Corning Natural Gas Corporation
330 W. William Street
P.O. Box 58
Corning, New York 14830
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
to be held on Tuesday, April 23, 1996
Corning, New York
March 29, 1996
To the Common Stockholders of
Corning Natural Gas Corporation
Notice is hereby given that the Annual Meeting of Stockholders of Corning
Natural Gas Corporation will be held at the office of the Company, 330 W.
William Street, in the City of Corning, New York, on Tuesday, April 23, 1996 at
10:30 A.M., local time, for the following purposes:
(1) To fix the number of Directors at seven and to elect a Board of
Directors for the ensuing year.
(2) To transact such other business as may properly come before the
meeting.
The stock transfer books will not be closed, but only common stockholders
of record at the close of business on March 22, 1996 will be entitled to vote at
the meeting or any adjournment thereof.
You are cordially invited to attend the meeting and vote your shares. In
the event that you cannot attend, please date, sign and mail the enclosed proxy
in the enclosed self-addressed envelope. A stockholder who executes and returns
a proxy in the accompanying form has the power to revoke such proxy at any time
prior to the exercise thereof.
By Order of the Board of Directors
PHYLLIS J. GROEGER, Secretary
CORNING NATURAL GAS CORPORATION
PROXY STATEMENT
March 29, 1996
By Whom Proxy Solicited and Solicitation Expenses. The accompanying proxy
is solicited by the Board of Directors of the Company for use at the Annual
Meeting of Stockholders to be held on Tuesday, April 23, 1996. Proxies in
substantially the accompanying form, properly executed and received prior to or
delivered at the meeting and not revoked, will be voted in accordance with the
specification made. The expense of soliciting proxies will be borne by the
Company.
The approximate date upon which this proxy statement and the accompanying
proxy will first be mailed to stockholders is March 29, 1996.
Right to Revoke Proxy. Any stockholder giving the proxy enclosed with this
statement has the power to revoke it at any time prior to the exercise thereof.
Such revocation may be by writing (which may include a later dated proxy)
received by the Office of the Secretary, Corning Natural Gas Corporation, 330 W.
William Street, P.O. Box 58, Corning, New York, 14830, no later than April 22,
1996 if by mail, or prior to the exercise thereof if delivered by hand. Such
revocation may also be effected orally at the meeting prior to the exercise of
the proxy.
Proposals of Stockholders. Stockholders' proposals intended to be
presented at the 1997 Annual Meeting of Stockholders must be received by the
Office of the Secretary, Corning Natural Gas Corporation, 330 W. William Street,
P.O. Box 58, Corning, New York 14830, by December 5, 1996.
Voting Securities Outstanding. There were 460,000 shares of common stock
outstanding and entitled to vote on March 22, 1996 (the "Record Date"). Each
share of common stock is entitled to one vote. Only stockholders of record on
the Record Date are entitled to notice of and to vote at the meeting or any
adjournment thereof.
Abstentions and broker non-votes are each included in calculating the
number of shares present and voting for purposes of determining quorum
requirements. However, each is tabulated separately. Abstentions are counted
in tabulating the votes cast on proposals presented to shareholders, whereas
broker non-votes are not counted for purposes of determining whether a proposal
has been approved.
The following table sets forth the shares of the Company's common stock,
and the percent of total outstanding shares represented thereby, beneficially
owned* by the nominees for director of the Company, the Chief Executive Officer
of the Company, all directors and officers as a group, and all persons or groups
known to the Company to beneficially own more than 5% of such stock.
* As used in this Proxy Statement, "beneficial ownership" includes direct or
indirect, sole or shared power to vote, or to direct the voting of, and/or
investment power to dispose of, or to direct the disposition of, shares of
the common stock of the Company. Except as otherwise indicated in the
footnotes below, the listed beneficial owners held direct and sole voting
and investment power with respect to the stated shares.
