<PAGE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 1996
Commission file number: 1-7196
CASCADE NATURAL GAS CORPORATION
(Exact name of registrant as specified in its charter)
Washington 91-0599090
---------- ----------
State or other jurisdiction of (I.R.S. Employer
incorporation or organization Identification No.)
222 Fairview Avenue North, Seattle, WA 98109
-------------------------------------- -----
(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code (206) 624-3900
--------------
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No
----
Indicate the number of shares outstanding of each of the registrant's
classes of common stock, as of the latest practicable date.
Title Outstanding
----- -----------
Common Stock, Par Value $1 per Share 10,824,160 as of December 31, 1996
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
CASCADE NATURAL GAS CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF NET EARNINGS
(unaudited)
THREE MONTHS ENDED
----------------------------------
Dec 31, 1996 Dec 31, 1995
-------------- --------------
(thousands except per share data)
Operating revenues $64,971 $56,908
Less: Gas purchases 35,689 31,621
Revenue taxes 3,671 3,272
------- -------
Operating margin 25,611 22,015
------- -------
Cost of operations:
Operating expenses 8,985 7,717
Depreciation and amortization 3,223 3,028
Property and payroll taxes 1,028 935
------- -------
13,236 11,680
------- -------
Earnings from operations 12,375 10,335
Less interest and other
deductions - net 2,330 2,470
------- -------
Earnings before income taxes 10,045 7,865
Income taxes 3,597 2,666
------- -------
Earnings before preferred dividends 6,448 5,199
Preferred dividends 128 131
------- -------
Net earnings $ 6,320 $ 5,068
------- -------
------- -------
Common shares outstanding:
Weighted average 10,800 9,115
End of period 10,821 9,140
Net earnings per common share $ 0.59 $ 0.56
------- -------
------- -------
Cash dividends per share $ 0.24 $ 0.24
------- -------
------- -------
See Notes to Consolidated Condensed Financial Statements
2
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CASCADE NATURAL GAS CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
Dec 31, 1996 Sep 30, 1996
------------ ------------
(dollars in thousands)
(unaudited)
ASSETS
<S> <C> <C>
Utility Plant, net after accumulated
depreciation of $150,946 and $147,599 $ 247,295 $ 236,172
Construction work in progress 6,258 19,497
------------ ----------
253,553 255,669
------------ ----------
Other Assets:
Investments 668 667
Notes receivable, less current maturities 1,722 1,777
------------ ----------
2,390 2,444
------------ ----------
Current Assets:
Cash and cash equivalents 359 543
Accounts receivable, less allowance of $559
and $439 for doubtful accounts 31,668 11,646
Current maturities of notes receivable 631 631
Materials, supplies and inventories 5,897 6,063
Prepaid expenses and other assets 5,768 5,723
------------ ----------
44,323 24,606
------------ ----------
Deferred Charges 13,237 13,662
------------ ----------
$ 313,503 $ 296,381
------------ ----------
------------ ----------
COMMON SHAREHOLDERS' EQUITY,
PREFERRED STOCKS AND LIABILITIES
Common Shareholders' Equity:
Common stock, par value $1 per share, authorized 15,000,000
shares, issued and outstanding 10,824,160 and 10,786,585 shares $ 10,824 $ 10,787
Additional paid-in capital 93,972 93,438
Retained earnings 8,621 4,901
------------ ----------
113,417 109,126
------------ ----------
Redeemable Preferred Stocks, aggregate redemption
amount of $6,845 and $7,097 6,630 6,851
------------ ----------
Long-term Debt 101,550 101,850
------------ ----------
Current Liabilities:
Notes payable and commercial paper 6,194 --
Accounts payable 26,744 17,599
Property, payroll and excise taxes 5,063 3,113
Dividends and interest payable 4,710 6,570
Other current liabilities 6,830 2,931
------------ ----------
49,541 30,213
------------ ----------
Deferred Credits:
Gas cost changes 15,933 21,578
Other 26,432 26,763
------------ ----------
42,365 48,341
------------ ----------
Commitments and Contingencies -- --
------------ ----------
$ 313,503 $ 296,381
------------ ----------
------------ ----------
</TABLE>
See Notes to Consolidated Condensed Financial Statements
3
<PAGE>
CASCADE NATURAL GAS CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(unaudited)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
----------------------------
Dec 31, 1996 Dec 31, 1995
------------ ------------
(dollars in thousands)
<S> <C> <C>
OPERATING ACTIVITIES:
Earnings before preferred dividends $ 6,447 $ 5,199
Adjustments to reconcile earnings before preferred
dividends to net cash provided by operating activities:
Depreciation 3,223 3,134
Amortization of gas cost changes (602) 988
Decrease in deferred income taxes (608) (427)
Decrease in deferred investment tax credits (58) (85)
Cash provided (used) by changes in operating assets and liabilities:
Current assets and liabilities (6,797) (4,480)
Gas cost changes (5,043) 3,966
Other deferrals and non-current liabilities 724 (2,350)
------ -------
Net cash (used) provided by operating activities (2,714) 5,945
------ -------
INVESTING ACTIVITIES:
Capital expenditures (6,984) (15,229)
Customer contributions in aid of construction 5,975 176
New consumer loans (244) (449)
Receipts on consumer loans 266 785
Purchase of securities available for sale -- (2,293)
Proceeds from securities available for sale -- 4,375
------ -------
Net cash used by investing activities (987) (12,635)
------ -------
FINANCING ACTIVITIES:
Issuance of common stock 282 470
Redemption of preferred stock (216) (345)
Proceeds from issuance of long-term debt -- 2,100
Repayment of long-term debt (300) (5,000)
Changes in notes payable and commercial paper, net 6,194 13,000
Dividends paid (2,443) (2,056)
------ -------
Net cash provided by financing activities 3,517 8,169
------ -------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (184) 1,479
CASH AND CASH EQUIVALENTS:
Beginning of period 543 718
------ -------
End of period $ 359 $ 2,197
------ -------
------ -------
</TABLE>
See Notes to Consolidated Condensed Financial Statements
4
<PAGE>
CASCADE NATURAL GAS CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
THREE MONTHS ENDED DECEMBER 31, 1996
The preceding statements were taken from the books and records of the
Company and reflect all adjustments which are, in the opinion of management,
necessary for a fair statement of the results for the interim periods. All
adjustments were of a normal and recurring nature.
