<PAGE> 1
File No. 1-1098
FORM 11-K
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
ANNUAL REPORT
PURSUANT TO SECTION 15(d)
of the
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1995
EMPLOYEES' THRIFT PLAN OF COLUMBIA GAS SYSTEM
The Columbia Gas System, Inc.
20 Montchanin Road
Wilmington, Delaware 19807
<PAGE> 2
EMPLOYEES' THRIFT PLAN
OF COLUMBIA GAS SYSTEM
INDEX TO FINANCIAL STATEMENTS AND SCHEDULES
AS OF DECEMBER 31, 1995 AND 1994
<TABLE>
<S> <C>
Report of Independent Public Accountants . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Statements of Net Assets Available for Benefits. . . . . . . . . . . . . . . . . . . . . . . . 4
Statement of Changes in Net Assets Available for Benefits. . . . . . . . . . . . . . . . . . . 5
Notes to Financial Statements and Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Schedule A - Statements of Net Assets Available for Benefits . . . . . . . . . . . . . . . . . 12
Schedule B - Statement of Changes in Net Assets Available for Benefits . . . . . . . . . . . . 14
Item 27(a) - Schedule of Assets Held for Investment Purposes. . . . . . . . . . . . . . . . . . 16
Item 27(d) - Schedule of Reportable Transactions. . . . . . . . . . . . . . . . . . . . . . . . 17
Item 27(e) - Schedule of Non-Exempt Transactions. . . . . . . . . . . . . . . . . . . . . . . . 19
Consent of Independent Public Accountants. . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Federal Tax Consequences. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
</TABLE>
All other schedules are omitted as they are not applicable or are not required
based on the disclosure requirements of the Employee Retirement Income Security
Act of 1974 (ERISA) and applicable regulations issued by the Department of
Labor.
-2-
<PAGE> 3
[ARTHUR ANDERSEN LLP LETTERHEAD]
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Thrift Plan Committee of the
Employees' Thrift Plan of Columbia
Gas System:
We have audited the accompanying statements of net assets available for
benefits of the Employees' Thrift Plan of Columbia Gas System (the "Plan") as
of December 31, 1995 and 1994, and the related statement of changes in net
assets available for benefits for the year ended December 31, 1995. These
financial statements are the responsibility of the Plan's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. 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, 1995 and 1994, and the changes in net assets available for
benefits of the Plan for the year ended December 31, 1995, in conformity with
generally accepted accounting principles.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of assets
held for investment purposes, reportable transactions and non exempt
transactions are presented for purposes of additional analysis and are not a
required part of the basic financial statements but are 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 Fund Information in the statement of net assets available for
benefits (Schedule A) and the statement of changes in net assets available for
benefits (Schedule B) is presented for purposes of additional analyses rather
than to present the net assets available for plan benefits and changes in net
assets available for plan benefits of each fund. The supplemental schedules
and Fund Information have been subjected to the auditing procedures applied in
the audits of the basic financial statements and, in our opinion, are fairly
stated in all material respects in relation to the basic financial statements
taken as a whole.
As explained in the notes thereto, information certified by the trustees and
presented in the schedule of assets held for investment purposes and the
schedule of reportable transactions does not disclose the historical cost of
certain investments. Disclosure of this information is required by the
Department of Labor's Rules and Regulations for Reporting and Disclosure under
the Employee Retirement Income Security Act of 1974.
ARTHUR ANDERSEN LLP
-------------------------------------
ARTHUR ANDERSEN LLP
New York, New York
June 26, 1996
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<PAGE> 4
EMPLOYEES' THRIFT PLAN OF COLUMBIA GAS SYSTEM
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
<TABLE>
<CAPTION>
December 31, 1995 December 31, 1994
----------------- -----------------
<S> <C> <C>
Assets
- ------
Investments:
The Columbia Gas System, Inc.
Common Stock $281,964,004 $154,333,551
Interest-bearing cash 2,067,750 1,045,173
------------ ------------
Total Columbia Gas Stock Fund $284,031,754 $155,378,724
Confederation Life GIC - $ 6,838,984
Fidelity Mutual Funds:
Retirement Money Market Fund $ 40,454,700 $ 28,275,251
Magellan Fund 27,461,720 19,562,197
Contrafund 6,465,118 1,871,184
Growth Company Fund 3,715,110 792,201
Growth & Income Portfolio 26,471,961 18,037,123
Intermediate Bond Fund 45,273,849 44,825,705
Overseas Fund 7,224,105 8,062,282
Europe Fund 1,250,274 882,814
Pacific Basin Fund 1,195,685 1,193,399
Balanced Fund 14,169,385 13,775,972
Capital Appreciation Fund 1,442,322 760,419
Short-Term Bond Portfolio 3,073,421 2,942,976
U.S. Equity Index Portfolio 51,424,890 38,689,121
LESOP (Note 5) - 33,309,119
------------ ------------
$513,654,294 $375,197,471
Employer Contributions Receivable $ 1,023,167 $ 984,750
Participant Deposits Receivable 1,816,274 1,730,644
------------ ------------
Total Assets $516,493,735 $377,912,865
Liabilities
- -----------
LESOP Loan Payable (Note 5) - $ 86,992,707
Interest Payable on LESOP Loan - 28,875,989
------------ ------------
Net Assets $516,493,735 $262,044,169
============ ============
</TABLE>
The accompanying notes to financial statements and schedules are an integral
part of these statements.
