UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
_x_ Quarterly Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the quarterly period ended March 31, 1998
OR
___ Transition Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the transition period from to
COMMISSION FILE NUMBER 0-10007
COLONIAL GAS COMPANY
(Exact name of registrant as specified in its charter)
Massachusetts 04-1558100
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
40 Market Street, Lowell, Massachusetts 01852
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (978)322-3000
Former name, former address and former fiscal year, if
changed since last report: Not applicable
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 ___
The number of shares of the registrant's common stock, $3.33
par value, outstanding as of April 30, 1998 was 8,732,120.
COLONIAL GAS COMPANY
INDEX
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Condensed Statements of Income -
Three Months Ended March 31, 1998 and 1997
Twelve Months Ended March 31, 1998 and 1997
Consolidated Condensed Balance Sheets -
March 31, 1998, December 31, 1997 and
March 31, 1997
Consolidated Condensed Statements of Cash Flows -
Three Months Ended March 31, 1998 and 1997
Twelve Months Ended March 31, 1998 and 1997
Notes to Consolidated Condensed Financial Statements
Item 2. Management's Discussion and Analysis of Results of
Operations and Financial Condition
PART II - OTHER INFORMATION
Item 5. Other Information
Item 6. Exhibits and Reports on Form 8-K
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
COLONIAL GAS COMPANY AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(UNAUDITED)
Three Months Ended
March 31,
1998 1997
(In Thousands Except
Per Share Amounts)
Operating Revenues $77,822 $83,061
Cost of gas sold 40,917 43,717
Operating Margin 36,905 39,344
Operating Expenses:
Operations 6,650 7,437
Maintenance 1,067 1,146
Depreciation and Amortization 3,184 2,973
Taxes, other than income 1,254 1,382
Total Operating Expenses 12,155 12,938
Income Taxes 8,675 9,432
Utility Operating Income 16,075 16,974
Other Operating Income:
Energy Trucking revenues 406 1,339
Energy Trucking expenses, including income
taxes and interest 361 1,258
Energy Trucking net income 45 81
Other, net of income taxes 51 49
Total Other Operating Income 96 130
Non-Operating Income, Net 176 94
Income Before Interest and Debt Expense 16,347 17,198
Interest and Debt Expense 2,135 1,905
Net Income $14,212 $15,293
Average Common Shares Outstanding 8,703 8,543
Income per Average Common Share $ 1.63 $ 1.79
Dividends Paid per Common Share $ .335 $ .325
(See accompanying notes to consolidated condensed financial
statements)
COLONIAL GAS COMPANY AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(UNAUDITED)
Twelve Months Ended
March 31,
1998 1997
(In Thousands Except
Per Share Amounts)
Operating Revenues $181,901 $175,630
Cost of gas sold 99,655 92,909
Operating Margin 82,246 82,721
Operating Expenses:
Operations 29,257 28,940
Maintenance 4,425 4,505
Depreciation and Amortization 12,260 11,307
Taxes, other than income 5,132 5,357
Total Operating Expenses 51,074 50,109
Income Taxes 9,216 9,675
Utility Operating Income 21,956 22,937
Other Operating Income:
Energy Trucking revenues 4,596 8,794
Energy Trucking expenses, including
income taxes and interest 4,305 7,602
Energy Trucking net income 291 1,192
Other, net of income taxes 317 203
Total Other Operating Income 608 1,395
Non-Operating Income, Net 659 692
Income Before Interest and Debt Expense 23,223 25,024
Interest and Debt Expense 8,264 8,481
Net Income $14,959 $16,543
Average Common Shares Outstanding 8,640 8,470
Income per Average Common Share $ 1.73 $ 1.95
Dividends Paid per Common Share $ 1.34 $ 1.30
(See accompanying notes to consolidated condensed financial
statements)
COLONIAL GAS COMPANY AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
ASSETS
March 31, December 31, March 31,
1998 1997 1997
(Unaudited) (Unaudited)
(In Thousands)
Utility Property:
At original cost $370,317 $362,742 $338,174
Accumulated depreciation (91,523) (88,210) (85,433)
Net utility property 278,794 274,532 252,741
Non-Utility Property - Net 7,567 7,312 5,879
Net property 286,361 281,844 258,620
Capital Leases - Net 2,614 2,630 2,487
Current Assets:
Cash and cash equivalents 3,092 259 3,406
Accounts receivable 29,991 21,788 32,102
Allowance for doubtful
accounts (3,561) (3,203) (3,445)
Accrued utility revenues 5,447 7,417 5,869
Unbilled gas costs 8,118 19,266 12,296
Fuel and other inventories 10,122 12,959 8,785
Prepayments and other current
assets 6,791 9,481 5,778
Total current assets 60,000 67,967 64,791
Deferred Charges and Other Assets:
Unrecovered deferred
income taxes 8,820 9,014 9,580
Unrecovered demand side
management costs 8,122 8,273 7,983
Unrecovered environmental
expenses - incurred 4,135 3,833 4,130
Unrecovered environmental
expenses - accrued 707 707 1,063
Unrecovered transition
costs - accrued 2,800 2,800 4,500
Other 12,202 11,923 11,499
Total deferred charges
and other assets 36,786 36,550 38,755
Total Assets $385,761 $388,991 $364,653
(See accompanying notes to consolidated condensed financial
statements)
COLONIAL GAS COMPANY AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
LIABILITIES AND CAPITALIZATION
March 31, December 31, March 31,
1998 1997 1997
(Unaudited) (Unaudited)
(In Thousands)
Capitalization:
Common equity:
Common Stock - par value $3.33 per share
Authorized - 15,000 shares
Issued and outstanding -
8,728, 8,688 and
8,561 shares $29,063 $28,931 $28,508
Premium on common stock 58,262 57,277 54,985
Retained earnings 47,219 35,924 43,838
Total Common equity 134,544 122,132 127,331
Long-term debt 90,059 100,102 85,226
Total capitalization 224,603 222,234 212,557
Capital Lease Obligations 1,528 1,617 1,538
Current Liabilities:
Current maturities of
long-term debt 20,167 10,164 15,155
Current capital lease
obligations 1,086 1,013 949
Notes payable 38,500 49,400 40,100
Gas inventory purchase
obligations 9,088 14,895 7,412
Accounts payable 10,482 15,674 8,556
Other 17,268 11,362 17,733
Total current liabilities 96,591 102,508 89,905
Deferred Credits and Reserves:
Deferred income taxes-funded 42,626 41,443 37,023
Deferred income taxes-unfunded 8,820 9,014 9,580
Accrued environmental expenses 707 707 1,063
Accrued transition costs 2,800 2,800 4,500
Other 8,086 8,668 8,487
Total deferred credits
and reserves 63,039 62,632 60,653
Total Capitalization and
Liabilities $385,761 $388,991 $364,653
(See accompanying notes to consolidated condensed financial
statements)
COLONIAL GAS COMPANY AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Three Months Ended
March 31,
1998 1997
(In Thousands)
Cash Flows From Operating Activities:
Net income $14,212 $15,293
Adjustments to reconcile net
income to net cash 3,719 2,498
Changes in current assets and
liabilities 12,392 6,173
Net cash provided by operating
activities 30,323 23,964
Cash Flows From Investing Activities:
Utility capital expenditures (7,489) (4,836)
Non-utility capital expenditures (378) (56)
Change in deferred accounts (734) (1,376)
Net cash used in investing
activities (8,602) (6,268)
Cash Flows From Financing Activities:
Dividends paid on Common Stock (2,917) (2,774)
Issuance of Common Stock 1,117 907
Issuance of long-term debt, net of
issuance costS 9,658 0
Retirement of long-term debt, including
premiums (10,040) (37)
Change in notes payable (10,900) (10,300)
Change in gas inventory purchase
obligations (5,807) (5,627)
Net cash used in financing
activities (18,889) (17,831)
Net increase (decrease) in cash and
cash equivalents 2,832 (135)
Cash and cash equivalents at beginning of
period 259 3,541
Cash and cash equivalents at end of period $3,092 $3,406
Supplemental Disclosures of Cash Flow
Information:
Cash paid during the period for:
Interest - net of amount capitalized $3,414 $2,812
Income and franchise taxes $ 278 $ 529
(See accompanying notes to consolidated condensed financial
statements)
COLONIAL GAS COMPANY AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Twelve Months Ended
March 31,
1998 1997
(In Thousands)
Cash Flows From Operating Activities:
Net income $14,959 $16,543
Adjustments to reconcile net income
to net cash 19,528 20,218
Changes in current assets and liabilities 4,346 (12,430)
Net cash provided by operating
activities 38,833 24,331
Cash Flows From Investing Activities:
Capital expenditures (38,441) (27,415)
Non-utility Capital expenditures (2,210) (973)
Change in deferred accounts (200) (2,924)
Net cash used in investing
activities (40,851) (31,312)
Cash Flows From Financing Activities:
Dividends paid on Common Stock (11,578) (11,013)
Issuance of Common Stock 3,832 3,503
Issuance of long-term debt, net of
issuance costs 24,528 19,867
Retirement of long-term debt, including
premiums (15,155) (11,286)
Change in notes payable (1,600) 100
Change in gas inventory purchase
obligations 1,676 1,371
Net cash (used in) provided by
financing activities 1,703 2,542
Net decrease in cash and cash equivalents (315) (4,439)
Cash and cash equivalents at beginning of
period 3,406 7,845
Cash and cash equivalents at end of period $3,092 $3,406
Supplemental Disclosures of Cash
Flow Information:
Cash paid during the period for:
Interest - net of amount
capitalized $10,067 $9,795
Income and franchise taxes $7,258 $6,283
(See accompanying notes to consolidated condensed financial
statements)
COLONIAL GAS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
1. In the opinion of the Company, the accompanying unaudited
consolidated condensed financial statements contain all
adjustments (consisting of only normal recurring
accruals) necessary to present fairly the financial
position as of March 31, 1998 and 1997 and results of
operations for the three and twelve month periods ended
March 31, 1998 and 1997 and cash flows for the three and
twelve month periods ended March 31, 1998 and 1997.
2. Due to the significant impact of gas used for space
heating during the heating season (November-April) and
the Company's seasonal rate structure, the results of
operations for the three month periods ending March 31,
1998 and 1997 are not necessarily indicative of the
results to be expected for the full year.
3. During the three months ended March 31, 1998, the Company
issued 40,000 shares of Common Stock, $3.33 par value,
under a Dividend Reinvestment and Common Stock Purchase
Plan and under an Employee Savings Plan. As a result,
Common Stock, $3.33 par value, increased $132,000 and
Premium on Common Stock increased $985,000.
4. Contingencies
Reference is made to Note I/Contingencies of the Notes to
Consolidated Financial Statements contained within the
Company's 1997 Annual Report to Stockholders.
5. Reclassifications are made periodically to previously
issued financial statements to conform to the current
year presentation.
Item 2. Management's Discussion and Analysis of Results of
Operations and Financial Condition
Results of Operations
Three Months Ended March 31, 1998 and 1997
Net income for the three months ending March 31, 1998
decreased $1,081,000 or 7.1% to $14,212,000 compared to
$15,293,000 for the same period last year. Weather for the
first quarter was 10.2% warmer than the prior year and 13.5%
warmer than normal, causing a $2,439,000 or 6.2% decrease in
operating margin. Operating income for the Company's utility
operations decreased $899,000 or 5.3%, despite an $787,000
or 11% reduction in operations expense due to a $460,000
decrease in bad debt expense, a $156,000 decrease in health
insurance expense, and a $112,000 decrease in payroll costs.
Income taxes decreased $757,000 or 8.0% due to a lower level
of utility income subject to tax.
Other operating income (net of income taxes) decreased
$34,000 or 26% over the comparable 1997 period primarily as
a result of a $36,000 or 45% decrease in net income of
Transgas Inc., the Company's energy trucking subsidiary,
which is attributable to the warmer weather. Hauls of
liquefied natural gas (LNG) decreased 45% in the three
months ended March 30, 1998, compared to the same period in
1997.
Interest expense increased $230,000 or 12% in the three
months ended March 31, 1998 compared to the same period last
year principally due to the issuance of long-term debt to
finance capital expenditures.
Twelve Months Ended March 31, 1998 and 1997
Net income was $14,959,000 for the twelve months ending
March 31, 1998, compared with $16,543,000 for the comparable
1997 period. This $1,584,000 or 9.6% decrease in net income
primarily resulted from three factors: weather which was
3.6% warmer than normal and 2% warmer than the prior period;
a $901,000 or 76% weather-related decline in earnings from
Transgas Inc., and a $953,000 or 8.4% increase in
depreciation due to the addition of utility property.
Other operating income (net of income taxes) decreased
$787,000 or 56% compared to the comparable 1997 period. The
net income of Transgas Inc. for the twelve months ended
March 31, 1998 decreased $901,000 or 76% due to the warm
winter of 1997-1998, which resulted in a significant
decrease in demand for energy trucking services. The
decrease in Transgas net income was partially offset by
increased merchandise and jobbing net income of $114,000.
Regulatory Matters
On May 8, 1998, the Massachusetts Department of
Telecommunications and Energy (the "DTE") opened an industry-
wide investigation into the time period for calculating the
lost margins gas companies are allowed to recover as a
result of their conservation or demand side management
("DSM") programs. The investigation was opened in
connection with a December 1997 filing by the Company which
sought the collection of lost DSM margins for the period May
1996 through April 1997. In that December 1997 filing, the
Company used the same calculation method (based on the
useful life of installed conservation measures) that it had
used in filings previously approved by the DTE. The current
DTE investigation could result in a shortening of the time
period for calculating lost DSM margins to less than the
full useful life of installed measures. A shortening of the
period would result in some decrease in operating revenues,
but it is uncertain at this time whether or by how much the
period would be shortened and, therefore, what impact it
would have on the Company.
Information Systems
As part of its ongoing "Genesis" program for automating and
improving its information systems, the Company is in the
process of implementing a new customer information and
billing system that is expected to be in place by the end of
May 1998. The new customer information and billing system
is designed to be capable of processing Year 2000 and
subsequent date data. Although there can be no assurance
until the conversion to the new system is completed, at this
time the Company does not anticipate any significant
implementation difficulties.
Liquidity and Capital Resources
On April 15, 1998, the quarterly dividend on the Company's
common stock was increased to $.345 per share or an
annualized dividend rate of $1.38 per share. This is the
62nd consecutive year that the Company has paid a dividend
to common shareholders and the 19th consecutive year that it
has increased its per share dividend payment.
On December 9, 1997, the Company received approval from the
DTE to issue and sell up to 400,000 shares of Common Stock
pursuant to the Company's Common Stock and Dividend
Reinvestment Plan.
On March 20, 1998, the Company issued the remaining
$10,000,000 under its Medium Term Note Program ("MTN")
(Series A) as a 10-year First Mortgage Bond with an
effective rate of 6.38%.