Because of the highly seasonal nature of the business, earnings or loss
for any portion of the year are disproportionate in relation to the full year.
Reference is directed to the Notes to Consolidated Financial Statements
contained in the 1996 transition report for the period January 1, 1996 to
September 30, 1996 on Form 10-K, and to comments included therein under
"Management's Discussion and Analysis of Financial Condition and Results of
Operations".
5
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ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATION.
The following is management's assessment of the Company's financial
condition and a discussion of the principal factors that affect consolidated
results of operations for the three month periods ended December 31, 1996 and
December 31, 1995.
RESULTS OF OPERATIONS
Net earnings for the first quarter of fiscal 1997 were $6,320,000, or
$0.59 per share, compared to net earnings of $5,068,000, or $0.56 per share,
for the quarter ended December 31, 1995. The 25% increase in net earnings is
primarily attributable to improved overall operating margin. Per share
earnings are affected by the 1,487,700 shares of new common stock issued in
August, 1996.
RESIDENTIAL AND COMMERCIAL OPERATING MARGIN
RESIDENTIAL AND COMMERCIAL OPERATING MARGIN
(dollars in thousands)
--------------------------------------------------------
--------------------------------------------------------
Three Months Ended
December 31
1996 1995
--------- ---------
Degree Days 2,191 1,940
Average Customers
Residential 132,894 124,957
Commercial 24,403 23,345
Therms per Customer
Residential 303 272
Commercial 1,529 1,395
Margin
Residential $ 10,511 $ 8,466
Commercial $ 7,200 $ 6,168
--------------------------------------------------------
--------------------------------------------------------
Operating margin from sales to residential and commercial customers
increased $3,077,000, or 21%, quarter to quarter. Factors contributing to
this increase were an increase of 8,995 (6.1%) in the average number of
residential and commercial customers, an 11.4% increase in gas consumption
per residential customer, and a 9.6% increase in gas consumption per
commercial customer. Consumption improvement is driven by the mix of
customers, particularly commercial, the number of appliances in use, and by
the weather. Estimated degree days were 13% greater than in the quarter ended
December 31, 1995, and 9% greater than normal. New tariff rates charged to
customers in the state of Washington, which became effective August 1, 1996,
contributed an estimated $1 million of additional margin. Mitigating the
improvements was $428,000 of gas cost increases representing 20% of the
excess of incurred gas cost over the base gas cost level established in the
Company's tariff for sales in the state of Oregon. The tariff requires the
Company to absorb 20% of such differences (positive or negative), while the
remaining 80% is deferred for pass back to customers.
6
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INDUSTRIAL AND OTHER MARGIN
Operating margin from industrial and other customers increased $520,000,
or 7%, quarter to quarter, primarily resulting from increased margins from
cogeneration customers, including service to a new customer that began
commercial operation in the second quarter of 1996.
COST OF OPERATIONS
Cost of operations, which consists of operating expenses, depreciation
and amortization, and property and payroll taxes, increased $1,556,000 or 13%
over the quarter ended December 31, 1995. Operating expenses, which are
primarily labor and benefits expenses, contributed $1,268,000 of the
increase. Of this increase, $351,000 is attributable to increases in amounts
included therein for postretirement benefits other than pensions (PBOP). From
1993 through July 1996, a portion of PBOP expenses were deferred, in
accordance with a policy statement issued by the Washington Utilities and
Transportation Commission in 1992. Concurrent with the settlement of the
Washington rate case, effective August 1, 1996, ongoing PBOP expenses are no
longer deferred, and amortization of the previously deferred amounts is also
included in operating expenses, resulting in the $351,000 increase.
Additionally there were increased expenses resulting from higher wage rates,
overtime pay, and purchased services.
Increases in depreciation and amortization and in property and payroll
taxes are primarily attributable to increases in utility plant.
INTEREST AND OTHER DEDUCTIONS
Interest and other deductions for the quarter decreased $140,000, or
5.7% from the quarter ended December 31, 1995, due primarily to decreases in
the amount of outstanding debt during the quarter. Less debt was required
because of the common stock sold in a public offering in August 1996 which
added $20 million of common equity.
LIQUIDITY AND CAPITAL RESOURCES
The seasonal nature of the Company's business creates short-term cash
requirements to finance customer accounts receivable and construction
expenditures. To provide working capital for these requirements, the Company
has a five-year credit commitment for $40 million from three banks. The
committed lines also support a money market facility of a similar amount and
a regional commercial paper program. A subsidiary has a $5 million five-year
revolving credit facility used for non-regulated business, and at December 31,
1996, $1.55 million was outstanding. The Company also has $25 million of
uncommitted lines from three banks.
Longer term financing is provided by a Medium-Term Note program with
$100 million outstanding at December 31, 1996, and $50 million registered
under the Securities Act of 1933 and available for issuance. Because of the
availability of short-term credit and the ability to issue long-term debt and
additional equity, management believes it has adequate financial flexibility
to meet its anticipated cash needs.
Operating activities provided a negative cash flow of $2,714,000 for the
quarter, compared to a positive $5,943,000 for the quarter ended December 31,
1995, primarily due to higher gas costs incurred. The effect of these higher
gas costs, except for $428,000 discussed above under "Residential and
Commercial Operating Margin", has been deferred, and the Company will file
for recovery from customers through purchased gas rate adjustments over
future periods. Capital expenditures for the quarter were $6,984,000, which
was mostly offset by contributions in aid of construction of $5,975,000.
Capital
7
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expenditures for fiscal 1997 are budgeted at approximately $32 million. The
Company expects that fiscal 1997 capital expenditures will be financed 50% to
75% by debt financing. The broad range of capital needs coverage is due to
uncertainty of gas costs. If gas costs continue at high levels, there will
continue to be a negative effect on operating cash flow.
REGULATORY MATTERS
The Company has consistently earned in excess of its allowed rate of
return in Oregon in recent years, and continued earnings improvement in that
state would likely result in a mandated general rate reduction under the
current regulatory system. The staff of the Oregon Public Utility Commission
(OPUC) has agreed to collaborate with the Company in exploring alternative
incentive rate mechanisms which would allow the Company and its customers to
equitably share earnings improvements resulting from improved efficiency.
