust Company." KCPL will acquire Common Securities in an aggregate liquidation amount equal to approximately 3 percent of the total capital of the Trust. The Trust exists for the exclusive purposes of (i) issuing the Trust Securities representing undivided beneficial interests in the assets of the Trust, (ii) investing the gross proceeds of the Trust Securities in the Subordinated Debentures and (iii) engaging in only those other activities necessary or incidental thereto. The Trust has a term of 45 years, but may terminate earlier as provided in the Declaration. Pursuant to the Declaration, the number of the Trustees of the Trust will initially be four. Two of the Trustees (the "Regular Trustees") will be persons who are employees or officers of, S-12or who are affiliated with, KCPL. A third trustee will be a financial institution that is unaffiliated with KCPL, which trustee will serve as property trustee under the Declaration and as indenture trustee for the purposes of compliance with the provisions of the Trust Indenture Act (the "Property Trustee"). The fourth Trustee will be either a legal entity with its principal place of business in Delaware or an individual resident in Delaware, which will serve for the limited purpose of satisfying certain Delaware laws (the "Delaware Trustee"). Initially, The First National Bank of Chicago will be the Property Trustee and First Chicago Delaware Inc. will be the Delaware Trustee until removed or replaced by the holder of the Common Securities. For purposes of compliance with the provisions of the Trust Indenture Act, The First National Bank of Chicago will act as trustee (the "Preferred Guarantee Trustee") under the Preferred Securities Guarantee. The First National Bank of Chicago will act as Debt Trustee (as defined herein) under the Indenture. See "Description of the Preferred Securities Guarantees" in the accompanying Prospectus and "Description of the Preferred Securities-Voting Rights" herein. The Property Trustee will hold title to the Subordinated Debentures for the benefit of the holders of the Trust Securities and will have the power to exercise all rights, powers and privileges under the Indenture as the holder of the Subordinated Debentures. In addition, the Property Trustee will maintain exclusive control of a segregated non-interest bearing bank account (the "Property Account") to hold all payments made in respect of the Subordinated Debentures for the benefit of the holders of the Trust Securities. The Property Trustee will make payments of distributions and payments on liquidation, redemption and otherwise to the holders of the Trust Securities out of funds from the Property Account. The Preferred Guarantee Trustee will hold the Preferred Securities Guarantee for the benefit of the holders of the Preferred Securities. KCPL, as the direct or indirect holder of all the Common Securities, will have the right to appoint, remove or replace any Trustee and to increase or decrease the number of Trustees. KCPL will pay all fees and expenses related to the Trust and the offering of the Trust Securities. See "Description of the Subordinated Debentures-Miscellaneous." The rights of the holders of the Preferred Securities, including economic rights, rights to information and voting rights, are set forth in the Declaration, the Delaware Business Trust Act (the "Trust Act") and the Trust Indenture Act. See "Description of the Preferred Securities." S-13SELECTED FINANCIAL DATA KANSAS CITY POWER & LIGHT COMPANY Income Statement Information Twelve Months Year Ended December 31, Ended ------------------------------- Sept. 30, 1996 -------------- 1993 1994 1995 (Unaudited) ---- ---- ---- (Thousands) (Thousands) Operating revenues. . . . . . . .$857,450 $868,272 $885,955 $907,105 Operating income. . . . . . . . .$156,302 $149,691 $167,048 $179,636 Net income. . . . . . . . . . . .$105,772 $104,775 $122,586 $111,753 RECENT DEVELOPMENTS [ To be completed as of the date of the Prospectus Supplement] CAPITALIZATION OF KCPL The following table sets forth the capitalization of KCPL at September 30, 1996, and KCPL's capitalization as of such date as adjusted to reflect the sales of the Preferred Securities but does not reflect any portion of the $398 million principal amount of Medium-Term Notes which are being offered by the Company for sale from time to time through agents pursuant to separate properties. In the fourth quarter of 1996, $98 million of these Notes have been issued. The table should be read in conjunction with KCPL's consolidated financial statements and notes thereto included in the documents incorporated by reference herein. See "Incorporation of Certain Documents by Reference" in the accompanying Prospectus. S-14September 30, 1996 ------------------------- (Millions) Actual Adjusted (unaudited) Long-term debt(1): Bonds $ 762 762 Subsidiary Obligations 119 119 ------ ------ Total Long-term debt 881 881 Preferred Stock 90 90 Company Obligated Mandatorily Redeemable Preferred Securities of Subsidiary Trust 300 Common equity 917 917 ------ ------ Total $1888 $2188 ------ ------ ------ ------ (1) Includes long-term debt included in current liabilities. ACCOUNTING TREATMENT The financial statements of the Trust will be consolidated into KCPL's consolidated financial statements, with the Preferred Securities treated as minority interest and shown in KCPL's balance sheet as "Company-obligated mandatorily redeemable preferred securities of subsidiary trust holding solely Company subordinated debt securities." The financial statement footnotes of KCPL will reflect that the sole asset of the Trust will be the Subordinated Debentures. See "Capitalization." USE OF PROCEEDS The Trust will use the proceeds of the sale of the Trust Securities to acquire Subordinated Debentures from KCPL. KCPL intends to add the net proceeds from the sale of the Subordinated Debentures to the general funds of KCPL for use for corporate purposes, which may include capital expenditures, acquisitions, refinancing or repurchase of outstanding long-term debt, preferred and common securities, investments in subsidiaries, and repayment of short-term debt and other business opportunities. DESCRIPTION OF THE PREFERRED SECURITIES The Preferred Securities will be issued pursuant to the terms of the Declaration. The Declaration will be qualified as an indenture under the Trust Indenture Act. The Property Trustee will act as the indenture trustee for purposes of compliance with the provisions of the Trust Indenture Act. The terms of the Preferred Securities will include thosestatedin the S-15Declaration and those made part of the Declaration by the Trust Indenture Act. The following summary of the principal terms and provisions of the Preferred Securities, which supplements and to the extent inconsistent, replaces, the description set forth under the caption "Description of the Preferred Securities" in the accompanying Prospectus, does not purport to be complete and is subject to, and qualified in its entirety by reference to, the Declaration, a copy of the form of which is filed as an exhibit to the Registration Statement of which this Prospectus forms a part, the Trust Act and the Trust Indenture Act. GENERAL The Declaration authorizes the Regular Trustees, on behalf of the Trust, to issue the Preferred Securities, which represent preferred undivided beneficial interests in the assets of the Trust, and the Common Securities, which represent common undivided beneficial interests in the assets of the Trust. All of the Common Securities will be owned by KCPL. The Common Securities rank PARI PASSU, and payments will be made thereon on a pro rata basis, with the Preferred Securities, except that upon the occurrence and during the continuation of a Declaration Event of Default, the rights of the holders of the Common Securities to receive payment of periodic distributions and payments upon liquidation, redemption and otherwise will be subordinated to the rights to payment of the holders of the Preferred Securities. The Declaration does not permit the issuance by the Trust of any securities other than the Trust Securities or the incurrence of any indebtedness by the Trust. Pursuant to the Declaration, the Property Trustee will own and hold the Subordinated Debentures for the benefit of the holders of the Trust Securities. The payment of distributions out of money held by the Trust, and payments upon redemption of the Preferred Securities or liquidation of the Trust, are guaranteed by KCPL to the extent described under "Description of the Preferred Securities Guarantees" in the accompanying Prospectus. The Guarantee Trustee will hold the Preferred Securities Guarantee for the benefit of the holders of the Preferred Securities. The Preferred Securities Guarantee does not cover payment of distributions on the Preferred Securities when the Trust does not have sufficient available funds in the Property Account to make such distributions. In such event, the remedy of a holder of Preferred Securities is to vote to direct the Property Trustee to enforce the Property Trustee's rights under the Subordinated Debentures except in the limited circumstances in which the holder may take Direct Action. See "Voting Rights" and "Declaration Events of Default." DISTRIBUTIONS Distributions on the Preferred Securities will be fixed at a rate per annum of _____% of the stated liquidation amount of $25 per Preferred Security. Distributions in arrears will bear interest at the same per annum rate (to the extent permitted by applicable law). The term "distributions" as used herein includes any such interest payable unless otherwise stated. Distributions on the Preferred Securities will be cumulative, will accrue from the date of the initial issuance of the Preferred Securities and will be payable quarterly in arrears on March 31, June 30, September 30 and December 31 of each year commencing _______, when, as and if available for payment by the Property Trustee, except as otherwise described below. The amount of distributions payable for any full quarterly period will be computed on the basis of a 360-day year of twelve 30 day months, and for any period shorter than a full quarter, on the basis of the actual number of days elapsed in such a 90-day quarter. S-16KCPL has the right under the Indenture to defer payments of interest on the Subordinated Debentures by extending the interest payment period from time to time on the Subordinated Debentures issued thereunder which, if exercised, would defer quarterly distributions on the Preferred Securities (though such distributions would continue to accrue interest since interest would continue to accrue on the Subordinated Debentures) during any such extended interest payment period. In the event that KCPL exercises this right, then (a) KCPL may not declare or pay any dividend on, make any distributions with respect to, or redeem, purchase or make a liquidation payment with respect to, any of its capital stock, other than (i) purchases or acquisitions of shares of KCPL common stock in connection with the satisfaction by KCPL of its obligations under any employee benefit plans or any other contractual obligation of KCPL (other than a contractual obligation ranking PARI PASSU with or junior to the Subordinated Debentures), (ii) as a result of a reclassification of KCPL capital stock or the exchange or conversion of one class or series of KCPL capital stock for another class or series of KCPL capital stock or (iii) the purchase of fractional interests in shares of KCPL capital stock pursuant to the conversion or exchange provisions of such KCPL capital stock or the security being converted or exchanged), (b) KCPL may not make any payment of interest, principal or premium, if any, on or repay, repurchase or redeem any debt securities (including guarantees) issued by KCPL which rank PARI PASSU with or junior to the Subordinated Debentures, and (c) KCPL may not make any guarantee payments with respect to the foregoing (other than pursuant to the Preferred Securities Guarantee). This prohibition effectively requires that any Extension Period with respect to any series of Subordinated Debentures will also apply to each other series of subordinated debentures issued under the Indenture to other trusts similar to the Trust. Prior to the termination of any such Extension Period, KCPL may further extend the interest payment period, provided that such Extension Period, together with all such previous and further extensions thereof, may not exceed 20 consecutive quarters or extend beyond the maturity of the Subordinated Debentures. Upon the termination of any Extension Period and the payment of all amounts then due, KCPL may select a new Extension Period as if no Extension Period had previously been declared, subject to the above requirements. See " -- Voting Rights" and "Description of the Subordinated Debentures -- Interest" and "-- Option to Extend Interest Payment Period." If distributions are deferred, the deferred distributions and accrued interest thereon shall be paid to holders of record of the Preferred Securities, if funds are available therefor, as they appear on the books and records of the Trust on the record date next following the termination of such Extension Period. Distributions on the Preferred Securities must be paid on the dates payable to the extent that the Trust has funds available for the payment of such distributions in the Property Account. The Trust's funds available for distribution to the holders of the Preferred Securities will be limited to payments received under the Subordinated Debentures. See "Description of the Subordinated Debentures." The payment of distributions out of moneys held by the Trust is guaranteed by KCPL to the extent set forth under "Description of the Preferred Securities Guarantee." Distributions on the Preferred Securities will be payable to the holders thereof as they appear on the books and records of the Trust on the relevant record dates, which, as long as the Preferred Securities remain in book-entry only form, will be one Business Day (as defined herein) prior to the relevant payment dates, which payment dates correspond to the interest payment dates on the Subordinated Debentures. Such distributions will be paid through the Property Trustee, which will hold amounts received in respect of the Subordinated Debentures in the Property Account for the benefit of the holders of the Trust Securities. Subject to any S-17applicable laws and regulations and the provisions of the Declaration, each such payment will be made as described under "-Book-Entry Only Issuance -- The Depository Trust Company" below. In the event the Preferred Securities do not continue to remain in book-entry only form, the Regular Trustees will have the right to select relevant record dates which will be at least one Business Day, but less than 60 Business Days, prior to the relevant payment dates. In the event that any date on which distributions are to be made on the Preferred Securities is not a Business Day, then payment of the distributions payable on such date will be made on the next succeeding day which is a Business Day (and without any interest or other payment in respect of any such delay) except that, if such Business Day is in the next succeeding calendar year, such payment will be made on the immediately preceding Business Day, in each case with the same force and effect as if made on such date. A "Business Day" means any day other than a day on which banking institutions in Chicago, Illinois or New York, New York are authorized or required by law to close. REDEMPTION The Subordinated Debentures will mature on _________ __, ____ and may be redeemed, in whole or in part, at any time on or after __________ __, ____, or at any time in certain circumstances upon the occurrence of a Tax Event. Upon the repayment of the Subordinated Debentures, whether at maturity or upon acceleration, redemption or otherwise, the proceeds from such repayment or payment will simultaneously be applied to redeem Trust Securities having an aggregate liquidation amount equal to the aggregate principal amount of the Subordinated Debentures so repaid or redeemed at the Redemption Price; provided that, except in the case of payments upon maturity, holders of Trust Securities will be given not less than 30 nor more than 60 days notice of such redemption. See "Description of the Subordinated Debentures." In the event that fewer than all of the outstanding Preferred Securities are to be redeemed, the Preferred Securities will be redeemed pro rata as described under "-- Book-Entry Only Issuance-- The Depository Trust Company" below. TAX EVENT REDEMPTION "Tax Event" means that the Regular Trustees shall have received an opinion from independent tax counsel experienced in such matters (a "Redemption Tax Opinion") to the effect that, on or after the date of this Prospectus Supplement, as a result of (a) any amendment to, or change (including any announced prospective change) in, the laws (or any regulations thereunder) of the United States or any political subdivision or taxing authority thereof or therein or (b) any amendment to, or change in, an interpretation or application of such laws or regulations by any legislative body, court, governmental agency or regulatory authority, which amendment or change is enacted, promulgated, issued or announced or which interpretation or pronouncement is issued or announced or which action is taken, in each case on or after the date of this Prospectus Supplement, there is more than an insubstantial risk that interest payable to the Trust on the Subordinated Debentures would not be deductible in whole or in part by KCPL for United States federal income tax purposes, which change or amendment becomes effective on or after the date of this Prospectus Supplement. If at any time a Tax Event has occured and is continuing with respect to the Trust or the Preferred Securities, the Trust may, upon not less than 30 nor more than 60 days notice, redeem the Subordinated Debentures in whole or in part for cash within 90 days following the occurrence of such Tax Event, and, following such redemption, Trust Securities with an S-18aggregate liquidation amount equal to the aggregate principal amount of the Subordinated Debentures so redeemed will be redeemed by the Trust at the Redemption Price on a pro rata basis; provided, however, that, if at the time there is available to KCPL or the Trust the opportunity to eliminate, within such 90-day period, the Tax Event by taking some ministerial action, such as filing a form or making an election, or pursuing some other similar reasonable measure which has no adverse effect on the Trust, KCPL or the holders of the Trust Securities, KCPL or the Trust will pursue such measure in lieu of redemption. REDEMPTION PROCEDURES The Trust may not redeem fewer than all of the outstanding Preferred Securities of the Trust unless all accrued and unpaid distributions have been paid on all Trust Securities for all quarterly distribution periods terminating on or prior to the date of redemption. If the Trust gives a notice of redemption in respect of Preferred Securities of the Trust (which notice will be irrevocable), then by 12:00 noon, New York City time, on the redemption date, provided that KCPL has paid to the Property Trustee a sufficient amount of cash in connection with the related redemption or maturity of the Subordinated Debentures, the Trust will irrevocably deposit with the depositary funds sufficient to pay the applicable Redemption Price and will give the depositary irrecovable instructions and authority to pay the Redemption Price to the holders of the Preferred Securities. See "-- Book-Entry Only Issuance -- The Depository Trust Company." If notice of redemption has been given and funds deposited as required, then immediately prior to the close of business on the date of such deposit, distributions will cease to accrue and all rights of holders of such Preferred Securities so called for redemption will cease, except the right of the holders of such Preferred Securities to receive the Redemption Price, but without interest on such Redemption Price. In the event that any date fixed for redemption of Preferred Securities is not a Business Day, then payment of the Redemption Price payable on such date will be made on the next succeeding day which is a Business Day (and without any interest or other payment in respect of any such delay), except that, if such Business Day falls in the next calendar year, such payment will be made on the immediately preceding Business Day. In the event that payment of the Redemption Price in respect of Preferred Securities is improperly withheld or refused and not paid either by the Trust or by KCPL pursuant to the Preferred Securities Guarantee, distributions on such Preferred Securities will continue to accrue, from the original redemption date to the actual date of payment, in which case the actual payment date will be considered the date fixed for redemption for purposes of calculating the Redemption Price. In the event that fewer than all of the outstanding Preferred Securities are to be redeemed, the Preferred Securities will be redeemed pro rata as described under "-- Book-Entry Only Issuance -- The Depository Trust Company" below. Subject to the foregoing and to applicable law (including, without limitation, United States federal securities laws), KCPL or its affiliates may, at any time and from time to time, purchase outstanding Preferred Securities by tender, in the open market or by private agreement. S-19DISSOLUTION; DISTRIBUTION OF SUBORDINATED DEBENTURES In the event of any voluntary dissolution, winding-up or termination of the Trust, the holders of the Preferred Securities at that time will be entitled to receive out of the assets of the Trust, after satisfaction of liabilities to creditors of the Trust, distributions in an amount equal to the aggregate of the stated liquidation amount of $25 per Preferred Security plus accrued and unpaid distributions thereon to the date of payment (the "Liquidation Distribution"), unless, in connection with such dissolution, winding-up or termination, Subordinated Debentures in an aggregate principal amount equal to the aggregate stated liquidation amount of, with an interest rate identical to the distribution rate of, and accrued and unpaid interest equal to accrued and unpaid distributions, on the Preferred Securities have been distributed on a pro rata basis to the holders of Preferred Securities in exchange for such Preferred Securities. If upon any such dissolution the Liquidation Distribution can be paid only in part because the Trust has insufficient assets available to pay in full the aggregate Liquidation Distribution, then the amounts payable directly by the Trust on the Preferred Securities shall be paid on a pro rata basis. The holders of the Common Securities will be entitled to receive distributions upon any such dissolution pro rata with the holders of the Preferred Securities, except that if a Declaration Event of Default has occurred and is continuing, the Preferred Securities shall have a preference over the Common Securities. Pursuant to the Declaration, the Trust will terminate (i) on________ 20 ___ [45 years], the expiration of the term of the Trust, (ii) upon the bankruptcy of KCPL, (iii) upon the filing of a certificate of dissolution or its equivalent with respect to KCPL, the filing of a certificate of cancellation with respect to the Trust, or the revocation of the charter of KCPL and the expiration of 90 days after the date of revocation without a reinstatement thereof, (iv) upon the entry of a decree of judicial dissolution of KCPL or the Trust, (v) upon the redemption of all of the Trust Securities, (vi) upon the dissolution of the Trust in accordance with the terms of the Trust Securities pursuant to which all Subordinated Debentures shall have been distributed to the holders of the Trust Securities, or (vii) at any time at the option of KCPL upon its written direction to the Property Trustee to dissolve the Trust and distribute the Subordinated Debentures to the holders of the Trust Securities. If Subordinated Debentures are distributed to the holders of the Preferred Securities, KCPL will use its best efforts to have the Subordinated Debentures listed on the New York Stock Exchange or on such other exchange as the Preferred Securities are then listed. After the date for any distribution of Subordinated Debentures upon dissolution of the Trust, (i) the Preferred Securities and Preferred Securities Guarantees will no longer be deemed to be outstanding, (ii) the depositary or its nominee, as the record holder of the Preferred Securities, will receive a registered global certificate or certificates representing the Subordinated Debentures to be delivered upon such distribution and (iii) any certificates representing Preferred Securities and Preferred Securities Guarantees not held by the depositary or its nominee will be deemed to represent Subordinated Debentures having an aggregate principal amount equal to the aggregate stated liquidation amount of, with an interest rate identical to the distribution rate of, and accrued and unpaid interest equal to accrued and unpaid distributions on, such Preferred Securities, until such certificates are presented to KCPL or its agent for transfer or reissuance. S-20There can be no assurance as to the market prices for the Preferred Securities or the Subordinated Debentures that may be distributed in exchange for the Preferred Securities if a dissolution and liquidation of the Trust were to occur. Accordingly, the Preferred Securities that an investor may purchase, or the Subordinated Debentures that the investor may receive on dissolution and liquidation of the Trust, may trade at a discount to the price that the investor paid to purchase the Preferred Securities offered hereby. DECLARATION EVENTS OF DEFAULT An event of default under the Indenture (an "Indenture Event of Default") (see "Description of the Subordinated Debentures -- Indenture Events of Default") constitutes an event of default under the Declaration with respect to the Trust Securities (a "Declaration Event of Default"), provided that pursuant to the Declaration, the holder of the Common Securities will be deemed to have waived any Declaration Event of Default with respect to the Common Securities or its consequences until all Declaration Events of Default with respect to the Preferred Securities have been cured, waived or otherwise eliminated. Until such Declaration Events of Default with respect to the Preferred Securities have been so cured, waived or otherwise eliminated, the Property Trustee will be deemed to be acting solely on behalf of the holders of the Preferred Securities and only the holders of the Preferred Securities will have the right to direct the Property Trustee with respect to certain matters under the Declaration, and therefore under the Indenture. If the Property Trustee fails to enforce its rights under the Subordinated Debentures after a holder of Preferred Securities has made a written request, such holder may institute a legal proceeding against KCPL to enforce the Property Trustee's rights under the Subordinated Debentures without first instituting any legal proceeding against the Trustee or any other person or entity. Notwithstanding the foregoing, if a Declaration Event of Default has occurred and is continuing and such event is attributable to the failure of KCPL to pay interest or principal on the Subordinated Debentures on the date such interest or principal is otherwise payable (or in the case of redemption, the redemption date), then a holder of Preferred Securities may institute a Direct Action for enforcement of payment to such holder directly of the principal of, or interest on, Subordinated Debentures having a principal amount equal to the aggregateliquidation amount of the Preferred Securities of such holder on or after therespectiveduedatedates specified in theSubordinated Debentures. In connection with such Direct Action, KCPL will be subrogated to the rightssubordinated debt securities of suchholder of Preferred Securitiesseries.If the Company fails to make payments under
the Declaration to the extent ofanypayment made by KCPL toGuarantee, suchholder of Preferred Securities in such Direct Action. The holders of Preferred Securities will not be able to exercise directly any other remedy available to the holders of the Subordinated Debentures. Upon the occurrence ofGuarantee provides aDeclaration Event of Default, the Property Trustee, as the sole holder of the Subordinated Debentures, will have the right under the Indenture to declare the principal of, and interest on, the Subordinated Debentures to be immediately due and payable. KCPL and the Trust are each required to file annually with the Property Trustee an officers' certificate as to its compliance with all conditions and covenants under the Declaration. S-21VOTING RIGHTS Except as provided below, under the Trust Act, the Trust Indenture Act and under "Description of the Preferred Securities Guarantee -- Amendments and Assignment" in the accompanying Prospectus and as otherwise required by law and the Declaration,mechanism that allows the holders of the Preferred Securitieswill have no voting rights. In the event that KCPL electstodefer payments of interest on the Subordinated Debentures as described above under" -- Distributions," the holders of the Preferred Securities do not have the right to appoint a special representative or trustee or otherwise act to protect their interests. The holders of a majority in aggregate liquidation amount of the Preferred Securities have the rightwhich such Guarantee relates to direct thetime, method and place of conducting any proceeding for any remedy available to the PropertyGuarantee Trusteeor to direct the exercise of any trust or power conferred upon the Property Trustee under the Declaration, including the right to direct the Property Trustee, as the holder of the Subordinated Debentures, to (i) direct the time, method and place of conducting any proceeding for any remedy available to the Debt Trustee under the Indenture with respect to the Subordinated Debentures, (ii) waive any past Indenture Event of Default which is waivable under the Indenture, (iii) exercise any right to rescind or annul a declaration that the principal of all the Subordinated Debentures shall be due and payable, or (iv) consent to any amendment, modification or termination of the Indenture or the Subordinated Debentures, where such consent shall be required; provided, however, that where a consent under the Indenture would require the consent of the holders of more than a majority in principal amount of Subordinated Debentures affected thereby (a "Super-Majority"), only the holders of at least the proportion in liquidation amount of the Preferred Securities which the relevant Super-Majority represents of the aggregate principal amount of the Subordinated Debentures may direct the Property Trustee to give such consent. If the Property Trustee failsto enforce its rights underthe Declaration,suchGuarantee. In addition, a holder of Preferred Securities may institute a legal proceeding directly against
any personthe Company to enforcethe Property Trustee'sits rights under theDeclarationrelated Guarantee without first institutinganya legal proceeding against or requesting or directing that action be taken by thePropertyGuarantee Trustee or any other person or entity.TheEach Guarantee, the Subordinated Note Indenture, the subordinated debt securities of the related series, the related Trust Agreement and the related Agreement as to Expenses and Liabilities, as described above, constitute a full and unconditional guarantee by the Company of the payments due on the related series of Preferred Securities.
