_________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31, 1993
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from _____________ to ____________
Commission File Number 0-1125
MADISON GAS AND ELECTRIC COMPANY
(Exact name of registrant as specified in its charter)
WISCONSIN 39-0444025
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
133 South Blair Street
Post Office Box 1231
Madison, Wisconsin 53701-1231
(Address of principal executive offices, including zip code)
(608) 252-7923
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Securities registered pursuant to Section 12(g) of the Act:
Common, Par Value $8 Per Share
(Title of Class) <PAGE>
<PAGE>
Indicate by check mark whether the Registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the Registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein,
and will not be contained, to the best of registrant's knowledge,
in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this
Form 10-K. Yes X No
State the aggregate market value of the voting stock held by
nonaffiliates of the Registrant: $340,354,031 based on a closing
bid price of $31 3/4 on March 1, 1994 (the record date for the
Annual Meeting of Shareholders).
The number of shares outstanding of each of the issuer's classes
of common stock, as of the close of the period covered by this
report, was 10,719,812 of Common, Par Value $8 Per Share.
List hereunder the following documents if incorporated by
reference and the part of the Form 10-K (e.g., Part I, Part II,
etc.) into which the document is incorporated: (1) Any annual
report to security holders; (2) Any proxy or information
statement; and (3) Any prospectus filed pursuant to Rule 424(b)
or (c) under the Securities Act of 1933.
1993 Annual Report to Shareholders (Parts I, II, and IV)
Definitive Proxy Statement filed on March 24, 1994
(Parts I and III)
Current report on Form 8-K dated February 11, 1994 (Part II)
<PAGE>
<PAGE>
PART I
Item 1. Business.
General Description of Business
The registrant, Madison Gas and Electric Company (the Company), a Wisconsin
corporation organized as such in 1896, is a public utility engaged in the
generation and transmission of electric energy and in its distribution in
Madison and its environs (250 square miles) and in the purchase,
transportation, and distribution of natural gas in Columbia, Dane, Iowa,
Juneau, Monroe, and Vernon counties, Wisconsin (975 square miles). See
Exhibit No. 21 herein for a description of the Company's wholly owned
subsidiaries.
The Company is subject to regulation by the Public Service Commission of
Wisconsin (PSCW) as to rates, accounts, issuance of securities, plant and
transmission line siting, and in other respects. The Federal Energy
Regulatory Commission (FERC) has jurisdiction, under the Federal Power Act,
over certain of the accounting practices of the Company and in certain other
respects. The Nuclear Regulatory Commission (NRC) has jurisdiction over the
operation of the Kewaunee Nuclear Power Plant (Kewaunee). The Company has a
17.8 percent ownership interest in Kewaunee. The other owners are Wisconsin
Public Service Corporation (WPSC), which operates Kewaunee, and Wisconsin
Power and Light Company (WPL).
The Company is also subject to regulation with regard to air quality, water
quality, and solid waste (see I-6 and I-7) and may be subject to regulation
with regard to other environmental matters by various federal, state, and
local authorities, including the Wisconsin Department of Natural Resources
(DNR), which has jurisdiction over air and water quality, and solid and
hazardous waste standards, and regulates the electric generating operations of
the Company with respect to pollution and environmental control matters. The
Company has met the requirements of current environmental regulations.
Unknown additional expenditures may be required for pollution control
equipment and for the modification of existing plants to comply with future
unknown environmental regulations. For example, the emerging issue of global
warming could result in significant compliance cost for carbon dioxide
emission controls. Except as set forth below, the amounts of such
expenditures and the period of time over which they may be required to be made
are not known. The Company is unable to predict whether compliance with
future pollution control regulations would involve curtailments of operations
or reductions in generating capacity or efficiency of present generating
facilities or delays in the construction and operation of future generating
facilities. Under both the National Environmental Policy Act and the
Wisconsin Environmental Policy Act, the Company must obtain the necessary
authorizations or permits from regulatory agencies for any new projects or
other major actions significantly affecting the quality of the human
environment after all aspects of the proposed project or action are subjected
to a complete environmental review and a detailed environmental impact
statement is issued. <PAGE>
<PAGE>
Electric Operations
At December 31, 1993, the Company supplied electric service to 117,043
customers, of whom 104,637 were located in the cities of Fitchburg, Madison,
Middleton, and Monona, and 12,406 in adjacent areas. Of the total number of
customers, 101,722 were residential and 15,187 were commercial. For 1993,
residential and commercial electric service revenues comprised 35 percent and
53 percent, respectively, of total electric revenues. The remaining electric
revenues during 1993 were from industrial sales (5 percent), sales to public
authorities including the University of Wisconsin (6 percent), and sales to
other utilities (less than 1 percent). The electric operations accounted for
60 percent of the total revenues of the Company.