These discussions are not complete, and the outcome is uncertain.
Approximately 26% of the Company's pre-tax regulated operating income is
derived from Oregon operations.
FORWARD-LOOKING STATEMENTS
Statements contained in this report which are not historical in nature
are forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. Forward-looking statements are subject to
risks and uncertainties that may cause actual future results to differ
materially. Such risks and uncertainties with respect to the Company include,
among others, its ability to successfully implement internal performance
goals, competition from alternative forms of energy, performance issues with
key natural gas suppliers, the capital-intensive nature of the Company's
business, regulatory issues, including the need for adequate and timely rate
relief to recover increased capital and operating costs resulting from
customer growth and to sustain dividend levels, the weather, increasing
competition brought on by deregulation initiatives at the federal and state
levels, the potential loss of large volume industrial customers due to
"bypass" or the shift by such customers to special competitive contracts at
lower per unit margins, exposure to environmental cleanup requirements, and
economic conditions, particularly in the Company's service area.
8
<PAGE>
PART II. OTHER INFORMATION
ITEM 2. CHANGES IN SECURITIES.
Under the terms of its bank credit agreements, the Company is required
to maintain a minimum of $83,716,000 of net worth. Under the most restrictive
agreement, approximately $29,701,000 was available for the payment of
dividends as of December 31, 1996.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
The 1997 annual meeting of the Shareholders of the Corporation was held
on January 23, 1997. The following directors were elected at the meeting for
terms of office expiring in 1998 by the vote indicated below:
Abstentions and
For Withheld Broker Non-Votes
--------- -------- ----------------
Carl Burnham, Jr. 8,944,363 81,306 2,135
Melvin C. Clapp 8,937,905 84,264 5,093
Thomas E. Cronin 8,918,272 107,367 28,226
David A. Ederer 8,944,473 81,196 2,025
Howard L. Hubbard 8,940,725 81,444 2,273
W. Brian Matsuyama 8,941,745 84,024 4,858
Larry L. Pinnt 8,939,171 82,998 3,827
Brooks G. Ragen 8,940,510 81,659 2,488
Mary A. Williams 8,937,304 84,865 5,694
ITEM 5. OTHER INFORMATION.
Ratio of Earnings to Fixed Charges:
Twelve Months Ended
-------------------------------------------------------------------
12/31/96 9/30/96 12/31/95 12/31/94 12/31/93 12/31/92
-------- ------- -------- -------- -------- --------
2.39 2.17 2.16 2.07 2.86 1.97
For purposes of this calculation, earnings include income before income
taxes plus fixed charges. Fixed charges include interest expense and the
amortization of debt issuance expenses. Refer to Exhibit 12 for the calculation
of these ratios as well as the ratio of earnings to fixed charges including
preferred dividends.
9
<PAGE>
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
a. Exhibits:
No. Description
--- -----------
3.2 Restated Bylaws of the Registrant
12 Computation of Ratio of Earnings to Fixed Charges
27 Financial Data Schedule UT
b. Reports on Form 8-K:
No reports were filed on Form 8-K during the quarter.
10
<PAGE>
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, thereunto duly authorized.
CASCADE NATURAL GAS CORPORATION
(Registrant)
By:
-------------------------------------------------------------------
J. D. Wessling Vice President - Finance and Chief Financial Officer
Date: February 7, 1997
11
<PAGE>
EXHIBIT 3.2
Restated Bylaws
of
Cascade Natural Gas Corporation
ARTICLE I -- OFFICES
Sec. 1. The principal office shall be in the City of Seattle, County of
King, State of Washington.
Sec. 2. The corporation may also have offices at such other places as the
board of directors may from time to time appoint or the business of the
corporation may require.
ARTICLE II -- SEAL
Sec. 1. The corporation seal shall have inscribed thereon the name of the
corporation, the year of its organization and the words, "Corporate Seal,
Washington." Said seal may be used by causing it or a facsimile thereof to be
impressed or affixed or reproduced or otherwise.
ARTICLE III -- SHAREHOLDERS' MEETINGS
Sec. 1. Meetings of the shareholders may be held within or without the
State of Washington. The annual meeting of shareholders shall be held at a
place and time on a day designated by the board of directors not less than
sixty days nor more than one hundred eighty days after October 1 of each
year, when they shall elect by a plurality vote, by ballot, a board of
directors, and transact such other business as may properly be brought before
the meeting. In the election of directors, every shareholder of record shall
have the right to multiply the number of votes to which he or she may be
entitled by the number of directors to be elected, and he or she may cast all
such votes for one candidate or distribute them among any two or more
candidates.
Sec. 2. The holders of a majority of the stock issued and outstanding and
entitled to vote thereat, present in person, or represented by proxy, shall
be requisite to, and shall constitute, a quorum at all meetings of the
shareholders for the transaction of business, except as otherwise provided by
law, by the Articles of Incorporation or by these bylaws. If, however, such
majority shall not be present or represented at any meeting of the
shareholders, the shareholders entitled to vote thereat, present in person or
by proxy, shall have power to adjourn the meeting from time to time, without
notice other than announcement at the meeting, until the requisite amount of
voting stock shall be present, except that any meeting at which directors are
to be elected shall be adjourned only from day to day until such directors
have been elected. At such adjourned meeting at which the requisite amount of
voting stock shall be represented, any business may be transacted which might
have been transacted at the meeting as originally notified.
Sec. 3. The shareholders present at a duly organized meeting can continue
to do business until adjournment, notwithstanding the withdrawal of enough
shareholders to leave less than a quorum.
Sec. 4. At each meeting of the shareholders every shareholder having the
right to vote shall be entitled to vote in person, or by proxy appointed by
an instrument in writing subscribed by such shareholder and bearing a date
not more than eleven months prior to said meeting, unless said instrument
provides for a longer period, not exceeding three years (unless said proxy is
coupled with an interest). The revocation of a proxy shall not be effective
until notice thereof has been given to the secretary. Each shareholder shall
have one vote for each share of capital stock registered in his or her name
on the books of the corporation. The vote for directors, and, upon the demand
of any shareholder, the vote upon any question before the meeting, shall be
by ballot. All elections shall be had and all questions decided by a
plurality vote except where a greater vote is required by law.
