EXHIBIT 99.1
KU ENERGY CORPORATION
Xxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
May 20, 1997
Illinois Stock Transfer Company
000 Xxxx Xxxxxxx Xxxxxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: President
Re: Amendment No. 1 to Rights Agreement
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Ladies and Gentlemen:
Pursuant to Section 26 of the Rights Agreement, dated as of January
27, 1992, by and between KU Energy Corporation (the "Company") and Illinois
Stock Transfer Company (the "Rights Agreement"), the Company, by resolution
adopted by its Board of Directors, hereby amends the Rights Agreement as follows
(with additions shown in bold type):
1. Section 1(a) of the Rights Agreement is hereby amended to read in
its entirety as follows:
"Acquiring Person" shall mean any Person (other than the Company
or any Subsidiary of the Company or any employee benefit or stock
ownership plan of the Company or of any Subsidiary of the Company or
any entity holding Common Shares for or pursuant to the terms of any
such plan) who or which, together with all Affiliates and Associates
of such Person, shall be the Beneficial Owner of 10% or more of the
Common Shares then outstanding; provided, however, that a Person shall
not be deemed to have become an Acquiring Person solely as a result of
a reduction in the number of Common Shares outstanding unless and
until (i) such time as such Person or any Affiliate or Associate of
such Person shall thereafter become the Beneficial Owner of any
additional Common Shares, other than as a result of a stock dividend,
stock split or similar transaction effected by the Company in which
all holders of Common Shares are treated equally, or (ii) any other
person who is the Beneficial Owner of any Common Shares shall
thereafter become an Affiliate or Associate of such Person; and
provided, further, that neither LG&E Energy nor its Affiliates and
Associates
Illinois Stock Transfer Company
May 20, 1997
Page 2
shall become an Acquiring Person solely as a result of LG&E Energy or
its Affiliates or Associates becoming the Beneficial Owner of any
Common Shares by reason of (i) the approval, execution or delivery of
the Merger Agreement or the Company Stock Option Agreement or (ii) the
consummation of any transaction contemplated by the Merger Agreement,
the Company Stock Option Agreement or the LG&E Energy Stock Option
Agreement. The immediately preceding proviso shall not apply to LG&E
Energy or any of its Affiliates or Associates if LG&E Energy or its
Affiliates or Associates becomes the Beneficial Owner of Common Shares
other than (w) Common Shares beneficially owned by LG&E Energy or its
Affiliates or Associates on May 20, 1997, (x) Common Shares
beneficially owned by LG&E Energy or its Affiliates or Associates by
reason of the approval, execution or delivery of the Merger Agreement
or the Company Stock Option Agreement or by reason of the consummation
of any transaction contemplated by the Merger Agreement, the Company
Stock Option Agreement or the LG&E Energy Stock Option Agreement, (y)
Common Shares of which LG&E Energy becomes the Beneficial Owner
inadvertently after May 20, 1997, provided that the number of such
Common Shares does not exceed 1/2 of 1% of the Common Shares
outstanding on May 20, 1997 and that LG&E Energy divests such Common
Shares as soon as practicable after it becomes aware that it has
become the Beneficial Owner of such Common Shares, or (z) Common
Shares of which any Affiliate or Associate of LG&E Energy becomes the
Beneficial Owner, provided that the number of such Common Shares does
not exceed 1/2 of 1% of the Common Shares outstanding on May 20,
1997."
2. Section 1(bb) of the Rights Agreement is hereby amended by adding
the following new subsections immediately thereafter:
"(cc) "Company Stock Option Agreement" means that certain Stock
Option Agreement, dated as of May 20, 1997, by and between the Company
and LG&E Energy, by which the Company will grant to LG&E Energy an
option to purchase up to 19.9% of the Common Shares, subject to and
upon the terms specified therein, as the same may be amended from time
to time.
(dd) "LG&E Energy" means LG&E Energy Corp., a Kentucky
corporation.
Illinois Stock Transfer Company
May 20, 1997
Page 3
(ee) "LG&E Energy Stock Option Agreement" means that certain
Stock Option Agreement, dated as of May 20, 1997, by and between the
Company and LG&E Energy, by which LG&E Energy will grant to the
Company an option to purchase up to 19.9% of LG&E Energy's common
stock, subject to and upon the terms specified therein, as the same
may be amended from time to time.
(ff) "Merger Agreement" means that certain Agreement and Plan of
Merger, dated as of May 20, 1997, by and between the Company and LG&E
Energy, as the same may be amended from time to time."
3. Section 11(a)(ii)(C) of the Rights Agreement is hereby amended by
adding the following at the end of that subsection before the words "then, and
in each such case,":
"; and provided, further, that if neither LG&E Energy nor any of its
Affiliates or Associates have become an Acquiring Person, then LG&E
Energy or its Affiliates and Associates shall not be deemed to have
become the Beneficial Owner of any Common Shares for purposes of this
Section 11(a)(ii)(C),"
4. Capitalized terms used without other definition in this Amendment
No. 1 to Rights Agreement shall be used as defined in the Rights Agreement.
5. This Amendment No. 1 to Rights Agreement shall be deemed to be a
contract made under the internal substantive laws of the Commonwealth of
Kentucky and for all purposes shall be governed by and construed in accordance
with the internal substantive laws of the Commonwealth of Kentucky applicable to
contracts to be made and performed entirely within the Commonwealth of Kentucky.
6. This Amendment No. 1 to Rights Agreement may be executed in any
number of counterparts and each of such counterparts shall for all purposes be
deemed to be an original, and all such counterparts shall together constitute
but one and the same instrument.
7. This Amendment No. 1 to Rights Agreement shall be effective as
of, and immediately prior to, the execution and delivery of the Merger
Agreement, and all references to the Rights Agreement shall, from and after such
time, be deemed to be references to the Rights Agreement as amended hereby.
Illinois Stock Transfer Company
May 20, 1997
Page 4
8. Exhibit C to the Rights Agreement shall be amended in a manner
consistent with this Amendment No. 1 to Rights Agreement.
Very truly yours,
KU ENERGY CORPORATION
By: /s/ X.X. Xxxxxxxx
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Name: X.X. Xxxxxxxx
Title: Senior Vice President
Accepted and agreed to as of the
effective time specified above:
ILLINOIS STOCK TRANSFER COMPANY
By: /s/ Xxxxxx X. Xxxxxxx
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Name: Xxxxxx X. Xxxxxxx
Title: President and
Chief Executive Officer
