SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 11-K (Mark One) /X/ ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended DECEMBER 31, 1999 or / / TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED) Commission File No. 1-10568 (LG&E Energy Corp.) A. Full Title of the Plan: WKE Corp. Bargaining Employees' Savings Plan B. Name of issuer of the securities help pursuant to the Plan and the address of its principal executive office: LG&E ENERGY CORP. 220 West Main Street P. O. Box 32030 Louisville, Kentucky 40232 WKE CORP. BARGAINING EMPLOYEES' SAVINGS PLAN FINANCIAL STATEMENTS AND SCHEDULE AS OF DECEMBER 31, 1999 AND 1998 TOGETHER WITH AUDITORS' REPORT WKE CORP. BARGAINING EMPLOYEES' SAVINGS PLAN Financial Statements and Schedule As of December 31, 1999 and 1998 - -------------------------------------------------------------------------------- INDEX TO FINANCIAL STATEMENTS AND SCHEDULE REFERENCE Report of Independent Public Accountants..................................................................Page 1 Statement of Net Assets Available for Benefits as of December 31, 1999 and 1998..........................Page 2 Statement of Changes in Net Assets Available for Benefits for the Year Ended December 31, 1999....................................................................................Page 2 Notes to Financial Statements and Schedule as of December 31, 1999 and 1998.........................................................................................Page 3 - 7 Schedule I - Item 4(i) - Schedule of Assets Held for Investment Purposes As of December 31,1999..................................................................................Page 8 REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS To the Trustees of the WKE Corp. Bargaining Employees' Savings Plan: We have audited the accompanying statement of net assets available for benefits of the WKE Corp. Bargaining Employees' Savings Plan (the Plan) as of December 31, 1999 and 1998, and the related statement of changes in net assets available for benefits for the year ended December 31, 1999. These financial statements are the responsibility of the Plan's administrator. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Plan as of December 31, 1999 and 1998, and the changes in its net assets available for benefits for the year ended December 31, 1999, in conformity with accounting principles generally accepted in the United States. Our audit was made for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedule of assets held for investment purposes as of December 31, 1999 is presented for purposes of additional analysis and are not a required part of the basic financial statements but is supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The supplemental schedule has been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole. /s/ Arthur Andersen LLP - -------------------------- Arthur Andersen LLP Louisville, Kentucky June 28, 2000 WKE CORP. BARGAINING EMPLOYEES' SAVINGS PLAN Statement of Net Assets Available for Benefits As of December 31, 1999 and 1998 - -------------------------------------------------------------------------------- PARTICIPANT DIRECTED ------------------------------------ 1999 1998 ---------------- --------------- ASSETS Investments - at Fair Value (Notes 1, 2 and 4) $ 2,185,313 $ 617,897 Contributions receivable Employee 36,555 - Employer 12,222 - ---------------- --------------- Net assets available for benefits $ 2,234,090 $ 617,897 ================ =============== Statement of Changes in Net Assets Available for Benefits For the Year Ended December 31, 1999 - -------------------------------------------------------------------------------- PARTICIPANT DIRECTED ----------------- Net assets available for benefits, beginning of year: $ 617,897 ----------------- Additions: Employee contributions 1,057,956 Employer contributions 356,269 Interest and dividend income 167,838 Realized gain 4,267 Unrealized gain 49,643 ----------------- Total additions 1,635,973 ----------------- Deductions: Distributions/Withdrawals 19,780 ----------------- Net assets available for benefits, end of year: $ 2,234,090 ================= The accompanying notes to financial statements and schedule are an integral part of these statements. 2 WKE CORP. BARGAINING EMPLOYEES' SAVINGS PLAN Notes To Financial Statements and Schedule December 31, 1999 and 1998 - -------------------------------------------------------------------------------- (1) DESCRIPTION OF PLAN- The following description of the WKE Corp. Bargaining Employees' Savings Plan ("Plan") provides only general information. Participants should refer to the Plan document for a more complete description of the Plan's provisions. (a) GENERAL--The Plan was established on July 17, 1998. All bargaining unit employees of WKE Corp., Western Kentucky Energy Corp. and WKE Station Two Inc. (collectively, the "Company"), are eligible to participate in the Plan on the first of the month on or following twelve months of continuous employment. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 (ERISA). (b) CONTRIBUTIONS AND VESTING--Employees choosing to participate may elect to contribute an amount equal to an integral percentage from one percent (1%) to fifteen percent (15%) of base pay on a pre-tax or after-tax basis. The Company in turn will match fifty percent (50%) of the employees' contribution on the first six percent (6%) of eligible compensation. Employee contributions, plus actual earnings thereon, are vested immediately. Company contributions are 20% vested for each year of service with 100% vesting after five years. Forfeited balances of terminated participants are used to reduce future company contributions. (c) PARTICIPANT ACCOUNTS--Each participant's account is credited with the participant's contribution and allocations of the Company's contribution and, Plan earnings. Allocations are based on participant earnings or account balances, as defined. The benefit to which a participant is entitled is the benefit that can be provided from the participant's vested account. (d) INVESTMENT OPTIONS-- Participants may choose from the following ten mutual fund investment options or a company stock fund in 1% increments: - FIDELITY RETIREMENT GOVERNMENT MONEY MARKET PORTFOLIO Invests in obligation issued or guaranteed as to timely payment of principal and interest by the U.S. government, it agencies or instrumentalities. - FIDELITY PURITAN FUND Diversifies investments among a variety of companies, industries and types of securities. - SPARTAN U.S. EQUITY INDEX PORTFOLIO Attempts to duplicate the composition and total return of the Standard & Poor's 500 Index. - FIDELITY MAGELLAN FUND Invests in common stocks, and securities convertible to common stock, issued by companies operating in the U.S. and/or abroad as well as foreign companies. Investments are made in large corporations as well as smaller, less well-known companies. The Fund also diversifies investments among a variety of industries and sectors within the market. 3 - FIDELITY INTERMEDIATE BOND FUND Invests in all types of medium to high quality U.S. and foreign bonds, including corporate or U.S. government issues. - FIDELITY EQUITY INCOME II FUND Invests in stocks of domestic and foreign companies with potential for capital growth. - FIDELITY CONTRAFUND Invests in common stocks believed to be undervalued and in companies that are currently out of public favor but show potential for capital growth. - WARBURG PINCUS EMERGING GROWTH FUND Invests primarily in common stocks of rapidly growing small and medium sized companies which generally will benefit from new products or services, technology, or changes in management. The stocks are diversified among a variety of industries. - TEMPLETON FOREIGN FUND A Invests primarily in common stocks and it can purchase securities in any foreign country, developed or developing. - JANUS WORLDWIDE FUND, EFFECTIVE AUGUST 1, 1998 Invests primarily in common stocks of foreign and domestic companies. The fund normally invests in issuers from at least five different countries, including the US; however the fund may at times invest in fewer than five countries or even a single country. - LG&E ENERGY CORP. COMMON STOCK FUND Invests primarily in the common stock of LG&E Energy Corp., as well as short-term investments. (e) PARTICIPANTS LOANS--Participants may borrow from their fund accounts a minimum of $1,000 up to a maximum equal to the lesser of $50,000 or 50 percent of their account balance. Loan transactions are treated as a transfer to (from) the investment fund from (to) the Participant Loans fund. Loans to purchase a home can not exceed 15 years and all other loans are for a period not exceeding five years. A participant can have up to two loans. The loans are secured by the balance in the participant's account and bear interest at an agreed upon rate commensurate with local prevailing rates, interest rate currently 7.75 percent. Principal and interest is paid ratably through monthly payroll deductions. (f) PAYMENT OF BENEFITS--On termination of service due to death, disability, retirement or other reasons, a participant may elect to receive a lump-sum amount equal to the value of the participant's vested interest in his or her account, periodic installments over a fifteen-year period, or any combination of lump-sum and periodic installments. 4 (2) SUMMARY OF ACCOUNTING POLICIES- (a) BASIS OF ACCOUNTING--The financial statements of the Plan are prepared under the accrual method of accounting in accordance with generally accepted accounting principles. (b) USE OF ESTIMATES--The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of changes in net assets during the reporting period. Actual results could differ from those estimates. (c) INVESTMENT VALUATION AND INCOME RECOGNITION--The Plan's investments are stated at fair value. Shares of registered investment companies are valued at quoted market prices in an active market which represent the net asset value of shares held by the Plan at year end. Participant loans receivable are valued at cost which approximates fair value. Purchases and sales of securities are recorded on a trade-date basis. Interest income is recorded on the accrual basis. (d) PAYMENT OF BENEFITS--Benefits are recorded when paid. 5 (3) INVESTMENTS Investments representing 5% or