Sec. 5. A complete list of the shareholders entitled to vote at the ensuing
election, arranged in alphabetical order, with the residence of each, and the
number of voting shares held by each, shall be prepared by the secretary and
filed in the registered office of the corporation, at least ten days before
every election, and shall at all times during the usual hours for business,
and during the whole time of said election, be open to the examination of any
shareholder.
Sec. 6. Special meetings of the shareholders, for any purpose or purposes,
unless otherwise prescribed by
12
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statute, may be called at any time by the chairman of the board, president,
secretary or board of directors. If more than eighteen months are allowed to
elapse without the annual shareholders' meeting being held, any shareholder
may call such meeting to be held at the registered office of the corporation.
At any time, upon written request of any director, or of any shareholder or
shareholders holding in the aggregate one-fifth of the voting power of all
shareholders, it shall be the duty of the secretary to call a special meeting
of shareholders to be held at the registered office at such time as the
secretary may fix, not less than ten nor more than thirty-five days after the
receipt of said request, and if the secretary shall neglect or refuse to
issue such call, the director or shareholder or shareholders making the
request may do so. Such request shall state the purpose or purposes of the
proposed meeting.
Sec. 7. (a) Written notice stating the place, day and hour of the meeting
and, in case of a special meeting, the purpose or purposes for which the
meeting is called, shall be delivered not less than ten (or in the case of an
amendment to the Articles of Incorporation, a plan of merger or share
exchange, a proposed sale, lease exchange, or other disposition of all or
substantially all of the assets of the corporation other than in the usual or
regular course of business, or the dissolution of the corporation, twenty)
nor more than seventy days before the date of the meeting, either personally
or by mail, by or at the direction of the chairman, the president, the
secretary, or the officer or persons calling the meeting, to each shareholder
of record entitled to vote at such meeting. If mailed, such notice shall be
deemed to be delivered when deposited in the United States mail addressed to
the shareholder at his or her address as it appears on the stock transfer
books of the corporation, with postage thereon prepaid.
(b) A shareholder may waive any notice required by law or these
bylaws before or after the date and time of the meeting that is the subject
of the notice, and such waiver shall be equivalent to giving such notice.
Waiver of notice of a meeting of shareholders shall be effective upon receipt
of a written waiver by the corporation.
Sec. 8. Nominations for the election of directors may be made by the board
of directors, the nominating committee of the board of directors, or by any
shareholder entitled to vote in the election of directors. However, any
shareholder entitled to vote in the election of directors may nominate one or
more persons for election as directors at a meeting only if written notice of
the shareholder's intent to make the nomination or nominations has been
given, either by personal delivery or by United States mail, postage prepaid,
to the secretary of the corporation not later than (i) with respect to an
election to be held at an annual meeting of shareholders, on the date
established for nominations in the proxy statement of the corporation, or if
no such date is established one hundred twenty days in advance of such
meeting, and (ii) with respect to an election to be held at a special meeting
of shareholders for the election of directors, the close of business on the
seventh day following the date of which notice of such meeting is first
mailed to the shareholders of the corporation. Each such notice shall set
forth: (a) the name and address of the shareholder who intends to make the
nomination and of the person or persons to be nominated; (b) a representation
that the shareholder is a holder of record of stock of the corporation
entitled to vote at such meeting and intends to appear in person or by proxy
at the meeting to nominate the person or persons specified in the notice; (c)
a description of all arrangements or understandings between the shareholder
and each nominee and any other person or persons (naming such person or
persons) pursuant to which the nomination or nominations are to be made by
the shareholders; (d) such other information regarding each nominee proposed
by such shareholder as would have been required to be included in a proxy
statement filed pursuant to the proxy rules of the Securities and Exchange
Commission had the nominee been nominated, or intended to be nominated, by
the board of directors or the nominating committee of the board of directors;
and (e) the written consent of each nominee to serve as a director of the
corporation if so elected. The chairman of the meeting may refuse to
acknowledge the nomination of any person not made in compliance with the
foregoing procedure.
Sec. 9. Tabulation of votes for election of directors shall be conducted by
an inspector or judge, who may or may not be a stockholder, appointed by the
presiding officer of the meeting. The inspector or judge shall certify to the
returns in writing. No person who is a candidate for the office of director
shall be an inspector
13
<PAGE>
or judge.
ARTICLE IV -- DIRECTORS
Sec. 1. The property and business of this corporation shall be managed by
its board of directors, nine in number, but the number of directors may be
decreased to any number not less than three at any annual meeting of the
shareholders, or at any special meeting of the shareholders called for that
purpose, or by a two-thirds vote of the then directors of the company at any
regular meeting of such directors, or at any special meeting of said
directors called for that purpose.
Sec. 2. The number of directors of said corporation may likewise be
increased in the same manner as they may be decreased, from three to not more
than eleven directors.
Sec. 3. The directors shall be elected at the annual meeting of the
shareholders, and each director shall be elected to serve until his or her
successor shall be elected and shall qualify.
Sec. 4. The entire board of directors or any individual director may, at
any special meeting of the shareholders called for that purpose in the manner
provided by Section 6 of Article III hereof, be removed from office by a vote
of shareholders holding a majority of the outstanding shares entitled to a
vote at an election of directors. In case the board or any one or more
directors be so removed, new directors may be elected at the same meeting. No
individual director shall be removed in case the votes of a sufficient number
of shares are cast against the resolution for his or her removal which, if
cumulatively voted at an election of the whole board, would be sufficient to
elect one or more directors.
Sec. 5. In addition to the powers and authorities by these bylaws expressly
conferred upon them, the board may exercise all such powers of the
corporation and do all such lawful acts and things as are not by statute or
by the Articles of Incorporation or by these bylaws directed or required to
be exercised or done by the shareholders.
Sec. 6. In addition to reimbursement for reasonable expenses incurred in
attending meetings or otherwise in connection with attention to the affairs
of the corporation and in addition to remuneration as a member of any
committee of the board of directors, each director as such shall be entitled
to receive such remuneration as may be fixed from time to time by the board
of directors.