-4-
<PAGE> 5
EMPLOYEES' THRIFT PLAN OF COLUMBIA GAS SYSTEM
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
For the Year Ended December 31, 1995
<TABLE>
<S> <C>
Net Assets, Beginning of Year $262,044,169
Net Investment Income 10,651,759
Net Realized Gain on Securities Sold or
Distributed 19,867,226
Net Change in Unrealized Appreciation on
Investments 142,640,692
Participants' Deposits 21,856,706
Columbia's Contributions 12,179,399
Distributions to Participants (35,305,793)
Interfund Exchanges 0
LESOP Loan Settlement (see Note 5) 82,559,577
------------
Net Assets, End of Year $516,493,735
============
</TABLE>
The accompanying notes to financial statements and schedules are an integral
part of this statement.
-5-
<PAGE> 6
EMPLOYEES' THRIFT PLAN OF COLUMBIA GAS SYSTEM
NOTES TO FINANCIAL STATEMENTS AND SCHEDULES
December 31, 1995 and December 31, 1994
1. Description of the Plan
The Employees' Thrift Plan of Columbia Gas System (the "Plan") was
adopted by the Board of Directors of The Columbia Gas System, Inc. (Columbia)
on May 1, 1958. Its purpose is to encourage employees to adopt a regular
savings program and to provide additional security for retirement. Each
employee who works for a Columbia company participating in the Plan is eligible
to join the Plan on the first day of any month after completing twelve months
of service. Participation is voluntary, and participants are fully and
immediately vested in the Plan.
The Plan offers a wide range of mutual funds to Plan participants
through Fidelity Investments' family of mutual funds. The investment funds
offered include:
Columbia Stock Fund: This Fund consists almost entirely of Columbia
Common Stock. A small portion is invested in money market instruments
for administrative purposes.
Retirement Money Market Fund: The Retirement Money Market Fund seeks
to maximize current income consistent with the preservation of
capital. The Fund invests in high quality U.S. dollar denominated
money market instruments of U.S. and foreign issuers.
Short-Term Bond Portfolio: The Short-Term Bond Portfolio seeks
current income consistent with preservation of capital, by investing
in a broad range of investment grade fixed income securities. The
assets of the fund are invested in securities with a maturity of 1 to
3 years.
Intermediate Bond Fund: The Intermediate Bond Fund is an
income-oriented mutual fund that seeks a high level of current income.
The Fund invests primarily in investment grade corporate debt
obligations, as well as obligations issued or guaranteed by the U.S.
Government and its agencies or instrumentalities, U.S. banks, prime
commercial paper, as well as a limited amount of high quality foreign
debt instruments.
Balanced Fund: The Balanced Fund is a growth and income mutual fund
that seeks the highest amount of income possible while still
preserving its capital investment. The Fund invests in a broadly
diversified portfolio of high-yielding securities, including common
stocks, preferred stocks and bonds. At least 25% of the Balanced
Fund's assets are always invested in fixed-income securities.
U.S. Equity Index Portfolio: The U.S. Equity Index Portfolio is a
growth and income mutual fund that seeks to duplicate the composition
and total return of the Standard & Poor's 500 Composite Stock Price
Index (S&P). The Portfolio invests primarily in the common stock of
the 500 companies that make up the S&P.
Growth & Income Portfolio: The Growth & Income Portfolio is a growth
and income mutual fund that seeks long-term capital growth, current
income and growth of income with reasonable investment risk. The
Portfolio is primarily invested in the securities of companies with
the potential for growth of earnings while paying current dividends,
as well as securities
-6-
<PAGE> 7
convertible into common stocks, preferred stocks and fixed income
securities.
Magellan Fund: The Magellan Fund's goal is capital appreciation.
Magellan primarily invests in common stock and securities convertible
into common stock of U.S., multinational, and foreign companies of all
sizes and industries that offer potential for growth. Up to 20% of
the Fund may be invested in fixed income securities.
Contrafund: The Contrafund seeks capital appreciation by investing
primarily in undervalued domestic and foreign stocks. These companies
may have favorable long-term outlooks due to termination of
unprofitable operations, changes in management, industry or products,
or possible mergers and acquisitions. A substantial portion of the
portfolio is invested in medium- to small-capitalization stocks.
Growth Company Fund: The Growth Company Fund focuses on capital
appreciation by investing primarily in common stocks with above-
average growth characteristics. Investments include both foreign and
domestic securities. Growth can be measured by earnings or gross
sales.
Capital Appreciation Fund: The Capital Appreciation Fund seeks capital
appreciation by investing primarily in common stocks, but may invest
in other types of securities including preferred stocks and bonds.
Investments include domestic and foreign securities. These securities
may be issued by well-known and established, cheap and out-of-favor
companies as well as smaller, lesser-known companies.
Overseas Fund: The Overseas Fund is a growth mutual fund that seeks
long-term capital growth through investments in foreign securities in
both developed and emerging markets. At least 65% of its total assets
are invested in securities of issuers from at least three countries
outside of North America. Currency hedging is permitted.
Europe Fund: The Europe Fund seeks long-term capital growth by
investing primarily in companies in Western Europe. The Fund may also
invest in Eastern Europe. Normally, the Fund intends to maintain
investments in at least three different countries, though it may at
times invest all of its assets in a single country. A 1% redemption
fee will be charged for shares held less than 90 days.
Pacific Basin Fund: Pacific Basin Fund seeks long-term growth of
capital by investing in companies in the Pacific Basin. The Fund will
generally be invested in at least three different countries, although
it may at times invest all of its assets in one country. A 1%
redemption fee will be charged for shares held less than 90 days.