more of the plan's net assets are as follows: DECEMBER 31, 1999 DECEMBER 31, 1998 ------------------ ------------------ Fidelity Magellan Fund $ 633,174 $ 166,951 Fidelity Equity Income II Fund 458,029 153,126 Fidelity Contrafund 305,872 79,486 Spartan U.S. Equity Index Fund 251,721 71,915 Warburg Pincus Emerging Growth Fund 161,211 41,969 (4) ACCOUNTING PRONOUNCEMENT- The Accounting Standards Executive Committee issued Statement of Position 99-3, "Accounting for and Reporting of Certain Defined Contribution Plan Investments and Other Disclosure Matters" (SOP 99-3), which eliminates the requirement for a defined contribution plan to disclose participant-directed investment programs. As required by SOP 99-3, the Plan adopted SOP 99-3 for the 1999 financial statements and reclassified certain amounts in the 1998 financial statements to eliminate the participant-directed fund investment program disclosures. (5) RELATED PARTY TRANSACTIONS- Certain Plan investments are shares of mutual funds managed by subsidiaries of Fidelity Management Research Corp. Fidelity Management Trust Company (a subsidiary of Fidelity Management Research Corp.) is the trustee as defined by the Plan, and therefore, these transactions qualify as party-in-interest. (6) PLAN TERMINATION- Although it has not expressed any intent to do so, the Company has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA. (7) ADMINISTRATIVE COSTS- Certain expenses incurred for the administration of the Plan are paid by the Company. 6 (8) RECONCILIATION TO FORM 5500- Interest and dividends shown on the accompanying financial statements include interest and dividends from registered investment companies of $167,838 for the year ended December 1999. This amount, together with the net realized and unrealized gains of $53,910 for the year ended December 31, 1999, is shown as net investment gain from registered investment companies on the Plan's 5500. (9) TAX STATUS- The Internal Revenue Service has determined and informed the Company by a letter dated March 31, 2000, that the Plan and the related trust are in compliance with applicable sections of the Internal Revenue Code (IRC). The Plan has been amended since receiving the determination letter. However, management believes that the Plan is designed and is currently being operated in compliance with the applicable requirements of the IRC. (10) SUBSEQUENT EVENT- On February 28, 2000, LG&E Energy Corp. announced that its Board of Directors accepted an offer to be acquired by PowerGen for cash of approximately $3.2 billion or $24.85 per share and the assumption of $2.2 billion of LG&E Energy Corp.'s debt. WKE Corp., the Plan sponsor is a subsidiary of LG&E Energy Corp. This acquisition is subject to SEC and other regulatory approvals. The currently anticipated effect of this transaction on the plan would be to liquidate the LG&E Energy Corp. common stock fund and apply the proceeds to the other mutual fund options, based on participants election. Although various options remain under consideration by the Plan and the ultimate outcome or decision with respect to this transaction is not known at this time. 7 WKE CORP. BARGAINING EMPLOYEES' SAVINGS PLAN SCHEDULE I PLAN SPONSOR: WKE CORP. EIN 611329628 PLAN NO. 002 Item 4(i) - Schedule of Assets Held for Investment Purposes As of December 31, 1999 - -------------------------------------------------------------------------------- IDENTITY OF ISSUE DESCRIPTION OF ASSET COST FAIR VALUE - ------------------------------ -------------------------------------------------- ---------------- ---------------- *Fidelity Fidelity Magellan Fund $ 562,013 $ 633,174 *Fidelity Fidelity Equity Income II Fund 496,568 458,029 *Fidelity Fidelity Contrafund 298,781 305,872 *Fidelity Spartan U.S. Equity Index Fund 216,997 251,721 Warburg Pincus Warburg Pincus Emerging Growth Fund 127,641 161,211 *LG&E Energy Corp. LG&E Energy Corp. Common Stock Fund 98,228 74,006 *Fidelity Fidelity Puritan Fund 79,358 77,182 *Fidelity Fidelity Ret. Gov't MM Portfolio 89,842 89,842 Templeton Templeton Foreign Fund A 57,418 68,790 Janus Janus Worldwide 12,418 13,246 *Fidelity Fidelity Intermediate Bond Fund 41,216 40,005 *Participants Participant Loans ** 12,235 12,235 ---------------- ---------------- Total $ 2,092,715 $ 2,185,313 ================ ================ * Party-in-interest ** Rate of interest = 7.75% The accompanying notes to financial statements and schedule are an integral part of these statements. 8 SIGNATURE Pursuant to the requirements of the Securities and Exchange Act of 1934, all members of the Committee having responsibility for the administration of WKE Corp. Bargaining Employees Saving Plan. WKE Corp. Bargaining Employees Savings Plan - ------------------------------------------- Name of Plan June 28, 2000 /s/ Victor A. Staffieri ----------------------- Victor A. Staffieri /s/ Charles A. Markel --------------------- Charles A. Markel /s/ S. Bradford Rives --------------------- S. Bradford Rives /s/ Frederick J. Newton III --------------------------- Frederick J. Newton III /s/ R. Foster Duncan -------------------- R. Foster Duncan /s/ Robert M. Hewett -------------------- Robert M. Hewett