Sec. 7. (a) The board of directors shall meet at a time and place, as
fixed by resolution of the board of directors, on the same date as the annual
meeting of shareholders of the corporation for the purpose of organization or
otherwise, and no notice of such meeting shall be necessary to the newly
elected directors in order legally to constitute a meeting if it is held
following the adjournment of the annual meeting of shareholders; provided, a
majority of the whole board shall be present.
(b) Regular meetings of the board of directors may be held at such
place, whether in this state or elsewhere, as a majority of the directors may
from time to time appoint.
(c) Regular meetings of the board of directors may be held without
notice of the date, time, place, or purpose of the meetings. Special meetings
of the board of directors must be preceded by at least two days' notice of
the date, time, and place of the meeting.
(d) A director may waive any notice required by law or these
bylaws before or after the date and time of the meeting that is the subject
of the notice, and such waiver shall be equivalent to giving such notice.
Waiver of notice shall be effective upon receipt of a written waiver by the
corporation.
Sec. 8. If the office of any director or directors becomes vacant by reason
of death, resignation, retirement, disqualification, removal from office or
otherwise, a majority of all of the remaining directors, though less than a
quorum, shall elect a successor or successors, who shall hold office for the
unexpired term of his or her predecessor in office and until his or her
successor is elected by the shareholders who may make such election at the
next annual meeting of the shareholders, or at any special meeting called for
that purpose and held prior thereto.
ARTICLE V -- OFFICERS
Sec. 1. The officers of the corporation shall be chosen by the board of
directors, and shall be a chairman of the board, a president, one or more
vice presidents, a secretary, a controller, and if appointed, a treasurer,
one or more assistant secretaries, assistant controllers, and assistant
treasurers, such assistants to
14
<PAGE>
have such powers and duties of the secretary and treasurer, respectively, as
shall from time to time be assigned to them by the board of directors.
Sec. 2. The board of directors, at its first meeting after each annual
meeting of shareholders, shall choose a chairman of the board from their own
number, and a president, and one or more vice presidents, a controller, and a
treasurer who need not be members of the board.
Sec. 3. The board may appoint such other officers, vice presidents,
assistant secretaries, assistant treasurers, managers and agents as shall be
deemed necessary by it, who shall hold their offices for such terms and shall
exercise such powers and perform such duties as shall be determined from time
to time by the board.
Sec. 4. The board of directors shall by resolution fix the salaries and the
manner and time of payment thereof of all of the officers of this corporation.
Sec. 5. Any officer, manager or agent elected or appointed by the board of
directors may be removed at any time by the affirmative vote of a majority of
the whole board of directors, whenever in their judgment the best interest of
the corporation will be served thereby, such removal, however, to be without
prejudice to the contract rights, if any, of the person so removed.
Sec. 6. If any office becomes vacant for any reason, the vacancy shall be
filled by the board of directors.
Sec. 7. The chairman of the board shall be the chief executive officer of
the corporation; he or she shall, if present, preside at all meetings of the
shareholders and directors; he or she shall have general and active
management of the business of the corporation, under the direction of the
board of directors, and shall see that all orders and resolutions of the
board are carried into effect.
Sec. 8. The president shall, in the absence or disability of the chairman,
perform the duties and exercise the powers of the chairman, and shall perform
such other duties as the board of directors shall prescribe.
Sec. 9. (a) The secretary shall personally or with the assistance of
others, prepare and keep minutes of meetings of the board of directors and
shareholders, authenticate all records of the corporation, attest all
certificates of stock in the name of the corporation, and keep a record of
the issuance of certificates of stock and stock transfers. The secretary
shall give, or cause to be given notice of all meetings of the shareholders
and of the board of directors, and shall perform such other duties as may be
prescribed by the board of directors. The secretary shall keep in safe
custody the seal of the corporation, and affix the same to any instrument
requiring it.
(b) The assistant secretaries, if any, shall, in the absence or
disability of the secretary, perform the duties and exercise the powers of
the secretary, and shall perform such other duties as the board of directors
shall prescribe.
Sec. 10. In case of the absence of any officer of the corporation, or for
any reason that the board may deem sufficient, the board of directors may
delegate, for the time being, the powers or duties, or any of them, of such
officer to any other officer, or to any director.
ARTICLE VI -- CONSIDERATION FOR STOCK
Sec. 1. (a) Without the consent of any holder of any share of the capital
stock of this corporation, the shares of stock of this corporation may be
issued by it from time to time in such number or amount of shares of said
stock, and for such consideration in labor or services actually performed for
the corporation, money or property, as from time to time may be fixed and
determined by the board of directors of this corporation at any annual
meeting or any special meeting called for said purpose, and the right, power
and authority of said board of directors from time to time so to authorize
and order the issuance by this corporation of the said shares of said stock,
in such number or amount of shares, and for such consideration in labor or
services actually performed for the corporation, money or property, as from
time to time said board may fix and determine, is hereby absolutely reserved
to said board of directors.
(b) Payment or delivery to, or receipt by this corporation of such
consideration as may be so fixed and determined by its board of directors for
the issuance of any share or shares of its said stock, as hereinbefore in
this Section provided, shall operate and be construed, deemed and held:(i) to
discharge, release and satisfy fully and absolutely, all liability to this
corporation and/or to its
15
<PAGE>
creditors now or at any time hereafter existing, of any subscriber for,
and/or holder of any such share or shares so authorized to be issued in any
way on account of, founded upon, or arising out of any subscription for,
and/or purchase of, and/or issuance of such share or shares, and(ii) to
constitute such share or shares fully paid stock of this corporation.
ARTICLE VII -- CERTIFICATES OF STOCK
Sec. 1. The certificates for shares of the common stock and each series of
preferred stock of the corporation shall be separately numbered and shall be
entered in the books of the corporation as they are issued. They shall
exhibit the holder's name and number of shares and shall be signed by the
president or a vice president and the treasurer or the secretary. Where,
however, such certificates are countersigned by a transfer agent and
registered by a registrar, at least one of which shall be other than the
corporation itself or an employee thereof, the signatures of such officers
may be facsimile.
Sec. 2. Shares of stock to be transferred may be transferred by endorsement
of the certificate and its surrender to the secretary for cancellation,
whereupon the new certificate shall issue to the transferee.