On March 30, 1998, the Company established a new $75,000,000
MTN Program (Series B), of which approximately $45,000,000
has been authorized for issuance to date by the
Massachusetts Department of Telecommunications and Energy
(DTE).
On April 2, 1998, the Company called $20,000,000 of 8.05%
First Mortgage Bonds (Series CG) one year prior to their
maturity, at a price of 102.02%.
On April 7, 1998, the Company issued $20,000,000 of 30-year
First Mortgage Bonds under its MTN Program (Series B), with
an effective rate of 6.68%. The Bonds are redeemable at the
option of the holder in April 2008.
PART II - OTHER INFORMATION
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
a. Exhibits
4(l) Fourth Supplemental Indenture Filed herewith.
dated as of March 1, 1998
relating to the Company's Secured
Medium Term Notes, Series B
b. Reports on Form 8-K
None
SIGNATURES
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.
COLONIAL GAS COMPANY
(Registrant)
Date: May 15, 1998 s/F.L. Putnam, III
F.L. Putnam, III
President and Chief
Executive Officer
Date: May 15, 1998 s/Nickolas Stavropoulos
Nickolas Stavropoulos
Executive Vice President -
Finance, Marketing and Chief
Financial Officer
[END OF FORM 10-Q FOR PERIOD ENDING MARCH 31, 1998]
[EXHIBIT 4l TO COLONIAL GAS COMPANY'S FORM 10-Q]
COLONIAL GAS COMPANY
TO
STATE STREET BANK AND TRUST COMPANY,
Trustee
_______________
Fourth Supplemental Indenture
Dated as of March 1, 1998
to Second Amended and
Restated First Mortgage Indenture
Additional Issue (Secured Medium Term Notes, Series B)
$75,000,000
COLONIAL GAS COMPANY
Fourth Supplemental Indenture
dated as of March 1, 1998 to Second
Amended and Restated First Mortgage Indenture
The above Supplemental Indenture was filed for recordation
in Massachusetts as follows:
Location Date Reference
Secretary of the Documents Nos.
Commonwealth March 30, 1998 539108 and 539109
Barnstable Instrument No.
County March 31, 1998 21782, Book 11324,
Page 14
Barnstable County, Document No. 721,491,
Land Registration March 31, 1998 Certificates of
Division Title Nos. 46050,
59716, and 84810
Middlesex County, Instrument No.
North Division March 31, 1998 20357, Book 9168,
Page 298
Middlesex County, Instrument No.
South Division March 31, 1998 244, Book _____,
Page _____
Plymouth March 31, 1998 Book 16043,
Page 236
THIS SUPPLEMENTAL INDENTURE, dated as of March 1, 1998
(hereinafter referred to as this "Supplemental Indenture" or this
"Instrument"), made and entered into by and between Colonial Gas
Company (formerly named "Lowell Gas Company"), a corporation duly
organized and existing under the laws of The Commonwealth of
Massachusetts, having its principal place of business at 40
Market Street, Lowell, Massachusetts (hereinafter referred to as
the "Company"), and State Street Bank and Trust Company, a
corporation duly organized and existing under the laws of the
Commonwealth of Massachusetts, having its principal place of
business at 225 Franklin Street, Boston, Massachusetts, as
successor Trustee (hereinafter referred to, together with its
successors hereunder, as the "Trustee") under the Second Amended
and Restated First Mortgage Indenture dated as of June 15, 1992,
as supplemented by the First to Third Supplemental Indentures
thereto, inclusive, and the Amendment to Second Supplemental
Indenture (as so supplemented and amended, the "Indenture"),
which amends, restates and supplements the Amended and Restated
First Mortgage Indenture dated as of July 1, 1981 from the
Company to State Street Bank and Trust Company, as supplemented
by the First to Eighth Supplemental Indentures thereto,
inclusive, which amended, restated and supplemented the First
Mortgage Indenture and Deed of Trust dated as of June 1, 1951
from Lowell Gas Company to State Street Bank and Trust Company,
as supplemented by the First to Twenty-second Supplemental
Indentures thereto, inclusive, and the Indenture of Trust and
First Mortgage dated as of April 1, 1950 from Cape Cod Gas
Company (which has been merged into and with the Company) to
State Street Bank and Trust Company, as supplemented by the First
to Twenty-fifth Supplemental Indentures, thereto, inclusive.
WHEREAS, the Company has heretofore duly executed and
delivered to the Trustee the Indenture to which this instrument
is supplemental, whereby substantially all the properties of the
Company used by it in its gas business, whether then owned or
thereafter acquired, with certain exceptions and reservations
fully set forth in the Indenture, were given, granted, bargained,
sold, transferred, assigned, pledged, mortgaged and conveyed to
the Trustee, its successors and assigns, in trust upon the terms
and conditions set forth therein to secure bonds of the Company
issued and to be issued thereunder (the "Bonds"), and for other
purposes more particularly specified therein; and
WHEREAS, in order to comply with the provisions of sections
2.02, 3.01(g) and 4.07 of the Indenture, it is desirable and the
Company is required and has duly and lawfully determined, at the
request of the Trustee, to execute and deliver this instrument
for the purpose of complying with said provisions; and
WHEREAS, for the protection of the holders of the Bonds it
is desirable to add certain covenants to the covenants of the
Indenture; and;
WHEREAS, it is necessary, desirable and not inconsistent
with the security and protection intended to be conferred upon
the Trustee and the holders of the Bonds to make certain
provisions in this instrument in regard to matters arising under
the Indenture; and
WHEREAS, Bonds in the principal amounts specified below have
heretofore been issued under and in accordance with the terms of
the Indenture (or Prior Indentures, as defined in the Indenture)
as separate series described or designated as hereinafter
specified, of which the respective amounts specified below were
outstanding as of the date hereof.
Principal Amount Principal
Authorized and Amount
Designation Issued Outstanding
First Mortgage Bonds, $20,000,000 $20,000,000
Series CG
First Mortgage Bonds, $25,000,000 $25,000,000
Series CH
First Mortgage Bonds, $75,000,000 $75,000,000
Medium Term Notes,
Series A
and the Company now proposes to issue from time to time up to
$75,000,000 in aggregate principal amount of additional First
Mortgage Bonds designated Secured Medium Term Notes, Series B
(herein referred to as the "Series B Notes") under the Indenture
subject to the prior approval of the Massachusetts Department of
Telecommunications and Energy with respect to any Series Notes
issued in excess of $45,896,060 in aggregate principal amount,
(subject to reduction in the event of the issuance of certain
other securities of the Company) which Bonds are to be further
designated and described, as to dates, maturities, interest rates,
sinking funds, denominations and redemption and call provisions,
in such Series B Notes which the Company may issue from time to
time, each in the form hereinafter set forth (and the Trustee hereby
confirms its approval, previously given prior to the certification
of any of said additional Bonds, of the form and designation thereof
so specified); and
WHEREAS, this Supplemental Indenture has been duly
authorized by resolution of the Board of Directors of the
Company, as required by section 3.01(b) of the Indenture, and the
use of terms and expressions herein is in accordance with
definitions, uses and constructions contained in the Indenture;
and
WHEREAS, the Series B Notes to be issued under, and in
accordance with the terms of, the Indenture are to be
substantially in the following form:
(Form of Series B Note)
Unless this Note is presented by an authorized
representative of The Depository Trust Company ("DTC") to the
issuer or its agent for registration of transfer, exchange or
payment, and any certificate issued is registered in the name of
Cede & Co. or such other name as requested by an authorized
representative of DTC and any payment hereon is made to Cede &
Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered
owner hereof, Cede & Co., has an interest herein.
