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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT
PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
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For the fiscal year ended December 31, 2001
Commission File Number 333-52664
BLACK HILLS CORPORATION
EMPLOYEE STOCK PURCHASE PLAN
BLACK HILLS CORPORATION
625 NINTH STREET
PO BOX 1400
RAPID CITY, SOUTH DAKOTA 57709
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BLACK HILLS CORPORATION
EMPLOYEE STOCK PURCHASE PLAN
FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2001 AND 2000
TOGETHER WITH REPORT OF
INDEPENDENT PUBLIC ACCOUNTANTS
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Board of Directors and the Employee Stock Purchase Plan
Committee of the Black Hills Corporation
Employee Stock Purchase Plan:
We have audited the accompanying statements of financial position of the Black
Hills Corporation Employee Stock Purchase Plan (the Plan) as of December 31,
2001 and 2000, and the related statements of changes in participants' equity for
the three years ended December 31, 2001. These financial statements are the
responsibility of the Employee Stock Purchase Plan Committee and Black Hills
Corporation's management. 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 financial position of the Plan as of December 31,
2001 and 2000, and changes in participants' equity for each of the three years
ended December 31, 2001, in conformity with accounting principles generally
accepted in the United States.
Arthur Andersen LLP
Minneapolis, Minnesota,
January 30, 2002
Black Hills Corporation
Employee Stock Purchase Plan
Statements of Financial Position
December 31
2001 2000
---- ----
Assets
Receivable from Black Hills Corporation $68,959 $204,223
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Participants' Equity
Participants' Equity $68,959 $204,223
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The accompanying note is an integral part of these statements.
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Black Hills Corporation
Employee Stock Purchase Plan
Statements of Changes in Participants' Equity
For the years ended December 31
2001 2000 1999
---- ---- ----
Participants' Equity, Beginning of Year $ 204,223 $ 77,457 $ 95,392
Increases (Decreases) During the Year:
Employee Contributions Received 824,578 580,008 396,659
Dividend Income 22,357 9,850 9,184
Distributions to Participants (982,199) (463,092) (423,778)
---------- -------- --------
Participants' Equity, End of Year $ 68,959 $204,223 $ 77,457
========== ======== =========
The accompanying note is an integral part of these statements.
2
Black Hills Corporation
Employee Stock Purchase Plan
Note to Financial Statements
December 31, 2001 and 2000
(1) Plan Description
General - The Black Hills Corporation Employee Stock Purchase Plan (the
Plan) was adopted by the Board of Directors of Black Hills Corporation
(the Company) on January 29, 1987, and approved by the Company's
stockholders on May 20, 1987. Three hundred thousand shares of the
Company's Common Stock have been approved for issuance under the Plan.
As of December 31, 2001, 177,808 shares were available for issuance
under the Plan.
The Board of Directors of the Company determine the offering date on
which shares of the Company's common stock may be offered, at such
times, for such number of shares and for such periods (up to 90 days)
as the Board of Directors may prescribe. Subscriptions can only be
accepted during the prescribed period. The subscription price per share
is equal to 90 percent of the fair market value of the Common Stock on
the offering date and is set forth in the Subscription Agreement.
Administration - The Plan is administered by the Board of Directors of
the Company who have the power and authority to promulgate such rules
and regulations as they deem appropriate for the administration of the
Plan, to interpret Plan provisions and to take all actions in
connection therewith as they deem necessary or advisable. Other aspects
of administration are handled by the Employee Stock Purchase Plan
Committee, the members of which are designated from time to time by the
Chief Executive Officer of the Company. The Company pays all
administrative costs of the Plan.
Eligibility and Vesting - Each full-time employee of the Company or its
subsidiaries, including officers, but excluding directors who are not
employees of the Company or subsidiaries, is eligible to participate in
the Plan. A full-time employee is one who is in the active service of
the Company or its subsidiaries on the date an offering is made. Any
employee whose customary employment is twenty hours or less per week or
whose customary employment is for not more than five months per
calendar year is not eligible to participate.
No employee is allowed to participate in the Plan if such employee,
immediately after the offering is granted, owns stock comprising 5
percent or more of the total combined voting power or value of all
classes of stock of the Company.
Employees are immediately vested.
Contributions - The plan is solely funded by participant contributions.
An eligible employee may subscribe for not less than 20 nor more than
400 shares of Common Stock
3
in connection with each offering. A subscription must be accompanied by
an initial payment of $1.00 for each share of stock for which a
subscription is made. The remaining balance will be paid through equal
payroll deductions during the 12-month period following the
subscription date.
Contributions are collected from participants through payroll
deductions and amounts are not segregated by the Company. Therefore,
contributions are recorded as a receivable from Black Hills Corporation
on the Statement of Financial Position.
Investment of Funds; Issuance of Shares - Amounts paid by participants
on the Plan subscriptions through payroll deductions are applied solely
to purchase shares of Common Stock allotted to them, pursuant to the
Plan.
Dividends - Dividends on subscribed shares are applied toward the
purchase of additional shares of common stock of the Company through
the Dividend Reinvestment and Stock Purchase Plan at the offering
price.
Withdrawal From the Plan or Cancellation of Subscription - An employee
participating in the Plan has the right, any time prior to payment in
full, to cancel a subscription for unpaid shares by giving the
committee written notice to that effect. Upon payment in full of the
subscription or upon withdrawal from the Plan or termination of
employment, the participant's account will be cleared by one of the
following methods pursuant to the participant's request; (a) shares
transferred to employee's "of record" account; (b) certificate issued
for whole shares and a check for fractional shares; or (c) shares sold
on the open market.
Termination of employment for any reason including retirement or death,
accompanied by failure of the terminated employee or the legal
representative of the descendent to pay the entire balance due for the
purchase of the shares for which a subscription has been accepted will
result in cancellation. Such election to continue payment shall be made
within ten days of the time of termination of employment, except for
death, which shall be within two months following death.
Reclassification
Certain 2000 amounts have been reclassified to conform to the 2001
classification. These reclassifications had no effect on participants'
equity previously reported.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Employee Stock Purchase Plan Committee has duly caused this Annual Report to be
signed on its behalf by the undersigned hereunto duly authorized.
Black Hills Corporation
Employee Stock Purchase Plan
Date: March 27, 2002 By /S/ ROXANN R. BASHAM
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Roxann R. Basham
Exhibit 23
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation of our
report dated January 30, 2002, included in this Form 11-K, into the Company's
previously filed Registration Statements, File Numbers 33-71130, 33-63059,
333-17451, 333-61969, 333-82787, 333-30272 and 333-63264.
Arthur Andersen LLP
Minneapolis, Minnesota,
March 22, 2002
Exhibit 99.1
Black Hills Corporation
625 Ninth Street
Rapid City, SD 57701
LETTER TO COMMISSION PURSUANT TO TEMPORARY NOTE 3T
March 27, 2002
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Ladies and Gentlemen:
Pursuant to Temporary Note 3T to Article 3 of Regulation S-X, Black
Hills Corporation has obtained a letter of representation from Arthur Andersen
LLP stating that the December 31, 2001 audit was subject to their quality
control system for the U.S. accounting and auditing practice to provide
reasonable assurance that the engagement was conducted in compliance with
professional standards, that there was appropriate continuity of Arthur Andersen
LLP personnel working on the audit and availability of national office
consultation to conduct the relevant portions of the audit. Availability of
personnel at foreign affiliates of Arthur Andersen is not relevant to this
audit.
Very truly yours,
Black Hills Corporation
/s/ Mark T. Thies
Mark T. Thies
Senior Vice President and
Chief Financial Officer