Upon any voluntary or involuntary dissolution, winding-up or termination of any Trust, unless subordinated debt securities of the related series are distributed in connection with such action, the holders of Preferred Securities of such Trust will be entitled to receive, out of assets legally available for distribution to holders, a liquidation distribution in cash as described in the applicable prospectus supplement. Upon any voluntary or involuntary liquidation or bankruptcy of the Company, the Property Trustee,
will notifyas holder of the related series of subordinated debt securities, would be a subordinated creditor of the Company, subordinated in right of payment to all Senior Indebtedness, but entitled to receive payment in full of principal and interest, before any stockholders of the Company receive payments or distributions. Because the Company is guarantor under each Guarantee and has ag reed to pay for all costs, expenses and liabilities of each Trust (other than the Trust's obligations to holders of the Preferred Securities) pursuant to the related Agreement as to Expenses and Liabilities, the positions of a holder of Preferred Securities and a holder of subordinated debt securities of the related series relative to other creditors and to stockholders of the Company in the event of liquidation or bankruptcy of the Company would be substantially the same.A default or event of default under any Senior Indebtedness would not constitute a default or Event of Default under the Subordinated Note Indenture. However, in the event of payment defaults under, or acceleration of, Senior Indebtedness, the subordination provisions of the subordinated debt securities provide that no payments may be made in respect of the subordinated debt securities until such Senior Indebtedness has been paid in full or any payment default thereunder has been cured or waived. Failure to make required payments on the subordinated debt securities of any
noticeseries would constitute an Event ofdefault received fromDefault under theDebt TrusteeSubordinated Note Indenture with respect to theSubordinated Debentures. Such noticesubordinated debt securities of such series except that failure to make interest payments on the subordinated debt securities of such series willstate that such Indenturenot be an Event of Defaultalso constitutes a Declaration Event of Default. The Property Trustee will not take any actionduring an extension period as described inclauses (i), (ii), (iii) or (iv) above unlesstheProperty Trustee has obtained an opinionapplicable prospectus supplement.BOOK-ENTRY SYSTEM
Unless otherwise indicated in the applicable prospectus supplement, each series of
independent tax counseldebt securities (other than debt securities issued tothe effect that, asaresult of such action, the Trust will not be classified as other than a grantor trust for United States federal income tax purposes. In the event the consent of the Property Trustee, as the holder of the Subordinated Debentures, is required under the Indenture for any amendment, modification or termination of the Indenture, the Property Trustee will request,Trust) andact only in accordance with, the direction of the holders of a majority in liquidation amount of the Preferred Securities and, if no Declaration Event of Default has occurred and is continuing, the holders of a majority in liquidation amount of the Common Securities, voting together as separate classes, provided that where a consent under the Indenture would require the consent of a Super- Majority, the Property Trustee may only give such consent at the direction of the holders of at least the proportion in liquidation amount of the Preferred Securities and Common Securities, respectively, which the relevant Super- Majority represents of the aggregate principal amount of the Subordinated Debentures outstanding. The Property Trustee will not take any such action in accordance with the directions of the holders of the Trust Securities unless the Property Trustee has obtained an S-22opinion of independent tax counsel to the effect that, as a result of such action, the Trust will not be classified as other than a grantor trust for United States federal income tax purposes. A waiver of an Indenture Event of Default will constitute a waiver of the corresponding Declaration Event of Default. Any required approval or direction of holders of Preferred Securities may be given at a separate meeting of holders of Preferred Securities convened for such purpose, at a meeting of all of the holders of the Trust Securities or pursuant to written consent. The Regular Trustees will cause a notice of any meeting at which holders of Preferred Securities are entitled to vote, or of any matter upon which action by written consent of such holders is to be taken, to be mailed to each holder of record of Preferred Securities. Each such notice will include a statement setting forth (i) the date of such meeting or the date by which such action is to be taken, (ii) a description of any resolution proposed for adoption at such meeting on which such holders are entitled to vote or of such matter upon which written consent is sought and (iii) instructions for the delivery of proxies or consents. No vote or consent of the holder ofPreferred Securities will initially berequired forissued in theTrust to redeem and cancel Preferred Securitiesform of one ordistribute Subordinated Debenturesmore global securities, inaccordanceregistered form, without coupons. The global security will be deposited with,the Declaration. Notwithstanding that holders of Preferred Securities are entitled to voteorconsent under anyon behalf of, thecircumstances described above, neither KCPL nor any entity directly or indirectly controlling or controlled by, or under direct or indirect common control with, KCPL, will be entitled to vote or consent with respect to any Preferred Securities which at such time are owned by KCPL or any such entity,depository, andsuch Preferred Securities will, for purposes of such vote or consent, be treated as if they were not outstanding. The procedures by which holders of Preferred Securities may exercise their voting rights are described below. See "-- Book-entry only Issuance -- The Depository Trust Company." Holdersregistered in the name of thePreferred Securities will have no rights to appointdepository orremove the Trustees, who may be appointed, removed or replaced solely by KCPL, as the direct or indirect holder of all the Common Securities. MODIFICATION OF THE DECLARATION The Declaration may be amended or modified if approved and executed byamajoritynominee of theRegular Trustees, provided that if any proposed amendment provides for, or the Regular Trusteesdepository. Unless otherwisepropose to effect, (i) any action that would adversely affect the powers, preferences or special rights of the Trust Securities, whether by way of amendment to the Declaration or otherwise or (ii) the dissolution, winding up or termination of the Trust other than pursuant to the terms of the Declaration, then the holders of the Trust Securities as a single class will be entitled to vote on such amendment or proposal and such amendment or proposal will not be effective except with the approval of the holders of at least 66-2/3 per cent in liquidation amount of the Trust Securities affected thereby, provided that if any amendment or proposal referred to in clause (i) above would adversely affect only the Preferred Securities or the Common Securities, then only the affected class will be entitled to vote on such amendment or proposal and such amendment or proposal will not be effective except with the approval of the holders of 66-2/3 per cent in liquidation amount of such class of Trust Securities. S-23Notwithstanding the foregoing, no amendment or modification may be made to the Declaration if such amendment or modification would (i) cause the Trust to be classified as other than a grantor trust, for purposes of United States federal income tax purposes, (ii) reduce or otherwise adversely affect the powers of the Property Trustee or (iii) cause the Trust to be deemed to be an "investment company" which is required to be registered under the Investment Company Act of 1940, as amended (the "1940 Act"). MERGERS, CONSOLIDATIONS OR AMALGAMATIONS The Trust may not consolidate, amalgamate, merge with or into, or be replaced by, or convey, transfer or lease its properties and assets substantially as an entirety to any corporation or other body, except as described below. The Trust may, with the consent of a majority of the Regular Trustees and without the consent of the holders of the Trust Securities, the Delaware Trustee or the Property Trustee, consolidate, amalgamate, merge with or into, or be replaced by a trust organized as such under the laws of any State; provided, that (i) such successor entity either (x) expressly assumes all of the obligations of the Trust with respect to the Trust Securities or (y) substitutes for the Trust Securities other securities having substantially the same terms as the Trust Securities (the "Successor Securities") so long as the Successor Securities rank the same as the Trust Securities in priority with respect to distributions and payments upon liquidation, redemption, maturity and otherwise, (ii) KCPL expressly acknowledges a trustee of such successor entity which possesses the same powers and duties as the Property Trustee as the holder of the Subordinated Debentures, (iii) the Preferred Securities or any Successor Securities are listed, or any Successor Securities will be listed upon notification of issuance, or any national securities exchange or other organization on which the Preferred Securities are then listed, (iv) such merger, consolidation, amalgamation or replacement does not cause the Preferred Securities (including any Successor Securities) to be downgraded by any nationally recognized statistical rating organization, (v) such merger, consolidation, amalgamation or replacement does not adversely affect the rights, preferences and privileges of the holders of the Trust Securities (including any Successor Securities) in any material respect (other than with respect to any dilution of the holders' interestindicated in thenew entity), (vi) such successor entity has a purpose identical to that ofapplicable prospectus supplement, theTrust, (vii) prior to such merger, consolidation, amalgamation or replacement, KCPL has received an opinion from independent counsel to the Trust experienced in such matters to the effect that (A) such merger, consolidation, amalgamation or replacement does not adversely affect the rights, preferences and privileges of the holders of the Trust Securities (includingdepository for anySuccessor Securities) in any material respect (other than with respect to any dilution of the holders' interest in the new entity), and (B) following such merger, consolidation, amalgamation or replacement, neither the Trust nor such successor entityglobal securities will berequired to register as an investment company under the 1940 Act and (viii) KCPL guarantees the obligations of such successor entity under the Successor Securities at least to the extent provided by the Preferred Securities Guarantee. Notwithstanding the foregoing, the Trust will not, except with the consent of the holders of 100% in liquidation amount of the Trust Securities, consolidate, amalgamate, merge with or into, or be replaced by any other entity or permit any other entity to consolidate, amalgamate, merge with or into, or replace it if such consolidation, amalgamation, merger or replacement would cause the Trust or the successor entity to be classified for United States federal income tax purposes as other than a grantor trust. S-24BOOK-ENTRY ONLY ISSUANCE - THE DEPOSITORY TRUST COMPANYThe Depository Trust Company,("DTC")or DTC.So long as the depository, or its nominee, is the registered owner of a global security, such depository or such nominee, as the case may be, will be considered the owner of such global security for all purposes under the applicable indenture, including for any notices and voting. Except in limited circumstances, the owners of beneficial interests in a global security will not be entitled to have securities registered in their names, will not receive or be entitled to receive physical delivery of any such securities and will not be considered the registered holder thereof under the applicable indenture. Accordingly, each person holding a beneficial interest in a global security must rely on the procedures of the depository and, if such person is not a direct participant, on procedures of the direct participant through which such person holds its interest, to exercise a ny of the rights of a registered owner of such security.
Global securities may be exchanged in whole for certificated securities only if:
*
the depository notifies us that it is unwilling or enable to continue as depository for the global securities or the depository has ceased to be a clearing agency registered under the Exchange Act and, in either case, we thereupon fail to appoint a successor depository within 90 days;
*
we, at our option, notify the trustee in writing that we elect to cause the issuance of certificated securities; or
*
there shall have occurred and be continuing an event of default with respect to the applicable securities of any series
In any such case, we have agreed to notify the applicable trustee in writing that, upon surrender by the direct participants and indirect participants of their interest in such global securities, certificated securities representing the applicable securities will be issued to each person that such direct participants and indirect participants and the depository identify as being the beneficial owners of such securities.
The following is based solely on information furnished by DTC:
DTC will act as
securities depositarydepository for thePreferred Securities.global securities. ThePreferred Securitiesglobal securities will be issuedonlyasfully registeredfully-registered securities registered in the name of Cede & Co.(DTC's nominee)., DTC's partnership nominee. Oneor more fully registeredfully-registered globalPreferred Securities certificatessecurity certificate will be issuedrepresentingfor each issue of the global securities, each in the aggregatethe total numberprincipal amount ofPreferred Securities,such issue and will be deposited withDTC ("Global Certificates"). The laws of some jurisdictions require that certain purchasers of securities take physical delivery of securities in definitive form. Such laws may impair the ability to transfer beneficial interests in a global Preferred Security.DTC.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""clearing corporation" registered pursuant to the provisions of Section 17A of the Securities ExchangeAct.Act of 1934. DTC holds securities that its direct participants("Participants")deposit with DTC. DTC also facilitates the settlement amongParticipantsdirect participants of securities transactions, such as transfers and pledges, in depositedsecurities through electronic computerized book-entry changes in
Participants'direct participants' accounts, thereby eliminating the need for physical movement of securities certificates.Direct
Participantsparticipants include securities brokers and dealers, banks, trust companies, clearing corporations and certain otherorganizations ("Direct Participants").organizations. DTC is owned by a number of itsDirect Participantsdirect participants and by the New York Stock Exchange, Inc., the American Stock Exchange, Inc., and the National Association of Securities Dealers, Inc. Access to the DTC system is also available to others such as securities brokers and dealers, banks and trust companies that clear through or maintain a custodial relationship with aDirect Participant,direct participant, either directly or indirectly,("Indirect Participants").which are referred to as indirect participants and, together with the direct participants, the participants. The rules applicable to DTC and itsParticipantsparticipants are on file with theCommission.SEC.Purchases of
Preferred Securities withinglobal securities under the DTC system must be made by or throughDirect Participants, whichdirect participants, who will receive a credit forthe Preferred Securitiessuch purchases of global securities on DTC's records. The ownership interest of each actual purchaser ofPreferred Securities ("Beneficial Owner")each global security, or beneficial owners, is in turn to be recorded on theDirectdirect andIndirect Participants'indirect participants' records. BeneficialOwnersowners will not receive written confirmation from DTC of theirpurchases,purchase, butBeneficial Ownersbeneficial owners are expected to receive written confirmations providing details of thetransactions,transaction, as well as periodic statements of their holdings, from theDirectdirect orIndirect Participantsindirect participant through which theBeneficial Owners purchased Preferred Securities.beneficial owners entered into the transaction. Transfers of ownership interests in thePreferred Securitiesglobal securities are to be accomplished by entries made on the books ofParticipantsparticipants acting on behalf of beneficial owners. BeneficialOwners. Beneficial Ownersowners will not receive certificates representing their ownership interests inPreferredthe global securities, except in the event that use of the book-entry system for thePreferred Securitiesglobal securities is discontinued.To facilitate subsequent transfers, all
the Preferred Securitiesglobal securities deposited byParticipantsparticipants with DTC are registered in the name of DTC's partnership nominee, Cede & Co. The deposit ofPreferred Securitiesglobal securities with DTC and their registration in the name of Cede & Co. effect no change in beneficial ownership. DTC has no knowledge of the actualBeneficial Ownersbeneficial owners of thePreferred Securities.global securities; DTC's records reflect only the identity of theDirect Participantsdirect participants to whose accounts suchPreferred Securitiesglobal securities are credited which may or may not be theBeneficial Owners.beneficial owners. TheS-25Participantsparticipants will remain responsible for keeping account of their holdings on behalf of their customers.So long as DTC, or its nominee, is the registered owner or holder of a Global Certificate, DTC or such nominee, as the case may be, will be considered the sole owner or holder of the Preferred Securities represented thereby for all purposes under the Declaration and the Preferred Securities. No beneficial owner of an interest in a Global Certificate will be able to transfer that interest except in accordance with DTC's applicable procedures, in addition to those provided for under the Declaration. DTC has advised KCPL that it will take any action permitted to be taken by a holder of Preferred Securities (including the presentation of Preferred Securities for exchange as described below) only at the direction of one or more Participants to whose account the DTC interests in the Global Certificates are credited and only in respect of such portion of the aggregate liquidation amount of Preferred Securities as to which such Participant or Participants has or have given such direction. However, if there is a Declaration Event of Default under the Preferred Securities, DTC will exchange the Global Certificates for certificated Preferred Securities, which it will distribute to its Participants.Conveyance of notices and other communications by DTC to
Direct Participants,direct participants, byDirect Participantsdirect participants toIndirect Participants,indirect participants, and byDirect Participantsdirect participants andIndirect Participantsindirect participants toBeneficial Ownersbeneficial owners will be governed by arrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time.RedemptionIf the global securities are redeemable, redemption notices
willshall be sent to Cede & Co. If less than all of thePreferred Securitiesglobal securities are being redeemed,DTC will reduce pro rataDTC's practice is to determine by lot the amount of the interest of eachDirect Participantdirect participant inthe Preferred Securitiessuch issue to beredeemed; provided that if, as a result of such pro rata redemption, Direct Participants would hold fractional interests in the Preferred Securities, DTC will adjust the amount of the interest of each Direct Participant to be redeemed to avoid such fractional interests. Although voting with respect to the Preferred Securities is limited, in those cases where a vote is required neitherredeemed.Neither DTC nor Cede & Co. will
itselfconsent or vote with respect toPreferred Securities.the global securities. Under its usual procedures, DTCwould mailmails anOmnibus Proxyomnibus proxy tothe Trustus as soon as possible after the record date. TheOmnibus Proxyomnibus proxy assigns Cede &Co.'sCo's consenting orvoting rights to those
Direct Participants todirect participants whose accounts thePreferred Securitiesglobal securities are credited on the record date,(identifiedidentified in a listing attached to theOmnibus Proxy). Distributionomnibus proxy.Principal, interest and premium payments, if any, on the
Preferred Securitiesglobal securities will be made toDTC.DTC in immediately available funds. DTC's practice is to creditDirect Participants'direct participants' accounts on therelevant paymentdate on which interest is payable in accordance withtheirthe respective holdings shown on DTC's records, unless DTC has reason to believethatit will not receivepaymentspayment on suchpaymentdate. Payments by participants toBeneficial Ownersbeneficial owners will be governed by standing instructions and customary practices, asinis the case with securities held for theaccountaccounts of customers in bearer form or registered in "street name," and will be the responsibility of suchParticipantparticipant and not of DTC, theTrust, anytrustee for such securities, orKCPL,us, subject to any statutory or regulatory requirements as may be in effect from time to time. Payment ofdistributionsprincipal, interest and premium, if any, on any of the aforementioned securities represented by g lobal securities to DTC is the responsibility of theTrust, disbursementappropriate trustee and us. Disbursement of such payments toDirect Participants isdirect participants shall be the responsibility of DTC, and disbursement of such payments to theBeneficial Owners isbeneficial owners shall be the responsibility ofDirect and Indirect Participants. S-26Except as provided herein, a Beneficial Owner in a global Preferred Security will not be entitled to receive physical delivery of Preferred Securities. Accordingly, each Beneficial Owner must rely ontheprocedures of DTC to exercise any rights under the Preferred Securities. Although DTC has agreed to the foregoing procedures in order to facilitate transfers of interests in the Global Certificates among Participants of DTC, DTC is under no obligation to perform or continue to perform such procedures, and such procedures may be discontinued at any time. Neither KCPL, the Trust nor any Trustee will have any responsibility for the performance by DTC or its Direct Participants or Indirect Participants under the rules and procedures governing DTC. DTC may discontinue providing its services as securities depositary with respect to the Preferred Securities at any time by giving reasonable notice to the Trust. Under such circumstances, in the event that a successor securities depositary is not obtained, Preferred Securities certificates are required to be printed and delivered. Additionally, the Regular Trustees (with the consent of KCPL) may decide to discontinue use of the system of book-entry transfers through DTC (or a successor depositary) with respect to the Preferred Securities. In that event, certificates for the Preferred Securities of such Trust will be printed and delivered.participants.The information in this section
concerningcovering DTC and DTC's book-entry system has been obtained from sources,that KCPL and the Trustincluding DTC, which we believe to bereliable, but KCPL and the Trust assume no responsibility for the accuracy thereof. INFORMATION CONCERNING THE PROPERTY TRUSTEEreliable.The
Property Trustee, prior to the occurrenceunderwriters, dealers or agents ofa default with respect to the Trust Securities and after the curing of all such defaults that may have occurred, undertakes to perform only such duties as are specifically set forth in the Declaration and, after default, shall exercise the same degree of care as a prudent individual would exercise in the conduct of his or her own affairs. Subject to such provisions, the Property Trustee is under no obligation to exerciseany of thepowers vested in it by the Declaration at the requestsecurities may be direct participants ofany holder of Preferred Securities unless offered reasonable indemnity by such holder against the costs, expenses and liabilities which might be incurred thereby; but the foregoing shall not relieve the Property Trustee, upon the occurrence of a Declaration Event of Default, from exercising the rights and powers vested in it by the Declaration. The Property Trustee also serves as trustee under the Preferred Securities Guarantee. KCPL and its officers and directors have no material relationship with the Property Trustee except that (a) the Property Trustee is a dealer in commercial paper issued by KCPL, (b) the Property Trustee is trustee and remarketing agent for certain governmental revenue bonds which are payable with amounts paid by KCPL to the issuer of such bonds, and (c) KCPL and its principal subsidiary maintain lines of credit with the Property Trustee. REGISTRAR AND TRANSFER AGENT In the event that the Preferred Securities do not remain in book-entry only form, the Property Trustee will act as paying agent and may designate an additional or substitute paying agent at any time. Registration of transfers of Preferred Securities will be effected without charge by or on behalfDTC.None of the