See Item 2 for a description of the Company's electric utility plant.
The Company is a member of Wisconsin-Upper Michigan Systems (WUMS), a planning
group, which is comprised of five electric companies in Wisconsin and upper
Michigan and The Wisconsin Public Power Inc. SYSTEM. WUMS, in turn, is a part
of Mid-America Interconnected Network, Inc. (MAIN), a regional reliability
group. Membership in these groups permits better utilization of reserve
generating capacity and coordination of long-range system planning and day-to-
day operations. WUMS and MAIN seek to maintain adequate planning reserve
margins as a group in the range of 15 to 22 percent.
Fuel Supply and Generation--
The Company estimates that its net kilowatt-hour requirements for 1994 will be
provided approximately from the following sources: 55 percent from fossil-
fueled steam plants, 27 percent from a nuclear-fueled steam plant, 17 percent
from low-cost power purchases, and 1 percent from a combination of natural
gas- and oil-fired combustion turbines.
The Company has a 22 percent ownership interest in the Columbia Energy Center
(Columbia). The other owners are WPL, which operates Columbia, and WPSC. The
first (Columbia I) and second (Columbia II) units at Columbia were placed in
commercial operation in 1975 and 1978, respectively. The Columbia co-owners'
coal inventory supply for Columbia I and Columbia II was 38 days on
December 31, 1993. The co-owners' goal is to maintain a 40-day inventory.
The Columbia Energy Center, with two 527-megawatts units, uses coal from the
Wyoming-Montana coal fields. Seventy (70) percent of the low-sulfur coal for
Unit 1 is supplied under terms of a contract which does not expire until 2004.
The balance of the requirements for Unit 1, as well as the entire low-sulfur
coal supply for Unit 2, are from the Southern Powder River Basin.
About 200 megawatts of the Company's electric-generating capacity is provided
by the Blount Plant (Blount) (see I-9). The Company is able to burn a variety
of coals and natural gas at Blount. This permits the Company to comply with
its emissions requirements while avoiding expensive capital additions to the
plant which would be necessary if coal were the only fuel source. When
natural gas is not economically available, the Company may use oil in four of
its small boilers at Blount and in its combustion turbines (see page I-9).
Under present conditions, adequate supplies of oil are available to permit the
anticipated operation of all of the Company's units which use oil. <PAGE>
<PAGE>
The Company has a 17.8 percent ownership interest in Kewaunee. The other
owners are WPSC, which operates Kewaunee, and WPL. The availability factor
for Kewaunee since going commercial in 1974 is 84.7 percent.
The most recent NRC inspection of Kewaunee found plant operations and plant
support to be "superior." Maintenance and engineering received "good"
ratings. The inspection is part of the NRC's Systematic Assessment of
Licensee Performance Review.
The Kewaunee co-owners have procured an extra expense insurance policy through
Nuclear Electric Insurance Limited to cover, in part, the costs for
replacement power of an extended outage related to an accident at Kewaunee.
The operating company for Kewaunee is a member of the Institute of Nuclear
Power Operations (INPO), an organization of nuclear utilities. INPO manages
the accreditation process for industry training programs, which includes
periodic accreditation of those training programs by an independent
organization, the National Nuclear Accrediting Board (NNAB). All ten
accredited training programs at Kewaunee are currently in good standing with
the NNAB.
The steam generator tubes at Kewaunee are susceptible to corrosion
characteristics seen throughout the nuclear industry. Annual inspections are
performed to identify degraded tubes. Degraded tubes are either repaired by
sleeving or are removed from service by plugging. The steam generators were
designed with a heat transfer margin of approximately 15 percent, meaning that
full power should be sustainable with the equivalent of 15 percent of the
steam generator tubes plugged. Tube plugging and the buildup of deposits on
the tubes affect the heat-transfer capability of the steam generators to the
point where eventually full power operation is affected. The result is a
gradual decrease in the capacity of the plant. Currently, the equivalent of
10 percent of the tubes in the steam generators are plugged. The co-owners
continue to evaluate appropriate repair strategies including replacement as
well as continued operation of the steam generators without replacement.