ARTICLE VIII -- FIXING RECORD DATE
Sec. 1. For the purpose of determining shareholders entitled to notice of
or to vote at any meeting of shareholders or any adjournment thereof, or
entitled to receive payment of any dividend, the board of directors may fix
in advance a date as the record date for any such determination of
shareholders, such date in any case to be not more than seventy days and, in
case of a meeting of shareholders, not less than ten (or in case of an
amendment to the Articles of Incorporation, a plan of merger or share
exchange, a proposed sale, lease, exchange, or other disposition of all or
substantially all of the assets of the corporation other than in the usual or
regular course of business, or the dissolution of the corporation, twenty)
days prior to the date on which the particular action, requiring such
determination of shareholders, is to be taken.
Sec. 2. If no record date is fixed for the determination of shareholders
entitled to notice of or to vote at a meeting of shareholders, or
shareholders entitled to receive payment of a dividend, the close of business
on the day before the date on which notice of the meeting is mailed or the
date on which the resolution of the board of directors declaring such
dividend is adopted, as the case may be, shall be the record date for such
determination of shareholders. When a determination of shareholders entitled
to vote at any meeting of shareholders has been made as provided in this
Article, such determination shall apply to any adjournment thereof.
ARTICLE IX -- REGISTERED STOCKHOLDERS
Sec. 1. The corporation shall be entitled to treat the holder of record of
any share or shares of stock as the holder in fact thereof and accordingly
shall not be bound to recognize any equitable or other claim to or interest
in such share on the part of any other person, whether or not it shall have
express or other notice thereof, save as expressly provided by the laws of
Washington.
ARTICLE X -- LOST CERTIFICATES
Sec. 1. Any person claiming a certificate of stock to be lost or destroyed,
shall make an affidavit or affirmation of that fact and advertise the same in
such manner as the board of directors may require, and the board of directors
may, in its discretion, require the owner of the lost or destroyed
certificate, or his or her legal representative, to give the corporation a
bond, in such sum as they may direct, not exceeding double the value of the
stock, to indemnify the corporation against any claim that may be made
against it on account of the alleged loss of any such certificate. A new
certificate of the same tenor and for the same number of shares as the one
alleged to be lost or destroyed may be issued without requiring any bond,
when, in the judgment of the directors, it is proper to do so.
ARTICLE XI -- CORPORATE BOOKS AND RECORDS; INSPECTION
Sec. 1. The corporation shall keep a copy of the following records at its
principal office: (a) the Articles of Incorporation or Restated Articles of
Incorporation and all amendments to them currently in effect; (b) the bylaws
or restated bylaws, and all amendments to them currently in effect; (c) the
minutes of all shareholders' meetings, and records of all actions taken by
shareholders without a meeting, for the past
16
<PAGE>
three years; (d) its financial statements for the past three years, including
balance sheets showing in reasonable detail the financial condition of the
corporation as of the close of each fiscal year, and an income statement
showing the results of its operations during each fiscal year prepared on a
stated basis explained therein; (e) all written communications to
shareholders generally within the past three years; (f) a list of the names
and business addresses of its current directors and officers; (g) its most
recent annual report delivered to the Secretary of State, and (h) such other
records as may be required under Washington law.
Sec. 2. Any shareholder of the corporation may inspect and copy, during
regular business hours at the corporation's principal office, any of the
records of the corporation specified in Sec. 1 (a) through (g) of this
Article, provided the shareholder gives the corporation written notice of the
shareholder's demand at least five business days before the date on which the
shareholder wishes to inspect and copy such records.
Sec. 3. A shareholder of the corporation is entitled to inspect and copy,
during regular business hours at a reasonable location specified by the
corporation, any of the following records of the corporation provided the
shareholder gives the corporation written notice of the shareholder's demand
at least five business days before the date on which the shareholder wishes
to inspect and copy such records and the shareholder's demand is made in good
faith and for a proper purpose, the shareholder describes with reasonable
particularity the shareholder's purpose and the records the shareholder
desires to inspect, and the records are directly connected with the
shareholder's purpose: (a) excerpts from minutes of any meeting of the board
of directors, records of any meeting of the board of directors, records of
any action of a committee of the board of directors while exercising the
authority of the board of directors, minutes of the shareholders, and records
of action taken by the shareholders or the board of directors without a
meeting; (b) accounting records of the corporation; and (c) the record of
shareholders.
ARTICLE XII -- CHECKS
Sec. 1. All checks or demands for money and notes of the corporation shall
be signed by such officer or officers as the board of directors may from time
to time designate.
ARTICLE XIII -- FISCAL YEAR
Sec. 1. The fiscal year shall begin the first day of October in each year.
ARTICLE XIV -- DIVIDENDS
Sec. 1. Dividends upon the capital stock of the corporation, subject to the
provisions of the Articles of Incorporation, may be declared by the board of
directors at any regular or special meeting, pursuant to law. Dividends may
be paid in cash, in property, or in shares of the capital stock, and shall be
paid only out of the surplus of the aggregate of the assets of the
corporation over the aggregate of its liabilities, including in the latter
the amount of its capital stock.
Sec. 2. Before payment of any dividend, there may be set aside out of any
funds of the corporation available for dividends such sum or sums as the
directors from time to time, in their absolute discretion, think proper as a
reserve fund to meet contingencies, or for equalizing dividends, or for
repairing or maintaining any property of the corporation, or for such other
purpose as the directors shall think conducive to the interests of the
corporation.
ARTICLE XV -- REPRESENTATION OF SHARES OF OTHER CORPORATIONS
Sec. 1. The chairman, the president, and the secretary, or any assistant
secretary, of the corporation are authorized to vote, represent and exercise
on behalf of the corporation all rights incident to any and all shares of
other corporations standing in the name of the corporation. Said authority
may be exercised by such officers either in person or by proxy or power of
attorney duly executed by any of said officers.