Trust, but upon payment (with the giving of such indemnity as the Regular Trustees may require) in respect of any tax or other governmental charges which may be imposed in relation to it. The Trust will not be required to register or cause to be registered S-27the transfer of Preferred Securities after such Preferred Securities have been called for redemption. GOVERNING LAW The Declaration and the Preferred Securities will be governed by, and construed in accordance with, the internal laws of the State of Delaware. MISCELLANEOUS The Regular Trustees are authorized and directed to operate the Trust in such a way so that the Trust will not be deemed to be an "investment company" required to be registered under the 1940 Act or characterized for United States Federal income tax purposes as other than a grantor trust. KCPL is authorized and directed to conduct its affairs so that the Subordinated Debentures will be treated as indebtedness of KCPL for United States federal income tax purposes. In this connection, the Regular Trustees and KCPL are authorized to take any action, not inconsistent with applicable law, or the corporate charter of KCPL, that each of the Regular Trustees and KCPL determines in their discretion to be necessary or desirable for such purposes, as long as such action does not materially and adversely affect the interests of the holders of the Preferred Securities. Holders of Preferred Securities will have no preemptive or similar rights. DESCRIPTION OF THE PREFERRED SECURITIES GUARANTEE Pursuant to the Preferred Securities Guarantee, KCPL will irrevocably and unconditionally agree, to the extent set forth therein, to pay in full to the holders of the Preferred Securities issued by the Trust, the Guarantee Payments (as defined in the accompanying Prospectus) except to the extent paid by the Trust, as and when due, regardless of any defense, right of setoff or counterclaim which the Trust may have or assert. KCPL's obligation to make a Guarantee Payment may be satisfied by direct payment of the required amounts by KCPL to the holders of Preferred Securities or by causing the Trust to pay such amounts to such holders. The Preferred Securities Guarantee will be qualified as an indenture under the Trust Indenture Act. The First National Bank of Chicago will act as Guarantee Trustee. The terms of the Preferred Securities Guarantee will be those set forth in such Guarantee and those made part of such Preferred Securities Guarantee by the Trust Indenture Act. The Preferred Securities Guarantee will be held by the Guarantee Trustee for the benefit of the holders of the Preferred Securities. A summary description of the Preferred Securities Guarantee appears in the accompanying Prospectus under the caption "Description of the Preferred Securities Guarantees." DESCRIPTION OF THE SUBORDINATED DEBENTURES Set forth below is a description of the specific terms of the Subordinated Debentures in which the Trust will invest the proceeds from the issuance and sale of the Trust Securities. This description supplements the description of the general terms and provisions of the Subordinated Debentures set forth in the accompanying Prospectus under the caption "Description of the S-28Subordinated Debentures". The following description does not purport to be complete and is subject to, and is qualified in its entirety by reference to, the description in the accompanying Prospectus and the Indenture, dated as of , between KCPL and The First National Bank of Chicago, as Trustee (the "Debt Trustee"), as supplemented by a Supplemental Indenture dated as of (said Indenture, as so supplemented, is hereinafter referred to as the "Indenture"), the forms of which are filed as Exhibits to the Registration Statement of which this Prospectus Supplement and the accompanying Prospectus form a part. Certain capitalized terms used herein are defined in the Indenture. KCPL will have the right at any time to liquidate the Trust and cause the Subordinated Debentures to be distributed to the holders of the Trust Securities. If the Subordinated Debentures are distributed to the holders of the Preferred Securities, KCPL will use its best efforts to have the Subordinated Debentures listed on the New York Stock Exchange or on such other national securities exchange or similar organization on which the Preferred Securities are then listed or quoted. GENERAL The Subordinated Debentures will be issued as unsecured indebtedness of KCPL under the Indenture. The Subordinated Debentures will be limited in aggregate principal amount to approximately $ , such amount being the sum of the aggregate stated liquidation amount of the Trust Securities. The Subordinated Debentures are not subject to a sinking fund provision. The entire principal amount of the Subordinated Debentures will mature and become due and payable, together with any accrued and unpaid interest thereon including Compound Interest (as defined herein) and Additional Interest (as defined herein), if any, on , subject to the right of KCPL to shorten the maturity date to a date no earlier than . If Subordinated Debentures are distributed to holders of Preferred Securities in liquidation of such holders' interests in the Trust, such Subordinated Debentures will initially be issued as a Global Security (as defined herein). As described herein, Subordinated Debentures may be issued in certificated form in exchange for a Global Security. See "Book-Entry and Settlement" and "The Depositary" below. In the event that Subordinated Debentures are issued in certificated form, such Subordinated Debentures will be in denominations of $25 and integral multiples thereof and may be transferred or exchanged at the offices described below. Payments on Subordinated Debentures issued as a Global Security will be made to DTC, a successor depositary or, in the event that no depositary is used, to a Paying Agent for the Subordinated Debentures. In the event Subordinated Debentures are issued in certificated form, principal and interest will be payable, the transfer of the Subordinated Debentures will be registrable and Subordinated Debentures will be exchangeable for Subordinated Debentures of other denominations of a like aggregate principal amount, at the corporate trust office of the Debt Trustee in New York, New York; provided, that payment of interest may be made at the option of KCPL by check mailed to the address of the holder entitled thereto or by wire transfer to an account appropriately designated by the holder entitled thereto. Notwithstanding the foregoing, so long as the holder of any Subordinated Debentures is the Property Trustee, the payment of principal and interest on the Subordinated Debentures held by the Property Trustee will be made at such place and to such account as may be designated by the Property Trustee. S-29The Indenture does not contain provisions that afford holders of the Subordinated Debentures protection in the event of a highly leveraged transaction or other similar transaction involving KCPL that may adversely affect such holders. SUBORDINATION The Indenture provides that the Subordinated Debentures are subordinated and junior in right of payment to all Senior Indebtedness of KCPL, whether now existing or hereafter incurred. Senior Indebtedness may include Indebtedness of KCPL which is subordinated to other Indebtedness of KCPL but nevertheless senior to the Subordinated Debentures. No payment of principal of (including redemption payments, if any), premium, if any, or interest on, the Subordinated Debentures may be made if (a) there is a default in the payments of principal, premium, interesttrustees, us or anyother payment due on any Senior Indebtedness, or (b) the maturity of any Senior Indebtedness has been accelerated because of a default. Upon any distribution of assets of KCPL to creditors upon any dissolution, winding-up, liquidation or reorganization, whether voluntary or involuntary, or in bankruptcy, insolvency, receivership or other proceedings, all principal of, premium, if any, and interest due or to become due on, all Senior Indebtedness must be paid in full before the holders of the Subordinated Debentures are entitled to receive or retain any payment. The rights of the holders of the Subordinated Debentures will be subrogated to the rights of the holders of Senior Indebtedness to receive payments or distributions applicable to such Senior Indebtedness until all amounts owing on the Subordinated Debentures are paid in full. The term "Senior Indebtedness" means (i) any payment in respect of (a) indebtedness of KCPL for money borrowed and (b) indebtedness evidenced by securities, debentures, bonds, notes or other similar instruments issued by KCPL including, without limitation, indebtedness evidenced by securities issued pursuant to its General Mortgage Indenture and Deed of Trust dated as of December 1, 1986, between KCPL and UMB Bank, N.A., as supplemented, and pursuant to other indentures with various trustees (other than the Indenture); (ii) all capital lease obligations of KCPL; (iii) all obligations of KCPL issued or assumed as the deferred purchase price of property, all conditional sale obligations of KCPL and all of its obligations under any title retention agreement (but excluding trade accounts payable arising in the ordinary course of business); (iv) all obligations of KCPL for the reimbursement on any letter of credit, banker's acceptance, security purchase facility or similar credit transaction; (v) all obligations of the type referred to in clauses (i) through (iv) above of other Persons for the payment of which KCPL is responsible or liable as obligor, guarantor or otherwise; and (vi) all obligations of the type referred to in clauses (i) through (v) above of other Persons secured by any lien on any property or asset of KCPL (whether or not such obligation is assumed by KCPL), except for (1) any such indebtedness that is by its terms subordinated to or PARI PASSU with the Subordinated Debentures, as the case may be, including all other debt securities and guarantees in respect of those debt securities, issued to any other trusts, partnerships or other entity affiliated with KCPL which is a financing vehicle of KCPL in connection with the issuance of preferred securities by such entity or other securities which rank PARI PASSU with, or junior to, the Preferred Securities, and (2) any indebtedness between or among KCPL and its affiliates. Such Senior Indebtedness will continue to be Senior Indebtedness and be entitled to the benefits of the subordination provisions irrespective of any amendment, modification or waiver of any term of such Senior Indebtedness. S-30The Indenture does not limit the aggregate amount of Senior Indebtedness which may be issued by KCPL. As of September 30, 1996, Senior Indebtedness of KCPL aggregated approximately $________ million. OPTIONAL REDEMPTION KCPL will have the right to redeem the Subordinated Debentures, in whole or in part, from time to time, on or after _____________ __, ____, or at any time in certain circumstances upon the occurrence of a Tax Event as described under "Description of the Preferred Securities -- Tax Event Redemption" herein, upon not less than 30 nor more than 60 days' notice, at a Redemption Price equal to 100% of the principal amount to be redeemed plus any accrued and unpaid interest, including Additional Interest, if any, to the redemption date. If a partial redemption of the Preferred Securities resulting from a partial redemption of the Subordinated Debentures would result in the delisting of the Preferred Securities, KCPL may only redeem the Subordinated Debentures in whole. OPTION TO CHANGE MATURITY DATE KCPL will have the right at any time to shorten the maturity of the Subordinated Debentures to a date not earlier than _____________ __, ____. INTEREST Each Subordinated Debenture will bear interest at the rate of ___% per annum from the original date of issuance, payable quarterly in arrears on March 31, June 30, September 30 and December 31 of each year (each, an "Interest Payment Date"), commencing ________ __, _____, to the person in whose name such Subordinated Debenture is registered, subject to certain exceptions, at the close of business on the Business Day next preceding such Interest Payment Date. If the Subordinated Debentures do not continue to remain in book-entry only form, KCPL will have the right to select record dates which may not be less than fifteen days prior to each Interest Payment Date. The amount of interest payable for any period will be computed on the basis of a 360-day year of twelve 30-day months. The amount of interest payable for any period shorter than a full quarterly period will be computed on the basis of the actual number of days elapsed in such 90-day quarter. In the event that any date on which interest is payable on the Subordinated Debentures is not a Business Day, then payment of the interest payable on such date will be made on the next succeeding day which is a Business Day (and without any interest or other payment in respect of any such delay), except that, if such Business Day is in the next succeeding calendar year, such payment will be made on the immediately preceding Business Day, in each case with the same force and effect as if made on such date. OPTION TO EXTEND INTEREST PAYMENT PERIOD KCPL will have the right at any time, and from time to time, during the term of the Subordinated Debentures, to defer payments of interest by extending the interest payment period for a period not exceeding 20 consecutive quarters, at the end of which Extension Period, KCPL will pay all interest then accrued and unpaid (including any Additional Interest, together with the interest thereon compounded quarterly at the rate specified for the Subordinated Debentures S-31to the extent permitted by applicable law); provided, that, during any such Extension Period, (a) KCPL may not declare or pay any dividend on, make any distributions with respect to, or redeem, purchase or acquire, or make a liquidation payment with respect to, any of its capital stock (other than (i) purchases or acquisitions of shares of KCPL common stock in connection with the satisfaction by KCPL of its obligations under any employee benefit plans or any other contractual obligation of KCPL (other than a contractual obligation ranking PARI PASSU with or junior to the Subordinated Debentures), (ii) as a result of a reclassification of KCPL capital stock or the exchange or conversion of one class or series of KCPL capital stock for another class or series of KCPL capital stock or (iii) the purchase of fractional interests in shares of KCPL capital stock pursuant to the conversion or exchange provisions of such KCPL capital stock or the security being converted or exchanged), (b) KCPL may not make any payment of interest, principal or premium, if any, on or repay, repurchase or redeem any debt securities (including guarantees) issued by KCPL which rank PARI PASSU with or junior to the Subordinated Debentures to which such Extension Period applies and (c) KCPL may not make any guarantee payments with respect to the foregoing (other than pursuant to the Preferred Securities Guarantee). This covenant effectively requires that any Extension Period with respect to payment of interest on any series of Subordinated Debentures will also apply to each other series of subordinated debentures issued under the Indenture to other trusts similar to the Trust. Prior to the termination of any such Extension Period, KCPL may further defer payments of interest by extending the interest payment period, provided that such Extension Period together with all such previous and further extensions thereof may not exceed 20 consecutive quarters or extend beyond the maturity of the Subordinated Debentures. Upon the termination of any Extension Period and the payment of all amounts then due, KCPL may select a new Extension Period, as if no Extension Period had previously been declared, subject to the above requirements. No interest during an Extension Period, except at the end thereof, will be due and payable, KCPL has no present intention of exercising its rights to defer payments of interest by extending the interest payment period on the Subordinated Debentures. If the Property Trustee is the sole holder of the Subordinated Debentures, KCPL will give the Regular Trustees and the Property Trustee notice of its selection of such Extension Period one Business Day prior to the earlier of (i) the next succeeding date on which distributions on the Preferred Securities are payable or (ii) the date the Trust is required to give notice to the New York Stock Exchange or other applicable self-regulatory organization or to holders of the Preferred Securities on the record date or the date such distribution is payable, but in any event not less than one Business Day prior to such record date. The Regular Trustees will give notice of KCPL's selection of such Extension Period to the holders of the Preferred Securities. If the Property Trustee is not the sole holder of the Subordinated Debentures, KCPL will give the holders of the Subordinated Debentures notice of its selection of such Extension Period ten Business Days prior to the earlier of (i) the next Interest Payment Date or (ii) the date KCPL is required to give notice to the New York Stock Exchange or other applicable self-regulatory organization or to holders of the Subordinated Debentures affected thereby on the record or payment date of such related interest payment, but in any event at least two Business Days before such record date. ADDITIONAL INTEREST If at any time the Trust is required to pay any taxes, duties, assessments or governmental charges of whatever nature (other than withholding taxes) imposed by the United States, or any other taxing authority, then, in any such case, KCPL will pay as additional interest ("Additional Interest") such additional amounts as shall be required so that the net amounts received and retained by the Trust after paying any such taxes, duties, assessments or other governmental S-32charges will be equal to the amounts the Trust would have received had no such taxes, duties, assessments or other governmental charges been imposed. POSSIBLE TAX LAW CHANGES On March 19, 1996, the Revenue Reconciliation Bill of 1996 (the "Bill"), the revenue portion of President Clinton's budget proposal, was released. The Bill would, among other things, generally deny interest deductions for United States federal income tax purposes for interest on an instrument, issued by a corporation, that has a maximum weighted average maturity of more than 40 years. The Bill would also generally deny interest deductions for interest on an instrument, issued by a corporation, that has a maximum term of more than 20 years and that is not shown as indebtedness on the separate balance sheet of the issuer, or where the instrument is issued with a related instrument that is not shown as indebtedness on the issuer's consolidated balance sheet. The above- described provisions of the Bill were proposed to be effective generally for instruments issued on or after December 7, 1995. If either provision were to apply to the Subordinated Debentures, KCPL would be unable to deduct interest on the Subordinated Debentures for United States federal income tax purposes. However, on March 29, 1996, the Chairmen of the Senate Finance and House Ways and Means Committees issued a joint statement to the effect that it was their intention that the effective date of the President's legislative proposals, if adopted, will be no earlier than the date of appropriate Congressional action. KCPL believes, that, under current law, it will be able to deduct interest on the Subordinated Debentures. There can be no assurance, however, that current or future legislative proposals or final legislation will not be enacted which may affect the ability of KCPL to deduct interest on the Subordinated Debentures. Such a change could give rise to a Tax Event, which may permit KCPL to cause a redemption of the Preferred Securities. See "Description of the Preferred Securities -- Tax Event Redemption or Distribution" in the accompanying Prospectus. Such a tax law change would not alter the United States federal income tax consequences of the purchase, ownership and disposition of Preferred Securities to holders thereof. INDENTURE EVENTS OF DEFAULT If any Indenture Event of Default has occured and is continuing, the Property Trustee, as the holder of the Subordinated Debentures, will have the right to declare the principal of and the interest on the Subordinated Debentures (including any Compound Interest and Additional Interest, if any) and any other amounts payable under the Indenture to be forthwith due and payable and to enforce its other rights as a creditor with respect to the Subordinated Debentures. See "Description of Subordinated Debentures -- Indenture Events of Default" in the accompanying Prospectus for a description of Indenture Events of Default. An Indenture Event of Default also constitutes a Declaration Event of Default. The holders of Preferred Securities in certain circumstances have the right to direct the Property Trustee to exercise its rights as a holder of Subordinated Debentures. See "Description of the Preferred Securities -- Declaration Events of Default" and "Voting Rights." Notwithstanding the foregoing, if an Indenture Event of Default has occurred and is continuing and is attributable to the failure of KCPL to pay interest or principal on the Subordinated Debentures on the date such interest or principal is otherwise payable, KCPL acknowledges that a holder of Preferred Securities may then institute a Direct Actionagent for payment on orafter the respective due date specified in the Subordinated Debentures. Notwithstanding any payments made to such holderregistration ofPreferred Securities by KCPL in connection with a Direct Action, KCPL will remain obligated to pay the principal oftransfer orinterest on the Subordinated Debentures held by the Trust or the Property Trustee, and KCPL S-33will be subrogated to the rights of the holder of such Preferred Securities with respect to payments on the Preferred Securities to the extentexchange of anypayments made by KCPL to such holder in any Direct Action. The holders of Preferred Securities will not be able to exercise directly any other remedy available to the holders of Subordinated Debentures. BOOK-ENTRY AND SETTLEMENT If distributed to holders of Preferred Securities in connection with the involuntary or voluntary dissolution, winding-up or liquidation of the Trust, the Subordinated Debentures will be issued in the form of one or moreglobalcertificates (each a "Global Security") registered in the name of the depositary or its nominee. Except under the limited circumstances described below, Subordinated Debentures represented by the Global Security will not be exchangeable for, and will not otherwise be issuable as, Subordinated Debentures in definitive form. The Global Securities described above may not be transferred except by the depositary to a nominee of the depositary or by a nominee of the depositary to the depositary or another nominee of the depositary or to a successor depositary or its nominee. The laws of some jurisdictions require that certain purchasers of securities take physical delivery of such securities in definitive form. Such laws may impair the ability to transfer beneficial interests in such a Global Security. Except as provided below, owners of beneficial interests in such a Global Security will not be entitled to receive physical delivery of Subordinated Debentures in definitive form and will not be considered the holders (as defined in the Indenture) thereof for any purpose under the Indenture, and no Global Security representing Subordinated Debentures will be exchangeable, except for another Global Security of like denomination and tenor to be registered in the name of the Depositary or its nominee or to a successor Depositary or its nominee. Accordingly, each beneficial owner must rely on the procedures of the Depositary or, if such person is not a Participant on the procedures of the Participant through which such person owns its interest, to exercise any rights of a holder of Subordinated Debentures under the Indenture. THE DEPOSITARY If Subordinated Debentures are distributed to holders of Preferred Securities in liquidation of such holders' interests in the Trust, DTC will act as securities depositary for the Subordinated Debentures. For a description of DTC and the specific terms of the depositary arrangements, see "Description of the Preferred Securities -- Book-Entry Only Issuance - the Depository Trust Company" As of the date of this Prospectus Supplement, the description therein of DTC's book-entry system and DTC's practices as they relate to purchases, transfers, notices and payments with respect to the Preferred Securities apply in all material respects to any Subordinated Debentures represented by one or more Global Securities. KCPL may appoint a successor to DTC or any successor depositary in the event DTC or such successor depositary is unable or unwilling to continue as a depositary for the Global Securities. None of KCPL, the Trust, the Property Trustee, any paying agent or any other agent of KCPL or the Debt Trusteesecurity will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficialownershipinterests ina Global Security for Subordinated Debenturessuch global security or for maintaining, supervising or reviewing any records relating to such beneficialownershipinterests.S-34A Global Security will be exchangeable for Subordinated Debentures registered inPLAN OF DISTRIBUTION
The Company may sell the
names of persons other than the Depositary or its nominee only if (i) the Depositary notifies KCPL that it is unwilling or unable to continue as a depositary for such Global Security and no successor depositary shall have been appointed, (ii) the Depositary, at any time, ceases to be a clearing agency registered under the Exchange Act at which time the Depositary is required to be so registered to act as such depositary and no successor depositary shall have been appointed, (iii) KCPL, in its sole discretion, determines that such Global Security will be so exchangeable or (iv) there has occurred an Indenture Event of Default with respect to such Subordinated Debentures. Any Global Security that is exchangeable pursuant to the preceding sentence will be exchangeable for Subordinated Debentures registered in such names as the Depositary shall direct. It is expected that such instructions will be based upon directions received by the Depositary from its Participants with respect to ownership of beneficial interests in such Global Security. If the Subordinated Debentures are not represented by one or more Global Securities, certificates evidencing the Subordinated Debentures may be presented for registration of transfer (with the form of transfer endorsed thereon duly executed) or exchange, at the office of the Debenture Registrar or at the office of any transfer agent designated by KCPL for such purpose with respect to the Subordinated Debentures, without service charge and upon payment of any taxes and other governmental charges as described in the Indenture. Such transfer or exchange will be effected upon the Debenture Registrar or such transfer agent, as the case may be, being satisfied with the documents of title and identity of the person making the request. KCPL has appointed the Debt Trustee as Debenture Registrar with respect to the Subordinated Debentures. KCPL may at any time rescind the designation of any such transfer agent or approve a change in the location through which any such transfer agent acts, except that KCPL will be required to maintain a transfer agent at the place of payment. KCPL may at any time designate additional transfer agents with respect to the Subordinated Debentures. In the event of any redemption of only a part of the Subordinated Debentures, KCPL will not be required to (i) issue, exchange or register the transfer of Subordinated Debentures during a period beginning at the opening of business 15 days before the day of the mailing of a notice of redemption of less than all of the Subordinated Debentures and ending at the close of business on the date of such mailing and (ii) register the transfer of or exchange any Subordinated Debentures so selected for redemption, in whole or in part, except the unredeemed portion of any Subordinated Debentures being redeemed in part. GOVERNING LAW The Indenturesenior debt securities and theSubordinated Debentures will be governed by, and construed in accordance with, the internal laws of the State of New York. MISCELLANEOUS The Indenture will provide that KCPL will pay all fees and expenses related to (i) the offering of the Trust Securitiessubordinated debt securities and theSubordinated Debentures, (ii) the organization, maintenance and dissolution of the Trust, (iii) the retention of the Trustees and (iv) the enforcement by the Property Trustee of the rights of the holders of the Preferred Securities. The payment of such fees and expenses will be fully and unconditionally guaranteed by KCPL. S-35KCPL will have the right at all times to assign any of its respective rights or obligations under the Indenture to a direct or indirectly wholly-owned subsidiary of KCPL; provided that, in the event of any such assignment, KCPL will remain liable for all of such obligations. Subject to the foregoing, the Indenture will be binding upon and inure to the benefit of the parties thereto and their respective successors and assigns. The Indenture provides that itTrusts maynot otherwise be assigned by the parties thereto. EFFECT OF OBLIGATIONS UNDER THE SUBORDINATED DEBENTURES AND THE PREFERRED SECURITIES GUARANTEE As set forth in the Declaration, the sole purposes of the Trust are to (i) issue Trust Securities, (ii) invest the proceeds thereof in the Subordinated Debentures and (iii) engage in only those other activities necessary or incidental thereto. As long as payments of interest and other payments are made when due on the Subordinated Debentures, such payments will be sufficient to cover distributions and payments due on the Trust Securities primarily because (i) the aggregate principal amount of Subordinated Debentures will be equal to the sum of the aggregate stated liquidation amount of the Trust Securities; (ii) the interest rate and interest and other payment dates on the Subordinated Debentures will match the distribution rate and distribution and other payment dates for the Preferred Securities; (iii) KCPL will pay for all costs and expenses of the Trust; and (iv) the Declaration provides that the Trustees may not cause or permit the Trust to, among other things, engage in any activity that is not consistent with the purposes of the Trust. Payments of distributions (to the extent funds therefor are available) and other payments due onsell the Preferred Securities(to the extent funds therefor are available) are guaranteed by KCPL as and to the extent set forth under "Description of the Preferred Securities Guarantee"inthe accompanying Prospectus. If KCPL does not make interest payments on the Subordinated Debentures purchased by the Trust, it is expected that the Trust will not have sufficient funds to pay distributions on the Preferred Securities. The Preferred Securities Guarantee is a full and unconditional guarantee from the time of its issuance, but does not apply to any payment of distributions unless and until the Trust has sufficient funds for the payment of such distributions. If KCPL fails to make interest or other payments on the Subordinated Debentures when due (taking into account any Extension Period), the Declaration provides a mechanism whereby the holders of the Preferred Securities, using the procedures described in "Description of the Preferred Securities -- Voting Rights" in this Prospectus Supplement, may direct the Property Trustee to enforce its rights under the Subordinated Debentures, including proceeding directly against KCPL to enforce the Subordinated Debentures. If the Property Trustee fails to enforce its rights under the Subordinated Debentures, a holder of Preferred Securities may, after a period of 30 days has elapsed from such holder's written request to the Property Trustee to enforce such rights, institute a legal proceeding directly against KCPL to enforce the Property Trustee's rights under the Subordinated Debentures without first instituting any legal proceeding against the Property Trustee or any other person or entity, including the Trust. If KCPL fails to make payments under the Preferred Securities Guarantee, the Preferred Securities Guarantee provides a mechanism whereby the holders of the Preferred Securities may direct the Guarantee Trustee to enforce its rights thereunder. If the Guarantee Trustee fails to S-36enforce the Preferred Securities Guarantee, any holder of Preferred Securities affected thereby may institute a legal proceeding directly against KCPL to enforce the Guarantee Trustee's rights under the Preferred Securities Guarantee, without first instituting a legal proceeding against the Trust, the Guarantee Trustee or any other person or entity. The above mechanisms and obligations, taken together, are equivalent to a full and unconditional guarantee by KCPL of payments due on the Preferred Securities. See "Description of the Preferred Securities Guarantees -- General" in the accompanying Prospectus. UNITED STATES FEDERAL INCOME TAXATION The following is a summary of certain of the material United States federal income tax consequences of the purchase, ownership and disposition of Preferred Securities. Unless otherwise stated, this summary deals only with Preferred Securities held as capital assets by holders that purchase the Preferred Securities upon original issuance. This summary does not address all the tax consequences that may be relevant to holders