The co-owners are engaged in ongoing discussions regarding steam generator
replacement. A number of studies have been undertaken by the co-owners
concerning steam generator replacement, but no final decision has been
reached. The co-owners intend to operate Kewaunee until at least 2013, the
expiration of the present operating license. The co-owners are also
evaluating initiatives to improve the performance of Kewaunee. These
initiatives include funding of the development of welded repair technology for
steam generator tubes and numerous cost reduction measures such as the
conversion from a 12-month to an 18-month fuel cycle. If the steam generators
are not replaced, and excluding the possible effect of the aforementioned
repair strategies, a gradual power reduction of approximately 1 percent per
year may begin as soon as 1995. <PAGE>
<PAGE>
Physical decommissioning of Kewaunee is expected to occur during the period
2014 through 2021 with additional expenditures being incurred during the
period 2022 through 2050 related to the storage of spent nuclear fuel at the
site. The Company's share of the decommissioning costs of this plant is
estimated to be $61 million (1992 dollars) based on a site-specific study
performed in 1992 using immediate dismantlement as the method of
decommissioning. Wisconsin utilities operating nuclear generating plants are
required by the PSCW to establish external trust funds to provide for the
decommissioning of such plants. The estimated fair value of the investments
in the funds established by the Company at December 31, 1993, totaled
$27 million.
The supply of nuclear fuel for Kewaunee involves the mining and milling of
uranium ore to uranium concentrates, the conversion of uranium concentrates to
uranium hexafluoride, enrichment of the uranium hexafluoride, and fabrication
of the enriched uranium into usable fuel assemblies. After a region
(approximately one-third of the nuclear fuel assemblies in the reactor) of
spent fuel is removed from the reactor, it is placed in temporary storage for
cooling in a spent fuel pool at the nuclear plant site. Permanent storage is
addressed below. There are presently no operating facilities in the United
States reprocessing commercial nuclear fuel. A discussion of the nuclear fuel
supply for Kewaunee, which requires approximately 250,000 pounds of uranium
concentrates per year, as follows:
a. The Company and the other Kewaunee co-owners formed a limited partnership
of subsidiaries in the mid-1970s to secure uranium reserves and maintain
a long-term uranium concentrates supply capability. In 1993, the Company
completed divestiture of uranium reserves in Colorado and Utah and
returned properties potentially containing uranium concentrates to the
previous leaseholders. Requirements for uranium are now met through spot
or contract purchases. An inventory policy to take advantage of
economical spot market purchases of uranium is maintained. In general,
the co-owners maintain a four-year supply of uranium.
b. Uranium hexafluoride, from inventory and from spot market purchases, was
used to satisfy converted material requirements in 1993. The co-owners
intend to purchase future conversion services on the spot market.
c. In 1993, enriched uranium was procured from COGEMA, Inc., pursuant to a
contract executed in 1983 and last amended in 1991. The co-owners are
obligated to take delivery of additional enriched uranium contracted from
COGEMA in 1994. The equivalent of 52,000 pounds of uranium concentrates
as enriched uranium was purchased on the spot market in 1993. Enrichment
services were purchased from the Department of Energy (DOE) under the
terms of the utility services contract which is in effect for the life of
Kewaunee. The co-owners are committed to take 70 percent of its annual
enrichment requirements in 1994 and 1995 and in alternate years
thereafter from the DOE.
d. Fuel fabrication requirements through February 15, 1995, are covered by
contract. The contract contains an option to allow the co-owners to
extend the contract through 1998.
e. Beyond the stated periods set forth above, additional contracts for
uranium concentrates, conversion to uranium hexafluoride, fabrication and
reprocessing or spent fuel storage will have to be procured. The prices
for the foregoing are expected to increase. <PAGE>
<PAGE>
f. Pursuant to the Nuclear Waste Policy Act of 1982, the DOE has entered
into a contract with the Kewaunee co-owners to accept, transport, and
dispose of spent nuclear fuel beginning no later than January 31, 1998.