Confederation Life Guaranteed Investment Contract (GIC): The GIC is
presented in the financial statements at contract value for the year
ended December 31, 1994. The contract value reasonably approximates
the fair market value of the GIC as of August 11, 1994, the date in
which the GIC assets were frozen by the Canadian and Michigan
regulators, due to the bankruptcy of Confederation Life Insurance
Company. In September 1995, Columbia and Columbia Gas Transmission
(Transmission) loaned the Plan $6,599,361, in order to provide
liquidity to the Plan participants who had invested in the GIC. The
value of each participant's investment in the GIC was replaced with an
equivalent value in the Retirement Money Market Fund. The provisions
of the loan agreements state that the loan will be paid back from the
proceeds received by the Plan, if any, from the GIC. However, the
loan is non-interest bearing, unsecured without
-7-
<PAGE> 8
interest and non-recourse to participants or to any assets held in the
Plan.
Fidelity (Boston) is the Trustee for the Fidelity family of mutual
funds and the Columbia Stock Fund. First Fidelity Bank, N.A.
(Fidelity-Philadelphia) was terminated as Trustee for the Columbia Stock Fund
and the Leveraged Employee Stock Ownership Plan (LESOP) as of the close of
business on December 31, 1995.
Employees may deposit up to 6% of their monthly base pay, subject to
IRS limitations, in the various investment funds, and Columbia will match such
deposits at various levels based on the period of an employee's participation
in the Plan. Columbia's contributions are invested in the Columbia Stock Fund
except for employees age 55 or older who may direct monthly Columbia
contributions among any of those funds available for Plan participants'
deposits. Employees may also invest up to an additional 10% of their monthly
base pay, subject to IRS limitations, but no additional contributions will be
made by Columbia. Employee deposits may be made on an after-tax and/or
before-tax basis. Before-tax deposits are not subject currently to Federal
income tax but are taxable to the employee when they are withdrawn from the
Plan. Prior to age 59-1/2, an active employee may withdraw before-tax deposits
only under certain hardship conditions. Such withdrawals are subject to a 10%
excise tax. If an employee makes a withdrawal from his account, his future
deposits are subject to various suspension periods depending on the type of
withdrawal. After-tax deposits are taxed before they go into the applicable
Funds of the Plan; therefore, they will not be taxed again.
Administrative expenses of the Plan are paid by the participating
subsidiaries of Columbia.
The value of participants' deposits in the Plan is reflected in
Shares/Units in each applicable Fund. Each Share/Unit has a value equal to
every other Share/Unit in that Fund. The value of a Share/Unit is determined
daily by dividing the value of each Fund by its total number of outstanding
Shares/Units.
The following is a summary of the Share/Unit Values and Shares/Units
outstanding as of:
<TABLE>
<CAPTION>
December 31, December 31,
1995 1994
--------------------------- -------------------------
Share/Unit Shares/ Share/Unit Shares/
Value Units Value Units
----------- ---------- ---------- ----------
($) ($)
<S> <C> <C> <C> <C>
Columbia Stock Fund 16.09 17,657,667 8.65 17,958,914
Confederation Life GIC - - 1.00 6,838,984
Retirement Money
Market Fund 1.00 40,454,700 1.00 28,275,251
Magellan Fund 85.98 319,397 66.80 292,847
Contrafund 38.02 170,045 30.28 61,796
Growth Company Fund 36.29 102,373 27.26 29,061
Growth & Income Portfolio 27.05 978,631 21.09 855,245
Intermediate Bond Fund 10.41 4,349,073 9.83 4,560,092
Overseas Fund 29.07 248,507 27.30 295,322
Europe Fund 22.82 54,789 20.00 44,141
Pacific Basin Fund 15.20 78,664 16.19 73,712
Balanced Fund 13.52 1,048,032 12.29 1,120,909
Capital Appreciation
Fund 16.78 85,955 15.31 49,668
</TABLE>
-8-
<PAGE> 9
<TABLE>
<S> <C> <C> <C> <C>
Short-Term Bond
Portfolio 8.88 346,106 8.60 342,206
U.S. Equity Index
Portfolio 22.57 2,278,462 16.91 2,287,943
</TABLE>
As of December 31, 1995 and 1994, the only individual security held by
the Plan in excess of 5% of net assets was Columbia Gas Common Stock, 6,426,530
shares valued at $281,964,004 and 6,557,093 shares valued at $154,333,551,
respectively.
The above is a brief description of the Plan and is provided for general
information purposes only. Participants should refer to the Plan documents for
more complete information.
2. Chapter 11 Bankruptcy filings
On July 31, 1991, Columbia and its wholly-owned subsidiary, TCO, filed
separate voluntary petitions seeking protection under Chapter 11 of the Federal
Bankruptcy Code. Columbia and TCO emerged from Chapter 11 on November 28,
1995.
3. Summary of significant accounting policies
(A) Valuation of Investments.
The assets of the Plan are reflected in the accompanying Statements of
Net Assets Available for Benefits based on quoted market prices and per share
net asset value.
(B) Basis of accounting.
The accounts of the Plan have been maintained on a modified cash basis
of accounting by Fidelity-Boston for the family of mutual funds and Fidelity-
Philadelphia for the Columbia Stock Fund and the LESOP Suspense Account, which
held the unallocated shares under the LESOP; however, the accompanying
financial statements have been prepared on an accrual basis as of December 31,
1995 and December 31, 1994, by application of memorandum entries to reflect:
(l) participant deposits and Columbia contributions receivable;
(2) LESOP loan payable; and
(3) interest payable on LESOP loan.
(C) Net realized gain (loss) on securities sold or distributed.
The cost of securities sold or distributed is determined on the
revalued cost of assets basis, whereby the cost of assets is adjusted to
reflect the market value of assets as of the prior year end. The Plan
recognized gains and losses on the sale of securities and the distribution of
Columbia Gas Common Stock to withdrawn participants in settlement of their
accounts equal to the difference between the revalued cost and market value of
the securities sold or distributed through December 31, 1995.
(D) Unrealized appreciation (depreciation) of investments.
