SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 15, 2005
THE EMPIRE DISTRICT ELECTRIC COMPANY
(Exact name of registrant as specified in charter)
Kansas |
(State or other jurisdiction of incorporation) |
| | |
1-3368 | | 44-0236370 |
(Commission File Number) | | (IRS Employer Identification Number) |
| | |
602 Joplin Street, Joplin, Missouri | | 64801 |
(Address of principal executive offices) | | (Zip Code) |
| | |
Registrant’s telephone number, including area code: (417) 625-5100 |
Not applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
SECTION 1 – REGISTRANT’S BUSINESS AND OPERATIONS
Item 1.01. Entry Into a Material Definitive Agreement.
On July 15, 2005, The Empire District Electric Company (the “Company”) entered into a $150.0 million five year unsecured credit agreement (the “Credit Agreement”) with UMB Bank, N.A., as administrative agent, Bank of America, N.A., as syndication agent, and the other lenders party thereto. The Credit Agreement replaces the Company’s pre-existing $100.0 million unsecured credit agreement, which was terminated upon entering into the Credit Agreement. The Credit Agreement provides for $150.0 million of revolving loans to be available to the Company for working capital, general corporate purposes and to back up the Company’s use of commercial paper.
Interest on borrowings under the Credit Agreement accrues at a rate equal to, at the Company’s option, (i) the bank’s prime commercial rate plus a margin or (ii) LIBOR plus a margin, in each case based on the Company’s current credit ratings. A Facility Fee is payable quarterly on the full amount of the commitments under the Credit Agreement and a Utilization Fee is payable on the full amount of the commitments under the Credit Agreement for any period in which the Company has drawn more than 33% of the commitments under the Credit Agreement, in each case based on the Company’s current credit ratings.
The Credit Agreement contains certain covenants, including requirements that (i) the Company’s total indebtedness (which does not include the Company’s trust preferred securities or the related note payable to the securitization trust) to be less than 62.5% of the Company’s total capitalization at the end of each fiscal quarter and (ii) the Company’s EBITDA (defined as net income plus interest, taxes, depreciation, amortization and certain other non-cash charges) to be at least two times its interest charges (which includes interest on the note payable to the securitization trust) for the trailing four fiscal quarters at the end of each fiscal quarter. Failure to maintain these ratios or comply with the other covenants in the Credit Agreements would result in an event of default under the Credit Agreement and would prohibit the Company from borrowing funds thereunder. The Company was in compliance with these covenants as of the Closing Date. The Credit Agreement is also subject to cross-default if the Company defaults on in excess of $10,000,000 in the aggregate of its other indebtedness.
At closing, no amounts were drawn under the Credit Agreement.
SECTION 2 – FINANCIAL INFORMATION
Item 2.03. Creation of a Direct Financial Obligation or an Obligation Under an Off-Balance Sheet Arrangement of a Registrant.
The information set forth in Item 1.01 is incorporated herein by reference.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| THE EMPIRE DISTRICT ELECTRIC COMPANY |
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| By | /s/ | Gregory A. Knapp | |
| | Name: | Gregory A. Knapp |
| | Title: | Vice President – Finance and Chief
Financial Officer |
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Dated: July 18, 2005 | |
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