It is expected that the DOE will delay the acceptance of spent nuclear
fuel beyond 1998. A fee to offset the costs of the DOE's disposal for
all spent fuel used since April 7, 1983, has been assessed by DOE at one
mill per net kilowatt-hour of electricity generated by Kewaunee. An
additional one-time fee was paid for the disposal of spent nuclear fuel
used to generate electricity prior to April 7, 1983.
In response to a U.S. Court of Appeals ruling, the DOE published a final rule
in the December 31, 1991, Federal Register changing the quantity of nuclear-
generated electricity subject to the millage fee by incorporating line losses
into the calculation. A reduction in fees of approximately 5 percent will be
applied to all future payments for storage of spent nuclear fuel. The
overcollections since 1983 for future storage of spent nuclear fuel resulted
in refunds of $33,166, $176,370, and $194,837 for the DOE fiscal years 1992,
1993, and 1994, respectively. The refund for the DOE fiscal year 1995 is
expected to be approximately $53,000. This amount is being refunded to
customers over a two-year period beginning in 1993.
The National Energy Policy Act of 1992 provides that both the federal
government and the nuclear utilities fund the decontamination and
decommissioning of the three gaseous diffusion plants in the United States.
Utility contributions will be collected through a special assessment based on
a utility's percentage of uranium enrichment services purchased through the
date of enactment compared to total enrichment sales by the DOE. This will
require the co-owners of Kewaunee to pay approximately $15 million, in current
dollars, of which the Company's share would be $2.7 million over a period of
15 years. The Company made its first payment of $170,613 in September 1993.
The payments are subject to adjustment for inflation.
Spent fuel is currently stored at Kewaunee. The existing capacity of the
spent fuel storage facility will enable storage of the projected quantities of
spent fuel through April 2001. The co-owners are currently evaluating options
for the storage of additional quantities beyond 2001. Several technologies
are available. An investment of $2.5 million in the early 2000s could provide
additional storage sufficient to meet spent fuel storage needs until the
expiration of the current operating license.
The Low-Level Radioactive Waste Policy Act of 1980 specifies that states may
enter into compacts to provide for regional low-level waste disposal
facilities. The Act set January 1, 1986, as a deadline when compact members
may restrict the use of regional disposal facilities to waste generated within
the region.
Additional legislation enacted by Congress since the Low-Level Waste Policy
Act of 1980 has allowed generators of low-level waste continued access to
disposal facilities provided certain milestones are met by states
participating in regional compacts. Presently, the state of Ohio has been
selected as the host state for the Midwest Compact and is proceeding with the
preliminary phases of site selection. In the meantime, the co-owners have
access to an existing low-level waste storage site through June 1994. The
co-owners expect to have sufficient storage space to temporarily store low-
level waste generated between 1994 and the time that the Ohio facility is
opened. <PAGE>
<PAGE>
Air Quality--
Phase 1 of the Federal Clean Air Act Amendments of 1990 beginning on
January 1, 1995, does not affect the Company. Phase 2, beginning on
January 1, 2000, sets a stringent SO2 emission cap and sets more stringent
than present nitrogen oxide emission limitations. Phase 2 will entail
additional emission control strategies which may result in increased capital
and operating and maintenance expenditures. Phase 2 emission compliance
strategies could include the following: fuel switching, emission trading,
purchased power agreements, new emission control devices, or installation of
new fuel-burning technologies and clean-coal technologies. Phase 2 emission
compliance strategies and their costs are currently being evaluated. The
Company has filed legal proceedings in the United States Court of Appeals for
the 7th Circuit against the EPA to require the EPA to award the Company bonus
credits for SO2 emissions under the Clean Air Act. The Company and EPA
disagree on the statutory interpretation of the bonus provisions of the Clean
Air Act. If the Company prevails, it could save $3 million to $6 million in
total capital expenditures between 2000 to 2009, depending on the then current
market price for SO2 credits.
The state of Wisconsin also enacted an acid rain law in 1986 which imposes
limitations of SO2 emissions on the major utilities. This emission rate is
coupled with a goal of 250,000 tons of SO2 per year (beginning in 1993)
applied to the major utilities. Blount and Columbia are required to meet a
combined SO2 emission rate of 1.20 pounds of SO2 per million Btu. No capital
costs were required to meet this standard.