that may be subject to special tax treatment such as, for example, banks, real estate investment trusts, regulated investment companies, insurance companies, dealers in securities or currencies, tax-exempt investors, persons whose functional currency is other than the United States dollar, persons who hold Preferred Securities as part of a straddle, hedging or conversion transaction or, except as specifically described herein, foreign taxpayers. In addition, this summary does not address any aspects of state, local, or foreign laws. This summary is based on the Internal Revenue Code of 1986, as amended, Treasury regulations promulgated thereunder and administrative and judicial interpretations thereof, as of the date hereof, all of which are subject to change, possibly on a retroactive basis. Each holder should consult its tax advisor as to its particular tax consequences of acquiring, holding, and disposing of the Preferred Securities, including the tax consequences under state, local, and foreign laws. CLASSIFICATION OF THE SUBORDINATED DEBENTURES It is a condition to the issuance of the Preferred Securities that Sidley & Austin render its opinion generally to the effect that, under then current United States federal income tax law and assuming full compliance with the terms of the Indenture (and certain other documents), and based on certain facts and assumptions contained in such opinion, the Subordinated Debentures held by the Trust will be classified for United States federal income tax purposes as indebtedness of KCPL. Accordingly, corporate holders of Preferred Securities will not be entitled to a dividends-received deduction with respect to any income recognized with respect to the Preferred Securities. CLASSIFICATION OF THE TRUST It is a condition to the issuance of the Preferred Securities that Sidley & Austin render its opinion generally to the effect that, under then current United States federal income tax law and assuming full compliance with the terms of the Declaration and the Indenture (and certain other documents), and based on certain facts and assumptions contained in such opinion, the Trust will be classified for United States federal income tax purposes as a grantor trust and not as an association taxable as a corporation. Accordingly, for United States federal income tax purposes, each holder of Preferred Securities will generally be considered the owner of an undivided interest in the Subordinated Debentures, and each holder will be required to include S-37in its gross income any interest or original issue discount ("OID") accrued with respect to its allocable share of those Subordinated Debentures. Investors should be aware that the foregoing opinions of Sidley & Austin have not been confirmed by the Internal Revenue Service (the "Service"), by private ruling or otherwise, and are not binding on the Service or the courts. KCPL, the Trust, and, by its acceptance of a Preferred Security or a beneficial interest therein, the holder of, and any person that acquires a beneficial interest in, such Preferred Security agree to treat such Preferred Security and the Subordinated Debentures consistently with the foregoing opinions. INTEREST INCOME AND ORIGINAL ISSUE DISCOUNT Unless the Subordinated Debentures are issued with OID, stated interest on the Subordinated Debentures will be taxable to a holder as ordinary income at the time such interest is paid (if the holder uses the cash method of accounting for tax purposes) or accrued (if the holder uses the accrual method of accounting for tax purposes). Under regulations of the U.S. Treasury Department, the Subordinated Debentures will not be considered issued with OID if the likelihood of KCPL exercising its right to defer interest (as described under "Description of the Subordinated Debentures--Option to Extend Interest Payment Period") is considered a "remote" contingency at the time the Subordinated Debentures are issued. KCPL believes that such likelihood is remote, because exercise of its right to defer interest would prevent KCPL from declaring dividends on its capital stock. Accordingly, KCPL intends to take the position that the Subordinated Debentures will not be issued with OID. However, the definition of the term "remote" in the regulations has not yet been addressed in any rulings or other interpretations by the Service, and it is possible that the Service would assert that the Subordinated Debentures were issued with OID. Assuming the Subordinated Debentures continue to remain in book-entry only form, a determination that the Subordinated Debentures were issued with OID would not result in substantially different United States federal income tax consequences to accrual method taxpayers or to cash-method taxpayers whose taxable year is the calendar year. Holders not described in the preceding sentence, if any, would recognize the acceleration of up to three months' interest income. If, notwithstanding KCPL's current belief, it does exercise its right to defer interest payments, the Subordinated Debentures would be treated as if they were retired and then reissued with OID at such time. In such case, the amount of OID would generally be equal to the interest payable thereafter. If the Subordinated Debentures are treated as having been issued or reissued with OID (either because KCPL exercises its right to defer interest payments or because the likelihood of exercise of such right is not considered a remote contingency at the time of issuance), holders would include that interest in income on an economic accrual basis, regardless of their method of tax accounting. The amount of OID that accrued in any quarter would approximately equal the amount of interest that accrued on the Subordinated Debentures in that quarter at the stated interest rate. If interest payments were received later than the taxable year in which the interest accrued, OID treatment would have the effect of accelerating the reporting of income for holders who otherwise use a cash method of tax reporting. S-38MARKET DISCOUNT AND PREMIUM Holders of Preferred Securities other than holders that purchased the Preferred Securities upon original issuance may be considered to have acquired their undivided interest in the Subordinated Debentures with market discount, amortizable bond premium or acquisition premium as such terms are defined for United States federal income tax purposes. Such holders are advised to consult their tax advisors as to the income tax consequences of the acquisition, ownership and disposition of the Preferred Securities. RECEIPT OF SUBORDINATED DEBENTURES OR CASH UPON LIQUIDATION OF THE TRUST Under certain circumstances, as described under the caption "Description of the Preferred Securities -- Dissolution; Distribution of Subordinated Debentures," Subordinated Debentures may be distributed to holders in exchange for Preferred Securities and in liquidation of the Trust. Under current United States federal income tax law, such a redemption would be treated as a non- taxable event to each holder, and each holder would have an aggregate tax basis in the Subordinated Debentures equal to such holder's aggregate tax basis in its Preferred Securities. A holder's holding period in the Subordinated Debentures so received in liquidation of the Trust would include the period during which the Preferred Securities were held by such holder. Under certain circumstances, as described under the captions "Description of the Preferred Securities--Redemption," "Description of the Preferred Securities--Tax Event Redemption," and "Description of the Subordinated Debentures--Optional Redemption," the Subordinated Debentures may be redeemed for cash and the proceeds of such redemption distributed to holders in redemption of their Preferred Securities. Under current United States federal income tax law, such a redemption would be a taxable event, and a holder would recognize gain or loss as if such holder sold such redeemed Preferred Securities for cash. See "Sales of Preferred Securities" below. SALES OF PREFERRED SECURITIES A holder that sells Preferred Securities will recognize gain or loss equal to the difference between such holder's adjusted tax basis in the Preferred Securities and the amount realized on the sale of such Preferred Securities (other than with respect to accrued and unpaid interest which has not yet been included in income, which will be treated as ordinary income). A holder's adjusted tax basis in the Preferred Securities will generally be the initial purchase price increased by OID (if any) previously includible in such holder's gross income to the date of disposition and decreased by payments received on the Preferred Securities. Such gain or loss will generally be a capital gain or loss and will generally be a long-term capital gain or loss if the Preferred Securities have been held for more than one year. The Preferred Securities may trade at prices that do not accurately reflect the value of accrued but unpaid interest with respect to the underlying Subordinated Debentures. A holder who uses the accrual method of accounting for tax purposes (and a cash method holder if the Subordinated Debentures are deemed to have been issued with OID) and that disposes of Preferred Securities between record dates for payments of distributions thereon will be required to include accrued but unpaid interest on the Subordinated Debentures through the date of disposition in income as ordinary income, and to add such amount to such holder's adjusted tax basis in the pro rata share of the underlying Subordinated Debentures deemed disposed of. To S-39the extent that the selling price is less than the holder's adjusted tax basis (so determined) a holder will recognize a capital loss. Subject to certain limited exceptions, capital losses cannot be applied to offset ordinary income for United States federal income tax purposes. UNITED STATES ALIEN HOLDERS For purposes of this discussion, a "United States Alien Holder" is any corporation, individual, partnership, estate or trust that is, as to the United States, a foreign corporation, a nonresident alien individual, a foreign partnership, or a foreign estate or trust. This discussion assumes that income with respect to the Preferred Securities is not effectively connected with a trade or business in the United States in which the United States Alien Holder is engaged. Under current United States federal income tax law, and subject to the discussion of backup withholding in the following section: (1) payments with respect to principal and interest (including any OID) by the Trust or any of its paying agents to any holder of a Preferred Security that is a United States Alien Holder will not be subject to withholding of United States federal income tax; provided that, in the case of interest, (a) the beneficial owner of the Preferred Security does not actually or constructively own 10% of more of the total combined voting power of all classes of stock of KCPL entitled to vote, (b) the beneficial owner of the Preferred Security is not a controlled foreign corporation that is related, directly or indirectly, to KCPL through stock ownership, and (c) either (A) the beneficial owner of the Preferred Security certifies to the Trust or its agent, under penalties of perjury, that it is a United States Alien Holder and provides its name and address or (B) a securities clearing organization, bank or other financial institution that holds customer' securities in the ordinary course of its trade or business (a "Financial Institution"), and holds the Preferred Securities in such capacity, certifies to the Trust or its agent, under penalties or perjury, that such statement has been received from the beneficial owner by it or by a Financial Institution between it and the beneficial owner and furnishes the Trust or its agent with a copy thereof, and (2) a United States Alien Holder of a Preferred Security will generally not be subject to withholding of United States federal income tax on any gain realized upon the sale or other disposition of a Preferred Security. On April 15, 1996, proposed Treasury Regulations (the "1996 Proposed Regulations") were issued which, if adopted in final form, could affect the United States taxation of United States Alien Holders. The 1996 Proposed Regulations are generally proposed to be effective for payments after December 31, 1997, regardless of the issue date of the instrument with respect to which such payments are made, subject to certain transition rules. It cannot be predicted at this time whether the 1996 Proposed Regulations will become effective as proposed or what, if any, modifications may be made to them. Prospective investors are urged to consult their tax advisors with respect to the effect the 1996 Proposed Regulations may have if adopted. BACKUP WITHHOLDING TAX AND INFORMATION REPORTING Under current United States federal income tax law, information reporting requirements apply to interest (including OID) and principal payments made to, and to the proceeds of sales before maturity by, certain non-corporate persons. In addition, a 31% backup withholding tax applies if a non-corporate person (i) fails to furnish such person's Taxpayer Identification Number ("TIN") (which, for an individual, would be his or her Social Security Number) to the payor in the manner required, (ii) furnishes an incorrect TIN and the payor is so notified by the Service, (iii) is notified by the Service that such person has failed properly to report payments S-40of interest and dividends or (iv) in certain circumstances, fails to certify, under penalties of perjury, that such person has not been notified by the Service that such person is subject to backup withholding for failure properly to report interest and dividend payments. Backup withholding does not apply with respect to payments made to certain exempt recipients, such as corporations and tax-exempt organizations. In the case of a United States Alien Holder, backup withholding and information reporting do not apply to payments of principal and interest with respect to a Preferred Security with respect to which such Holder has provided the required certification under penalties of perjury that such Holder is a United States Alien Holder or has otherwise established an exemption, provided that certain conditions are satisfied. In general, (i) principal or interest payments with respect to a Preferred Security collected outside the United States by a foreign office of a custodian, nominee or other agent acting on behalf of a beneficial owner of a Preferred Security and (ii) payments on the sale, exchange or retirement of a Preferred Security to or through a foreign office of a broker are not subject to backup withholding or information reporting. However, if such custodian, nominee, agent or broker is a United States person, a controlled foreign corporation for United States tax purposes, or a foreign person 50% of more of whose gross income is effectively connected with the conduct of a United States trade or business for a specified three-year period, such custodian, nominee, agent or broker may be subject to certain information reporting (but not backup withholding) requirements with respect to such payments. Backup withholding tax is not an additional tax. Rather, any amounts withheld from a payment to a person under the backup withholding rules are allowed as a refund or a credit against such person's United States federal income tax, provided that the required information is furnished to the Service. POSSIBLE TAX LAW CHANGES On March 19, 1996, the Revenue Reconciliation Bill of 1996 (the "Bill"), the revenue portion of President Clinton's budget proposal, was released. The Bill would, among other things, generally deny interest deductions for United States federal income tax purposes for interest on an instrument, issued by a corporation, that has a maximum weighted average maturity of more than 40 years. The Bill would also generally deny interest deductions for interest on an instrument, issued by a corporation, that has a maximum term of more than 20 years and that is not shown as indebtedness on the separate balance sheet of the issuer, or where the instrument is issued with a related instrument that is not shown as indebtedness on the issuer's consolidated balance sheet. The above- described provisions of the Bill proposed were to be effective generally for instruments issued on or after December 7, 1995. If either provision were to apply to the Subordinated Debentures, KCPL would be unable to deduct interest on the Subordinated Debentures for United States federal income tax purposes. However, on March 29, 1996, the Chairmen of the Senate Finance and House Ways and Means Committees issued a joint statement to the effect that it was their intention that the effective date of the President's legislative proposals, if adopted, will be no earlier than the date of appropriate Congressional action. KCPL believes that, under current law, it will be able to deduct interest on the Subordinated Debentures. There can be no assurance, however, that current or future legislative proposals or final legislation will not be adopted which may affect the ability of KCPL to deduct interest on the Subordinated Debentures. Such a change could give rise to a Tax Event, which S-41may permit KCPL to cause a redemption of the Preferred Securities. See "Description of the Preferred Securities -- Tax Event Redemption." Such a tax law change would not alter the United States federal income tax consequences of the purchase, ownership and disposition of Preferred Securities to holders thereof. THE FEDERAL INCOME TAX DISCUSSION SET FORTH ABOVE IS INCLUDED FOR GENERAL INFORMATION ONLY AND MAY NOT BE APPLICABLE DEPENDING UPON A HOLDER'S PARTICULAR SITUATION. HOLDERS SHOULD CONSULT THEIR TAX ADVISORS WITH RESPECT TO THE TAX CONSEQUENCES TO THEM OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF THE PREFERRED SECURITIES, INCLUDING THE TAX CONSEQUENCES UNDER STATE, LOCAL, FOREIGN AND OTHER TAX LAWS AND THE POSSIBLE EFFECTS OF CHANGES IN FEDERAL OR OTHER TAX LAWS. S-42UNDERWRITING Subject to the terms and conditions set forth in a purchase agreement (the "Purchase Agreement"), the Trust has agreed to sell to each of the Underwriters named below, and each of the Underwriters, for whom Merrill Lynch, Pierce, Fenner & Smith Incorporated are acting as representative (the "Representative"), has severally agreed to purchase the number of Preferred Securities set forth opposite its name below. In the Purchase Agreement, the several Underwriters have agreed, subject to the terms and conditions set forth therein, to purchase all the Preferred Securities offered hereby if any of the Preferred Securities are purchased. In the event of default by an Underwriter, the Purchase Agreement provides that, in certain circumstances, the purchase commitments of the non-defaulting Underwriters may be increased or the Purchase Agreement may be terminated. NUMBER OF PREFERRED UNDERWRITERS SECURITIES Merrill Lynch, Pierce, Fenner & Smith Incorporated ..................................... --------------------- --------------------- The Underwriters propose to offer the Preferred Securities, in part, directly to the public at the initial public offering price set forth on the cover page of this Prospectus Supplement, and, in part, to certain securities dealers at such price less a concession of $ per Preferred Security. The Underwriters may allow, and such dealers may reallow, a concession not in excess of $ per Preferred Security to certain brokers and dealers. After the Preferred Securities are released for sale to the public, the offering price and other selling terms may from time to time be varied by the Representative. In view of the fact that the proceeds of the sale of the Preferred Securities will ultimately be used to purchase the Subordinated Debentures of KCPL, the Purchase Agreement provides that KCPL will pay as compensation ("Underwriters' Compensation") to the Underwriters arranging the investment therein of such proceeds, an amount in immediately available funds of $ per Preferred Security (or $ in the aggregate) for the accounts of the several Underwriters; provided that, such compensation for sales of 10,000 or more Preferred Securities to any single purchaser will be $ per Preferred Security. Therefore, to the extent of such sales, the actual amount of Underwriters' Compensation will be less than the aggregate amount specified in the preceding sentence. During a period of 30 days from the date of this Prospectus Supplement, neither the Trust nor KCPL will, without the prior written consent of the Representative, directly or indirectly, sell, offer to sell, grant any option for sale of, or otherwise dispose of, any Preferred Securities, any security convertible into or exchangeable into or exercisable for Preferred Securities or S-43Subordinated Debentures or any debt securities substantially similar to the Subordinated Debentures or equity securities substantially similar to the Preferred Securities (except for the Subordinated Debentures and the Preferred Securities offered hereby). Application has been made to list the Preferred Securities on the New York Stock Exchange. If so approved, trading of the Preferred Securities on the New York Stock Exchange is expected to commence within a 30-day period after the initial delivery of the Preferred Securities. The Representative has advised the Trust that it intends to make a market in the Preferred Securities prior to the commencement of trading on the New York Stock Exchange. The Representatives will have no obligation to make a market in the Preferred Securities, however, and may cease market making activities, if commenced, at any time. Prior to this offering there has been no public market for the Preferred Securities. In order to meet one of the requirements for listing the Preferred Securities on the New York Stock Exchange, the Underwriters will undertake to sell lots of 100 or more Preferred Securities to a minimum of 400 beneficial holders. The Trust and KCPL have agreed to indemnify the Underwriters against, or contribute to payments that the Underwriters may be required to make in respect of, certain liabilities, including liabilities under the Securities Act of 1933, as amended. Certain of the Underwriters engage in transactions with, and, from time to time, have performed services for, KCPL and its subsidiaries in the ordinary course of business. S-44Information contained herein is subject to completion or amendment. A registration statement relating to these securities has been filed with the Securities and Exchange Commission. These securities may not be sold nor may offers to buy be accepted prior to the time the registration statement becomes effective. This prospectus shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sales of these securities in any State in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such State. SUBJECT TO COMPLETION, DATED DECEMBER __, 1996 KCPL FINANCING I KCPL FINANCING II KCPL FINANCING III PREFERRED SECURITIES (LIQUIDATION PREFERENCE $25 PER PREFERRED SECURITY) GUARANTEED TO THE EXTENT SET FORTH HEREIN BY KANSAS CITY POWER & LIGHT COMPANY -------------------- KCPL Financing I, KCPL Financing II, and KCPL Financing III, each a statutory business trust formed under the laws of the State of Delaware (each, a "Trust" and, collectively, the "Trusts") may severally offer, from time to time, their respective preferred securities (the "Preferred Securities") representing preferred undivided beneficial interests in the assets of each Trust. Kansas City Power & Light Company, a Missouri corporation ("KCPL"), will be the sole owner of the undivided common beneficial interests in such assets represented by common securities (the "Common Securities", together with the Preferred Securities herein referred to as the "Trust Securities") of each Trust. The payment of periodic cash distributions ("distributions") with respect to the Preferred Securities and payments on liquidation or redemption with respect to such Preferred Securities will be each guaranteed by KCPL in the case of each Trust (a "Preferred Guarantee"), in each case only out of funds held by such Trust. KCPL's obligations under the Preferred Security Guarantee will be subordinate and junior in right of payment to all other liabilities of KCPL and will rank PARI PASSU with the most senior preferred stock issued by KCPL. Concurrently with the issuance by a Trust of its Preferred Securities, such Trust will invest the proceeds thereof in KCPL's junior subordinated deferrable interest debentures (the "Subordinated Debentures") having terms corresponding to such Trust's Preferred Securities. The Subordinated Debentures will be unsecured and subordinated indebtedness of KCPL issued under an indenture dated as of __________, 199_ between the Company and The First National Bank of Chicago, as Trustee (such indenture, as the same may be supplemented or amended from time to time, herein referred to as the "Indenture"). The Subordinated Debentures held by each Trust will be its sole assets, and the payments of principal of and interest on such Subordinated Debentures will be its only revenues. The Subordinated Debentures purchased by a Trust may be subsequently distributed pro rata to holders of Preferred Securities and Common Securities in connection with the dissolution of such Trust. In addition, upon the occurrence of certain events, KCPL may redeem the Subordinated Debentures and cause the redemption of the Preferred Securities. The Preferred Securities may be offered in amounts, at prices and on terms to be determined at the time of offering, provided, however, that the aggregate initial public offering price of all Preferred Securities issued pursuant to the Registration Statement of which this Prospectus forms a part will not exceed $300,000,000. Certain specific terms of each Trust's Preferred Securities in respect of which this Prospectus is being delivered will be set forth in an accompanying Prospectus Supplement, including, where applicable and to the extent not set forth herein, the identity of the Trust, the specific title, the aggregate amount, the distribution rate (or the method for determining such rate), the stated liquidation amount, redemption provisions, other rights, the initial public offering price and any other special terms, as well as any planned listing on a securities exchange, of such Preferred Securities. The Preferred Securities may be sold in a public offering to or through underwriters or dealers designated from time to time. See "Plan of Distribution." The names of any of the underwriters or dealers involved in the sale of the Preferred Securities in respect of which this Prospectus is being delivered, the number of Preferred Securities to be purchased by any such underwriters or dealers, any applicable commissions or discounts and the net proceeds to each Trust will be set forth in the applicable Prospectus Supplement. Each Prospectus Supplement will also contain information concerning certain United States federal income tax considerations applicable to the Preferred Securities offered thereby. ------------------------- THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. ------------------------- The date of this Prospectus is ___________, 199_.AVAILABLE INFORMATION KCPL is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance therewith files reports, proxy statements and other information with the Securities and Exchange Commission (the "Commission"). KCPL and the Trusts have filed with the Commission a registration statement on Form S-3 (the "Registration Statement") under the Securities Act of 1933, as amended (the "Securities Act") with respect to the Preferred Securities offered hereby and certain related securities. This Prospectus does not contain all of the information set forth in the Registration Statement and reference is hereby made to the Registration Statement and the exhibits thereto for further information with respect to KCPL and the Preferred Securities offered hereby. Such reports, proxy statements, Registration Statement and exhibits and other information can be inspected and copied at the public reference facilities maintained by the Commission at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549, and at its Northeast Regional Office located at 7 World Trade Center, Suite 1300, New York, New York 10048 and Midwest Regional Office located at Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511. Copies of such material can be obtained at prescribed rates from the Public Reference Section of the Commission, 450 Fifth Street, N.W., Washington, D.C. 20549. KCPL is subject to the electronic filing requirements of the Commission. Accordingly, pursuant to the rules and regulations of the Commission, certain documents, including annual and quarterly reports and proxy statements, filed by KCPL with the Commission have been filed electronically. The Commission also maintains a World Wide Web site that contains reports, proxy and information statements and other information regarding registrants (including KCPL) that file electronically with the Commission at (http:// www.sec.gov). Certain of KCPL's securities are listed on the New York Stock Exchange and such reports, proxy statements and other information may also be inspected at the offices of the New York Stock Exchange, Inc., 20 Broad Street, New York, New York 10005. No separate financial statements of the Trusts are included herein. KCPL considers that such financial statements would not be material to holders of the Preferred Securities because: (i) all of the Common Securities of the Trusts are owned by KCPL, a reporting company under the Exchange Act; (ii) the Trusts have no independent operations; but exist for the sole purpose of issuing the Trust Securities and holding the Subordinated Debentures as trust assets; and (iii) the obligations of the Trusts under the Preferred Securities, to the extent funds are available therefor, are fully and unconditionally guaranteed to the extent set forth herein by KCPL. The Trusts are not currently subject to the information reporting requirements of the Exchange Act. The Trusts will become subject to such requirements upon the effectiveness of the Registration Statement, although they intend to seek and expect to receive exemptions therefrom. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE The Annual Report of KCPL on Form 10-K, as amended, for the year ended December 31, 1995, the Quarterly Reports of KCPL on Form 10-Q for the periods ended March 31, 1996, June 30, 1996 and September 30, 1996, and the Current Reports of KCPL on Form 8-K dated May 22, 1996, May 28, 1996, and September 19, 1996, are incorporated by reference into this Prospectus. All documents filed by KCPL pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus and prior to the termination of the 2offering of the Preferred Securities contemplated hereby shall be deemed to be incorporated by reference into this Prospectus and to be made a part hereof from the respective dates of filing of such documents. Any statement contained in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of the Registration Statement and this Prospectus to the extent that a statement contained herein, in the applicable Prospectus Supplement or in any subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of the Registration Statement or this Prospectus. KCPL hereby undertakes to provide without charge to each person to whom a copy of this Prospectus has been delivered, including any beneficial owner, upon the written or oral request of any such person, a copy of any or all of the documents referred to above which have been or may be incorporated in this Prospectus by reference, other than certain exhibits to such documents. Requests should be directed to Corporate Secretary, Kansas City Power & Light Company, 1201 Walnut, Kansas City, Missouri 64106-2124 (Telephone: (816) 556- 2053). KANSAS CITY POWER & LIGHT COMPANY Kansas City Power & Light Company, a Missouri corporation, is a medium-size electric utility, headquartered in downtown Kansas City, which generates and distributes electricity to over 430,000 customers in a 4,700- square mile area located in 23 counties in western Missouri and eastern Kansas. Customers include 380,000 residences, 50,000 commercial firms, and over 3,000 industries, municipalities and other electric utilities. About two-thirds of total Kwh sales and revenue are from Missouri customers and the remainder from Kansas customers. The address of its principal executive office is 1201 Walnut, Kansas City, Missouri 64106-2124 (Telephone: (816) 556-2200). THE TRUSTS Each of the Trusts is a statutory business trust formed under Delaware law pursuant to the filing of a certificate of trust with the Delaware Secretary of State on December __, 1996. The business of each Trust is defined in a Declaration of Trust, executed by KCPL as sponsor (the "Sponsor"), and the Trustees (as defined herein). The Declaration of Trust of each Trust will be amended and restated in its entirety (as so amended and restated, the "Declaration") substantially in the form filed as an exhibit to the Registration Statement of which this Prospectus forms a part. The Declaration will be qualified as an indenture under the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"). Upon issuance of the Preferred Securities, the purchasers thereof will own all of the Preferred Securities. KCPL will acquire all of the Common Securities in an aggregate liquidation amount equal to approximately 3% of the total capital of each Trust. Each Trust exists for the exclusive purposes of (i) issuing the Trust Securities representing undivided beneficial interests in the assets of the Trust, (ii) investing the gross proceeds of the Trust Securities in the Subordinated Debentures and (iii) engaging in only those other activities necessary or incidental thereto. Each Trust has a term of approximately 45 years, but may terminate earlier as provided in the applicable Declaration. Each Trust's business and affairs will be conducted by the trustees (the "Trustees") appointed by KCPL, as holder of the Common Securities. The duties and obligations of the 3Trustees will be governed by the Declaration. Pursuant to the Declaration, the number of Trustees will initially be four. Two of the Trustees (the "Regular Trustees") will be persons who are employees or officers of or affiliated with, KCPL. The third Trustee will be a corporation which maintains a principal place of business in the State of Delaware that will serve for the sole purpose of complying with certain Delaware laws (the "Delaware Trustee"). The fourth Trustee will be a financial institution unaffiliated with KCPL which will serve as property trustee under the Declaration and as indenture trustee for purposes of the Trust Indenture Act (the "Property Trustee"). First Chicago Delaware Inc. ("First Chicago Delaware") will act as the Delaware Trustee and The First National Bank of Chicago will act as the Property Trustee, in each case until removed or replaced by the holder of the Common Securities. The First National Bank of Chicago will also act as indenture trustee under the Preferred Securities Guarantee (the "Guarantee Trustee"). See "Description of the Preferred Securities Guarantee." The Property Trustee will hold title to the Subordinated Debentures held by each Trust for the benefit of the holders of the Trust Securities issued by such Trust and will have the power to exercise all rights, powers and privileges under the Indenture (as defined herein) as the holder of such Subordinated Debentures. In addition, the Property Trustee will maintain exclusive control of a segregated non-interest bearing bank account for each Trust (the "Property Account") to hold all payments made in respect of the Subordinated Debentures held by such Trust for the benefit of the holders of the Trust Securities issued by such Trust. The Property Trustee will make payments of distributions and payments on liquidation, redemption and otherwise to the holders of the Trust Securities issued by each Trust out of funds from the Property Account of such Trust. The Guarantee Trustee will hold each Preferred Securities Guarantee for the benefit of the holders of the Preferred Securities. KCPL, as the holder of all the Common Securities, will have the right to appoint, remove or replace any Trustee and to increase the number of Trustees, provided that the number of Trustees will be at least four, two of which will be Regular Trustees. KCPL will pay all fees and expenses related to the Trust, the offering of the Preferred Securities and the issuance of the Subordinated Debentures. See "Description of the Subordinated Debentures -- Miscellaneous." The rights of the holders of the Preferred Securities of each Trust, including economic rights, rights to information and voting rights, are as set forth in the Declaration for such Trust, the Delaware Business Trust Act, as amended (the "Trust Act"), and the Trust Indenture Act. See "Description of the Preferred Securities." The Property Trustee for each Trust is The First National Bank of Chicago, One First National Plaza, Suite 0126, Chicago, Illinois 60670-0126. The principal place of business of each Trust shall be c/o Kansas City Power & Light Company, 1201 Walnut, Kansas City, Missouri 64106-2124 (telephone number 816/556-2200). Copies of the above documents (other than exhibits to such documents unless such exhibits are specifically incorporated by reference into such documents) may be obtained upon written or oral request without charge from KCPL, 1201 Walnut, Kansas City, Missouri 64106-2124 (telephone number 816/556- 2200). 4RATIOS OF EARNINGS TO FIXED CHARGES AND EARNINGS TO FIXED CHARGES AND PREFERRED DIVIDEND REQUIREMENTS
Year Ended December 31, Twleve Months Ended ---------------------------------------------- September 30, 1996 1995 1994 1993 1992 1991 ------------------- ---------------------------------------------- (Thousands)Ratio of earnings to fixed charges 3.37 3.94 4.07 3.80 3.12 3.22 ------------------- --------------------------------------------- Ratio of earnings to combined fixed charges and preferred dividend requirements 3.12 3.59 3.69 3.51 2.90 2.85 ------------------- ---------------------------------------------(1) For the purpose of computing the ratio of earnings to fixed charges, "earnings" consist of net income plus interest charges, income taxes and the estimated interest component of rents. "Fixed charges" consists of interest charges and the estimated interest component of rents. (2) For the purpose of computing the ratio of earnings to fixed charges plus preferred dividend requirements, "earnings" consist of net income plus interest charges, income taxes and the estimated interest component of leased property. "Fixed charges" consists of interest charges and the estimated interest component of leased property. "Preferred dividend requirements" consists of the calculated pre-tax preferred dividend requirement. USE OF PROCEEDS Each Trust will use the proceeds of the sale of the Trust Securities to acquire Subordinated Debentures from KCPL. Unless otherwise indicated in the applicable Prospectus Supplement, KCPL intends to add the net proceeds from the sale of the Subordinated Debentures to the general funds of KCPL for use for corporate purposes, which may include capital expenditures, acquisitions, refinancing or repurchase of outstanding long-term debt, preferred and common securities, investments in subsidiaries, and repayment of short-term debt and other business opportunities. DESCRIPTION OF THE PREFERRED SECURITIES The Declaration of each Trust authorizes the Regular Trustees of such Trust to issue on behalf of such Trust only one series of Preferred Securities having terms described in the Prospectus Supplement relating thereto. The Declaration will be qualified as an indenture under the Trust Indenture Act. The Property Trustee will act as Indenture Trustee for purposes of the Trust Indenture Act. The Preferred Securities will have such terms, including distributions, redemption, voting, liquidation rights and such other preferred, deferred or other special rights or such restrictions as will be set forth in the Declaration or made part of the Declaration by the Trust Indenture Act and which will mirror the terms of the Subordinated Debentures held by the Trust and described in the Prospectus Supplement relating thereto. Reference is made to the Prospectus Supplement relating to the Preferred Securities of each Trust for specific terms, including (i) the distinctive designation of such Preferred Securities; (ii) the number of Preferred Securities issuable by such Trust; (iii) the annual distribution rate (or method of determining such rate) for Preferred Securities issued by such Trust and the date or dates upon which such distributions will 5be payable; (iv) whether distributions on Preferred Securities issued by such Trust will be cumulative, and, in the case of Preferred Securities having such cumulative distribution rights, the date or dates or method of determining the date or dates from which distributions on Preferred Securities issued by such Trust will be cumulative; (v) the amount or amounts which will be paid out of the assets of such Trust to the holders of Preferred Securities of such Trust upon voluntary or involuntary dissolution, winding-up or termination of such Trust; (vi) the obligation, if any, of such Trust to purchase or redeem Preferred Securities issued by such Trust and the price or prices at which, the period or periods within which, and the terms and conditions upon which Preferred Securities issued by such Trust will be purchased or redeemed, in whole or in part, pursuant to such obligation; (vii) the voting rights, if any, of holders of Preferred Securities issued by such Trust in addition to those required by law, including the number of votes per Preferred Security and any requirement for the approval by the holders of such Preferred Securities, or of Preferred Securities issued by one or more Trusts, or of both, as a condition to specified action or amendments to the Declaration of such Trust; (viii) the terms and conditions, if any, upon which the Subordinated Debentures owned by such Trust may be distributed to holders of Preferred Securities of such Trust; (ix) if applicable, any securities exchange upon which the Preferred Securities of such Trust will be listed; and (x) any other relevant rights, preferences, privileges, limitations or restrictions of Preferred Securities issued by such Trust not inconsistent with the Declaration of such Trust or with applicable law. All Preferred Securities offered hereby will be guaranteed by KCPL to the extent set forth below under "Description of the Preferred Securities Guarantees." Certain United Stated federal income tax considerations applicable to any offering of Preferred Securities will be described in the Prospectus Supplement relating thereto. Each Trust will issue one series of Common Securities in connection with the issuance of Preferred Securities. The Declaration of each Trust authorizes the Regular Trustees of such Trust to issue on behalf of such Trust one series of Common Securities having such terms including distributions, redemption, voting, liquidation rights or such restrictions as will be set forth therein. Except for voting rights, the terms of the Common Securities issued by a Trust will be substantially identical to the terms of the Preferred Securities issued by such Trust and such Common Securities will rank PARI PASSU, and payments will be made thereon pro rata, with such Preferred Securities except that, upon an event of default under the Declaration, the rights of the holders of such Common Securities to payment in respect of distributions and payments upon liquidation, redemption and otherwise will be subordinated to the rights of the holders of the Preferred Securities. Except in certain limited circumstances, the Common Securities of a Trust will also carry the right to vote to appoint, remove or replace any of the Trustees of such Trust. All of the Common Securities of each Trust will be directly or indirectly owned by KCPL. ENFORCEMENT OF CERTAIN RIGHTS BY HOLDERS OF TRUST PREFERRED SECURITIES If an Event of Default under a Declaration of a Trust occurs and is continuing, then the holders of Preferred Securities of such Trust would rely on the enforcement by the Property Trustee of its rights as a holder of the applicable series of Subordinated Debentures against KCPL. In addition, the holders of a majority in liquidation amount of Preferred Securities of such Trust will have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Property Trustee or to direct the exercise of any trust or power conferred upon the Property Trustee under the applicable Declaration, including the right to direct such Property Trustee to exercise the remedies available to it as a holder of Subordinated Debentures. If the Property Trustee fails to enforce its right under the Subordinated Debentures held by a Trust, a holder of Preferred Securities of such Trust may institute a legal proceeding directly 6against KCPL to enforce the Property Trustee's rights under the Subordinated Debentures without first instituting any legal proceeding against the Property Trustee or any other person or entity. Notwithstanding the foregoing, if an Event of Default under the Declaration of a Trust has occurred and is continuing and such event is attributable to the failure of KCPL to pay interest or principal on the applicable series of Subordinated Debentures on the date such interest or principal is otherwise payable (or in the case of redemption, on the redemption date), then a holder of Preferred Securities of such Trust may directly institute a proceeding for enforcement of payment to such holder of the principal of or interest on such Subordinated Debentures having a principal amount equal to the aggregate liquidation amount of the Preferred Securities of such holder (a "Direct Action") on or after the respective due date specified in such Subordinated Debentures. In connection with such Direct Action, KCPL will be subrogated to the rights of such holder of Preferred Securities under the applicable Declaration to the extent of any payment made by KCPL to such holder of Preferred Securities in such Direct Action. DESCRIPTION OF THE PREFERRED SECURITIES GUARANTEE Set forth below is a summary of information concerning the Preferred Securities Guarantees which will be executed and delivered by KCPL for the benefit of the holders from time to time of the Preferred Securities under each Trust. Each Preferred Securities Guarantee will be qualified as an indenture under the Trust Indenture Act. The Guarantee Trustee will act as the Guarantee Trustee. The terms of each Preferred Securities Guarantee will be those set forth therein and those made a part thereof by the Trust Indenture Act. The following summary of the material terms of the Preferred Securities Guarantee does not purport to be complete and is subject in all respects to the provisions of, and is qualified in its entirety by reference to, the form of the Preferred Securities Guarantee, which is filed as an exhibit to the Registration Statement of which this Prospectus forms a part, and the Trust Indenture Act. Each Preferred Securities Guarantee will be held by the Guarantee Trustee for the benefit of the holders of the Preferred Securities of the applicable Trust. GENERAL Pursuant to each Preferred Securities Guarantee with respect to a Trust, KCPL will irrevocably and unconditionally agree, to the extent set forth therein, to pay in full, to the holders of the Preferred Securities issued by such Trust, the Guarantee Payments (as defined herein) (without duplication of amounts theretofore paid by such Trust), as and when due regardless of any defense, right of set-off or counterclaim which such Trust may have or assert. The following payments or distributions with respect to the Preferred Securities of a Trust, to the extent not paid or made by such Trust, (the "Guarantee Payments") will be subject to the Preferred Securities Guarantee with respect to such Trust (without duplication):(i) any accrued and unpaid distributions which are required to be paid on the Preferred Securities, to the extent such Trust has funds available therefor, (ii) the redemption price, including all accrued and unpaid distributions to the date of the redemption (the "Redemption Price"), to the extent such Trust has funds available therefor, with respect to any Preferred Securities called for redemption by such Trust and (iii) upon a voluntary or involuntary dissolution, winding-up or termination of such Trust (other than in connection with the distribution of Subordinated Debentures held by such Trust to the holders of Preferred Securities issued by such Trust in exchange for such Preferred Securities or redemption of all such Preferred Securities), the lesser of (a) the aggregate of the liquidation amount and all accrued and unpaid distributions on such Preferred Securities to the date of 7payment to the extent such Trust has funds available therefor and (b) the amount of assets of such Trust remaining available for distribution to holders of such Preferred Securities in liquidation of such Trust. The redemption price and liquidation amount will be fixed at the time the Preferred Securities are issued. KCPL's obligation to make a Guarantee Payment may be satisfied by direct payment of the required amounts by KCPL to the holders of Preferred Securities issued by a Trust or by causing such Trust to pay such amounts to such holders. The Preferred Securities Guarantee for a Trust will not apply to any payment of distributions except to the extent such Trust has funds available therefor. If KCPL does not make interest payments on the Subordinated Debentures purchased by a Trust, such Trust will not pay distributions on the Preferred Securities issued by such Trust and will not have funds available therefor. The Preferred Securities Guarantee for a Trust, when taken together with KCPL's obligations under the applicable Subordinated Debentures, the Indenture and the applicable Declaration, including its obligation to pay costs, expenses, debt, and liabilities of such Trust (other than with respect to its Trust Securities), will be a full and unconditional guarantee, on a subordinated basis, by KCPL of payments due on the Preferred Securities issued by such Trust from the time of issuance of such Preferred Securities, but will not apply to the payment of distributions and other payments on such Preferred Securities when the Property Trustee does not have sufficient funds in the Property Account of such Trust to make such distributions or other payments. If KCPL does not make interest payments on the Subordinated Debentures held by the Property Trustee for a Trust, such Trust will not make distributions on the Preferred Securities issued by such Trust and will not have funds available therefor. See "Description of the Subordinated Debentures -- Certain Covenants." CERTAIN COVENANTS OF KCPL In the Preferred Securities Guarantee for a Trust, KCPL will covenant that, so long as any Preferred Securities issued by such Trust remain outstanding, if there shall have occurred and be continuing any event that would constitute an event of default under such Preferred Securities Guarantee or the Declaration of such Trust, then (a) KCPL may not declare or pay any dividend on, or make any distribution of such Trust with respect to, or redeem, purchase, acquire or make a liquidation payment with respect to, any of its capital stock (other than (i) purchases or acquisitions of shares of KCPL common stock in connection with the satisfaction by KCPL of its obligations under any employee benefit plans or any other contractual obligation of KCPL (other than a contractual obligation ranking PARI PASSU with or junior to the Subordinated Debentures), (ii) as a result of a reclassification of KCPL capital stock or the exchange or conversion of one class or series of KCPL capital stock for another class or series of KCPL capital stock or (iii) the purchase of fractional interests in shares of KCPL capital stock pursuant to the conversion or exchange provisions of such KCPL capital stock or the security being converted or exchanged), (b) KCPL may not make any payment of interest, principal or premium, if any, on or repay, repurchase or redeem any debt securities (including guarantees) issued by KCPL which rank PARI PASSU with or junior to the Subordinated Debentures and (c) KCPL may not make any guarantee payments with respect to the foregoing (other than pursuant to the Preferred Stock Guarantees). AMENDMENTS AND ASSIGNMENT 8Except with respect to any changes which do not materially adversely affect the rights of holders of Preferred Securities issued by a Trust (in which case no vote will be required), the Preferred Securities Guarantee for such Trust may be amended only with the prior approval of the holders of not less than 66-2/3% in liquidation amount of the outstanding Preferred Securities issued by such Trust. The manner of obtaining any such approval of holders of Preferred Securities will be set forth in the applicable Prospectus Supplement. All guarantees and agreements contained in each Preferred Securities Guarantee will bind the successors, assigns, receivers, trustees and representatives of KCPL and will inure to the benefit of the Preferred Guarantee Trustee and the holders of the Preferred Securities of the applicable Trust then outstanding. TERMINATION OF THE PREFERRED SECURITIES GUARANTEE Each Preferred Securities Guarantee for a Trust will terminate and be of no further force and effect as to the Preferred Securities issued by such Trust upon full payment of the Redemption Price of all such Preferred Securities, or upon distribution of the Subordinated Debentures held by such Trust to the holders of the Trust Securities of such Trust, and will terminate completely upon full payment of the amounts payable upon liquidation of such Trust. See "Description of the Subordinated Debentures -- Indenture Events of Default" for a description of the events of default and enforcement rights of the holders of Subordinated Debentures. Each Preferred Securities Guarantee for a Trust will continue to be effective or will be reinstated, as the case may be, if at any time any holder of Preferred Securities issued by such Trust must repay to such Trust or KCPL, or their successors, any sums paid to them under such Preferred Securities or Preferred Securities Guarantee. EVENTS OF DEFAULT An event of default under each Preferred Securities Guarantee will occur upon the failure of KCPL to perform any of its payment or other obligations thereunder. The holders of a majority in liquidation amount of the Preferred Securities issued by a Trust will have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Preferred Guarantee Trustee in respect of the Preferred Securities Guarantee for such Trust or to direct the exercise of any trust or power conferred upon the Preferred Guarantee Trustee under such Preferred Securities Guarantee. If the Preferred Guarantee Trustee fails to enforce the Preferred Securities Guarantee for a Trust, any holder of related Preferred Securities may institute a legal proceeding directly against KCPL to enforce the Preferred Guarantee Trustee's rights under such Preferred Securities Guarantee, without first instituting a legal proceeding against such Trust, the Preferred Guarantee Trustee or any other person or entity. STATUS OF THE PREFERRED SECURITIES GUARANTEE KCPL's obligations under the Preferred Securities Guarantee to make the Guarantee Payments will constitute unsecured obligations of KCPL and will rank (i) subordinate and junior in right of payment to all other liabilities of KCPL, including the Subordinated Debentures, except those liabilities of KCPL made PARI PASSU or subordinate by their terms, (ii) PARI PASSU with the most senior preferred stock now or hereafter issued by KCPL and with any 9guarantee now or hereafter entered into by KCPL in respect of any preferred or preference stock of any affiliate of KCPL, and (iii) senior to KCPL common stock. The terms of the Preferred Securities provide that each holder of Preferred Securities issued by the a Trust, by acceptance thereof, agrees to the subordination provisions and other terms of the Preferred Securities Guarantee relating thereto. Each Preferred Securities Guarantees will constitute guarantee of payment and not of collection (that is, the guaranteed party may institute a legal proceeding directly against the guarantor to enforce its rights under such Preferred Securities Guarantee without instituting a legal proceeding against any other person or entity). Each Preferred Securities Guarantee will be deposited with the Guarantee Trustee to be held for the benefit of the holders of the related Preferred Securities. Except as otherwise noted herein, the Guarantee Trustee has the right to enforce each Preferred Securities Guarantee on behalf of the holders of the related Preferred Securities. The Preferred Securities Guarantee for a Trust will not be discharged except by payment of the Guarantee Payments in full (without duplication of amounts theretofore paid by such Trust). INFORMATION CONCERNING THE GUARANTEE TRUSTEE The Guarantee Trustee, prior to the occurrence of a default with respect to a Preferred Securities Guarantee and after the curing of all such defaults that may have occurred, undertakes to perform only such duties as are specifically set forth in each Preferred Securities Guarantee and, after default, will exercise the same degree of care as a prudent individual would exercise in the conduct of his or her own affairs. Subject to such provisions, the Guarantee Trustee is under no obligation to exercise any of the powers vested in it by the Preferred Securities Guarantee for a Trust at the request of any holder of Preferred Securities issued by such Trust, unless offered reasonable indemnity against the costs, expenses and liabilities which might be incurred thereby; but the foregoing shall not relieve the Guarantee Trustee, upon the occurrence of an event of default under such Preferred Securities Guarantee, from exercising the rights and powers vested in it by such Preferred Securities Guarantee. The Guarantee Trustee also serves as Property Trustee. KCPL and its officers and directors have no material relationship with the Guarantee Trustee except that (a) the Guarantee Trustee is a dealer in commercial paper issued by KCPL, (b) the Guarantee Trustee is trustee and remarketing agent for certain governmental revenue bonds which are payable with amounts paid by KCPL to the issuer of such bonds, and (c) KCPL and its principal subsidiary maintain lines of credit with the Guarantee Trustee. GOVERNING LAW The Preferred Securities Guarantee will be governed by, and construed in accordance with, the internal laws of the State of New York. DESCRIPTION OF THE SUBORDINATED DEBENTURES Set forth below is a description of the terms of the Subordinated Debentures which each of the Trusts will hold as trust assets. The following description does not purport to be complete and is subject to, and is qualified in its entirety by reference to, the indenture 10("Indenture"), dated as of _________________, between KCPL and The First National Bank of Chicago, as Trustee (the "Debt Trustee"), as supplemented by the Supplemental Indenture creating each series of Subordinated Debentures. The Indenture and the form of Supplemental Indenture are filed as exhibits to the Registration Statement of which this Prospectus forms a part. The terms each series of Subordinated Debentures will include those stated in the Indenture and the related Supplemental Indenture and those made a part of the Indenture by reference to the Trust Indenture Act. Certain capitalized terms used herein are defined in the Indenture and the related