ARTICLE XVI -- INDEMNIFICATION OF DIRECTORS AND OFFICERS
Sec. 1. Each person who was or is made a party or is threatened to be made
a party to or is involved (including, without limitation, as a witness) in
any actual or threatened action, suit or proceeding, whether civil, criminal,
administrative or investigative, formal or informal, by reason of the fact
that he or she is or was a director or officer of the corporation or, being
or having been such a director or officer, he or she is or was serving at the
request of the corporation as a director, officer, employee or agent of
another
17
<PAGE>
corporation or of a partnership, joint venture, trust or other enterprise,
including service with respect to employee benefit plans, whether the basis
of such proceeding is alleged action in an official capacity as a director,
officer, employee or agent or in any other capacity while serving as a
director, officer, employee or agent or in any other capacity, shall be
indemnified and held harmless by the corporation to the full extent permitted
by applicable law as then in effect, against all expense, liability and loss
(including, without limitation, attorneys' fees, judgments, fines, ERISA
excise taxes or penalties and amounts to be paid in settlement) actually or
reasonably incurred or suffered by such person in connection therewith. Such
indemnification shall continue 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; provided, however, that no
indemnification shall be provided under this Article to any such person to
the extent that such indemnification would not be consistent with the
Washington Business Corporation Act or other applicable law as then in
effect; provided further, however, that except as provided in Sec. 2 of this
Article with respect to proceedings seeking to enforce rights to
indemnification, this corporation shall indemnify any such person seeking
indemnification in connection with a proceeding (or part thereof) initiated
by such person only if such proceeding (or part thereof) was authorized by
the Board of Directors of this corporation. The right to indemnification
conferred in this Article shall be a contract right and shall include the
right to be paid by the corporation the expense incurred in defending any
such proceeding in advance of its final disposition; provided, however, that
the payment of such expenses in advance of the final disposition of a
proceeding shall be made to or on behalf of a director or officer only upon
delivery to the corporation of an undertaking, by or on behalf of such
director or officer, to repay all amounts so advanced if it shall ultimately
be determined that such director or officer is not entitled to be indemnified
under this Section or otherwise.
Sec. 2. If a claim under Sec. 1 of this Article is not paid in full by this
corporation within sixty days after a written claim has been received by this
corporation (except in the case of a claim for expenses incurred in defending
a proceeding in advance of its final disposition, in which case the
applicable period shall be twenty days) the claimant may at any time
thereafter bring suit against the corporation to recover the unpaid amount of
the claim and, to the extent successful in whole or in part, the claimant
shall be entitled to be paid also the expense of prosecuting such claim. The
claimant shall be presumed to be entitled to indemnification hereunder upon
submission of a written claim (and, in an action brought to enforce a claim
for expenses incurred in defending any proceeding in advance of its final
disposition, where the required undertaking has been tendered to this
corporation), and thereafter this corporation shall have the burden of proof
to overcome the presumption that the claimant is not so entitled. It shall be
a defense to any such action (other than an action brought to enforce a claim
for expenses incurred in defending any proceeding in advance of its final
disposition where the required undertaking, if any is required, has been
tendered to this corporation) that the claimant has not met the standards of
conduct which make it permissible hereunder or under the Washington Business
Corporation Act for this corporation to indemnify the claimant for the amount
claimed, but the burden of proving such defense shall be on this corporation.
Neither the failure of this corporation (including its board of directors,
independent legal counsel, or its shareholders) to have made a determination
prior to the commencement of such action that indemnification of or
reimbursement or advancement of expenses to the claimant is proper in the
circumstances because he or she has met the applicable standard of conduct
set forth herein or in the Washington Business Corporation Act nor an actual
determination by this corporation (including its board of directors,
independent legal counsel, or its shareholders) that the claimant is not
entitled to indemnification or to the reimbursement or advancement of
expenses shall be a defense to the action or create a presumption that the
claimant is not so entitled.
Sec. 3. The right to indemnification and the payment of expenses incurred
in defending a proceeding in advance of its final disposition conferred in
this Article shall not be exclusive of any other right which any person may
have or hereafter acquire under any statute, provision of the Articles of
Incorporation, bylaws, agreement, vote of shareholders or disinterested
directors or otherwise.
Sec. 4. The corporation may maintain insurance, at its expense, to protect
itself and any director, officer,
18
<PAGE>
employee or agent of the corporation or another corporation, partnership,
joint venture, trust or other enterprise against any expense, liability or
loss, whether or not the corporation would have the power to indemnify such
person against such expense, liability or loss under the Washington Business
Corporation Act. The corporation may enter into contracts with any director
or officer of the corporation in furtherance of the provisions of this
Article and may create a trust fund, grant a security interest or use other
means (including, without limitation, a letter of credit) to ensure the
payment of such amounts as may be necessary to effect indemnification as
provided in this Article.
Sec. 5. The corporation may, by action of its board of directors from time
to time, provide indemnification and pay expenses in advance of the final
disposition of a proceeding to employees and agents of the corporation with
the same scope and effect as the provisions of this Article with respect to
the indemnification and advancement of expenses of directors and officers of
the corporation or pursuant to rights granted pursuant to, or provided by,
the Washington Business Corporation Act or otherwise.
ARTICLE XVII -- AMENDMENTS
Sec. 1. These bylaws may be altered or amended by the affirmative vote of a
majority of the stock issued and outstanding and entitled to vote thereat, at
any regular or special meeting of the shareholders if notice of the proposed
alteration or amendment be contained in the notice of the meeting, or by the
affirmative vote of a majority of the board of directors, subject to the
power of the shareholders to change or repeal such bylaws.
ARTICLE XVIII -- MISCELLANEOUS STATUTORY RESTRICTIONS
Sec. 1. The corporation shall have the right to purchase its own shares to
the extent of unreserved and unrestricted earned or capital surplus except as
prohibited by law.
Sec. 2. No loans shall be made by the corporation to its officers or
directors unless first approved in the manner required by RCW 23B.08.700
through .08.730 or other applicable law.
ARTICLE XIX -- MISCELLANEOUS PROCEDURAL PROVISIONS
Sec. 1. The rules contained in the most recent edition of Robert's Rules of
Order, Revised, shall govern all meetings of shareholders and directors where
those rules are not inconsistent with the Articles of Incorporation, bylaws
or special rules or order of the corporation.
ARTICLE XX -- COMMITTEES OF THE BOARD OF DIRECTORS
Sec. 1. The board of directors may, by resolution or resolutions, passed by
a majority of the whole board, designate an executive committee of five
directors. Said committee may meet at stated times, or on notice to all by
any of their number. During the intervals between meetings of the board such
committee shall advise with and aid the officers of the corporation in all
matters concerning its interests and the management of its business, and
generally perform such other duties and exercise such powers as may be
directed or delegated by the board of directors from time to time. The board
may delegate to such committee authority to exercise all the powers of the
board, except such powers as are denied to committees under RCW 23B.08.250(5)
as such statute shall be amended from time to time.