The acid rain law also includes a nonenforceable goal of 135,000 tons of
nitrogen oxide emissions per year applicable to the major utilities.
The area surrounding Blount has been declared a nonattainment area for
secondary ambient particulate standards by the DNR. The DNR's plan for
particulate emissions in secondary nonattainment areas may someday require
installation of fugitive dust-control facilities for coal- and ash-unloading
operations at Blount.
Hazardous air emission legislation affecting the electric utilities was passed
by Congress in 1990. The federal legislation requires certain studies be
performed prior to any regulation of electric utilities. The DNR has enacted
hazardous air emission regulations but has so far exempted fossil fuel
generating stations.
The Company has installed electrostatic precipitators on its three largest
coal/gas-fired boilers at Blount. The Company believes all of its plants to
be in full compliance with present rules with respect to particulate
emissions.
Water Quality--
Pursuant to the Federal Water Pollution Control Act of 1972 (FWPCA), as
amended, and its implementation by Wisconsin statutes, the Company is subject
to regulation by the DNR and Environmental Protection Agency (EPA) with
respect to water quality. These regulations include both categorical-effluent
discharge standards and general water quality standards. The regulations
limit thermal and other discharges from the Company's plants into Lake
Michigan and other Wisconsin waters. <PAGE>
<PAGE>
The categorical-effluent discharge standards require each discharger to use
effluent treatment processes equivalent to categorical "best practicable" or
"best available" technologies under compliance schedules established pursuant
to the FWPCA. The EPA and the DNR have published categorical regulations for
thermal and chemical discharges from steam electric generating plants.
Under the general water quality standards, thermal discharges must comply with
mixing zone standards. Such standards have been promulgated by the DNR and
limit permitted temperature changes in the receiving body of water at the edge
of a defined thermal mixing zone.
The DNR's water toxics regulations issued in 1989 could impose additional
discharge limitations on a number of previously unregulated substances. The
Company is in compliance with applicable standards.
Solid Waste--
From 1980 to 1984, the Company disposed of a fly-ash sludge at the Refuse
Hideaway Landfill in Middleton, Wisconsin. The fly-ash sludge consisted of
storm water runoff from the Blount coal pile area and an ash and water
effluent from the ash collection system. This material was composed of water,
coal particles, dirt, and fly ash. These wastes are nonhazardous under EPA
and DNR regulations.
In October 1992, the EPA placed the Refuse Hideaway Landfill on the national
priorities Superfund list of sites requiring clean up under the Comprehensive
Environmental Response, Compensation and Liability Act (CERCLA). The scope of
liability under CERCLA is very broad.
The wastes identified as causing groundwater contamination are known as
volatile organic compounds typically found in paint, solvents, and gasoline.
The Company's fly-ash sludge contained none of these chemicals or products.
Even though the wastes disposed of at Refuse Hideaway Landfill by the Company
are nonhazardous and do not contain volatile organics, the broad liability of
CERCLA may require the Company to pay for some fraction of the landfill clean-
up cost.
Although the Company is listed as a potentially responsible party on DNR's
roster of generators for Refuse Hideaway Landfill and received a general
notice of potential liability from the EPA in February 1993, in the opinion of
management, the Company does not have any material financial exposure for the
site.
The City of Madison has identified the Company as one of many possible
potential responsible parties for the remediation of the Demetral landfill.
Waste materials disposed of at the site by the Company consisted of fly ash
and bottom ash from the combustion of coal to generate electricity. The
Company and many others used the landfill in the early 1950s. The Company has
the potential to incur liability costs associated with its use of this
landfill. In the opinion of the Company, the resolution of this matter will
not result in any materially adverse effect on the operations or financial
position of the Company. <PAGE>
<PAGE>
Gas Operations
On December 31, 1993, the Company supplied gas service to 97,080 customers in
the cities of Elroy, Madison, Middleton, Monona, Fitchburg, Lodi, Verona, and
Viroqua; 14 villages; and all or parts of 33 townships. Revenues received
from residential and commercial customers accounted for 54 and 37 percent,
respectively, of the total gas revenues for 1993. The gas operations
accounted for 40 percent of the total revenues of the Company.