This Note is a Global Note within the meaning of the
Indenture (described below) and is registered in the name of DTC,
or its nominee, as depositary. This Global Note is exchangeable
for certificated Series B Notes, registered in the name of a
person other than DTC or its nominee only in the limited
circumstances described in the Indenture, and no transfer of this
Note (other than the transfer of this Note as a whole by DTC to
its nominee or by such nominee to DTC or another nominee of DTC)
may be registered except in such limited circumstances.
No. ____-____COLONIAL GAS COMPANY $____________
Secured Medium Term Note, Series B
Due ________ ___, _____
COLONIAL GAS COMPANY, a Massachusetts corporation
(hereinafter, with its successors and assigns, as defined in the
Indenture mentioned below, generally called the "Company"), for
value received, hereby promises to pay to _____________________
or registered assigns, on ________ ___, _____ (or earlier as
hereinafter referred to), the principal sum of
_____________________________________ dollars ($__________) in
lawful money of the United States of America, and to pay interest
thereon (computed on the basis of a 360-day year of twelve 30-day
months), in like lawful money, from the date hereof, at the rate
of ______________________ percent (______%) per annum,
semi-annually on _______________ and _______________ of each year
(each, an "Interest Payment Date"), commencing with
__________ __, ____, and at maturity, or, if applicable, upon
earlier redemption or repayment, until the principal hereof shall
become due and payable.
The Company agrees to pay on demand interest on any overdue
principal (including any overdue prepayment of principal) and
premium, if any, at the rate of ____________________ percent
(_____%) per annum and, to the extent permitted by law, interest
on any overdue installment of interest at the rate at which such
overdue installment was computed according to the terms hereof.
For so long as this Note is a Global Note, the principal of,
and premium, if any, and interest on this Note will be paid by
the Company in immediately available funds through the Trustee to
DTC. If this Note is not a Global Note, the principal of and
premium, if any, and interest on this Note will be paid in
immediately available funds to the registered owners hereof as of
___________ and __________ of each year at the principal
corporate trust office in Boston, Massachusetts of State Street
Bank and Trust Company (hereinafter, with its successors and
predecessors as defined in said Indenture, generally called the
"Trustee") or at the principal office of its successor in the
trust created by said Indenture or, at the option of such
registered owner, at such other office or agency of the Trustee
or of the Company maintained by it for the purpose in the Borough
of Manhattan, The City of New York, New York, or such other place
as may be designated for the purpose pursuant to the provisions
of said Indenture in lawful money of the United States of
America. Interest on this Note will accrue from and including
the date hereof for the first interest period or from the most
recent Interest Payment Date to which interest has been paid or
duly provided for all subsequent interest periods to but
excluding the applicable Interest Payment Date or at maturity or,
if applicable, earlier redemption or repayment. If an Interest
Payment Date or the date of maturity or, if applicable, date of
earlier redemption or repayment, with respect to any Note falls
on a day that is not a Business Day (as defined below), the
required payment to be made on such day need not be made on such
day, but may be made on the next succeeding Business Day with the
same force and effect as if made on such day, and no interest
shall accrue on such payment for the period from and after such
day to the next succeeding Business Day. "Business Day" means
any day, other than a Saturday or Sunday, that is neither a legal
holiday nor a day on which banking institutions are authorized or
required by law, regulation or executive order to close in The
City of New York or the City of Boston.
This Note is one of a duly authorized issue of First
Mortgage Bonds of the Company (the "Bonds") issued or to be
issued in one or more series, the series of which this Note is
one being designated Secured Medium Term Notes, Series B (herein
generally referred to as the "Series B Notes"). The Series B
Notes may be issued from time to time in various principal
amounts and may mature at different times, may bear interest at
different rates, may have different sinking fund provisions, may
be in different denominations, may be subject to different
redemption or call provisions and may otherwise vary.
All Bonds of all series and forms are issued or to be issued
under and secured by a certain Second Amended and Restated First
Mortgage Indenture dated as of June 15, 1992, as supplemented by
the First to Fourth Supplemental Indentures, inclusive, and the
Amendment to Second Supplemental Indenture, executed counterparts
of which are on file with the Trustee and may be examined at its
principal corporate trust office in Boston, Massachusetts. Said
Second Amended and Restated First Mortgage Indenture, as amended
and so supplemented, is herein generally called the Indenture.
Reference is made to the Indenture for a description of Bonds
outstanding under the Indenture as of particular dates, including
Prior Series Bonds as defined in the Indenture, for a description
of the property mortgaged and pledged to the Trustee as security
for Bonds, for a statement of the nature and extent of the
security, the terms and conditions upon which Bonds have been,
are or are to be issued and secured, the rights and remedies
under the Indenture of the holders of all of said Bonds, and the
rights and obligations under the Indenture of the Company and of
the Trustee, and for the definitions of certain terms used but
not defined in this Note; but neither the foregoing reference to
the Indenture, nor any provision of this Note or of the
Indenture, shall affect or impair the obligation of the Company,
which is absolute, unconditional and unalterable, to pay, at the
stated or accelerated maturities herein provided, the principal
of and premium, if any, and interest on this Note as herein
provided. By the terms of the Indenture, the Bonds to be secured
thereby are issuable to an unlimited (except as provided in said
Indenture) aggregate principal amount, in series which may vary
as to date, amount, date of maturity, rate of interest and in
other respects as in the Indenture provided. Such Series B Notes
shall be in minimum denominations of $1,000 and integral
multiples thereof.
In certain events, on the conditions, in the manner, to the
extent and with the effect set forth in the Indenture,
(1) the principal of this Note may be declared and/or may
become due and payable before the stated maturity hereof,
together with the interest accrued hereon;
(2) the Company and the Trustee may make modifications or
alterations of the provisions of the Indenture and of this Note
with the consent of the holders of not less than 66 2/3% in
principal amount of the Bonds outstanding under the Indenture,
including not less than 66 2/3% in principal amount of the Bonds
of any series or sub-series affected in any manner or to any
extent differing from that in or to which the Bonds of any other
series or sub-series are affected; provided, however, that no
such alteration or modification shall, without the consent of the
registered owner of this Note, (a) impair the obligation of the
Company in respect of the principal of or premium, if any, or
interest on this Note, or extend the maturity hereof or change
the rate or extend the time of payment of interest hereon or
modify the terms of payment of such principal, premium, if any,
or interest, or (b) permit the creation of any lien prior to or
on a parity with the lien of the Indenture, except as expressly
authorized by the Indenture, or (c) alter the percentages of the
principal amount of Bonds required to declare the principal of
and interest accrued on all Bonds outstanding immediately due and
payable as a result of a default under the Indenture or to annul
such declaration, or (d) reduce the percentage of the principal
amount of Bonds with the consent of the holders of which
modifications or alterations may be made as aforesaid;
(3) the holders of not less than 66 2/3% in principal
amount of the Bonds at the time outstanding under the Indenture,
including not less than 66 2/3% in principal amount of the Bonds
of any series or sub-series affected by the waiver in a manner
different from that of any other series or sub-series, may waive
any existing default under the Indenture and the consequences of
any such default, except a default in the payment of the
principal of, or, premium, if any, or interest on any of the
Bonds, and except a default arising from the creation of any lien
prior to or on a parity with the lien of the Indenture;
(4) subject to certain restrictions on transfer relating to
Global Notes as set forth in the legends hereon, upon payment of
charges and compliance with other conditions as provided in the
Indenture, the Series B Notes are exchangeable, at the principal
corporate trust office of the Trustee and at such other offices
or agencies of the Trustee or of the Company as may be designated
for the purpose, for like aggregate principal amounts of Series B
Notes in authorized denominations and this Note is transferable
on books kept by the Company at said office of the Trustee and at
such other offices or agencies, upon surrender and cancellation
hereof at any such office or agency, duly endorsed or accompanied
by a duly executed instrument of transfer, and thereupon a new
fully registered Series B Note or Notes for a like aggregate
principal amount will be issued to the transferee or transferees
in exchange for this Note; and
(5) the Series B Notes (i) are subject to redemption in
whole or in part at any time prior to maturity if through the
application of eminent domain moneys or the proceeds of insurance
arising from loss or casualty, each as specified in the
Indenture, at the principal amount thereof, and (ii) to the
extent specified in the attached table, if any, are subject to
redemption, in whole or in part, at any time prior to maturity,
at the option of the Company, on and after the initial redemption
date specified in the attached table, at the applicable
redemption prices (expressed as a percentage of the principal
amount) set forth in the attached table, together in each case
with accrued interest thereon to the date fixed for redemption.