Shares of Stock
Beneficially Owned
Directly or Indirectly Percent
Beneficial Owners as of December 31, 1995 of Class
J. Edward Barry (Director) 45,999(1) 10.0%
330 W. William Street
Corning, New York
Thomas K. Barry (Director and 14,031(2) 3.0%
Chief Executive Officer)
330 W. William Street
Corning, New York
Thomas H. Bilodeau (Director) 3,788(3) 0.8%
1648 Jupiter Cove Dr., Apt. 312
Jupiter, Florida
Bradford J. Faxon (Director) 26,210(4) 5.7%
225 Hix Bridge Road
Westport, Massachusetts
Jay A. Finley (Director) 12,900(5) 2.8%
27 Spring Terrace
Corning, New York
Liselotte R. Lull and 45,029(6) 9.8%
Robert E. Lull
231 Watauga Avenue
Corning, New York
Jack R. McCormick (Director) 1,469(7) 0.3%
2560 Riverside Avenue
Somerset, Massachusetts
Donald R. Patnode (Director) 13,353(8) 2.9%
91 Stage Harbor Road
Chatham, Massachusetts
All directors and officers 121,610(9) 26.4%
of the Company, twelve persons
as a group
(1) Includes 25,066 shares held in trust, with respect to which J. Edward Barry
has shared voting and investment power, and 20,933 shares beneficially
owned and held in trust on behalf of Virginia S. Barry, with respect to
which J. Edward Barry also has shared voting and investment power.
Percentage reflects rounding; actual percentage is less than 10 percent.
(2) Includes indirect beneficial ownership of 1,000 shares owned by children of
Thomas K. Barry, and as to which Thomas K. Barry has shared voting and
investment power. Also includes 1,000 shares owned by a daughter of Thomas
K. Barry, as to which shares Mr. Barry disclaims beneficial ownership.
(3) All shares are held in trusts and Mr. Bilodeau is a beneficiary or
contingent beneficiary of such trusts.
(4) Includes indirect beneficial ownership of 5,431 shares owned by children of
Bradford J. Faxon, and as to which Bradford J. Faxon has shared voting and
investment power.
(5) Includes indirect beneficial ownership of 6,450 shares owned by Gertrude C.
Finley, who has sole voting and investment power over such shares.
(6) Includes 23,378 shares owned by Liselotte R. Lull and 21,651 shares owned
by Robert E. Lull.
(7) All shares are owned jointly with Madeline McCormick.
(8) Includes 1,159 shares owned by spouse, who has sole voting and investment
power over such shares. Also includes 6,994 shares held in two trusts, of
which Donald R. Patnode is co-trustee.
(9) Aggregate record or imputed beneficial ownership, with sole or shared
voting or investment power.
Election of Directors. (Proposal No. 1) It is the intention of the
persons named in the enclosed proxy to vote the shares represented by the proxy
to fix the number of directors at seven and to elect the nominees listed below
to serve until the next Annual Meeting of Stockholders and until their
successors are duly elected and qualified. In the event of a vacancy in the
list of nominees, an event which the Board of Directors does not anticipate, the
holders of the proxies will vote for the election of a nominee acceptable to the
remaining nominees.The directors must be elected by a plurality of votes cast.
The following is a brief description of each nominee, including his principal
employment or professional experience for the past five years.
J. Edward Barry, 83, Consultant to the Company. Former Chairman of
the Board of Directors 1975 - 1993. A Director since 1953 and Chairman of
the Executive and Pension Fund Committees. Father of Thomas K. Barry,
Chairman of the Board, Chief Executive Officer and President of the
Company.
Thomas K. Barry, 50, Chairman of the Board of Directors since 1993,
President of the Company since 1983, Chief Executive Officer since 1984. A
Director since 1983 and a member of the Executive and Pension Fund
Committees. A Director of Fall River Gas Company. Son of J. Edward Barry,
Consultant to the Company.
Thomas H. Bilodeau, 53, Vice President - Finance, Medical &
Environmental Coolers, Inc. since 1990. A Director since 1984 and a member
of the Compensation and Audit Committees. A Director of Fall River Gas
Company.
Bradford J. Faxon, 58, Chairman of the Board of Directors, President
and Director of Fall River Gas Company since 1986. A Director since 1984,
Chairman of the Compensation Committee and a member of the Pension Fund
Committee.
Jay A. Finley, 81, Retired; former President of the Company, 1977-
1983. A Director since 1975 and a member of the Executive Committee.
Jack R. McCormick, 71, Utility Consultant; current Director and former
President (1974-1986) of Fall River Gas Company. A Director since 1985 and
a member of the Audit Committee.
Donald R. Patnode, 67, Retired; former President of Industrial Filters
and Equipment Corporation 1989-1994. A Director since 1964, Chairman of the
Audit Committee and a member of the Compensation Committee. Director also
of Fall River Gas Company.
The Board of Directors does not have a standing nominating committee, or
any committee performing similar functions. The Board of Directors has a
standing Audit Committee, of which Messrs. D.R. Patnode, J.R. McCormick and T.H.