Revenues from transportation service accounted for 0.2 percent of the total
gas revenues for 1993. Sales and revenues from best-efforts rate schedules
accounted for 9 and 6 percent of total retail sales and revenues,
respectively.
The Company has the ability to peak shave through use of a propane-air gas
manufacturing plant for which it had on hand adequate fuel supplies for its
peak-shaving requirements during the 1993 to 1994 heating season. In
addition, the Company can curtail gas deliveries to its interruptible
customers. Approximately 21 percent of gas sold in 1993 was sold to
interruptible customers.
Gas Supply--
The Company has physical interconnections with both ANR Pipeline Company (ANR)
and Northern Natural Gas Company (NNG). Deliveries are received at four
locations from ANR and at one location from NNG. Interconnections with two
major pipelines provide for competition in interstate pipeline service,
provides the Company with better access to economical supplies from Canada and
Oklahoma, and provides increased reliability of gas supply receipts.
On April 8, 1992, the FERC issued Order 636. Order 636 requires natural gas
pipelines to separate natural gas sales service from transmission service. It
also requires these pipelines to offer flexibility to parties contracting for
service. Following the issuance of Order 636, ANR and NNG made filings at
FERC to comply with Order 636.
In the first part of 1993, the Company purchased sales service from ANR under
an Interim Sales Program. Effective November 1, 1993, ANR and NNG's services
that comply with Order 636 went into effect. The heating season, which began
November 1, 1993, has been the most severe on record in nine years. The
services that the Company has contracted for have met the needs of its
customers reliably and economically.
The Company can currently inject a total of 5,576,600 dekatherms into ANR's
storage fields from April 1 through October 31 of each year. These gas
supplies are then available for withdrawal from November 1 through March 31.
ANR's storage fields are located in Michigan. Use of storage provides the
Company with the ability to purchase gas supplies during the summer season
when prices are the lowest and withdraw these same supplies during the winter
season when gas prices are typically the highest. <PAGE>
<PAGE>
ANR and NNG have both entered into settlements with their gas suppliers
concerning take-or-pay and transition cost provisions of gas supply contracts
that are being canceled and other costs associated with implementation of
Order 636. Known charges currently applicable to the Company for take-or-pay
or transition costs on ANR are $0.3 million including interest. This is being
paid to ANR as a fixed charge through December 1994. Also, a volumetric
surcharge is being paid to both ANR and NNG. ANR's surcharge is applied
through April 1998; NNG's is effective through May 1996. These amounts will
change over time. The PSCW has approved procedures whereby the Company is
allowed to recover both the fixed and volumetric take-or-pay charges in rates.
The Company currently has firm transportation contracts with NNG for a maximum
daily quantity of 51,108 dekatherms, of which 47,830 dekatherms can be
delivered on a firm basis into ANR's system at Janesville or directly to
Madison's Town Border Station. Of the remaining 3,278 dekatherms,
889 dekatherms can be delivered on a firm basis into Elroy's Town Border
Station and 2,389 dekatherms can be delivered on a firm basis into Viroqua's
Town Border Station.
On November 1, 1993, the Company entered into firm natural gas supply
contracts with suppliers on both ANR and NNG pipelines. These supply
contracts will provide the Company with firm gas from November 1, 1993,
through October 31, 1994, to meet the requirements of its firm customers.
General
The Company's business is seasonal to the same extent as other upper Midwest
electric and natural gas utilities.
The Company had 721 permanent employees at December 31, 1993.
Information regarding Company executive officers is included under Item 10 of
this report, page III-1, which information is incorporated herein by
reference.
Item 2. Properties.
The following table presents the generating capability in service at
December 31, 1993:
Commercial Net Capability No. of
Plants Operation Date Fuel (Megawatts) Units
Steam Plants
Columbia 1975 & 1978 Low-Sulfur Coal 225(1)(2) 2
Kewaunee 1974 Nuclear 93(1)(3) 1
Blount 1957 & 1961 Coal/Gas 103 2
(Madison) 1938 & 1942 Gas/Coal 40 2
1949 Coal/Gas 23 1
1964 - 1968 Gas/Oil 34 4
Combustion
Turbines 1964 - 1973 Gas/Oil 90 5
Total 608
(1) Base load generation.