Any redemptions permitted or required under the Indenture, other
than those described in (i), will be deemed optional redemptions.
At least thirty (30) but not more than sixty (60) days prior
to the date on which any Series B Note is to be redeemed as
aforesaid, written notice of such redemption shall be given by
registered mail to the registered owners of the Series B Notes
all or any portions of which are to be redeemed. If this Note is
called in whole or in part, after provision has been duly made
for notice of such call and after deposit shall have been made of
the principal, premium, if any, and interest to the date fixed
for redemption and such amounts are immediately available on the
date fixed for redemption to the holders of the Series B Notes to
be redeemed on surrender thereof, this Note, or such called part
of the principal amount hereof, shall cease to be secured by the
lien of the Indenture, no interest shall accrue on this Note or
such called part hereof on and after the date fixed for
redemption, and the Company after said date fixed for redemption
shall be under no further liability in respect of the principal
of or premium, if any, or interest on this Note or such called
part hereof (except as expressly provided in the Indenture); and
if less than the whole principal amount hereof shall be so
called, the registered owner hereof shall be entitled, in
addition to the sums payable on account of the part called, to
receive, without expense to such owner, on surrender of this Note
duly endorsed or accompanied by a duly executed instrument of
transfer, one or more Series B Notes for an aggregate principal
amount equal to that part of the principal amount hereof not then
called and paid, or to present this Note for the notation hereon
of the payment of the part of the principal amount then called
and paid.
This Note is not subject to redemption under any provision
of the Indenture, or otherwise, except as expressly referenced
above.
[This Note is subject to mandatory repayment in whole or in
part (as set forth below) on ____________________ (each, a
"Repayment Date") at the principal amount hereof plus accrued
interest thereon to the Repayment Date upon return by the
registered owner of (i) a duly completed "Option to Elect
Repayment" form attached hereto or (ii) a telegram, telex,
facsimile transmission or letter from a member of a national
securities exchange or the National Association of Securities
Dealers, Inc., or a commercial bank or a trust company in the
United States of America, setting forth the name of the
registered holder of the Note, the principal amount of the Note,
the principal amount of the Note to be repaid, a statement that
the option to elect repayment is being exercised thereby and a
guarantee that the Note to be repaid with the "Option to Elect
Repayment" form as set forth in clause (i) duly executed will be
received by the Company not later than three Business Days after
the date of such telegram, telex, facsimile transmission or
letter (the redemption not being effective unless such Note and
form duly completed are received by the Company by such third
Business Day) to the Trustee not less than 30 nor more than 60
days prior to the Repayment Date to the office maintained for
such purpose in Boston, Massachusetts, the corporate trust office
of the Trustee. Repayment in part shall be in minimum
denominations of $1,000 and integral multiples thereof. Such
demand for repayment shall be irrevocable. All questions as to
the validity, eligibility (including time of receipt) and the
acceptance of any Note for repayment will be determined by the
Company, whose determination will be final and binding. So long
as this Note is a Global Note, tender for repayment shall be in
accordance with DTC's repayment option procedures. If a holder
has elected to have this Note repaid by the Company in whole or
in part, after such holder has duly made a demand on the Company
for such repayment and after deposit shall have been made of the
principal, premium, if any, and interest to the Repayment Date
and such amounts are immediately available on the Repayment Date
to such holder on surrender thereof, this Note, or such part of
the principal amount hereof to be repaid, shall cease to be
secured by the lien of the Indenture, no interest shall accrue on
this Note or such part hereof to be repaid on and after the
Repayment Date, and the Company after said Repayment Date shall
be under no further liability in respect of the principal of or
premium, if any, or interest on this Note or such part hereof to
be repaid (except as expressly provided in the Indenture). If
less than the whole principal amount hereof shall be repaid by
the Company, the registered owner hereof shall be entitled, in
addition to the sums payable on account of the part repaid, to
receive, without expense to such owner, on surrender of this Note
duly endorsed or accompanied by a duly executed instrument of
transfer one or more Series B Notes in an aggregate principal
amount equal to that part of the principal amount hereof not then
repaid, or to present this Note for the notation hereon of the
payment of the portion of the principal amount to be repaid.] <F1>
The Company, the Trustee, any paying agent, any bond
registrar and any other person may treat the registered owner
hereof as the absolute owner hereof for the purpose of receiving
payment of the principal of and premium, if any, and interest on
this Note and for all other purposes, and neither the Company nor
the Trustee, nor any paying agent or bond registrar, shall be
affected by any notice or knowledge to the contrary, whether
payments on this Note shall be overdue or not. The Company, and
every successive owner and assignee of this Note, by accepting
and holding the same, consents and agrees to the foregoing
provisions, and each invites the others and all persons to rely
thereon.
No recourse shall be had for the payment of the principal of
or premium, if any, or interest on this Note against any
incorporator, stockholder, director, officer or agent, past,
present or future, as such, of the Company or of any predecessor
or successor corporation, either directly or through the Company
or any such predecessor or successor corporation, under any rule
of law, statute or constitution or by the enforcement of any
assessment or otherwise, all such liability of incorporators,
stockholders, directors, officers and agents being released by
the holder hereof by the acceptance of this Note and being
<F1> This bracketed provision will only apply with respect to Series
B Notes which have a repayment right exercisable at the option of
the registered owner thereof.
likewise waived and released as provided in the Indenture,
provided that nothing herein or in the Indenture shall prevent
enforcement of obligations on stock not fully paid up.
This Note shall take effect as a sealed instrument.
This Note shall not be valid or become obligatory for any
purpose or be entitled to any security or benefit under the
Indenture until the certificate hereon shall have been signed by
the Trustee.
IN WITNESS WHEREOF, Colonial Gas Company has caused this
Note to be executed under its corporate seal and issued by its
duly authorized officers, all as of _________________ __, 19__.
COLONIAL GAS COMPANY
By
By
Attest:
............................
(Form of Trustee's Certificate)
This is one of the Series B Notes referred to in the
within-mentioned Indenture.
STATE STREET BANK AND TRUST COMPANY,
as Trustee
By
Authorized Officer
(Form of Endorsement)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns
and transfers unto ____________________ (whose Taxpayer
Identification Number is ____________________) the within Note,
and all rights thereunder, hereby irrevocably constituting and
appointing _________________ attorney to transfer said Note on
the books of the Company, with full power of substitution in the
premises.