Fidelity-Philadelphia and Fidelity-Boston determine the market
value of all assets and share values on a daily basis. Unrealized appreciation
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<PAGE> 10
(depreciation) is equal to the difference between the revalued cost of assets
and market value of assets at December 31, 1995.
(E) Financial derivative disclosure.
Plan assets are invested through thirteen mutual funds, any of
which could from time-to-time utilize financial derivatives. Generally
Accepted Accounting Principles require the investment managers of such funds,
e.g., Fidelity-Boston, to list in their financial statements the amount and
purpose of such derivatives. Participants are provided with copies of the
mutual funds' financial statements directly from Fidelity-Boston on a regular
basis and should refer to these for information on this issue. Generally
speaking, the investment managers use derivatives to hedge against certain
unwanted actions, e.g., interest rate movements and foreign currency changes.
4. Participating Companies
The names of the participating companies, as of December 31,
1995, with contributions for the year ended December 31, 1995 are shown below:
<TABLE>
<CAPTION>
Columbia
Contributions
-------------
<S> <C>
Columbia Coal Gasification Corp. . . . . . . . . . . . $ 10,366
Columbia Gas Development Corp. . . . . . . . . . . . . 262,114
Columbia Gas Transmission Corp. . . . . . . . . . . . . 3,736,824
Columbia Gas of Kentucky, Inc. . . . . . . . . . . . . 304,932
Columbia Gas of Maryland, Inc. . . . . . . . . . . . . 80,623
Columbia Gas of Ohio, Inc. . . . . . . . . . . . . . . 3,972,968
Columbia Gas of Pennsylvania, Inc. . . . . . . . . . . 1,059,147
Columbia Gas System Service Corp. . . . . . . . . . . . 727,870
Columbia Gulf Transmission Company . . . . . . . . . . 803,955
Columbia Propane Corp. . . . . . . . . . . . . . . . . 16,539
Columbia LNG Corp. . . . . . . . . . . . . . . . . . . 31,970
Columbia Natural Resources . . . . . . . . . . . . . . 478,020
Commonwealth Gas Services, Inc. . . . . . . . . . . . . 406,155
Commonwealth Propane, Inc. . . . . . . . . . . . . . . 191,622
TriStar Ventures Corp. . . . . . . . . . . . . . . . . 37,063
Columbia Energy Services. . . . . . . . . . . . . . . . 59,231
-----------
Total . . . . . . . . . . . . . . . . . . . . . . . $12,179,399
===========
</TABLE>
5. Employee Stock Ownership Plan
In 1990, Columbia established an LESOP. The LESOP was designed to
prefund a portion of the matching obligations under the terms of the Thrift
Plan and to utilize tax advantages afforded by the Internal Revenue Code. In
October 1991, the Board of Directors of Columbia authorized the termination of
the LESOP and payments on LESOP indebtedness and release of LESOP shares
discontinued. On the day that Columbia emerged from bankruptcy, November 28,
1995, the LESOP was terminated and Columbia purchased the unallocated LESOP
shares from the LESOP Trust for $57,807,447. These monies were delivered by
Columbia to the LESOP Indenture Trustee. The remaining outstanding LESOP
liability ($126,275,697, including interest) was satisfied under Columbia's
Plan of Reorganization, pursuant to the sponsor's guarantee of this
indebtedness. Upon completion of these transactions, all Plan LESOP
obligations were settled.
6. Distributions
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<PAGE> 11
As of December 31, 1995 and 1994, amounts due to participants who had
requested a withdrawal were $4,752,385 and $1,780,803, respectively.
7. Tax Status
See "Federal Tax Consequences" located elsewhere in this document for
additional discussion of the tax status.
The Plan received a favorable determination letter, dated November 28,
1990, from the Internal Revenue Service in which it ruled that the Plan is in
compliance with Sections 401(a) and 401(k) and the Trust is exempt from
taxation under Section 501(a) of the Internal Revenue Code (IRC). The Company
and legal counsel are of the opinion that the Plan, as amended, meets the IRC
requirements and, therefore, continues to be tax-qualified and tax-exempt.
8. Other
Schedules A and B below reflect additional detail by Fund of the
accompanying Statements of Net Assets Available for Benefits for the years
ended December 31, 1995 and December 31, 1994 and Statement of Changes in Net
Assets Available for Benefits for the year ended December 31, 1995.