Bilodeau are the members, the function of which is to recommend the selection of
independent auditors, review the plan and results of the independent audit and
approve each professional service provided by the independent auditors. The
Audit Committee had one meeting in 1995. The Board of Directors also has a
standing Compensation Committee, of which Messrs. D.R. Patnode, B.J. Faxon and
T.H. Bilodeau are the members. This committee met once during 1995. This
committee reviews officer performance and duties and decides upon appropriate
remuneration. The Board of Directors met five times in 1995. Each Director
attended more than 75% of the aggregate number of meetings of the Board and
committees on which he served during the year.
At the most recent annual meeting of stockholders of the Company, held on
April 25, 1995, out of a total of 460,000 shares entitled to vote at the
meeting, 441,670 shares (96% of the total) were actually voted at the meeting
with respect to the election of Directors. Nominees proposed for election by
the Board of Directors were elected by requisite vote at such meeting. Each
nominee received an affirmative vote of over 99% of the votes cast.
Cash Compensation of Executive Officers. The following table sets forth
the compensation paid or accrued by the Company and its subsidiary during the
fiscal years ended December 31, 1993, 1994 and 1995 to the Company's Chief
Executive Officer. Other than the Chief Executive Officer, no other executive
officer of the Company was paid an annual salary and bonus in 1995 that
aggregated $100,000. Although only principal capacities are listed, the
compensation figures include all compensation received in any capacity,
including directorships, for services rendered during the fiscal years
indicated.
SUMMARY COMPENSATION TABLE
Annual Compensation(1)
Name and Other Annual
Principal Position Year Salary Bonus Compensation
Thomas K. Barry 1995 $134,967 --- $ 3,721
President and Chief 1994 126,667 --- 3,512
Executive Officer 1993 118,367 --- 2,581
(1) The Company did not pay any long-term compensation to its Chief Executive
Officer or to its other executive officers during the fiscal year ended
December 31, 1993, 1994 and 1995.
A description of the executive officers, other than Mr. Thomas K. Barry,
for whom a description is provided above, is set forth below.
Kenneth J. Robinson (age 51) is Executive Vice President. Mr. Robinson
joined the Company in 1978 as an accountant. Most recently he served as
Financial Vice President and Treasurer for 4 years and in his current position
for 4 years.
Edgar F. Lewis (age 58) is Senior Vice President - Operations. Mr. Lewis'
career with the Company dates back to 1956. He has been in charge of operations
for the past 23 years; 15 years in his current position.
Thomas S. Roye (age 42) is Vice President - Administration. Mr. Roye has
served 4 years in his current position and was previously Assistant Treasurer &
Assistant Secretary. He has prior utility experience and accounting education
and has been employed since 1978.
Gary K. Earley (age 41) is Treasurer. Mr. Earley has been a practicing
accountant since 1976. He joined the firm in 1987 as an accountant in the rates
and regulations department and has served as Treasurer for the past 4 years.
Phyllis J. Groeger (age 55) is Corporate Secretary. Mrs. Groeger has been
employed since 1973 in a number of positions advancing to Assistant Secretary in
1986 and has been Secretary of the Company for the past 8 years.
Compensation Pursuant to Plans. The Company has entered into separate
supplemental benefits agreements with Thomas K. Barry and one other executive
officer (collectively, the "Supplemental Benefits Agreements"), which provide
that the officer covered thereby and retiring after the age of 62 is entitled to
receive monthly payments equal to 35% of such officer's monthly salary at
retirement for either life or 180 months, whichever is longer. Such amount
payable shall increase by 4% annually on the anniversary date of such officer's
retirement. Retirement benefits otherwise available upon retirement at age 62
under the Supplemental Benefits Agreements are reduced cumulatively by 4% for
each year prior to age 60 in which the covered officer retires; provided,
however, that an officer covered under a Supplemental Benefits Agreement
receives no retirement benefits thereunder in the event that such officer
retires before age 55. Furthermore, the Supplemental Benefits Agreements
provide that in the event that an officer covered by a Supplemental Benefits
Agreement dies prior to retirement, such officer's designated beneficiary is
entitled to receive monthly payments equal to 50% of such officer's monthly
salary at death for 180 months.
The Company has also entered into an additional, more limited, Supplemental
Benefits Agreement with one other employee, which contains terms similar to the
foregoing agreements. However, such limited Supplemental Benefits Agreement
provides for monthly payments equal to 20% of the subject employee's monthly
salary in the event of retirement, monthly payments equal to 35% of his monthly
salary in the event of his death prior to retirement, and does not include an
annual escalator.
Eligibility to enter into a Supplemental Benefits Agreement, or equivalent
thereof, is based upon employee performance, service and value to the Company;
such eligibility is determined on an individual basis by the Board.