Dated:
In the presence of:
Signature Guaranteed by:
__________________________________________
Participant in a Recognized Signature
Guarantee Medallion Program
Notice: The signature to this assignment must correspond
with the name as it appears upon the face of the within Note in
every particular, without alteration or enlargement or any change
whatever.
[Insert Redemption Table, if applicable]
(Form of Option to Elect Repayment - Insert if applicable)
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably request(s) and
instruct(s) the Company to repay this Note (or portion hereof
specified below) pursuant to its terms at a price equal to ___%
of the principal amount to be repaid, together with unpaid
interest accrued hereon to the Repayment Date, to the
undersigned, at
_________________________________________________________
_________________________________________________________________
_____________
(Please print or typewrite name and address of the undersigned)
For this Note to be repaid, the Trustee must receive at its
corporate trust office in Boston, Massachusetts, not more than 60
nor less than 30 calendar days prior to the Repayment Date, this
Note with this "Option to Elect Repayment" form duly completed.
If less than the entire principal amount of this Note is to
be repaid, specify the portion hereof (which will be increments
of $1,000 which the holder elects to have repaid and specify the
denomination or denominations (which will be increments of
$1,000) of the Notes to be issued to the holder for the portion
of this Note not being repaid (in the absence of any such
specification, one such Note will be issued for the portion not
being repaid).
Principal Amount
to be Repaid: $__________
Date:__________________ Notice: The signature(s) on
this Option to Elect Repayment
must correspond with the
name(s) as written upon the
face of this Note in every
particular, without alteration
or enlargement or any change
whatsoever.
NOW, THEREFORE, THIS INSTRUMENT (BEING THE FOURTH
SUPPLEMENTAL INDENTURE TO THE INDENTURE) WITNESSETH that, in
consideration of the premises, and of the acceptance and purchase
of the Series B Notes by the holders thereof, and of the sum of
$1.00 duly paid by the Trustee to the Company, and of other good
and valuable consideration, the receipt of which is hereby
acknowledged, and in confirmation of and supplementing and
amending the Indenture and in performance of and compliance with
the provisions thereof, said Colonial Gas Company has given,
granted, bargained, sold, warranted, pledged, assigned,
transferred, mortgaged and conveyed, and by these presents does
give, grant, bargain, sell, transfer, warrant, assign, pledge,
mortgage, convey and confirm unto State Street Bank and Trust
Company, as Trustee, as provided in the Indenture, and its
successor or successors in the trust thereby and hereby created,
and its and their assigns, (a) all and singular the property, and
rights and interests in property, described (directly or by
cross-reference to the Prior Indentures) in the Indenture and
thereby conveyed, pledged, assigned, transferred and mortgaged,
or intended so to be (said descriptions being hereby made a part
hereof to the same extent as if set forth herein at length),
whether then or now owned or thereafter or hereafter acquired;
(b) all of the real estate and personal property owned by the
Company located respectively in the City of Lowell, and in the
Towns of Chelmsford, Tewksbury, Dracut, Billerica, Westford,
Tyngsboro, Dunstable, Pepperell, North Reading, Littleton,
Wilmington, Wareham, Bourne (which includes the village of
Buzzards Bay), Mashpee, Falmouth, Barnstable (which includes the
village of Hyannis), Yarmouth, Dennis, Harwich, Chatham,
Sandwich, Brewster, Orleans and Eastham, all in Massachusetts,
including (without in any way limiting the generality of the
foregoing) the parcel or parcels of real estate, if any,
described in Exhibit A hereto; and (c) also without limiting the
generality of the foregoing, all the right, title and interest of
the Company in and to the franchises, rights, titles, interests,
easements and all other real and personal property acquired or
constructed by the Company since the execution and delivery of
the Indenture as fully as if set forth herein at length; except
such of said properties or interests therein described above in
(a) to (c), inclusive, as may have been released by the Trustee
or sold or disposed of in whole or in part as permitted by the
Indenture.
SUBJECT, HOWEVER, as to all of the foregoing, to the
specific rights, privileges, liens, encumbrances, restrictions,
conditions, limitations, covenants, interests, reservations,
exceptions and otherwise as provided (directly or by cross-
reference to the Prior Indentures) in the Indenture and in the
descriptions (directly or by cross-reference to the Prior
Indentures) in the Indenture and in the deeds or grants referred
to therein (or in said Prior Indentures).
BUT SPECIFICALLY RESERVING AND EXCEPTING (as the same were
reserved and excepted from the lien of the Indenture) from this
instrument and the grant, conveyance, mortgage, transfer and
assignment herein contained all right, title and interest of the
Company, now owned or hereafter acquired, in and to the
properties and rights described (directly or by cross-reference
to the Prior Indentures) on page 11 of the Indenture as
specifically reserved and excepted.
PROVIDED, HOWEVER, that if an event of default occurs and
the Trustee or any receiver or trustee appointed for the purpose
shall enter upon and take possession of the trust estate, the
Trustee or such receiver or trustee may, to the extent permitted
by law, take possession of the said specifically excepted
property and use it as if such property were part of the trust
estate, unless and until such default shall be remedied and
possession of the trust estate restored to the Company.
TO HAVE AND TO HOLD all such property, rights, title and
interests unto State Street Bank and Trust Company, Trustee
hereunder, its successors in the trust created by the Indenture,
and its and their assigns, to its and their own use and behoof
forever;
BUT IN TRUST, NEVERTHELESS, under and subject to the
provisions and conditions, with all the powers and authority and
for the trusts and purposes set forth in the Indenture, and (1)
for the equal pro rata benefit and security (except as provided
in sections 2.09 and 2.10 of the Indenture, and except insofar as
a sinking, improvement or analogous fund or funds, established in
accordance with the provisions of the Indenture for any series of
Bonds, may afford particular security for Bonds of one or more
series or sub-series, and except independent security as provided
in section 2.02 of the Indenture) of the holders of such of said
series of Bonds as are now outstanding and $75,000,000 in
aggregate principal amount of Series B Notes for the issue of
which provision is made herein, and of the holders of all the
Bonds from time to time certified, issued and outstanding under
the Indenture, and the bearers of the coupons thereto
appertaining, without (except as aforesaid) any preference,
priority or distinction whatever of any Bond or coupon over any
other Bond or coupon by reason of priority in the series or in
the issue, sale or negotiation thereof, or otherwise, and (2)
subject to the covenants, agreements, rights, privileges,
immunities and duties set forth in the Indenture and this
instrument.
The Company hereby declares that it holds and will hold and
apply all property described (directly or by cross-reference to
the Prior Indentures) on page 11 of the Indenture as specifically
reserved and excepted, upon the trusts of the Indenture set forth
and as the Trustee (or any purchaser thereof upon any sale
thereof hereunder) shall for such purpose direct, from time to
time, to the fullest extent permitted by law or in equity, as
fully as if the same could be and had been granted, conveyed,
mortgaged, transferred and assigned to and vested in the Trustee
by the Indenture.