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<PAGE> 12
Schedule A
(Page 1 of 2)
EMPLOYEES' THRIFT PLAN OF COLUMBIA GAS SYSTEM
STATEMENT OF NET ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1995
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
Assets Liabilities Net Assets
- ----------------------------------------------------------------------------------------------------------------------------------
Employer Participants LESOP Interest
12/31/95 Contributions Deposits Loan Payable on
Investments Market Value Receivable Receivable Total Payable LESOP Loan
<S> <C> <C> <C> <C> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------------------
Columbia Stock Fund $284,031,754 $ 966,295 $ 597,463 $285,595,512 $ - $ - $285,595,512
- ----------------------------------------------------------------------------------------------------------------------------------
Confederation Life GIC - - - - - - -
- ----------------------------------------------------------------------------------------------------------------------------------
Fidelity Mutual Funds:
- ----------------------------------------------------------------------------------------------------------------------------------
Retirement Money Market
Portfolio 40,454,700 11,346 181,437 40,647,483 - - 40,647,483
- ----------------------------------------------------------------------------------------------------------------------------------
Magellan Fund 27,461,720 6,420 222,420 27,690,560 - - 27,690,560
- ----------------------------------------------------------------------------------------------------------------------------------
Contrafund 6,465,118 2,499 49,607 6,517,224 - - 6,517,224
- ----------------------------------------------------------------------------------------------------------------------------------
Growth Company Fund 3,715,110 1,758 29,781 3,746,649 - - 3,746,649
- ----------------------------------------------------------------------------------------------------------------------------------
Growth & Income Portfolio 26,471,961 9,135 164,149 26,645,245 - - 26,645,245
- ----------------------------------------------------------------------------------------------------------------------------------
Intermediate Bond Fund 45,273,849 7,612 187,588 45,469,049 - - 45,469,049
- ----------------------------------------------------------------------------------------------------------------------------------
Overseas Fund 7,224,105 3,960 51,449 7,279,514 - - 7,279,514
- ----------------------------------------------------------------------------------------------------------------------------------
Europe Fund 1,250,274 83 7,839 1,258,196 - - 1,258,196
- ----------------------------------------------------------------------------------------------------------------------------------
Pacific Basin Fund 1,195,685 417 12,380 1,208,482 - - 1,208,482
- ----------------------------------------------------------------------------------------------------------------------------------
Balanced Fund 14,169,385 5,954 87,780 14,263,119 - - 14,263,119
- ----------------------------------------------------------------------------------------------------------------------------------
Capital Appreciation Fund 1,442,322 413 10,320 1,453,055 - - 1,453,055
- ----------------------------------------------------------------------------------------------------------------------------------
Short-Term Bond Fund 3,073,421 657 22,188 3,096,266 - - 3,096,266
- ----------------------------------------------------------------------------------------------------------------------------------
U.S. Equity Index Portfolio 51,424,890 6,618 191,873 51,623,381 - - 51,623,381
- ----------------------------------------------------------------------------------------------------------------------------------
LESOP - - - - - - -
- ----------------------------------------------------------------------------------------------------------------------------------
TOTAL $513,654,294 $1,023,167 $1,816,274 $516,493,735 $ - $ - $516,493,735
==================================================================================================================================
</TABLE>
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<PAGE> 13
Schedule A
(Page 2 of 2)
EMPLOYEES' THRIFT PLAN OF COLUMBIA GAS SYSTEM
STATEMENT OF NET ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1994
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------------
Assets Liabilities Net Assets
- ---------------------------------------------------------------------------------------------------------------------------------
Employer Participant LESOP Interest
12/31/94 Contributions Deposits Loan Payable on
Investments Market Value Receivable Receivable Total Payable LESOP Loan
- ---------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Columbia Stock Fund $155,378,724 $919,650 $ 612,217 $156,910,591 $ - $ - $156,910,591
- ---------------------------------------------------------------------------------------------------------------------------------
Confederation Life GIC 6,838,984 - - 6,838,984 - - 6,838,984
- ---------------------------------------------------------------------------------------------------------------------------------
Fidelity Mutual Funds:
- ---------------------------------------------------------------------------------------------------------------------------------
Retirement Money Market
Portfolio 28,275,251 11,263 160,901 28,447,415 - - 28,447,415
- ---------------------------------------------------------------------------------------------------------------------------------
Magellan Fund 19,562,197 7,365 189,338 19,758,900 - - 19,758,900
- ---------------------------------------------------------------------------------------------------------------------------------
Contrafund 1,871,184 1,543 19,464 1,892,191 - - 1,892,191
- ---------------------------------------------------------------------------------------------------------------------------------
Growth Company Fund 792,201 518 8,534 801,253 - - 801,253
- ---------------------------------------------------------------------------------------------------------------------------------
Growth & Income Portfolio 18,037,123 10,678 138,671 18,186,472 - - 18,186,472
- ---------------------------------------------------------------------------------------------------------------------------------
Intermediate Bond Fund 44,825,705 9,215 199,452 45,034,372 - - 45,034,372
- ---------------------------------------------------------------------------------------------------------------------------------
Overseas Fund 8,062,282 4,790 62,500 8,129,572 - - 8,129,572
- ---------------------------------------------------------------------------------------------------------------------------------
Europe Fund 882,814 222 6,698 889,734 - - 889,734
- ---------------------------------------------------------------------------------------------------------------------------------
Pacific Basin Fund 1,193,399 869 12,385 1,206,653 - - 1,206,653
- ---------------------------------------------------------------------------------------------------------------------------------
Balanced Fund 13,775,972 8,706 96,365 13,881,043 - - 13,881,043
- ---------------------------------------------------------------------------------------------------------------------------------
Capital Appreciation Fund 760,419 457 7,024 767,900 - - 767,900
- ---------------------------------------------------------------------------------------------------------------------------------
Short-Term Bond Fund 2,942,976 1,595 24,998 2,969,569 - - 2,969,569
- ---------------------------------------------------------------------------------------------------------------------------------
U.S. Equity Index Portfolio 38,689,121 7,879 192,097 38,889,097 - - 38,889,097
- ---------------------------------------------------------------------------------------------------------------------------------
LESOP 33,309,119 - - 33,309,119 (86,992,707) (28,875,989) (82,559,577)
- ---------------------------------------------------------------------------------------------------------------------------------