Supplemental Indenture. Under certain circumstances involving the dissolution of a Trust following the occurrence of a Special Event as defined in the applicable Prospectus Supplement, Subordinated Debentures held by a Trust may be distributed to the holders of Trust Securities issued by such Trust in liquidation of such Trust. See "Description of the Preferred Securities -- Dissolution; Distribution of Subordinated Debentures" in the applicable Prospectus Supplement. If any Subordinated Debentures are distributed to the holders of Trust Securities, KCPL will use its best efforts to have such Subordinated Debentures listed on the New York Stock Exchange or on such other exchange as the related Preferred Securities are then listed. GENERAL The Indenture provides for the issuance of Subordinated Debentures in an unlimited amount from time to time. Each series of Subordinated Debentures will constitute a separate series under the Indenture, will be in a principal amount equal to the aggregate stated Liquidation Amount of the Preferred Securities issued by the Trust which will hold such Subordinated Debentures plus KCPL's concurrent investment in the Common Securities of such Trust and will rank PARI PASSU with all other series of Subordinated Debentures. The entire principal amount of the Subordinated Debentures held by a Trust will mature and become due and payable, together with any accrued and unpaid interest thereon, including Additional Interest (as defined), if any, on the date set forth in the applicable Prospectus Supplement. Reference is made to the Prospectus Supplement relating to the particular Subordinated Debentures being offered thereby for the following terms: (1) the designation of such Subordinated Debentures; (2) the aggregate principal amount of such Subordinated Debentures; (3) the date or dates on which such Subordinated Debentures will mature and the right, if any, to shorten such date or dates; (4) the rate or rates; if any, per annum, at which such Subordinated Debentures will bear interest, or the method of determination of such rate or rates; (5) the date or dates from which such interest will accrue, the interest payment dates on which such interest will be payable or the manner of determination of such interest payment dates and the record dates for the determination of holders to whom interest is payable on any such interest payment dates; (6) the right, if any, to extend the interest payment periods and the duration of such extensions; (7) provisions for a sinking, purchase or other analogous fund; (8) the period or periods, if any, within which, the price or prices of which, and the terms and conditions upon which such Subordinated Debentures may be redeemed, in whole or in part, at the option of KCPL or the holder; (9) the form of such Subordinated Debentures; and (10) any other specific terms of such Subordinated Debentures. Principal, premium, if any, and interest, if any, will be payable, and the Subordinated Debentures offered hereby will be transferable, at the corporate trust office 11of the Debt Trustee in New York, New York, provided that payment of interest, if any, may be made at the option of KCPL by check mailed to the address of the person entitled thereto as it appears in the Security Register. If a Prospectus Supplement specifies that a series of Subordinated Debentures is denominated in a currency or currency unit other than United States dollars, such Prospectus Supplement will also specify the denomination in which such Subordinated Debentures will be issued and the coin or currency in which the principal, premium, if any, and interest, if any, on such Subordinated Debentures will be payable, which may be United States dollars based upon the exchange rate for such other currency or currency unit existing on or about the time a payment is due. The covenants contained in the Indenture would not necessarily afford protection to holders of the Subordinated Debentures in the event of a decline in credit quality resulting from takeovers, recapitalizations or similar restructurings of KCPL. If Subordinated Debentures held by a Trust are distributed to holders of its Preferred Securities in liquidation of such holders' interests in such Trust, such Subordinated Debentures will initially be issued as a Global Security (as defined below). As described herein, under certain limited circumstances, Subordinated Debentures may be issued in certificated form in exchange for a Global Security. See "--Book Entry and Settlement." In the event Subordinated Debentures are issued in certificated form, such Subordinated Debentures will be in denominations as specified in the applicable Prospectus Supplement and integral multiples thereof and may be transferred or exchanged at the offices described therein. Payments on Subordinated Debentures issued as a Global Security will be made to the depositary for the Subordinated Debentures. In the event Subordinated Debentures are issued in certificated form, principal and interest will be payable, the transfer of the Subordinated Debentures will be registrable and Subordinated Debentures will be exchangeable for Subordinated Debentures of other denominations of a like aggregate principal amount at the corporate trust office of the Debt Trustee in New York, New York; provided, that payment of interest may be made at the option of KCPL by check mailed to the address of the persons entitled thereto. The Indenture does not contain provisions that afford holders of the Subordinated Debentures protection in the event of a highly leveraged transaction involving KCPL. SUBORDINATION The Indenture provides that the Subordinated Debentures are subordinated and junior in right of payment to all Senior Indebtedness of KCPL, whether now existing or hereafter incurred. Senior Indebtedness may include Indebtedness of KCPL which is subordinated to other Indebtedness of KCPL but nevertheless senior to the Subordinated Debentures. No payment of principal of (including redemption payments, if any), premium, if any, or interest on, the Subordinated Debentures may be made if (a) there is any default in the payment of principal, premium, interest or any other payment due on any Senior Indebtedness, or (b) the maturity of any Senior Indebtedness has been accelerated because of a default. Upon any distribution of assets of KCPL to creditors upon any dissolution, winding-up, liquidation or reorganization, whether voluntary or involuntary, or in bankruptcy, insolvency, receivership or other proceedings, all principal of, premium, if any, and interest due or to become due on, all Senior Indebtedness must be paid in full before the holders of the Subordinated Debentures are entitled to receive or retain 12any payment. The rights of the holders of the Subordinated Debentures will be subrogated to the rights of the holders of Senior Indebtedness to receive payments or distributions applicable to such Senior Indebtedness until all amounts owing on the Subordinated Debentures are paid in full. The term "Senior Indebtedness" means (i) any payment in respect of (a) indebtedness of KCPL for money borrowed and (b) indebtedness evidenced by securities, debentures, bonds, notes or other similar instruments issued by KCPL including, without limitation, indebtedness evidenced by securities issued pursuant to its General Mortgage Indenture and Deed of Trust dated as of December 1, 1986, between KCPL and UMB Bank, N.A., as supplemented, and pursuant to indentures with various trustees (other than the Indenture); (ii) all capital lease obligations of KCPL; (iii) all obligations of KCPL issued or assumed as the deferred purchase price of property, all conditional sale obligations of KCPL and all of its obligations under any title retention agreement (but excluding trade accounts payable arising in the ordinary course of business); (iv) all obligations of KCPL for reimbursement on any letter of credit, banker's acceptance, security purchase facility or similar credit transaction; (v) all obligations of the type referred to in clauses (i) through (iv) above of other Persons for the payment of which KCPL is responsible or liable as obligor, guarantor or otherwise; and (vi) all obligations of the type referred to in clauses (i) through (v) above of other Persons secured by any lien on any property or asset of KCPL (whether or not such obligation is assumed by KCPL), except for (1) any such indebtedness that is by its terms subordinated to or PARI PASSU with the Subordinated Debentures, as the case may be, including all other debt securities and guarantees in respect of those debt securities, issued to any other trusts, partnerships or other entity affiliated with KCPL which is a financing vehicle of KCPL in connection with the issuance of preferred securities by such entity or other securities which rank PARI PASSU with, or junior to, the Preferred Securities, and (2) any indebtedness between or among KCPL and its affiliates. Such Senior Indebtedness will continue to be Senior Indebtedness and be entitled to the benefits of the subordination provisions irrespective of any amendment, modification or waiver of any term of such Senior Indebtedness. The Indenture does not limit the aggregate amount of Senior Indebtedness which may be issued by KCPL. CERTAIN COVENANTS If (i) there has occurred any event that would constitute an Indenture Event of Default or (ii) KCPL is in default with respect to its payment of any obligations under any Preferred Securities, then (a) KCPL may not declare or pay any dividend on, make any distributions with respect to, or redeem, purchase or make a liquidation payment with respect to, any of its capital stock, (other than (i) purchases or acquisitions of shares of KCPL common stock in connection with the satisfaction by KCPL of its obligations under any employee benefit plans or any other contractual obligation of KCPL (other than a contractual obligation ranking PARI PASSU with or junior to the Subordinated Debentures), (ii) as a result of a reclassification of KCPL capital stock or the exchange or conversion of one class or series of KCPL capital stock for another class or series of KCPL capital stock or, (iii) the purchase of fractional interests in shares of KCPL capital stock pursuant to the conversion or exchange provisions of such KCPL capital stock or the security being converted or exchanged), (b) KCPL may not make any payment of interest, principal or premium, if any, on or repay, repurchase or redeem any debt securities issued by KCPL which rank PARI PASSU with or junior to the Subordinated Debentures and (c) KCPL may 13not make any guarantee payments with respect to the foregoing (other than pursuant to the Preferred Securities Guarantees). If KCPL has given notice of its election of an Extension Period as provided in the Indenture and such period, or any extension thereof, is continuing, then (a) KCPL may not declare or pay any dividend on, make any distributions with respect to, or redeem, purchase or make a liquidation payment with respect to, any of its capital stock, (other than (i) purchases or acquisitions of shares of KCPL common stock in connection with the satisfaction by KCPL of its obligations under any employee benefit plans or any other contractual obligation of KCPL (other than a contractual obligation ranking PARI PASSU with or junior to the Subordinated Debentures), (ii) as a result of a reclassification of KCPL capital stock or the exchange or conversion of one class or series of KCPL capital stock for another class or series of KCPL capital stock or, (iii) the purchase of fractional interests in shares of KCPL capital stock pursuant to the conversion or exchange provisions of such KCPL capital stock or the security being converted or exchanged) (b) KCPL may not make any payment of interest, principal or premium, if any, on or repay, repurchase or redeem any debt securities (including guarantees) issued by KCPL which rank PARI PASSU with or junior to the Subordinated Debentures and (c) KCPL may not make any guarantee payments with respect to the foregoing (other than pursuant to the Preferred Securities Guarantees). For so long as the Trust Securities under a Trust remain outstanding, KCPL will covenant (i) to directly or indirectly maintain 100% direct or indirect ownership of the Common Securities of such Trust; provided, however, that any permitted successor of KCPL under the Indenture may succeed to KCPL's ownership of such Common Securities, (ii) not to cause, as sponsor of such Trust, or to permit, as holder of such Common Securities, the dissolution or winding-up of such Trust, except in connection with a distribution of the Subordinated Debentures held by such Trust as provided in the Declaration for such Trust and in connection with certain mergers, consolidations or amalgamations and (iii) to use its reasonable efforts to cause such Trust (a) to remain a statutory business trust, except in connection with the distribution of Subordinated Debentures to the holders of Trust Securities of such Trust in liquidation of such Trust, the redemption of all such Trust Securities, or certain mergers, consolidations or amalgamations, each as permitted by such Declaration, and (b) to otherwise continue to be classified as a grantor trust for United States federal income tax purposes. OPTIONAL REDEMPTION KCPL will have the right to redeem the Subordinated Debentures of each series, in whole or in part, from time to time, on or after the date set forth in the applicable Prospectus Supplement or at any time in certain circumstances upon the occurrence of a Tax Event as described under "Description of the Preferred Securities -- Tax Event Redemption" in the applicable Prospectus Supplement, upon not less than 30 nor more than 60 days' notice, at a Redemption Price equal to 100% of the principal amount to be redeemed plus any accrued and unpaid interest, including Additional Interest, if any, to the redemption date. If a partial redemption of the Preferred Securities of a Trust resulting from a partial redemption of the Subordinated Debentures held by such Trust would result in the delisting of such Preferred Securities, KCPL may only redeem such Subordinated Debentures in whole. INTEREST 14Each Subordinated Debenture will bear interest at the rate set forth in the applicable Prospectus Supplement from the original date of issuance, payable quarterly in arrears on March 31, June 30, September 30 and December 31 of each year (each, an "Interest Payment Date"), to the person in whose name such Subordinated Debenture is registered, subject to certain exceptions, at the close of business on the Business Day next preceding such Interest Payment Date. In the event the Subordinated Debentures do not continue to remain in book-entry only form, KCPL will have the right to select record dates which may be not less than fifteen days prior to each Interest Payment Date. The amount of interest payable for any period will be computed on the basis of a 360-day year of twelve 30-day months. The amount of interest payable for any period shorter than a full quarterly period will be computed on the basis of the actual number of days elapsed in such 90-day quarter. In the event that any date on which interest is payable on the Subordinated Debentures is not a Business Day, then payment of the interest payable on such date will be made on the next succeeding day which is a Business Day (and without any interest or other payment in respect of any such delay), except that, if such Business Day is in the next succeeding calendar year, such payment shall be made on the immediately preceding Business Day, in each case with the same force and effect as if made on such date. OPTION TO EXTEND INTEREST PAYMENT PERIOD Except to the extent set forth in the applicable Prospectus Supplement, KCPL will have the right at any time, and from time to time, during the term of any series of Subordinated Debentures, to defer payments of interest by extending the interest payment period for a period not exceeding 20 consecutive quarters, at the end of which Extension Period, KCPL will pay all interest then accrued and unpaid (including any Additional Interest, together with interest thereon at the rate specified for such Subordinated Debentures to the extent permitted by applicable law); provided, that, during any such Extension Period, (a) KCPL may not declare or pay any dividend on, make any distributions with respect to, or redeem, purchase or acquire, or make a liquidation payment with respect to, any of its capital stock, (other than (i) purchases or acquisitions of shares of KCPL common stock in connection with the satisfaction by KCPL of its obligations under any employee benefit plans or any other contractual obligation of KCPL (other than a contractual obligation ranking PARI PASSU with or junior to the Subordinated Debentures), (ii) as a result of a reclassification of KCPL capital stock or the exchange or conversion of one class or series of KCPL capital stock for another class or series of KCPL capital stock or, (iii) the purchase of fractional interests in shares of KCPL capital stock pursuant to the conversion or exchange provisions of such KCPL capital stock or the security being converted or exchanged) or make any guarantee payments with respect to the foregoing (b) KCPL may not make any payment of interest, principal or premium, if any, on or repay, repurchase or redeem any debt securities (including guarantees) issued by KCPL which rank PARI PASSU with or junior to the Subordinated Debentures to which such Extension Period applies and (c) KCPL will not make any guarantee payments with respect to the foregoing (other than pursuant to the Preferred Securities Guarantees). This covenant effectively requires that any Extension Period with respect to payment of interest on a series of Subordinated Debentures will also apply to each other series of subordinated debentures issued under the Indenture to other trusts similar to the Trust. Prior to the termination of any such Extension Period for a series of Subordinated Debentures, KCPL may further defer payments of interest on such Subordinated Debentures, by extending the interest payment period, provided that such Extension Period together with all such previous and further 15extensions thereof for such series of Subordinated Debentures may not exceed 20 consecutive quarters or extend beyond the maturity of such series of Subordinated Debentures. Upon the termination of any Extension Period for a series of Subordinated Debentures, and the payment of all amounts then due, KCPL may select a new Extension Period for such series of Subordinated Debentures, as if no Extension Period had previously been declared, subject to the above requirements. No interest on a series of Subordinated Debentures during an Extension Period, except at the end thereof, will be due and payable on such series of Subordinated Debentures. KCPL has no present intention of exercising its rights to defer payments of interest by extending the interest payment period on any Subordinated Debentures. If the Property Trustee is the sole holder of a series of Subordinated Debentures, KCPL will give the Regular Trustees and the Property Trustee notice of its selection of such Extension Period for such series of Subordinated Debentures one Business Day prior to the earlier of (i) the next succeeding date on which distributions on the related Preferred Securities are payable or (ii) the date the applicable Trust is required to give notice to the New York Stock Exchange or other applicable self-regulatory organization or to holders of such Preferred Securities on the record date or the date such distribution is payable, but in any event not less than one Business Day prior to such record date. The Regular Trustees shall give notice of KCPL's selection of such Extension Period to the holders of such Preferred Securities. If the Property Trustee is not the sole holder of a series of Subordinated Debentures, KCPL will give the holders of such Subordinated Debentures notice of its selection of such Extension Period ten Business Days prior to the earlier of (i) the Interest Payment Date or (ii) the date KCPL is required to give notice to the New York Stock Exchange or other applicable self-regulatory organization or to holders of such Subordinated Debentures on the record or payment date of such related interest payment, but in any event at least two Business Days before such record date. ADDITIONAL INTEREST If at any time a Trust is required to pay any taxes, duties, assessments or governmental charges of whatever nature (other than withholding taxes) imposed by the United States, or any other taxing authority, then, in any such case, KCPL will pay as additional interest ("Additional Interest") such additional amounts as shall be required so that the net amounts received and retained by such Trust after paying any such taxes, duties, assessments or other governmental charges will be equal to the amounts such Trust would have received had no such taxes, duties, assessments or other governmental charges been imposed. INDENTURE EVENTS OF DEFAULT In case any Indenture Event of Default occurs and is continuing with respect to a series of Subordinated Debentures, the Property Trustee, as the holder of such Subordinated Debentures, will have the right to declare the principal of and the interest on such Subordinated Debentures (including Additional Interest, if any) and any other amounts payable under the Indenture to be forthwith due and payable and to enforce its other rights as a creditor with respect to such Subordinated Debentures. 16The Indenture provides that anyone or more of the followingdescribed events, which has occurred and is continuing, constitutes an "Event of Default"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 toanyeach series ofthe Subordinated Debentures: (a) failure for 30 days to pay interest on the Subordinated Debentures of such series, including any Additional Interest in respect thereof, when due; provided, however, that a valid extension of the interest payment period by KCPL will not constitute a default in the payment of interest for this purpose;senior debt securities, subordinated debt securities or(b) failure to pay principal of or premium, if any, on the Subordinated Debentures of such series when due whether at maturity, upon redemption or otherwise; or (c) failure to observe or perform any other covenant (other than those specifically relating solely to one or more other series of Subordinated Debentures) contained in the Indenture for 90 days after written notice to KCPL from the Debt Trustee or the holders of at least 25% in principal amount of the outstanding Subordinated Debentures; or (d) certain events of bankruptcy, insolvency or reorganization of KCPL; or (e) the voluntary or involuntary dissolution, winding-up or termination of the applicable Trust, except in connection with the distribution of Subordinated Debentures to the holders of Trust Securities of such Trust in liquidation of such Trust, the redemption of all outstanding Trust Securities of such Trust and certain mergers, consolidations or amalgamations permitted by the Declaration. The holders of a majority in aggregate outstanding principal amount of the Subordinated Debentures of such series have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Debt Trustee. Either the Debt Trustee or the holders of not less than 25% in aggregate outstanding principal amount of the Subordinated Debentures of such series may declare the principal of such series due and payable immediately on default, but the holders of a majority in aggregate outstanding principal amount of such series may annul such declaration and waive such default if such default has been cured and a sum sufficient to pay all matured installments of interest and principal due otherwise than by acceleration and any applicable premium has been deposited with the Debt Trustee. The holders of a majority in aggregate outstanding principal amount of a series of Subordinated Debentures affected thereby may, on behalf of the holders of all such Subordinated Debentures, waive any past default, except (i) a default in the payment of principal, premium, if any, or interest (unless such default has been cured and a sum sufficient to pay all matured installments of interest and principal due otherwise than by acceleration and any applicable premium has been deposited with the Debt Trustee) or (ii) a default in the covenant of KCPL not to declare or pay dividends on, or make distributions with respect to, or redeem, purchase or acquire any of its capital stock during an Extension Period. An Indenture Event of Default also constitutes a Declaration Event of Default. The holders of Preferred Securities in certain circumstances described in the applicable Prospectus Supplement may have the right to direct the Property Trustee to exercise its rights as the holder of the Subordinated Debentures. PAYMENT AND PAYING AGENTS 17Payment of principal of and premium (if any) on Subordinated Debentures will be made only against surrender to the Paying Agent of the Subordinated Debentures. Principal of and any premium and interest, if any, on Subordinated Debentures will be payable, subject to any applicable laws and regulations, at the office of such Paying Agent or Paying Agents as KCPL may designate from time to time, except that at the option of KCPL payment of any interest may be made by check mailed to the address of the person entitled thereto as such address appears in the Debenture Register with respect to the Subordinated Debentures. Payment of interest on the Subordinated Debentures on any Interest Payment Date will be made to the person in whose name the Subordinated Debenture (or predecessor security) is registered at the close of business on the Regular Record Date for such interest payment. The Debt Trustee will act as Paying Agent with respect to the Subordinated Debentures. KCPL 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 Paving Agent acts, except that KCPL will be required to maintain a Paying Agent at the place of payment. All moneys paid by KCPL to a Paying Agent for the payment of the principal of or premium or interest, if any, on any Subordinated Debentures which remain unclaimed at the end of two years after such principal, premium, if any, or interest shall have become due and payable will be repaid to KCPL and the holder of such Subordinated Debentures will thereafter look only to KCPL for payment thereof. MODIFICATION OF THE INDENTURE The Indenture contains provisions permitting KCPL and the Debt Trustee, with the consent of the holders of not less than a majority in principal amount of the Subordinated Debentures, to modify the Indenture or the rights of the holders of the Subordinated Debentures, and the holders of not less than a majority in principal amount of the Subordinated Debentures of a particular series to modify the supplemental indenture affecting that series; provided that no such modification may, without the consent of the holder of each outstanding Subordinated Debenture affected thereby, (i) extend the fixed maturity of such Subordinated Debentures, or reduce the principal amount thereof, or reduce the rate or extend the time of payment of interest thereon, or reduce any premium payable upon the redemption thereof, without the consent of the holder of the Subordinated Debentures so affected or (ii) reduce the percentage of Subordinated Debentures, the holders of which are required for such consent, without the consent of the holder of each Subordinated Debenture then outstanding and affected thereby. In addition, KCPL and the Debt Trustee may execute, without the consent of holders of the Subordinated Debentures, any supplemental indenture for certain other usual purposes including the creation of any new series of Subordinated Debentures. CONSOLIDATION, MERGER AND SALE The Indenture does not contain any covenant which restricts the ability of any Trust or KCPL to merge or consolidate with or into any other corporation, sell or convey all or substantially all of its assets to any person, firm or corporation or otherwise engage in restructuring transactions. 