ARTICLE I
Series B Notes
Section 1.01 General Terms of Series B Notes. The series
of Bonds to be issued under this Supplemental Indenture shall be
known as "Secured Medium Term Notes, Series B." Such Series B
Notes shall be limited in aggregate principal amount to
$75,000,000. The Series B Notes shall be issued from time to
time as fully registered Bonds, without coupons, and no coupon
bonds shall be issued, whether upon original issue or upon
transfers or exchanges. The Series B Notes shall be
substantially in the form hereinbefore recited and, in each case,
shall, pursuant to a resolution of the Company or, to the extent
permitted by the Indenture, a certificate of an officer of the
Company authorized for such purpose by a resolution of the Company,
providing for the issue of the Series B Notes (each, a "Resolution"),
recite the principal amount, interest rate, interest payment dates,
maturity, redemption or call provisions, repayment provisions and
other provisions thereof not inconsistent with the terms of the
Indenture, which may vary as among the Series B Notes. The
Series B Notes may be issued in the denomination of one thousand
dollars ($1,000) each or any multiple thereof and, without regard
to the denomination thereof, shall be numbered consecutively.
Each Series B Note shall be dated as of the day of certification,
except that Series B Notes issued upon transfers and exchanges of
Series B Notes and upon exchanges of temporary Bonds for such
Series B Notes shall be dated so that no gain or loss of interest
shall result from such transfer or exchange. The Series B Notes
shall be due and payable on such dates, and shall bear interest
at such rates (in each case computed on the basis of a 360-day
year of twelve 30-day months from the date thereof) as may be
specified therein from the date of issuance. Interest thereon
shall be payable semi-annually in each year on the dates as set
forth in the form of such Notes (each, an "Interest Payment
Date"), and at maturity or earlier redemption or repayment, if
applicable, until the principal thereof shall become due and
payable. The Company also agrees to pay on demand interest on
any overdue principal (including any overdue prepayment of
principal) and premium, if any, at a rate equal to the interest
rate of the relevant Series B Note, plus one percent (1.00%) per
annum and, to the extent permitted by law, interest on any
overdue installment of interest at the rate at which such overdue
installment of interest was calculated according to the terms of
the Series B Notes. Pursuant to section 1.04 hereof, as long as
the Series B Notes are represented by Global Notes, the Series B
Notes shall be payable as to principal, premium, if any, and
interest by the Company in immediately available funds through
the Trustee to DTC. If the Series B Notes cease to be
represented by Global Notes, the Series B Notes shall be payable
in immediately available funds to registered owners thereof as of
records dates to be set forth in such Series B Notes as to
principal, premium, if any, and interest at the principal
corporate trust office of the Trustee in Boston, Massachusetts,
or at the principal office of its successor in trust created by
the Indenture or, at the option of such registered owner thereof,
at such other office or agency of the Trustee or of the Company
maintained by it for the purpose in the Borough of Manhattan, The
City of New York, New York, or such other place as may be
designated for the purpose pursuant to the provisions hereof, in
lawful money of the United States of America.
Interest on the Series B Notes will accrue from and
including the date of certification for the first interest period
or from the most recent Interest Payment Date to which interest
has been paid or duly provided for all subsequent interest
periods to but excluding the applicable Interest Payment Date or
at maturity or, if applicable, earlier redemption or repayment.
If any Interest Payment Date or the date of maturity or, if
applicable, date of earlier redemption or repayment, with respect
to any Series B Note falls on a day that is not a Business Day
(as defined below), the required payment to be made on such day
need not be made on such day, but may be made on the next
succeeding Business Day with the same force and effect as if made
on such day, and no interest shall accrue on such payment for the
period from and after such day to the next succeeding Business
Day. "Business Day" means any day, other than a Saturday or
Sunday, that is neither a legal holiday nor a day on which
banking institutions are authorized or required by law,
regulation or executive order to close in The City of New York or
the City of Boston.
Subject to Section 1.04 hereof, the Series B Notes shall be
exchangeable by the holders, and may be transferred, in each case
as provided in Section 2.06 of the Indenture, all upon payment of
charges and otherwise as provided in the Indenture.
The Series B Notes are not subject to redemption, at the
option of the Company or otherwise, by operation of the
provisions of the Indenture, whether under sections 7.02 and 7.03
of the Indenture, or otherwise, except as specifically set forth
herein or in the Series B Notes.
Series B Notes at any time outstanding may be called for
redemption in the manner provided in Article 5 of the Indenture
and section 1.03 hereof (i) in whole or in part, at any time
prior to maturity, at the option of the Company, to the extent,
under the provisions of and at the redemption prices specified in
a Resolution and set forth in the related Series B Notes or (ii)
in whole or in part at any time prior to maturity through the
application of eminent domain moneys (as hereinafter defined) or
the proceeds of insurance arising from loss or casualty under the
provisions of the Indenture at the principal amount thereof,
together, in each case, with unpaid interest accrued thereon to
the date fixed for redemption. Any redemptions permitted or
required under the Indenture, other than those described in (ii)
above, shall be deemed optional redemptions. The term "eminent
domain moneys" shall mean the net proceeds of the taking of
property included in the trust estate by exercise of the power of
eminent domain, or by similar right or power, or the purchase or
designation of the purchaser of, or ordering of the sale of, all
or any part of such property by the exercise of any right of any
governmental authority, or the sale or conveyance in lieu and in
reasonable anticipation of any such event (provided that, in case
of a sale or conveyance in anticipation of any such event,
"eminent domain moneys" shall include, in addition to said net
proceeds, the excess of the fair value over the net proceeds, if
the fair value, as evidenced by an engineer's certificate, of the
property sold or conveyed, is greater than such net proceeds),
together with all net sums payable for any damage to any fixed
assets embraced in the trust estate by or in connection with any
such taking, sale or conveyance.
Section 1.02 Payment of Interest. Whenever Series B Notes
are called for redemption or the registered holder elects to have
such Series B Notes be repaid, if applicable, the Company shall,
in each case, prior to the date fixed for redemption or repayment
thereof, pay to the Trustee in cash all unpaid interest accrued
thereon to said date fixed for redemption or repayment.
Section 1.03 Procedure for Redemption. Except as
otherwise provided in any Series B Note, this section 1.03 or a
Resolution, the procedure for redemption of Series B Notes shall
be that specified in sections 5.02, 5.03 and 5.04 of the
Indenture.
Notice of redemption by the Company of any Series B Notes
shall be given by the Company as provided in sections 5.02 and
5.03 of the Indenture, except that, unless otherwise provided in
a Resolution, notice need be given only by mail and not by
publication. Any such notice of redemption shall be mailed not
less than thirty (30) nor more than sixty (60) days prior to the
date on which the proposed redemption is to take place. The
mailing of such notice shall be a condition precedent to
redemption, provided that any notice which is so mailed shall be
conclusively presumed to have been duly given, whether or not the
holders receive such notice, and failure to give such notice by
mail, or any defect in such notice, to the holder of any such
Series B Note designated for redemption, in whole or in part,
shall not affect the validity of the redemption of any other such
Series B Note.
Section 1.04 Global Notes. Notwithstanding any other
provisions of this Supplemental Indenture, unless otherwise
provided in the Series B Notes, the Series B Notes issued by the
Company and authenticated and delivered by the Trustee under this
Supplemental Indenture shall be issued as definitive, fully-
registered global notes ("Global Notes") in the name of Cede &
Co., as nominee of The Depository Trust Company ("DTC").
The Company and the Trustee may treat DTC as, and shall deem
DTC to be, the absolute owner of the Series B Notes evidenced by
the Global Notes for the purpose of payment of principal of, and
premium, if any, and interest on such Series B Notes, for the
purpose of all other matters with respect to such Series B Notes,
for the purpose of registering transfers with respect to Series B
Notes, and for all other purposes whatsoever. Neither the
Company nor the Trustee shall have any responsibility or
obligation to any of DTC's direct or indirect participants.