TOTAL $375,197,471 $984,750 $1,730,644 $377,912,865 ($86,992,707) ($28,875,989) $262,044,169
- ---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
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<PAGE> 14
Schedule B
(Page 1 of 2)
EMPLOYEES' THRIFT PLAN OF COLUMBIA GAS SYSTEM
STATEMENT OF CHANGES IN NET ASETS
FOR THE YEAR ENDED DECEMBER 31, 1995
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
Columbia Retirement Confederation Growth Growth &
Total Stock Fund Money Market Life GIC Magellan Contrafund Company Income
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net Assets, Beginning of
Year $262,044,169 $156,910,591 $28,447,415 $ 6,838,984 $19,758,900 $1,892,191 $ 801,253 $18,186,472
- ----------------------------------------------------------------------------------------------------------------------------------
Net Investment Income 10,651,759 -- 1,955,770 -- 1,579,873 502,400 164,014 1,272,840
- ----------------------------------------------------------------------------------------------------------------------------------
Net Realized Gain/(Loss)
on Securities Sold or
Distributed 19,867,226 11,059,122 -- -- 3,858,597 372,656 289,898 1,426,870
- ----------------------------------------------------------------------------------------------------------------------------------
Net Change Unrealized
Appreciation/(Deprecia-
tion) of Investments 142,640,692 122,213,399 -- -- 1,670,639 215,528 119,543 3,996,086
- ----------------------------------------------------------------------------------------------------------------------------------
Participants' Deposits 21,856,706 7,287,286 2,323,983 -- 2,466,938 501,683 230,238 1,873,641
- ----------------------------------------------------------------------------------------------------------------------------------
Columbia Contributions 12,179,399 11,460,522 145,091 -- 81,684 23,041 12,117 127,350
- ----------------------------------------------------------------------------------------------------------------------------------
Distributions (35,305,793) (13,173,894) (6,922,987) -- (1,760,230) (223,229) (92,251) (1,403,263)
- ----------------------------------------------------------------------------------------------------------------------------------
Interfund Exchanges -- (10,161,514) 14,698,211 (6,838,984) 34,159 3,232,954 2,221,837 1,165,249
- ----------------------------------------------------------------------------------------------------------------------------------
LESOP Loan Settlement 82,559,577 -- -- -- -- -- -- --
- ----------------------------------------------------------------------------------------------------------------------------------
Net Assets, End of Year $516,493,735 $285,595,512 $40,647,483 $ -- $27,690,560 $6,517,224 $3,746,649 $26,645,245
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
-14-
<PAGE> 15
EMPLOYEES' THRIFT PLAN OF COLUMBIA GAS SYSTEM
STATEMENT OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED DECEMBER 31, 1995
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------
Intermediate
Bond Overseas Europe Pacific Basin Balanced
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net Assets, Beginning of
Year $45,034,372 $8,129,572 $889,734 $1,206,653 $13,881,043
- --------------------------------------------------------------------------------------------------------
Net Investment Income 2,784,694 167,645 51,006 -- 619,898
- --------------------------------------------------------------------------------------------------------
Net Realized Gain/(Loss)
on Securities Sold or
Distributed 253,816 151,090 55,695 (75,147) 314,861
- --------------------------------------------------------------------------------------------------------
Net Change Unrealized
Appreciation/(Depreciation)
of Investments 2,263,840 299,604 79,655 617 1,039,686
- --------------------------------------------------------------------------------------------------------
Participants' Deposits 2,342,161 680,848 102,139 141,735 1,155,813
- --------------------------------------------------------------------------------------------------------
Columbia Contributions 92,466 50,134 2,848 4,069 83,083
- --------------------------------------------------------------------------------------------------------
Distributions (5,801,684) (454,400) (78,694) (48,362) (949,136)
- --------------------------------------------------------------------------------------------------------
Interfund Exchanges (1,500,616) (1,744,979) 155,813 (21,083) (1,882,129)
- --------------------------------------------------------------------------------------------------------
LESOP Loan Settlement -- -- -- -- --
- --------------------------------------------------------------------------------------------------------
Net Assets, End of Year $45,469,049 $7,279,514 $1,258,196 $1,208,482 $14,263,119
- --------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------
Capital Short-Term U.S. Equity
Appreciation Bond Index LESOP
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net Assets, Beginning of
Year $767,900 $2,969,569 $38,889,097 $(82,559,577)
- --------------------------------------------------------------------------------------------------------
Net Investment Income 108,771 169,548 1,275,300 --
- --------------------------------------------------------------------------------------------------------
Net Realized Gain/(Loss)
on Securities Sold or
Distributed 138,276 25,267 1,996,225 --
- --------------------------------------------------------------------------------------------------------
Net Change Unrealized
Appreciation/(Depreciation)
of Investments (57,730) 61,907 10,737,918 --
- --------------------------------------------------------------------------------------------------------
Participants' Deposits 114,365 290,918 2,344,958 --
- --------------------------------------------------------------------------------------------------------
Columbia Contributions 5,889 10,783 80,322 --
- --------------------------------------------------------------------------------------------------------
Distributions (10,196) (273,175) (4,114,292) --
- --------------------------------------------------------------------------------------------------------
Interfund Exchanges 385,780 (158,551) 413,853 --
- --------------------------------------------------------------------------------------------------------
LESOP Loan Settlement -- -- -- 82,559,577
- --------------------------------------------------------------------------------------------------------
Net Assets, End of Year $1,453,055 $3,096,266 $51,623,381 $ --
- --------------------------------------------------------------------------------------------------------
</TABLE>
-15-
<PAGE> 16
Employer ID#: 13-1594808
Plan #: 002
EMPLOYEES' THRIFT PLAN OF COLUMBIA GAS SYSTEM
ITEM 27(a) SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
AS OF DECEMBER 31, 1995
<TABLE>
<CAPTION>
Identity of Issuer,
Borrower, Lessor,
or Similar Party(*) Description of Investment Cost(2) Value
- ----------------------- ------------------------------------ ---- --------------
<S> <C> <C> <C>
Columbia 17,657,667 units of Columbia Stock Fund(1) -- $284,031,754
Fidelity-Boston 40,454,700 shares of Retirement Money Market -- 40,454,700
Portfolio
Fidelity-Boston 319,397 shares of Magellan Fund -- 27,461,720
Fidelity-Boston 170,045 shares of Contrafund -- 6,465,118
Fidelity-Boston 102,373 shares of Growth Company Fund -- 3,715,110
Fidelity-Boston 978,631 shares of Growth & Income Portfolio -- 26,471,961
Fidelity-Boston 4,349,073 shares of Intermediate Bond Fund -- 45,273,849
Fidelity-Boston 248,507 shares of Overseas Fund -- 7,224,105
Fidelity-Boston 54,789 shares of Europe Fund -- 1,250,274
Fidelity-Boston 78,664 shares of Pacific Basin Fund -- 1,195,685
Fidelity-Boston 1,048,032 shares of Balanced Fund -- 14,169,385
Fidelity-Boston 85,955 shares of Capital Appreciation Fund -- 1,442,322
Fidelity-Boston 346,106 shares of Short-Term Bond Portfolio -- 3,073,421
Fidelity-Boston 2,278,462 shares of U.S. Equity Index Portfolio -- 51,424,890
------------
Total Thrift Plan(2) $513,654,294
============
</TABLE>
* All parties listed are considered parties-in-interest.