Sec. 2. The board of directors shall designate three of their number who
are neither officers nor employees of the corporation as an audit committee.
It shall be the duty of the audit committee to:
(a) Review the financial statements with the independent
accountants prior to recommending approval by the full board.
(b) Determine the effectiveness of the audit effort through
regular meetings with the independent accountants.
(c) Determine through discussions with the independent accountants
that no restrictions were placed on the scope of the examination or on its
implementation.
(d) Inquire into the effectiveness of the corporation's financial
and accounting functions, organizations, operations and management through
discussions with the independent accountants, internal auditors and officers
of the corporation, especially those using the information.
(e) Inquire into the effectiveness of the corporation's internal
auditing methods and procedures.
(f) Report to the board of directors on the committee's activities
and recommendations.
19
<PAGE>
(g) Recommend the appointment of independent accountants for the
ensuing year.
Sec. 3. The board of directors shall designate three or more of their
number to serve the corporation as a nominating and compensation committee to:
(a) Set criteria for selection of potential members of the board
of directors.
(b) Consider and recommend nominees for election to the board of
directors and make such other recommendations relating to nomination for
election to the board as the committee deems appropriate.
(c) Consider nominees for election to the board of directors
timely recommended by shareholders of the corporation and consider the
recommendation of the Chairman.
(d) Consider the recommendation of the Chairman and evaluate and
recommend to the board of directors compensation levels for all officers.
(e) Evaluate and recommend to the board of directors appropriate
board and committee fees.
Sec. 4. The board of directors, by resolution adopted by a majority of the
full board of directors, may designate one or more additional committees of
the board of directors which shall have two or more members and which shall
have such duties and exercise such powers as may be directed or delegated by
the board of directors from time to time. Vacancies in the membership of any
committee shall be filled by the board of directors. Each committee shall
keep regular minutes of its proceedings and report the same to the board of
directors when required.
20
<PAGE>
EXHIBIT 12
CASCADE NATURAL GAS CORPORATION AND SUBSIDIARIES
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
AND PREFERRED DIVIDEND REQUIREMENTS
<TABLE>
<CAPTION>
Twelve Months Ended
-----------------------------------------------------------------------------
12/31/96 9/30/96 12/31/95 12/31/94 12/31/93 12/31/92
-------- ------- -------- -------- -------- --------
(dollars in thousands)
<S> <C> <C> <C> <C> <C> <C>
Fixed charges, as defined:
Interest expense $ 9,927 10,101 9,938 8,090 7,038 $ 7,478
Amortization of debt issuance expense 612 612 606 593 562 402
--------- ------- ------- ------- ------- --------
Total fixed charges $ 10,539 10,713 10,544 8,683 7,600 $ 7,880
--------- ------- ------- ------- ------- --------
Earnings, as defined:
Earnings before preferred dividends $ 9,459 8,211 7,732 5,760 9,103 $ 4,843
Add (deduct):
Income taxes 5,203 4,272 4,508 3,505 5,224 2,817
Cumulative effect of change in
accounting method - - - - (209) -
Fixed charges 10,539 10,713 10,544 8,683 7,600 7,880
--------- ------- ------- ------- ------- --------
Total earnings $ 25,201 23,196 22,784 17,948 21,718 $ 15,540
--------- ------- ------- ------- ------- --------
Ratio of earnings to fixed charges 2.39 2.17 2.16 2.07 2.86 1.97
--------- ------- ------- ------- ------- --------
--------- ------- ------- ------- ------- --------
Fixed charges and preferred
dividend requirements:
Fixed charges $ 10,539 10,713 10,544 8,683 7,600 $ 7,880
Preferred dividend requirements 808 819 853 898 913 941
--------- ------- ------- ------- ------- --------
Total $ 11,347 11,532 11,397 9,581 8,513 $ 8,821
--------- ------- ------- ------- ------- --------
Ratio of earnings to fixed charges
and preferred dividend requirements 2.22 2.01 2.00 1.87 2.55 1.76
--------- ------- ------- ------- ------- --------
--------- ------- ------- ------- ------- --------
</TABLE>
21
<TABLE> <S> <C>
<PAGE>
<ARTICLE> OPUR1
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED FINANCIAL STATEMENTS OF CASCADE NATURAL GAS CORPORATION,
INCLUDED IN THE QUARTERLY REPORT ON FORM 10-Q FOR THE THREE MONTHS ENDED
DECEMBER 31, 1996, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-END> DEC-31-1996
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 253,553
<OTHER-PROPERTY-AND-INVEST> 2,390
<TOTAL-CURRENT-ASSETS> 44,323
<TOTAL-DEFERRED-CHARGES> 13,237
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 313,503
<COMMON> 10,824
<CAPITAL-SURPLUS-PAID-IN> 93,972
<RETAINED-EARNINGS> 8,621
<TOTAL-COMMON-STOCKHOLDERS-EQ> 113,417
6,630
0
<LONG-TERM-DEBT-NET> 101,550
<SHORT-TERM-NOTES> 1,250
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 4,944
<LONG-TERM-DEBT-CURRENT-PORT> 0
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 85,712
<TOT-CAPITALIZATION-AND-LIAB> 313,503
<GROSS-OPERATING-REVENUE> 64,971
<INCOME-TAX-EXPENSE> 3,597
<OTHER-OPERATING-EXPENSES> 52,596
<TOTAL-OPERATING-EXPENSES> 52,596
<OPERATING-INCOME-LOSS> 12,375
<OTHER-INCOME-NET> 22
<INCOME-BEFORE-INTEREST-EXPEN> 12,397
<TOTAL-INTEREST-EXPENSE> 2,352
<NET-INCOME> 6,448
128
<EARNINGS-AVAILABLE-FOR-COMM> 6,320
<COMMON-STOCK-DIVIDENDS> 2,600
<TOTAL-INTEREST-ON-BONDS> 0
<CASH-FLOW-OPERATIONS> (2,714)
<EPS-PRIMARY> 0.59
<EPS-DILUTED> 0.59
</TABLE>