18DEFEASANCE AND DISCHARGE Under the terms of the Indenture, KCPL will be discharged from any and all obligations in respect of any series of Subordinated Debentures (except in each case for certain obligations with respect to denominations and provisions for payment of such Subordinated Debentures and obligations to register the transfer or exchange of such Subordinated Debentures, replace stolen, lost or mutilated Subordinated Debentures, maintain paying agencies and hold moneys for payment in trust) if KCPL (i) deposits with the Debt Trustee, in trust, moneys or Governmental Obligations, in an amount sufficient to pay all the principal of, and interest on, such Subordinated Debentures on the dates such payments are due in accordance with the terms of such Subordinated Debentures and (ii) delivers to the Debt Trustee an opinion of counsel to the effect that, based upon KCPL's receipt from, or the publication by, the Internal Revenue Service of a ruling, or a change in law, the holders of the Subordinated Debentures of such series will not recognize income, gain or loss for United States Federal income tax purposes as a result of the deposit, defeasance and discharge and will be subject to United States Federal income tax on the same amount and in the same manner and at the same times as would have been the case if such deposit, defeasance or discharge had not occurred. GOVERNING LAW The Indenture and the Subordinated Debentures will be governed by, and construed in accordance with, the internal laws of the State of New York. INFORMATION CONCERNING THE DEBT TRUSTEE The Debt Trustee, prior to default, undertakes to perform only such duties as are specifically set forth in the Indenture and, after default, will exercise the same degree of care as a prudent individual would exercise in the conduct of his or her own affairs. Subject to such provision, the Debt Trustee is under no obligation to exercise any of the powers vested in it by the Indenture at the request of any holder of Subordinated Debentures, unless offered reasonable indemnity by such holder against the costs, expenses and liabilities which might be incurred thereby; but the foregoing will not relieve the Debt Trustee, upon the occurrence of an Indenture Event of Default, from exercising the rights and powers vested in it by the Indenture. The Debt Trustee is not required to expend or risk its own funds or otherwise incur personal financial liability in the performance of its duties if the Debt Trustee reasonably believes that repayment or adequate indemnity is not reasonably assured to it. MISCELLANEOUS KCPL will have the right at all times to assign any of its rights or obligations under the Indenture to a direct or indirect wholly-owned subsidiary of KCPL; provided that, in the event of any such assignment, KCPL will remain liable for all of such obligations. Subject to the foregoing, the Indenture will be binding upon and inure to the benefit of the parties thereto and their respective successors and assigns. The Indenture provides that it may not otherwise be assigned by the parties thereto. The Indenture will provide that KCPL will pay all fees and expenses related to (i) the offering and sale of the Trust Securities and the Subordinated Debentures, (ii) the 19organization, maintenance and dissolution of each Trust, (iii) the retention of the Trustees and (iv) the enforcement by the Property Trustee of the rights of holders of Preferred Securities. EFFECT OF OBLIGATIONS UNDER THE SUBORDINATED DEBENTURES AND THE PREFERRED SECURITIES GUARANTEE As set forth in the Declaration for each Trust, the sole purposes of each Trust are to (i) issue Trust Securities, (ii) invest the proceeds thereof in the Subordinated Debentures and (iii) engage in only those other activities necessary or incidental thereto. As long as payments of interest and other payments are made when due on a series of Subordinated Debentures, such payments will be sufficient to cover distributions and payments due on the related Trust Securities primarily because (i) the aggregate principal amount of such Subordinated Debentures will be equal to the sum of the aggregate stated liquidation amount of such Trust Securities; (ii) the interest rate and interest and other payment dates on such Subordinated Debentures will match the distribution rate and distribution and other payment dates for such Preferred Securities; (iii) KCPL will pay for all costs and expenses of each Trust; and (iv) the Declaration provides that the Trustees may not cause or permit the Trust to, among other things, engage in any activity that is not consistent with the purposes of the Trust. Payments of distributions (to the extent funds therefor are available) and other payments due on the Preferred Securities (to the extent funds therefor are available) are guaranteed by KCPL as and to the extent set forth under "Description of the Preferred Securities Guarantee". If KCPL does not make interest payments on the Subordinated Debentures purchased by a Trust, it is expected that such Trust will not have sufficient funds to pay distributions on such Preferred Securities. The Preferred Securities Guarantee for a Trust is a full and unconditional guarantee from the time of its issuance, but does not apply to any payment of distributions unless and until such Trust has sufficient funds for the payment of such distributions. If KCPL fails to make interest or other payments on the Subordinated Debentures held by a Trust when due (taking into account any Extension Period), the Declaration for such Trust provides a mechanism whereby the holders of the Preferred Securities of such Trust, using the procedures described in "Description of the Preferred Securities -- Voting Rights" in the applicable Prospectus Supplement may direct the Property Trustee to enforce its rights under such Subordinated Debentures, including proceeding directly against KCPL to enforce the Subordinated Debentures. If the Property Trustee fails to enforce its rights under such Subordinated Debentures, a holder of such Preferred Securities may, after a period of 30 days has elapsed from such holder's written request to the Property Trustee to enforce such rights, institute a legal proceeding directly against KCPL to enforce the Property Trustee's rights under such Subordinated Debentures without first instituting any legal proceeding against the Property Trustee or any other person or entity, including such Trust. If KCPL fails to make payments under a Preferred Securities Guarantee for a Trust, such Preferred Securities Guarantee provides a mechanism whereby the holders of the Preferred Securities of such Trust may direct the Guarantee Trustee to enforce its rights thereunder. If the Guarantee Trustee fails to enforce such Preferred Securities Guarantee, any holder of such Preferred Securities may institute a legal proceeding directly against KCPL to enforce the 20Guarantee Trustee's rights under such Preferred Securities Guarantee, without first instituting a legal proceeding against such Trust, the Guarantee Trustee or any other person or entity. The above mechanisms and obligations, taken together, are equivalent to a full and unconditional guarantee by KCPL of payments due on the Preferred Securities. See "Description of the Preferred Securities Guarantees -- General." PLAN OF DISTRIBUTION KCPL and the Trusts may offer and sell the Preferred Securities in any of three ways: (i) through agents; (ii) through underwriters or dealers; or (iii) directly to one or more purchasers. The Prospectus Supplement with respect to any of thePreferred Securities will set forth the terms of the offering of such senior debt securities, subordinated debt securities or Preferred Securities, including the name or names of any underwriters or agents, the purchase price of such senior debt securities, subordinated debt securities or Preferred Securities and the proceeds to the Company or the applicable Trust from such sale, any underwritingdiscountsdiscou nts or agency fees and other items constituting underwriters' or agents' compensation,theany initial public offering price, any discounts or concessions allowed or reallowed or paid to dealers and any securitiesexchangesexchange on which such senior debt securities, subordinated debt securities or Preferred Securities may be listed.The distribution ofIf underwriters participate in the sale, such senior debt securities, subordinated debt securities or Preferred Securities will be acquired by the underwriters for their own account and may be
effectedresold from time to time in one or more transactions, including negotiated transactions, at a fixed public offering price or at varying priceswhich may be changed, at a market price prevailingdetermined at the time ofsale, at prices relatedsale.Unless otherwise set forth in the prospectus supplement, the obligations of the underwriters to purchase any series of senior debt securities, subordinated debt securities or Preferred Securities will be subject to certain conditions precedent and the underwriters will be obligated to purchase all of such
prevailing market pricesseries of senior debt securities, subordinated debt securities orat negotiated prices.Preferred Securities, if any are purchased.Underwriters
dealersand agents may be entitled under agreements entered into withKCPLthe Company and/or the applicable Trust to indemnificationby KCPLagainst certain civil liabilities, including liabilities under theSecurities Act, or to contribution with respect to payments which the underwriters, dealers or1933 Act. Underwriters and agents maybe required to make in respect thereof. Such underwriters, dealers and agents, and affiliates thereof, may be customers of,engage in transactions with, or perform services for,KCPL and its affiliatesthe Company in the ordinary course of business.AllEach series of senior debt securities, subordinated debt securities or Preferred Securities will be a new
issuesissue of securitieswithand will have no established trading market. Any underwriters to whom senior debt securities, subordinated debt securities or Preferred Securities are soldby a Trustfor public offering and sale may make a market in such senior debt securities, subordinated debt securities or Preferred Securities, but such underwriters will not be obligated to do so and may discontinue any market making at any time without notice.No assurance canThe senior debt securities, subordinated debt securities or Preferred Securities may or may not begiven concerninglisted on a national securities exchange.LEGAL MATTERS
Legal matters with respect to the
liquidity of the trading market for any Preferred Securities. 21EXPERTS The financial statements included in KCPL's Annual Report on Form 10-Kdebt securities offered hereby will be passed upon for theyear ended December 31, 1995, incorporatedCompany byreference in this ProspectusJeanie Sell Latz, Esq., Corporate Secretary. At August 6, 2003, Ms. Latz owned beneficially 22,427 shares of Great Plains Energy's common stock, including option grants andin the Registration Statement, have been audited by Coopers & Lybrand L.L.P., independent public accountants, as indicated in their reports with respect thereto,shares that may be acquired at a later date based on corporate andare included herein, in reliance upon the authority of said firm as experts in giving said reports. LEGAL OPINIONSMs. Latz's individual performance.Certain matters of Delaware law relating to the validity of the Preferred Securities will be passed upon on behalf of
each Trustthe Company and the Trusts by Pepper Hamilton& Scheetz,LLP, special Delaware counsel toeach Trust. Legal matters with respect totheSubordinated Debentures offered herebyCompany and thePreferred Securities GuaranteesTrusts.Certain legal matters will be passed upon for
KCPLthe underwriters byJeanie Sell Latz, Senior Vice President and Chief Legal Officer, and for the Underwriters by Sidley & Austin, One First National Plaza, Chicago, Illinois 60603. Sidley & AustinDewey Ballantine LLP, New York, New York. Dewey Ballantine LLP will rely for purposes of their opinions upon the opinion of Ms. Latz as to matters of Missouri law.Certain United States federal income taxation matters will be passed upon by Sidley & Austin. At September 30, 1996, Ms. Latz owned beneficially 1,945 shares of KCPL's Common Stock; she alsoDewey Ballantine LLP hasoptions to purchase 15,375 shares of KCPL's Common Stock atperformed, and may perform in thefair market value on the dates of the grants. Sidley & Austin occasionally performsfuture, legal services forKCPL.the Company and its affiliates.EXPERTS
The consolidated financial statements
herein under "Descriptionas ofSubordinated Debentures"December 31, 2002, and"Description of Preferred Securities Guarantees," asfor the year then ended and the related financial statement schedule, incorporated in this prospectus by reference to themattersCurrent Report on Form 8-K/A oflaw and legal conclusions, have been prepared under the supervision of and reviewed by, and are made on the authority of Ms. Latz, who has given her opinion that such statements as to such matters and conclusions are correct. 22- -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- No person is authorized to give any information or make any representations, other than those contained or incorporated by reference in this Prospectus Supplement and the Prospectus, in connection with the offer contained herein, and, if given or made, such other information or representations must not be relied upon as having been authorized by the KCPL, the Trust or the Underwriters. Neither the delivery of this Prospectus Supplement and the Prospectus nor any sale made hereunder shall, under any circumstances, create any implication that there has been no change in the affairs of KCPL since the date as of which information is given in this Prospectus Supplement and the Prospectus. This Prospectus Supplement and the Prospectus do not constitute an offer or solicitation by any person in any jurisdiction in which such offer or solicitation is not authorized or in which the person making such offer or solicitation is not qualified to do so or to any person to whom it is unlawful to make such offer or solicitation. ________________________ TABLE OF CONTENTS Page ---- Prospectus Supplement Risk Factors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Kansas City Power & Light Company. . . . . . . . . . . . . . . . . . . .(a wholly-owned subsidiary of Great Plains Energy Incorporated) dated August 14, 2003, (the "August 14, 2003 Form 8-K/A") have been audited by Deloitte & Touche LLP, independent auditors, as stated in their report, which is incorporated herein by reference (which report expresses an unqualified opinion and includes an explanatory paragraph referring to a change in accounting principle), and has been so incorporated inreliance upon the report of such firm given on their authority as experts in auditing and accounting.
The
Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Selected Financial Data . . . . . . . . . . . . . . . . . . . . . . . . . Recent Developments . . . . . . . . . . . . . . . . . . . . . . . . . . . Capitalizationconsolidated financial statements ofKCPL. . . . . . . . . . . . . . . . . . . . . . . . . . Accounting Treatment . . . . . . . . . . . . . . . . . . . . . . . . . . Use of Proceeds . . . . . . . . . . . . . . . . . . . . . . . . . . . . Description of the Preferred Securities Guarantee . . . . . . . . . . . . Description of the Preferred Securities . . . . . . . . . . . . . . . . . Description of the Subordinated Debentures . . . . . . . . . . . . . . . Effect of Obligations under the Junior Subordinated Debt Securities and the Preferred Securities Guarantee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . United States Federal Income Taxation . . . . . . . . . . . . . . . . . . Underwriting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . PROSPECTUS Available Information Incorporation of Certain Documents by ReferenceKansas City Power & Light CompanyThe Trusts Ratios(a wholly-owned subsidiary ofEarnings to Fixed ChargesGreat Plains Energy Incorporated) as of December 31, 2001 andEarnings to Fixed Charges and Preferred Dividend Requirements Use of Proceeds Descriptionfor each of thePreferred Securities Descriptiontwo years in the period ended December 31, 2001 incorporated in this prospectus by reference to the August 14, 2003 Form 8-K/A, except as they relate to DTI Holdings, Inc. and Subsidiaries (Debtors-in-Possession), and the 2001 and 2000 financial statement schedule information incorporated in this prospectus by reference to the August 14, 2003 Form 8-K/A, have been audited by PricewaterhouseCoopers LLP, independent accountants, whose reports thereon (which report relating to the consolidated financial statements as of December 31, 2001 and for each of thePreferred Securities Guarantee Descriptiontwo years in the period ended December 31, 2001 includes an explanatory paragraph relating to the Company's corporate reorganization in 2001) also appear in the August 14, 2003 Form 8-K/A. The report of PricewaterhouseCoopers LLP, independent accountants, on the consolidated financial statements as of December 31, 2001 and for each of theSubordinated Debentures Effecttwo years in the period ended December 31, 2001 referred to above, insofar as it relates to the amounts included for DTI Holdings, Inc. and Subsidiaries (Debtors-in-Possession), is based solely on the report ofObligations UnderDeloitte & Touche LLP. The financial statements of DTI Holdings, Inc. and Subsidiaries (Debtors-in-Possession) (not presented separately or incorporated by reference herein) have been audited by Deloitte & Touche LLP, independent auditors, as stated in their report (which expresses an unqualified opinion and includes explanatory paragraphs referring to DTI Holdings, Inc. and Subsidiaries' filing for reorganization under Chapter 11 of theSubordinated DebenturesFederal Bankruptcy Code, substantial doubt about DTI Holdings, Inc. and Subsidiaries' ability to continue as a going concern and an impairment charge r ecorded by DTI Holdings, Inc. and Subsidiaries) which also appears in thePreferred Securities Guarantee PlanAugust 14, 2003 Form 8-K/A. The consolidated financial statements ofDistribution Experts Legal Opinions -------------------- -------------------- PREFERRED SECURITIES KCPL Financing I KCPL FinancingKansas City Power & Light Company referred to above have been incorporated in this prospectus in reliance on the reports of such firms, given on their authority as experts in auditing and accounting.PART II
KCPL Financing III ____% TRUST ORIGINATED PREFERREDSECURITIES_ ("TOPRS_) FULLY AND UNCONDITIONALLY GUARANTEED BY KANSAS CITY POWER & LIGHT COMPANY --------------------- PROSPECTUS SUPPLEMENT --------------------- MERRILL LYNCH & CO. , 199_ --------------------- --------------------- 23PART II.INFORMATION NOT REQUIRED IN PROSPECTUS
ITEMItem 14.
OTHER EXPENSE OF ISSUANCE AND DISTRIBUTION An estimateOther Expenses ofsuch expense,Issuance and Distribution.Expenses payable by Registrant for the sale of the Securities, other than underwriting discount and commissions,
isare estimated as follows:
Securities and Exchange Commission registration fee
$ 20,655.00
Printing
40,000.00
Services of Independent Auditors and Accountants
75,000.00
Fees and expenses of Trustees
50,000.00
Rating agency fees
195,000.00
New York Stock Exchange Listing Fees
54,090.00
Miscellaneous
65,255.00
Total
$500,000.00
_______________
Item 15. Indemnification of Directors and
Exchange Commission filing fee . . . . . . . $90,909 New York Stock Exchange listing fee . . . . . . . . . . . 45,000 Rating Agency fees . . . . . . . . . . . . . . . . . . . . 77,000 Trustees' expenses . . . . . . . . . . . . . . . . . . . . 15,000 Printing and engraving fees . . . . . . . . . . . . . . . . 30,000 Accounting fees and expenses. . . . . . . . . . . . . . . . 10,000 Legal fees and expenses . . . . . . . . . . . . . . . . . 125,000 Blue Sky expenses . . . . . . . . . . . . . . . . . . . . 1,000 Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . 6,091 Total . . . . . . . . . . . . . . . . . . . . . . . . $400,000 -------- -------- ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.Officers.RSMo. Section 351.355
R.S.Mo. (1986)(2001) provides as follows:1. A corporation created under the laws of this state may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, other than an action by or in the right of the corporation, by reason of the fact that he or she is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses, including attorneys' fees,
judgements,judgments, fines and amounts paid in settlement actually and reasonably incurred by him or her in connection with such action, suit, or proceeding if he or she acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful. The termination of any action, suit, or proceeding by judgment, order, settlement, conviction, or upon a plea of nolocontenderscontendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and inana manner which he or she reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had reasonable cause to believe that his or her conduct was unlawful.2. The corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the
factact that he or she is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses, including attorneys' fees, and amounts paid in settlement actually and reasonably incurred by him or her in connection with the defense or settlement of the action or suit if he or she acted ingood faith and in a manner he or she reasonably believed to be in or
II-1not opposed to the best interests of the corporation; except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable for negligence or misconduct in the performance of his or her duty to the corporation unless and only to the extent that the court in which the action or suit was brought determines upon application that, despite the adjudication of liability and in view of all the circumstances of the case, the person is fairly and reasonably entitled to indemnity for such expenses which the court shall deem proper. 3.
ToExcept as otherwise provided in the Articles of Incorporation or the bylaws, to the extent that a director, officer, employee or agent of the corporation has been successful on the merits or otherwise in defense of any action, suit, or proceeding referred to in subsections 1 and 2 of this section, or in defense of any claim, issue or matter therein, he or she shall be indemnified against expenses, including attorneys' fees, actually and reasonably incurred by him or her in connection with the action, suit or proceeding.4. Any indemnification under subsections 1 and 2 of this section, unless ordered by a court, shall be made by the corporation only as authorized in the specific case upon a determination that indemnification of the director, officer, employee or agent is proper in the circumstances because he or she has met the applicable standard of conduct set forth in this section. The determination shall be made by the board of directors by a majority vote of a quorum consisting of directors who were not parties to the action, suit, or proceeding, or if such a quorum is not obtainable, or even if obtainable a quorum of disinterested directors so directs, by independent legal counsel in a written opinion, or by the shareholders.
5. Expenses incurred in defending a civil or criminal action, suit or proceeding may be paid by the corporation in advance of the final disposition of the action, suit, or proceeding as authorized by the board of directors in the specific case upon receipt of an undertaking by or on behalf of the director, officer, employee or agent to repay such amount unless it shall ultimately be determined that he or she is entitled to be indemnified by the corporation as authorized in this section.
6. The indemnification provided by this section shall be deemed exclusive of any other rights to which those seeking indemnification may be entitled under the
articlesArticles ofincorporationIncorporation or bylaws or any agreement, vote of shareholders or disinterested directors or otherwise, both as to action in his or her official capacity and as to action in another capacity while holding such office, and shall continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such a person.7. A corporation created under the laws of this state shall have the power to give any further indemnity, in addition to the indemnity authorized or contemplated under other subsections of this section, including subsection 6, to any person who is or was a director, officer, employee or agent, or to any person who is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, provided such further indemnity is either (i) authorized, directed, or provided for in the
articlesArticles ofincorporationIncorporation of the corporation or any duly adopted amendment thereof or (ii) is authorized, directed, or provided for in any bylawor agreement of the corporation which has been adopted by a vote of the shareholders of the corporation, and provided further that no such indemnity shall indemnify any person from or on account of such person's conduct which was finally adjudged to have been knowingly fraudulent, deliberately dishonest or willful misconduct.
II-2Nothing in this subsection shall be deemed to limit the power of the corporation under subsection 6 of this section to enact bylaws or to enter into agreements without shareholder adoption of the same. 8. The corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against him and incurred by him or her in any such capacity, or arising out of his or her status as such, whether or not the corporation would have the power to indemnify him or her against such liability under the provisions of this section.
9. Any provision of this chapter to the contrary notwithstanding, the provisions of this section shall apply to all existing and new domestic corporations, including but not limited to banks, trust companies, insurance companies, building and loan associations, savings bank and safe deposit companies, mortgage loan companies, corporations formed for benevolent, religious, scientific or educational purposes and nonprofit corporations.
10. For the purpose of this section, references to "the corporation"include all constituent corporations absorbed in a consolidation or merger as well as the resulting or surviving corporation so that any person who is or was a director, officer, employee or agent of such a constituent corporation or is or was serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise shall stand in the same position under the provisions of this section with respect to the resulting or surviving corporation as he or she would if he or she had served the resulting or surviving corporation in the same capacity.
11. For purposes of this section, the term "other enterprise" shall include employee benefit plans; the term "fines" shall include any excise taxes assessed on a person with respect to an employee benefit plan; and the term "serving at the request of the corporation" shall include any service as a director, officer, employee, or agent of the corporation which imposes duties on, or involves services by, such director, officer, employee, or agent with respect to an employee benefit plan, its participants, or beneficiaries; and a person who acted in good faith and in a manner he or she reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner "not opposed to the best interests of the corporation" as referred to in this section.
The officers and directors of
KCPL (the "Company")the Company have entered into indemnification agreements withKCPLthe Company indemnifying such officers and directors to the extent allowed under the above RSMo. Section 351.355RSMo (1986)(2001).Article XIII of the Restated Articles of Consolidation of
KCPLthe Company provides as follows:ARTICLE THIRTEENTH. (a) Right to Indemnification. Each person who was or is made a party or is threatened to be made a party to any action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that he or she is
or was a director or officer of the Company or is or was an employee of the Company acting within the scope and course of his or her employment or is or was serving at the request of the Company as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust
II-3or other enterprise, including service with respect to employee benefit plans, shall be indemnified and held harmless by the Company to the fullest extent authorized by The Missouri General and Business Corporation Law, as the same exists or may hereafter be amended, against all expense, liability and loss (including attorneys' fees, judgments, fines, ERISA excise taxes or penalties and amounts paid to or to be paid in settlement) actually and reasonably incurred by such person in connection therewith. The Company may in its discretion by action of its Board of Directors provide indemnification to agents of the Company as provided for in this ARTICLE THIRTEENTH. Such indemnification shall continuec ontinue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of his or her heirs, executors and administrators.(b) Rights Not Exclusive. The indemnification and other rights provided by this ARTICLE THIRTEENTH shall not be deemed exclusive of any other rights to which a person may be entitled under any applicable law, By-laws of the Company, agreement, vote of shareholders or disinterested
Directorsdirectors or otherwise, both as to action in such person's official capacity and as to action in any other capacity while holding the office ofDirectordirector or officer, and the Company is hereby expressly authorized by the shareholders of the Company to enter into agreements with itsDirectorsdirectors and officers which provide greater indemnification rights than that generally provided by The Missouri General and Business Corporation Law; provided, however, that no such further indemnity shall indemnify any person from or on account of suchDirector'sdirector's or officer's conduct which was finally adjudged to have been knowingly fraudulent, deliberately dishonest or willful misconduct. Any such agreement providing for further indemnity entered into pursuant to this ARTICLE THIRTEENTH after the date of approval of this ARTICLE THIRTEENTH by the Company's shareholders need not be further approved by the shareholders of the Company in order to be fully effective and enforceable.(c) Insurance. The Company may purchase and maintain insurance on behalf of any person who was or is a director, officer, employee or agent of the Company, or was or is serving at the request of the Company as a
Director,director, officer, employee or agent of another company, partnership, joint venture, trust or other enterprise against any liability asserted against or incurred by such person in any such capacity, or arising out of his or her status as such, whether or not the Company would have the power to indemnify such person against such liability under the provisions of this ARTICLE THIRTEENTH.(d) Amendment. This ARTICLE THIRTEENTH may be hereafter amended or repealed; however, no amendment or repeal shall reduce, terminate or otherwise adversely affect the right of a person entitled to obtain indemnification or an advance of expenses with respect to an action, suit or proceeding that pertains to or arises out of actions or omissions that occur prior to the later of (a) the effective date of such amendment or repeal; (b) the expiration date of such person's then current term of office with, or service for, the Company (provided such person has a stated term of office or service and completes such term); or (c) the effective date such person resigns his or her office or terminates his or her service (provided such person has a stated term of office or service but resigns prior to the expiration of such term).