(1) Actual shares of The Columbia Gas System, Inc. Common Stock held equals
6,426,530.
(2) Records are maintained by Fidelity-Boston on a fair market value basis;
therefore, historical cost basis information is unavailable.
-16-
<PAGE> 17
Employer ID#: 13-1594808
Plan #: 002
EMPLOYEES' THRIFT PLAN OF COLUMBIA GAS SYSTEM
Item 27(d) Schedule of Reportable Transactions
Individual Transactions By Issue
For The Year Ended December 31, 1995
<TABLE>
<CAPTION>
Current Value
of Asset on
Identity Description Purchase Selling Cost of Transaction Net Gain
of Party of Asset Price Price Expense Asset Date (Loss)
- -------- ----------- ------- ----------- ------- --------- ------------ --------
<S> <C> <C> <C> <C> <C> <C> <C>
Columbia* Common stock of The - $57,807,447 - (1) $57,807,447 (1)
Columbia Gas System,
Inc.
</TABLE>
* All parties listed are considered parties-in-interest.
(1) See Note 5 to the accompanying financial statements.
NOTE: There were no lease rentals during the year.
-17-
<PAGE> 18
Employer ID#: 13-1594808
Plan #: 002
EMPLOYEES' THRIFT PLAN OF COLUMBIA GAS SYSTEM
Item 27(d) Schedule of Reportable Transactions
Cumulative Transactions By Issue
For The Year Ended December 31, 1995
<TABLE>
<CAPTION>
Current
Value of
Asset on
Identity Description Total Total Cost of Transaction Net Gain
of Party* of Asset Purchases Sales Expenses Asset Date or (Loss)
- --------------- ---------------------- ----------- ----------- -------- ----------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Columbia Columbia Stock Fund $32,012,610 -- -- $32,012,610 $32,012,610 --
Columbia Columbia Stock Fund -- $36,632,099 -- (1) 36,632,099 $5,035,049
Fidelity-Boston Magellan Fund 27,474,703 -- -- 27,474,703 27,474,703 --
Fidelity-Boston Magellan Fund -- 25,104,417 -- (1) 25,104,417 1,051,580
Fidelity-Boston Intermediate Bond Fund 7,800,399 -- -- 7,800,399 7,800,399 --
Fidelity-Boston Intermediate Bond Fund -- 9,869,910 -- (1) 9,869,910 (238,967)
Fidelity-Boston Retirement Money 94,676,934 -- -- 94,676,934 94,676,934 --
Market Fund
Fidelity-Boston Retirement Money -- 82,173,177 -- (1) 82,173,177 --
Market Fund
Fidelity-Boston U.S. Equity Index Fund 12,323,742 -- -- 12,323,742 12,323,742 --
Fidelity-Boston U.S. Equity Index Fund -- 12,317,133 -- (1) 12,317,133 1,479,323
Fidelity-Boston Growth & Income Fund 12,020,113 -- -- 12,020,113 12,020,113 --
Fidelity-Boston Growth & Income Fund -- 9,008,139 -- (1) 9,008,139 575,009
</TABLE>
* All parties listed are considered parties-in-interest.
(1) Records are maintained by Fidelity-Boston; historical cost information
is unavailable.
NOTE: There were no lease rentals during the year.
-18-
<PAGE> 19
EMPLOYEES' THRIFT PLAN OF COLUMBIA GAS SYSTEM
Item 27(e) Schedule of Nonexempt Transactions
For the Year Ended December 31, 1995
<TABLE>
<CAPTION>
Current Value
Identity of Asset on
of Relationship Description of Purchase Selling Cost of Transaction Net Gain
Party to Plan Transaction Price Price Expenses Asset Date(1) (Loss)
----- ------- ----------- ----- ----- -------- ----- ------------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Columbia Plan Sponsor Sale of 1,416,155 -- $57,807,447 -- -- $57,807,447 --
shares of Columbia
Gas Common Stock by
the Plan to The
Columbia Gas
System, Inc.,
pursuant to
Columbia's Plan of
Re-organization
</TABLE>
(1) See Note 5 to the accompanying financial statements.
Note: There was no lease rentals during the year.
-19-
<PAGE> 20
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation of
our report dated June 14, 1996 included in this Form 11-K, into the Company's
previously filed Form S-8 Registration Statement File No. 33-42776.
ARTHUR ANDERSEN LLP
------------------------------------
ARTHUR ANDERSEN LLP
New York, New York
June 26, 1996
-20-
<PAGE> 21
FEDERAL TAX CONSEQUENCES
Tax Treatment of Distributions and Withdrawals
If a participant withdraws money from the Plan, some or all of the
participant's withdrawal may be taxed. To the extent that any taxable money is
sent directly to the participant, the Trustee is required to withhold 20% of
the taxable amount to meet Federal tax requirements. A participant can avoid
the 20% Federal withholding requirement by requesting a direct rollover of all
or part of the taxable portion of the participant's withdrawal and distribution
to an Individual Retirement Account (IRA) or to another tax-qualified plan.