Currently, Mr. Thomas K. Barry and two other executive officers (as discussed,
above) are the only employees of the Company covered by a Supplemental Benefits
Agreement, and no payments have been made to date under such agreements. The
Supplemental Benefits Agreements are in addition to the amounts shown in the
Summary Compensation Table and are not subject to limitation. As of December
31, 1995, the estimated annual benefits payable under a Supplemental Benefits
Agreement upon retirement at the normal retirement age for Mr. Thomas K. Barry
are $ 43,983.
The Company also maintains the Corning Natural Gas Corporation Employees
Savings Plan (the "Savings Plan"). All non-union employees of the Company who
work for more than 1,000 hours per year and who have completed one year of
service may participate in the Savings Plan as of the following January 1 or
July 1. Under the Savings Plan, participants may contribute up to 15% of their
wages. The Company will match one-half of the participant's contributions up to
a total of 3% of the participant's wages. Company matching contributions vest
in the participants at a rate of 20% per year and become fully vested after five
years. Participants may select one of five investment plans, or a combination
thereof, for their account. Distribution of amounts accumulated under the
Savings Plan occurs upon the termination of employment or death of the
participant. The Savings Plan also contains loan and hardship withdrawal
provisions. During the year ended December 31, 1995, no amounts were
distributed to executive officers under the Savings Plan. Mr. Thomas K. Barry
had $3,721 accrued to his account under the Savings Plan during said period.
This accrual is included in the figures appearing in the summary compensation
table on page 5.
Compensation of Directors. The current annual Director's compensation is
$4,000. In addition, Directors are paid $300 for each Board meeting attended.
Additionally, the chairmen of the Board's Executive, Audit, Compensation and
Pension Fund committees and those directors who serve on more than one committee
receive an annual fee of $1,500 for such services. Committee members other than
the chairmen are paid $1,000 annually for their services, subject to the
limitation that no committee chairman or member may receive more than $1,500
annually for such services regardless of the number of committees on which he
serves.
As allowed by New York law, the Company currently has in effect an
insurance policy, with an effective date of June 1, 1995, with National Union
Fire Insurance Company for the indemnification of officers and directors at an
annual premium cost of $ 43,000.
Employment Contracts and Termination of Employment and Change-in-Control
Arrangements. In January of 1992, the Company entered into an employment
contract with its President and Chief Executive Officer, Mr. Thomas K. Barry.
Under the terms of such employment contract, Mr. Barry is compensated for his
duties as an officer and director with such salary as is determined from time to
time by the Board of Directors. The term of Mr. Barry's employment contract is
five years, unless earlier terminated by an act of either the Company or Mr.
Barry. Beginning in 1994, however, the remaining term of Mr. Barry's employment
contract is automatically extended for an additional one-year period. Mr.
Barry's employment contract further provides that upon any change in control of
the Company leading to the termination of Mr. Barry's employment with the
Company, the Company shall pay Mr. Barry three times his then-present annual
salary, or such lesser amount as may be required to comply with certain
provisions of the Internal Revenue Code.
Selection of Auditors. KPMG Peat Marwick, Certified Public Accountants of
Rochester, New York, have been selected as auditors for the Company for the
ensuing year. KPMG Peat Marwick, who served as principal accountants for the
Company for the past fiscal year, have no direct or indirect financial interest
in the Company or its subsidiaries in the capacity of promoter, underwriter,
voting director, officer or employee. A representative of KPMG Peat Marwick
will be present at the meeting, with the opportunity to make a statement if such
representative desires to do so, and will be available to respond to appropriate
questions.
Other Matters. Except for the matters set forth above, the Board of
Directors knows of no matters which may be presented to the meeting, but if any
other matters properly come before the meeting, it is the intention of the
persons named in the accompanying form of proxy to vote such proxy in accordance
with their judgment in such matters.
PLEASE DATE, SIGN AND RETURN THE ENCLOSED PROXY.
By Order of the Board of Directors,
PHYLLIS J. GROEGER, Secretary
Persons whose proxies are solicited by the Board of Directors of the Company may
obtain, without charge, a copy of the Company's Annual Report on Form 10-KSB,
including the financial statements and schedules thereto, required to be filed
with the Securities and Exchange Commission for the Company's most recent fiscal
year. The report will be furnished upon request made in writing to:
Thomas K. Barry
Chairman of the Board of Directors
Corning Natural Gas Corporation
330 W. William Street
P.O. Box 58
Corning, New York 14830