Without limiting the immediately preceding sentence, neither the
Company nor the Trustee shall have any responsibility or
obligation with respect to (i) the accuracy of the records of DTC
or its nominee or any of its direct or indirect participants with
respect to any ownership interest in the Global Notes, (ii) the
delivery to any of DTC's direct or indirect participants or any
other person, other than DTC, of any notice with respect to the
Series B Notes evidenced by the Global Notes, (iii) the payment
to any of DTC's direct or indirect participants or any other
person, other than DTC, of any amount with respect to the
principal of, and premium, if any, or interest on the Series B
Notes evidenced by the Global Notes, and (iv) the failure of DTC
to provide any information or notification on behalf of any of
DTC's direct or indirect participants. The Trustee shall make
all payments of principal of and premium, if any, and interest on
the Series B Notes in immediately available funds only to or upon
the order of DTC, and all such payments shall be valid and
effective to fully satisfy the Company's obligations with respect
to the principal of and premium, if any, and interest on such
Series B Notes to the extent so paid. Notwithstanding the
provisions of the Indenture to the contrary (including, without
limitation, place of payment, surrender of the Series B Notes,
registration and transfer thereof and authorized denominations),
as long as any of the Series B Notes are in the form of Global
Notes, full effect shall be given to the procedures and practices
of DTC with respect thereto, and the Trustee shall comply
therewith.
In the event that (i) DTC (or any successor securities
depositary) is at any time unwilling or unable to continue as
depositary and a successor depositary is not appointed by the
Company within 90 days, (ii) the Company determines not to
continue the system of book-entry only transfers through DTC (or
a successor securities depositary) or (iii) a default under the
Indenture has occurred and is continuing, the Company will
notify DTC and the Trustee, whereupon DTC or the Trustee will
notify DTC participants of the availability through DTC of
definitive certificates for the Series B Notes. In such event,
the Company and the Trustee shall execute and deliver a
supplemental indenture to add such provisions and to make such
modifications, including in the form of Series B Note, as may be
necessary or appropriate to provide for the issuance of the
Series B Notes in certificated form and the Company shall issue
and the Trustee shall transfer and exchange certificates for the
Series B Notes as requested by DTC in denominations as prescribed
by Section 1.01 hereof, to the identifiable beneficial owners in
replacement of such beneficial owners' respective beneficial
interests in the Series B Notes represented by Global Notes.
ARTICLE II
Miscellaneous
Section 2.01 Certain Covenants. For purposes of Sections
3.01(h) and 4.22 of the Indenture, and not for any other purpose,
the Series B Notes are hereby designated as Prior Series Bonds.
Section 2.02 Miscellaneous Provisions. The Trustee shall
be entitled to, may exercise and shall be protected by, where and
to the full extent that the same are applicable, all the rights,
powers, privileges, immunities and exemptions provided in the
Indenture, as if the provisions concerning the same were
incorporated herein at length. The Trustee under the Indenture
shall ex officio be Trustee hereunder. The remedies and
provisions of the Indenture, applicable in case of any default by
the Company thereunder, are hereby adopted and made applicable in
case of any default with respect to the properties included
herein and, without limitation of the generality of the
foregoing, there are hereby conferred upon the Trustee the same
powers of sale and other powers over the properties described
herein as are expressed to be conferred by the Indenture.
If, pursuant to Article I of this Supplemental Indenture or
any similar provision of any other supplemental indenture, the
Trustee makes payment of the redemption price of all or a portion
of any registered Series B Note directly to the registered owner
thereof without presentation or surrender thereof, the Trustee
shall have no responsibility to ascertain whether such registered
owner carries out its agreement not to dispose of such Note
without prior presentation or surrender thereof to the Trustee as
provided in said Article I or similar provision, and the Trustee
shall not be liable for any claim if arising out of or because of
the failure of such registered owner to carry out its said
agreement.
The recitals in this Supplemental Indenture shall be taken
as recitals by the Company alone, and shall not be considered as
made by or as imposing any obligation or liability upon the
Trustee, nor shall the Trustee be held responsible for the
legality or validity of this Supplemental Indenture, and the
Trustee makes no covenants or representations, and shall not be
responsible, as to or for the effect, authorization, execution,
delivery or recording of this Supplemental Indenture, except as
expressly set forth in the Indenture. The Trustee shall not be
taken impliedly to waive by this Supplemental Indenture any right
it would otherwise have. As provided in the Indenture, this
Supplemental Indenture shall hereafter form a part of the
Indenture.
The date of this Supplemental Indenture is intended as and
for a date for reference and for identification, the actual time
of the execution hereof being the date set forth in the
testimonium clause hereof.
This Supplemental Indenture shall become void when the
Indenture shall be void.
If any provision of this Supplemental Indenture limits,
qualifies or conflicts with the duties imposed by operation of
Section 318(c) of the Trust Indenture Act of 1939, as amended,
such imposed duties shall control.
This Supplemental Indenture may be simultaneously executed
in any number of counterparts, each of which shall be deemed an
original; and all said counterparts executed and delivered, each
as an original, shall constitute but one and the same instrument,
which shall for all purposes be sufficiently evidenced by any
such original counterpart.
IN WITNESS WHEREOF, Colonial Gas Company has caused this
Supplemental Indenture to be executed, and its corporate seal to
be hereto affixed, by its officers thereunto duly authorized, and
State Street Bank and Trust Company has caused this Supplemental
Indenture to be executed, and its corporate seal to be hereto
affixed, by its officers thereunto duly authorized, all as of the
day and year first above written but actually on March 26, 1998.
COLONIAL GAS COMPANY
[Seal]
By s/Dennis W. Carroll
Dennis W. Carroll
Vice President
By s/Dennis W. Carroll
Dennis W. Carroll
Treasurer
Attest:
s/June T. Abreu
Assistant Clerk
STATE STREET BANK AND TRUST
COMPANY, as Trustee
[Seal]
By s/Ruth A. Smith
Ruth A. Smith
Authorized Officer
Attest:
s/Jacqueline Bonhomme
The Commonwealth of Massachusetts )
) ss.:
County of Middlesex )
On this 26th day of March, 1998 before me personally
appeared Dennis W. Carroll and June T. Abreu, to me
personally known, who, being by me duly sworn, did say that they
are the Vice President and Treasurer and the Assistant Clerk,
respectively, of Colonial Gas Company, that the seal affixed to
the foregoing instrument is the corporate seal of said
corporation, and that said instrument was signed and sealed by
them on behalf of said corporation by authority of its Board of
Directors; and the said Dennis W. Carroll and Assistant Clerk,
acknowledged said instrument to be the free act and deed of said
corporation.
[Seal]
s/Susan E. Mousseau
Notary Public
My Commission Expires: 4/3/98
The Commonwealth of Massachusetts )
) ss.:
County of Suffolk )
On this 30th day of March, 1998 before me personally
appeared Ruth A. Smith, to me personally known, who, being by
me duly sworn, did say that he is an Authorized Officer of State
Street Bank and Trust Company, that the seal affixed to the
foregoing instrument is the corporate seal of said bank, and that
said instrument was signed and sealed by him on behalf of said
bank, by authority of its Board of Directors; and the said
Vice President, acknowledged said instrument to be the
free act and deed of said trust company, as trustee.
[Seal]
s/Rose Marie Mogauro
Notary Public
My Commission Expires:
January 14, 2005
Exhibit A
REAL ESTATE ACQUIRED
BY COLONIAL GAS COMPANY
[NONE]
[END OF EXHIBIT 4l TO COLONIAL GAS COMPANY'S FORM 10-Q]
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<EARNINGS-AVAILABLE-FOR-COMM> 14,212
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