In addition to ordinary income taxes, a 10% additional income tax may be
imposed on the taxable portion of a participant's distribution unless:
- - the participant is age 55 or older in the year he or she terminates
employment with Columbia,
- - the participant is age 59 1/2 or over when he or she receives the
distribution,
- - the withdrawal is due to disability or death,
- - the withdrawal is used to pay unreimbursed medical expenses,
- - payment is made to an alternate payee under a QDRO, or
- - the withdrawal is rolled over directly to an Individual Retirement
Account (IRA) or another qualified plan.
Tax Treatment of Withdrawals
The following withdrawals are 100% taxable, even for hardship:
- - Company contributions and their earnings,
- - a participant's savings in a before-tax account and their earnings,
- - earnings on a participant's Rollover Contributions, lump sum and
after-tax deposits, and a participant's Rollover Contribution
deposits.
All of a participant's after-tax deposits made to the Plan before January 1,
1987 can be withdrawn during active employment for any reason with no taxes
applied to the withdrawal.
A participant's after-tax deposits made to the Plan after December 31, 1986 can
also be withdrawn for any reason, but he or she is not free from taxes. Once a
participant has withdrawn all pre-1987 after-tax contributions, a portion of
each subsequent withdrawal from the participant's after-tax account will be
considered investment earnings, and will be taxable. The amount of your
withdrawal that is considered a return of the participant's after-tax savings,
and consequently non-taxable, will be determined by using the following
formula:
Total remaining savings before a participant's withdrawal in his or
her after-tax account contributed after December 31, 1986 divided by total
remaining savings in his or her after-tax account contributed after December
31, 1986, plus his or her investment earnings multiplied by the total amount of
the withdrawal equals non-taxable portion of the participant's withdrawal.
For example:
- - If savings in a participant's after-tax account
contributed after 12/31/86 equals $3,000
- - And the investment earnings since 12/31/86 equals $1,000
-21-
<PAGE> 22
- - The total of the after-tax savings contributed after
12/31/86 plus investment earnings equals $4,000
- - And the withdrawal equals $1,000
- - 3/4 of the withdrawal will not be taxable ($3,000/$4,000);
1/4 of the withdrawal will be taxable
- - Non-taxable amount equals $750
- - Taxable amount equals $250
In other words, in the above example, if a participant withdraws $1,000 from
his or her after-tax account that he or she contributed to the Plan after
December 31, 1986, $750 would not be taxable; $250 would be considered by the
IRS to be a return of investment earnings and subject to regular income tax,
the 20% withholding requirement and possibly the 10% additional tax.
Tax Treatment of Withdrawals From a Participant's Before-Tax Account
A participant's before-tax contributions are not taxed when they go into his or
her account, rather they are fully taxed when withdrawn. If a participant
withdraws money from his or her account during active employment, the money
will be added to his or her other income for that year and taxed at the
participant's applicable income tax rate. Withdrawals during active employment
may also be subject to a 10% additional tax over and above any regular income
taxes due, unless a participant meets any of the conditions listed in Tax
Treatment of Distributions and Withdrawals. Loans from a participant's
before-tax account are not taxable.
If the withdrawal is payable to a participant, the withholding requirements
discussed previously apply. A participant can avoid the Federal withholding
requirement by requesting a direct rollover to an IRA or another tax qualified
plan.
Possible Tax Advantages When Receiving a Lump Sum Distribution
If a participant receives a lump sum distribution of his or her account, he or
she may be able to defer or reduce their tax liability.
In general, a participant can use only one of the following tax advantages:
1. Deferral of tax liability
If a participant leaves the Company and receives the full value of his or her
account, he or she may want to consider rolling all or part of the taxable
amount into an IRA or into another employer's tax qualified plan. By doing so,
the participant can continue to defer paying taxes on the money. If the account
would otherwise be subject to the 10% additional tax, this approach would let
the participant avoid paying this additional tax if he or she leaves their
money in the IRA or other plan until they are age 59 1/2. However, a
participant will not be able to use five-or ten-year averaging (described
below) to calculate taxes on a distribution from an IRA.
2. Reduction of tax liability
If a participant takes a lump sum distribution of his or her account, he or she
may be entitled to special tax treatment such as five-year or ten-year
averaging or long-term capital gains treatment.
-22-
<PAGE> 23
If the participant was younger than 50 years old on January 1, 1986, five-year
averaging tax treatment is available only once, and only if: the
entire account balance is paid to the participant in one tax year after age 59
1/2, and the individual was a Plan participant for five or more years.
Under five-year averaging, the lump sum distribution is taxed in one year as if
the participant had received it over five years and as if he or she had no
other income during that time. The tax rate used is the one effective during
the year the participant receives the distribution.
If a participant was age 50 or over as of January 1,1986, he or she is
grandfathered under pre-1987 tax laws. This means that if the participant
receives the entire balance of his or her account in one tax year, he or she
will have a choice of:
- - ten-year averaging under 1986 tax rates, or
- - five-year averaging under the rates prevailing in the year he or she
receives the money.
If a participant is grandfathered, he or she can use five-year or ten-year
averaging at any time, but whichever method he or she chooses can only be used
once. The participant can choose whichever method is best for him or her.
However, to use either averaging method, he or she must have been a Plan
participant for five or more years.
-23-
<PAGE> 24
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Thrift Plan Committee has duly caused this annual report to be signed on
its behalf by the undersigned hereunto duly authorized.
EMPLOYEES' THRIFT PLAN OF
COLUMBIA GAS SYSTEM
June 26, 1996 By /s/ D. P. Geran
---------------------------------
D. P. Geran
Secretary, Thrift Plan Committee
-24-