Each Declaration of Trust provides that no Trustee, affiliate of any Trustee, or any officers, directors, shareholders, members, partners, employees, representatives, or agents of any Trustee, or any employee or agent of the Trust or its affiliates (each an "Indemnified Person") shall be liable, responsible or accountable in damages or otherwise to the Trust or any employee or II-4agent of the Trust or its affiliates for any loss, damage or claim incurred by reason of any act or omission performed or omitted by such Indemnified Person in good faith on behalf of the Trust and in a manner such Indemnified Person reasonably believed to be within the scope of the authority conferred on such Indemnified Person by the Declaration or by law, except that an Indemnified Person shall be liable for any such loss, damage or claim incurred by reason of such Indemnified Person's gross negligence or willful misconduct with respect to such act or omission. Each Declaration of Trust also provides that, to the fullest extent permitted by applicable law, KCPL shall indemnify and hold harmless each Indemnified Person from and against any loss, damage or claim incurred by such Indemnified Person by reason of any act or omission performed or omitted by such Indemnified Person in good faith on behalf of the Trust and in a manner such Indemnified Person reasonably believed to be within the scope of authority conferred on such Indemnified Person by such Declaration, except that no Indemnified Person shall be entitled to be indemnified in respect of any loss, damage or claim incurred by such Indemnified Person by reason of gross negligence or willful misconduct with respect to such act or omission. The Declaration of Trust further provides that, to the fullest extent permitted by applicable law, expenses (including legal fees) incurred by an Indemnified Person in defending any claim, demand, action, suit or proceeding shall, from time to time, be advanced by KCPL prior to the final disposition of such claim, demand, action, suit or proceeding upon receipt by KCPL of an undertaking by or on behalf of the Indemnified Person to repay such amount if it shall be determined that the Indemnified Person is not entitled to be indemnified for the underlying cause of action as authorized by such Declaration. ITEM 16. EXHIBITS The following exhibits are filed herewith. Documents indicated by an asterisk (*) are incorporated by reference by the File No. indicated. EXHIBIT NUMBER DESCRIPTION OF DOCUMENT ------ ----------------------- 1 Form of purchase agreement for offering of Preferred Securities. 4-a Certificate of Trust of KCPL Financing I, (The Certificate of Trust for each other Trust are identical except for the name, and will be filed upon request). 4-b Form of Amended and Restated Declaration of Trust of KCPL Financing I. (The Declaration of Trust for each other Trust are identical except for the name, and will be filed upon request). 4-c Indenture between KCPL and The First National Bank of Chicago, as Trustee. 4-d Form of Supplemental Indenture to be used in connection with the issuance of each series of Subordinated Debentures. 4-e Form of Preferred Security (included in 4-b). II-54-f Form of Subordinated Debenture (included in 4-d). 4-g Form of Preferred Securities Guarantee Agreement. 4-h *General Mortgage and Deed of Trust dated as of December 1, 1986, between the Company and UMB Bank, N.A. (formerly United Missouri Bank of Kansas City, N.A.), Trustee (Exhibit 4-bb to Form 10-K for the year ended December 31, 1986). 4-i *Third Supplemental Indenture dated as of April 1, 1991, to Indenture dated as of December 1, 1986 (Exhibit 4-aq to Registration Statement, Registration No. 33-42187). 4-j *Fourth Supplemental Indenture dated as of February 15, 1992, to Indenture dated as of December 1, 1986 (Exhibit 4-y to From 10-K for year ended December 31, 1991). 4-k *Fifth Supplemental Indenture dated as of September 15, 1992, to Indenture dated as of December 1, 1986 (Exhibit 4-a to Form 10-Q dated September 30, 1992). 4-l *Sixth Supplemental Indenture dated as of November 1, 1992, to Indenture dated as of December 1, 1986 (Exhibit 4-z to Registration Statement, Registration No. 33-54196). 4-m *Seventh Supplemental Indenture dated as of October 1, 1993, to Indenture dated as of December 1, 1986 (Exhibit 4-a to Form 10-Q dated September 30, 1993). 4-n *Eighth Supplemental Indenture dated as of December 1, 1993, to Indenture dated as of December 1, 1986 (Exhibit 4 to Registration Statement, Registration No. 33-51799). 4-o *Ninth Supplemental Indenture dated as of February 1, 1994, to Indenture dated as of December 1, 1986 (exhibit 4-h to Form 10-K for year ended December 31, 1993). 4-p *Tenth Supplemental Indenture dated as of November 1, 1994, to Indenture dated as of December 1, 1986 (Exhibit 4-i to Form 10-K for year ended December 31, 1994). 4-q *Note Indenture dated as of November 1, 1994, between the Company and the Bank of New York creating the Notes (Exhibit 4-j to Registration Statement, Registration No. 33-56309). 4-r *Note Indenture dated as of November 15, 1992, between the Company an The Bank of New York creating the Notes (Exhibit 4-aa to Registration Statement, Registration No. 33-54196). II-64-s *Note Indenture dated as of February 15, 1992, between the Company and The Bank of New York (Exhibit 4-bb to Registration Statement, Registration No. 33-45736). 4-t *Note Indenture dated as of April 1, 1991, between the Company and The Bank of New York (Exhibit 4-bb to Registration Statement, Registration No. 33-42187). 4-u *Form of Note Indenture dated as of December 1, 1996, between the Company and The Bank of New York creating the Notes. 4-v *Resolution of Board of Directors Establishing 3.80% Cumulative Preferred Stock (Exhibit 2-R to Registration Statement, Registration No. 2-402339). 4-w *Resolution of Board of Directors Establishing 4% Cumulative Preferred Stock (Exhibit 2-S to Registration Statement, Registration No. 2-40239). 4-x *Resolution of Board of Directors Establishing 4.50% Cumulative Preferred Stock (Exhibit 2-T to Registration Statement, Registration No. 2-40239). 4-y *Resolution of Board of Directors Establishing 4.20% Cumulative Preferred Stock (Exhibit 2-U to Registration Statement, Registration No. 2-40239). 4-z *Resolution of Board of Directors Establishing 4.35% Cumulative Preferred Stock (Exhibit 2-V to Registration Statement, Registration No. 2-40239). 4-aa *Certificate of Designation of Board of Directors Establishing the $50,000,000 Cumulative No Par Preferred Stock, Auction Series A (Exhibit 4-a to Form 10-Q dated March 31, 1992). 5-a Opinion of Pepper, Hamilton & Scheetz re legality of Preferred Securities. 5-b Opinion of J.S. Latz, Senior Vice President and Chief Legal Officer of KCPL, re legality of Subordinated Debentures and the Preferred Securities Guarantees. 8 Opinion of Sidley & Austin re tax matters. 12 Statement re Computation of Ratios of Earnings to Fixed Charges and Ratios of Earnings to Fixed Charges and Preferred Dividend Requirements. 23-a Consent of Independent Accountants -- Coopers & Lybrand L.L.P. 23-b Consent of Pepper, Hamilton & Scheetz (included in 5-a). II-723-c Consent of J.S. Latz (included in 5-b). 23-d Consent of Sidley & Austin (included in 8). 24 Powers of attorney. 25-a Statement of eligibility and qualification on Form T-1 of The First National Bank of Chicago, as Debt Trustee under the Indenture. 25-b Statements of Eligibility of The First National Bank of Chicago as Trustee under the Amended and Restated Declaration of Trust of KCPL Financing I and under the Preferred Security Guarantee of KCPL for the benefit of the holders of Preferred Securities of KCPL Financing I. 25-c Statements of Eligibility of The First National Bank of Chicago as Trustee under the Amended and Restated Declaration of Trust of KCPL Financing II and under the Preferred Security Guarantee of KCPL for the benefit of the holders of Preferred Securities of KCPL Financing II. 25-d Statements of Eligibility of The First National Bank of Chicago as Trustee under the Amended and Restated Declaration of Trust of KCPL Financing III and under the Preferred Security Guarantee of KCPL for the benefit of the holders of Preferred Securities of KCPL Financing III. ITEM 17. UNDERTAKINGS. The undersigned registrants hereby undertake: 1. To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: a. To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; b. To reflect in the prospectus any facts or events arising after the effective date of the Registration Statement (or the most recent post- effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the Registration Statement. Notwithstanding the foregoing, any increase or decrease in the volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective Registration Statement; and II-8c. To include any material information with respect to the plan of distribution not previously disclosed in the Registration Statement or any material change to such information in the Registration Statement; 2. That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such at that time shall be deemed to be the initial bona fide offering thereof. 3. To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. Provided, however, that (1)(a) and (1)(b) do not apply if the information required to be included in a post-effective amendment by those items is contained in periodic reports filed by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference to this registration statement. The undersigned registrants hereby undertake that, for purposes of determining any liability under the Securities Act of 1933, each filing of KCPL's annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 that is incorporated by reference in the Registration Statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities as that time shall be deemed to be the initial bona fide offering thereof.Insofar as indemnification for liabilities arising under the Securities Act of 1933, as amended (the "Act") may be permitted to directors, officers and controlling persons of
the registrantsRegistrant pursuant to the foregoing provisions,described under Item 15 above,or otherwise,the registrants haveRegistrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment bythe registrantsRegistrant of expenses incurred or paid by a director, officer or controlling person ofthe registrantsRegistrant in the successful defense of any action, suit or proceeding) is asserted against Registrant by such director, officer or controlling person in connection with the securities being registered,the registrantsRegistrant will, unless in the opinion oftheirits counsel thematterma tter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification bythemit is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.The undersigned registrantsItem 16. List of Exhibits.
Exhibit Number
Description of Exhibit
1.a
**
Form of Underwriting Agreement for the senior debt securities.
1.b
**
Form of Underwriting Agreement for the subordinated debt securities.
1.c
**
Form of Underwriting Agreement for the Preferred Securities.
4.a
Certificate of Trust for KCPL Financing II (the Certificate of Trust for each other trust is identical except for the names and will be filed upon request).
4.b
Declaration of Trust of KCPL Financing II and KCPL Financing III.
4.c
Form of Amended and Restated Declaration of Trust.
4.d
Form of Senior Indenture between Kansas City Power & Light Company and The Bank of New York, as Trustee.
4.e
Form of Subordinated Indenture between Kansas City Power & Light Company and The Bank of New York, as Trustee.
4.f
Form of Preferred Security (included in 4.c).
4.g
Form of Senior Debt Security (included in 4.d).
4.h
Form of Subordinated Debt Security (included in 4.e).
4.i
Form of Preferred Securities Guarantee Agreement.
4.j
*
General Mortgage and Deed of Trust dated as of December 1, 1986, between Kansas City Power & Light Company and UMB Bank, n.a. (formerly United Missouri Bank of Kansas City, N.A.), Trustee (Exhibit 4-bb to Form 10-K for the year ended December 31, 1986).
4.k
*
Fourth Supplemental Indenture dated as of February 15, 1992, to Indenture dated as of December 1, 1986 (Exhibit 4-y to Form 10-K for the year ended December 31, 1991).
4.l
*
Fifth Supplemental Indenture dated as of September 15, 1992, to Indenture dated as of December 1, 1986 (Exhibit 4-a to quarterly report on Form 10-Q for the period ended September 30, 1992).
4.m
*
Sixth Supplemental Indenture dated as of November 1, 1992, to Indenture dated as of December 1, 1986 (Exhibit 4-z to Registration Statement, Registration No. 33-54196).
4.n
*
Seventh Supplemental Indenture dated as of October 1, 1993, to Indenture dated as of December 1, 1986 (Exhibit 4-a to quarterly report on Form 10-Q for the period ended September 30, 1993).
4.o
*
Eighth Supplemental Indenture dated as of December 1, 1993, to Indenture dated as of December 1, 1986 (Exhibit 4 to Registration Statement, Registration No. 33-51799).
4.p
*
Ninth Supplemental Indenture dated as of February 1, 1994, to Indenture dated as of December 1, 1986 (Exhibit 4-h to Form 10-K for year ended December 31, 1993).
4.q
*
Indenture for Medium-Term Note Program dated as of February 15, 1992, between Kansas City Power & Light Company and The Bank of New York (Exhibit 4-bb to Registration Statement, Registration No. 33-45736).
4.r
*
Indenture for Medium-Term Note Program dated as of November 15, 1992, between Kansas City Power & Light Company and The Bank of New York (Exhibit 4-aa to Registration Statement, Registration No. 33-54196).
4.s
*
Amended and Restated Declaration of Trust of Kansas City Power & Light Company Financing I dated April 15, 1997 (Exhibit 4-a to Form 10-Q for the period ended March 31, 1997).
4.t
*
Indenture dated as of April 1, 1997 between the Company and The First National Bank of Chicago, Trustee (Exhibit 4-b to Form 10-Q for the period ended March 31, 1997).
4.u
*
First Supplemental Indenture dated as of April 1, 1997 to the Indenture dated as of April 1, 1997 between the Company and The First National Bank of Chicago, Trustee (Exhibit 4-c to Form 10-Q for the period ended March 31, 1997).
4.v
*
Preferred Securities Guarantee Agreement dated April 15, 1997 (Exhibit 4-d to Form 10-Q for the period ended March 31, 1997).
4.w
*
Indenture for $150 million aggregate principal amount of 6.50% senior debt securities due November 15, 2011 and $250 million aggregate principal amount of 7.125% senior debt securities due December 15, 2005 dated as of December 1, 2000, between Kansas City Power & Light Company and The Bank of New York (Exhibit 4-a to Report on Form 8-K dated December 18, 2000).
4.x
*
Indenture for $225 million aggregate principal amount of 6.00% senior debt securities due 2007, Series B, dated March 1, 2002 between The Bank of New York and Kansas City Power & Light Company (Exhibit 4.1.b. to Form 10-Q for the period ended March 31, 2002).
5.a
Opinion of Pepper Hamilton L.L.P. regarding legality of Preferred Securities.
5.b
Opinion and consent of Jeanie Sell Latz, Corporate Secretary of KCP&L regarding legality of Debt and Preferred Securities Guarantees.
12
Schedule of computation of ratio of earnings to fixed charges.
23.a
Consent of Deloitte & Touche LLP.
23.b
Consent of PricewaterhouseCoopers LLP.
23.c
Consent of Deloitte & Touche LLP.
23.d
Consent of Pepper Hamilton L.L.P. (included as part of Exhibit 5.a).
23.e
Consent of Jeanie Sell Latz, Corporate Secretary (included as part of Exhibit 5.b).
24
Powers of Attorney.
25.a
Form T-1 Statement of Eligibility ofThe Bank of New York, as Trustee under the Senior Indenture, under the Trust Indenture Act of 1939.
25.b
Form T-1 Statement of Eligibility of The Bank of New York, as Trustee under the Subordinated Indenture, under the Trust Indenture Act of 1939
25.c
Form T-1 Statement of Eligibility of The Bank of New York as Property Trustee under the Amended and Restated Declaration of Trust of KCPL Financing II.
25.d
Form T-1 Statement of Eligibility of The Bank of New York as Guarantee Trustee under the Preferred Security Guarantee of Kansas City Power & Light Company for the benefit of the holders of Preferred Securities of KCPL Financing II.
25.e
Form T-1 Statement of Eligibility of The Bank of New York as Property Trustee under the Amended and Restated Declaration of Trust of KCPL Financing III.
25.f
Form T-1 Statement of Eligibility of The Bank of New York as Guarantee Trustee under the Preferred Security Guarantee of Kansas City Power & Light Company for the benefit of the holders of Preferred Securities of KCPL Financing III.
*Exhibits listed above which have heretofore been filed with the Commission and which were designated as noted above are hereby
undertake that: (1) For purposes of determining any liability underincorporated herein by reference and made a part hereof with theSecurities Act of 1933, the information omitted from the form of prospectussame effect as if filedas part of this Registration Statement in reliance upon Rule 430A and contained in a form of prospectusherewith.**To be subsequently filed or incorporated by
the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this Registration Statement as of the time it was declared effective. (2) For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new Registration Statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. II-9reference. Item 17. Undertakings.
(1)
The undersigned Registrant hereby undertakes:
(a)
to file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement: (i) to include any prospectus required by Section 10(a)(3) of the Securities Act; (ii) to reflect in the prospectus any facts or events arising after the effective date of the Registration Statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the Registration Statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price se t forth in the "Calculation of Registration Fee" table in the effective registration statement; and (iii) to include any material information with respect to the plan of distribution not previously disclosed in the Registration Statement or any material change to such information in the Registration Statement; provided, however, that paragraphs (1)(a)(i) and (1)(a)(ii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Commission by Registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act that are incorporated by reference in the Registration Statement;
(1)
that, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof; and
(2)
to remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
(b)
The undersigned Registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 that is incorporated by reference in this Registration Statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(c)
See the last paragraph of Item 15.
2.
The undersigned Registrant hereby undertakes that,
(a)
for purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part of this Registration Statement in reliance upon Rule 430A and contained in a form of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this Registration Statement as of the time it was declared effective, and
(b)
for the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new Registration Statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Registration Statement or amendment thereto to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Kansas City,
Power & Light Company,State of Missouri, onbehalfthe 26th day ofeachAugust 2003.
KANSAS CITY POWER & LIGHT COMPANY
By:
/s/Bernard J. Beaudoin
(Bernard J. Beaudoin)
Chairman of the Board and Chief Executive OfficerPursuant to the requirements of the
Registrants,Securities Act of 1933, this Registration Statement or amendment has been signed below by the following persons in the capacities and on the dates indicated.
Signature
Title
Date
/s/Bernard J. Beaudoin
(Bernard J. Beaudoin)Chairman of the Board and Chief Executive Officer
(Principal Executive Officer))
)
))
/s/Andrea F. Bielsker
(Andrea F. Bielsker)Senior Vice President-Finance, Chief Financial Officer and Treasurer
(Principal Financial Officer))
)
))
/s/Lori A. Wright
(Lori A. Wright)Controller
(Principal Accounting Officer))
))
David L. Bodde*
(David L. Bodde)Director
)
))
Mark A. Ernst*
(Mark A. Ernst)Director
)
))
William K. Hall*
(William K. Hall)Director
)
))
Randall C. Ferguson, Jr*
(Randall C. Ferguson, Jr.)Director
) August 26, 2003
))
Luis A. Jimenez*
(Luis A. Jimenez)Director
)
))
James A. Mitchell*
(James A. Mitchell)Director
)
))
William C. Nelson*
(William C. Nelson)Director
)
))
Linda Hood Talbott*
(Linda Hood Talbott)Director
)
))
Robert H. West*
(Robert H. West)Director
)
)
*By:
/s/Bernard J. Beaudoin
(Bernard J. Beaudoin)
Attorney-in-factPursuant to the requirements of the Securities Act of 1933, KCPL Financing II certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Kansas City,
andState of Missouri,as of this 17thon the 26th day ofDecember, 1996. KANSAS CITY POWER & LIGHT COMPANY By /s/ Drue Jennings ------------------------------ (Drue Jennings) Chairman of the Board and Chief Executive Officer II-10Each person whose signature appears below hereby constitutes and appoints Drue Jennings and _______________, or either of them, acting alone, as his true and lawful attorney-in-fact, with full power and authority to execute in the name, place and stead of each such person in any and all capacities and to file, an amendment or amendments to the Registration Statement (and all exhibits thereto) and any documents relating thereto, which amendments may make such changes in the Registration Statement as said officer or officers so acting deem(s) advisable.August, 2003.
KCPL FINANCING II
/s/Andrea F. Bielsker
By:
Andrea F. Bielsker
as Trustee
Pursuant to the requirements of the Securities Act of 1933, KCPL Financing III certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this
Registration Statement has beenregistration statement to be signedbelowon its behalf by thefollowing personsundersigned, thereunto duly authorized, in thecapacities andCity of Kansas City, State of Missouri, on thedates indicated. Signature Title Date --------- ----- ---- Chairman26th day ofthe Board and ) /s/Drue Jennings Chief Executive ) - ----------------------------- Officer (Principal Executive ) (Drue Jennings) Officer) ) ) /s/B. J. Beaudoin Executive Vice President ) - ----------------------------- and Chief Financial Officer ) (B. J. Beaudoin) (Principal Financial Officer) ) ) /s/Neil Roadman Controller (Principal ) - ----------------------------- Accounting Officer) ) (Neil Roadman ) ) *David L. Bodde Director ) - ----------------------------- ) (David L. Bodde) ) ) *William H. Clark Director ) - ----------------------------- ) (William H. Clark) ) ) *Robert J. Dineen Director ) December 17, 1996 - ----------------------------- ) (Robert J. Dineen) ) ) *Arthur J. Doyle Director ) - ----------------------------- ) (Arthur J. Doyle) ) ) *W. Thomas Grant II Director ) - ----------------------------- ) (W. Thomas Grant II) ) ) *George E. Nettels, Jr. Director ) - ----------------------------- ) (George E. Nettels, Jr.) ) ) *Linda Hood Talbott Director ) - ----------------------------- ) (Linda Hood Talbott) ) ) *Robert H. West Director ) - ----------------------------- ) (Robert H. West) ) II-11*By /s/Drue Jennings --------------------- (Drue Jennings) Attorney-in-fact KCPL FINANCING I (Registrant) By: /s/ Andrea F. Bielsker ----------------------------- Trustee KCPL FINANCING II (Registrant) By: /s/ Andrea F. Bielsker ----------------------------- Trustee KCPL FINANCING III (Registrant) By: /s/ Andrea F. Bielsker ----------------------------- Trustee II-12
KCPL FINANCING III | ||
/s/Andrea F. Bielsker | ||
By: | Andrea F. Bielsker as Trustee | |
INDEX TO EXHIBITS
Exhibit Number | Description of Exhibit | |
1.a | ** | Form of Underwriting Agreement for the senior debt securities. |
1.b | ** | Form of Underwriting Agreement for the subordinated debt securities. |
1.c | ** | Form of Underwriting Agreement for the Preferred Securities. |
4.a | Certificate of Trust for KCPL Financing II (the Certificate of Trust for each other trust is identical except for the names and will be filed upon request). | |
4.b | Declaration of Trust of KCPL Financing II and KCPL Financing III. | |
4.c | Form of Amended and Restated Declaration of Trust. | |
4.d | Form of Senior Indenture between Kansas City Power & Light Company and The Bank of New York, as Trustee. | |
4.e | Form of Subordinated Indenture between Kansas City Power & Light Company and The Bank of New York, as Trustee. | |
4.f | Form of Preferred Security (included in 4.c). | |
4.g | Form of Senior Debt Security (included in 4.d). | |
4.h | Form of Subordinated Debt Security (included in 4.e). | |
4.i | Form of Preferred Securities Guarantee Agreement. | |
4.j | * | General Mortgage and Deed of Trust dated as of December 1, 1986, between Kansas City Power & Light Company and UMB Bank, n.a. (formerly United Missouri Bank of Kansas City, N.A.), Trustee (Exhibit 4-bb to Form 10-K for the year ended December 31, 1986). |
4.k | * | Fourth Supplemental Indenture dated as of February 15, 1992, to Indenture dated as of December 1, 1986 (Exhibit 4-y to Form 10-K for the year ended December 31, 1991). |
4.l | * | Fifth Supplemental Indenture dated as of September 15, 1992, to Indenture dated as of December 1, 1986 (Exhibit 4-a to quarterly report on Form 10-Q for the period ended September 30, 1992). |
4.m | * | Sixth Supplemental Indenture dated as of November 1, 1992, to Indenture dated as of December 1, 1986 (Exhibit 4-z to Registration Statement, Registration No. 33-54196). |
4.n | * | Seventh Supplemental Indenture dated as of October 1, 1993, to Indenture dated as of December 1, 1986 (Exhibit 4-a to quarterly report on Form 10-Q for the period ended September 30, 1993). |
4.o | * | Eighth Supplemental Indenture dated as of December 1, 1993, to Indenture dated as of December 1, 1986 (Exhibit 4 to Registration Statement, Registration No. 33-51799). |
4.p | * | Ninth Supplemental Indenture dated as of February 1, 1994, to Indenture dated as of December 1, 1986 (Exhibit 4-h to Form 10-K for year ended December 31, 1993). |
4.q | * | Indenture for Medium-Term Note Program dated as of February 15, 1992, between Kansas City Power & Light Company and The Bank of New York (Exhibit 4-bb to Registration Statement, Registration No. 33-45736). |
4.r | * | Indenture for Medium-Term Note Program dated as of November 15, 1992, between Kansas City Power & Light Company and The Bank of New York (Exhibit 4-aa to Registration Statement, Registration No. 33-54196). |
4.s | * | Amended and Restated Declaration of Trust of Kansas City Power & Light Company Financing I dated April 15, 1997 (Exhibit 4-a to Form 10-Q for the period ended March 31, 1997). |
4.t | * | Indenture dated as of April 1, 1997 between the Company and The First National Bank of Chicago, Trustee (Exhibit 4-b to Form 10-Q for the period ended March 31, 1997). |
4.u | * | First Supplemental Indenture dated as of April 1, 1997 to the Indenture dated as of April 1, 1997 between the Company and The First National Bank of Chicago, Trustee (Exhibit 4-c to Form 10-Q for the period ended March 31, 1997). |
4.v | * | Preferred Securities Guarantee Agreement dated April 15, 1997 (Exhibit 4-d to Form 10-Q for the period ended March 31, 1997). |
4.w | * | Indenture for $150 million aggregate principal amount of 6.50% senior debt securities due November 15, 2011 and $250 million aggregate principal amount of 7.125% senior debt securities due December 15, 2005 dated as of December 1, 2000, between Kansas City Power & Light Company and The Bank of New York (Exhibit 4-a to Report on Form 8-K dated December 18, 2000). |
4.x | * | Indenture for $225 million aggregate principal amount of 6.00% senior debt securities due 2007, Series B, dated March 1, 2002 between The Bank of New York and Kansas City Power & Light Company (Exhibit 4.1.b. to Form 10-Q for the period ended March 31, 2002). |
5.a | Opinion of Pepper Hamilton L.L.P. regarding legality of Preferred Securities. | |
5.b | Opinion and consent of Jeanie Sell Latz, Corporate Secretary of KCP&L regarding legality of Debt and Preferred Securities Guarantees. | |
12 | Schedule of computation of ratio of earnings to fixed charges. | |
23.a | Consent of Deloitte & Touche LLP. | |
23.b | Consent of PricewaterhouseCoopers LLP. | |
23.c | Consent of Deloitte & Touche LLP. | |
23.d | Consent of Pepper Hamilton L.L.P. (included as part of Exhibit 5.a). | |
23.e | Consent of Jeanie Sell Latz, Corporate Secretary (included as part of Exhibit 5.b). | |
24 | Powers of Attorney. | |
25.a | Form T-1 Statement of Eligibility of The Bank of New York, as Trustee under the Senior Indenture, under the Trust Indenture Act of 1939. | |
25.b | Form T-1 Statement of Eligibility of The Bank of New York, as Trustee under the Subordinated Indenture, under the Trust Indenture Act of 1939 | |
25.c | Form T-1 Statement of Eligibility of The Bank of New York as Property Trustee under the Amended and Restated Declaration of Trust of KCPL Financing II. | |
25.d | Form T-1 Statement of Eligibility of The Bank of New York as Guarantee Trustee under the Preferred Security Guarantee of Kansas City Power & Light Company for the benefit of the holders of Preferred Securities of KCPL Financing II. | |
25.e | Form T-1 Statement of Eligibility of The Bank of New York as Property Trustee under the Amended and Restated Declaration of Trust of KCPL Financing III. | |
25.f | Form T-1 Statement of Eligibility of The Bank of New York as Guarantee Trustee under the Preferred Security Guarantee of Kansas City Power & Light Company for the benefit of the holders of Preferred Securities of KCPL Financing III. |