(2) Company's 22% share of two 525-mw units located near Portage, Wis.
(3) Company's 17.8% share of 525-mw unit located near Kewaunee, Wis. <PAGE>
<PAGE>
Major electric transmission and distribution lines and substations in service
at December 31, 1993, are as follows:
Miles
Lines Overhead Lines Underground Lines
Transmission:
345 kV 124 -
138 kV 112 3
69 kV 91 21
Distribution:
13.8 kV and under 1,850 875
Substations Installed Capacity (KVA)
Transmission (22) 4,073,400
Distribution (33) 324,100
Gas facilities include 1,659 miles of distribution mains and one propane air
plant capable of producing a maximum daily capacity of 9,000 dekatherms of
natural gas equivalent. One propane air plant was retired in 1992.
Item 3. Legal Proceedings.
Regarding Note 5 entitled "Commitments and Contingencies" in the Notes to
Consolidated Financial Statements of the 1992 Annual Report to Shareholders,
which was filed with the 1992 Form 10-K, which is incorporated herein by
reference, the Wisconsin Supreme Court ruled in favor of Wisconsin Power and
Light Company and the issue was thus resolved.
Item 4. Results of Votes of Security Holders.
No matters were submitted to a vote of security holders during the fourth
quarter of the fiscal year. <PAGE>
<PAGE>
PART II
Item 5. Market for the Registrant's Common Stock and Related Stockholder
Matters
The principal market in which the common stock of the Company is traded is The
Nasdaq Stock Market under the symbol MDSN. The approximate number of
stockholders of record on February 1, 1994, was 16,170. The Company's
transfer agent and registrar is Harris Trust and Savings Bank, Chicago,
Illinois. The high and low sales prices for the common stock on The Nasdaq
Stock Market and the dividends paid per common share for each quarter for the
past two fiscal years are shown below:
Common Stock Price Range Dividends Per Share
1993 1993
High Low
First quarter ........ $35 1/2 $30 1/4 $0.455
Second quarter ....... $35 1/4 $32 3/4 $0.455
Third quarter ........ $36 3/4 $32 3/4 $0.465
Fourth quarter ....... $36 1/2 $32 3/4 $0.465
Common Stock Price Range Dividends Per Share
1992 1992
High Low
First quarter ........ $31 1/4 $29 $0.44
Second quarter ....... $31 3/4 $28 1/2 $0.44
Third quarter ........ $33 1/4 $28 3/4 $0.455
Fourth quarter ....... $34 1/2 $30 $0.455
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
Item 6. Selected Financial Data
For the years ended December 31, 1993 1992 1991 1990 1989
(In thousands of dollars, except
per-share amounts)
<S> <C> <C> <C> <C> <C>
Summary of Operations
Operating Revenues:
Electric .......................... $147,201 $142,646 $146,378 $140,493 $131,961
Gas ............................... 96,932 85,356 85,822 80,075 85,627
Total ............................ 244,133 228,002 232,200 220,568 217,588
Operating Expenses .................. 187,717 172,049 173,419 165,988 168,207
Other General Taxes ................. 8,222 8,107 7,872 7,574 7,307
Income Tax Items .................... 13,964 12,784 14,535 12,208 8,468
Net Operating Income ............. 34,230 35,062 36,374 34,798 33,606
Other Income (including allowance for
funds used during construction) ... 2,118 2,210 1,242 1,512 2,027
Income Before Interest Expense ... 36,348 37,272 37,616 36,310 35,633
Interest Expense .................... 11,673 13,465 12,736 14,281 15,037
Net Income ....................... 24,675 23,807 24,880 22,029 20,596
Preferred Dividends ................. 489 506 524 541 558
Earnings on Common Stock ......... $ 24,186 $ 23,301 $ 24,356 $ 21,488 $ 20,038
Average Shares Outstanding* ......... 10,704 10,697 10,696 10,530 10,290
Earnings Per Share* ............... $2.26 $2.18 $2.28 $2.04 $1.95
Dividends Paid Per Share* ......... $1.84 $1.79 $1.75 $1.72 $1.68
Ratio of Earnings to Fixed
Charges** ....................... 4.15 3.60 3.88 3.24 2.84
At December 31,
Assets
Electric ............................ $328,048 $325,510 $330,136 $331,609 $316,014
Gas ................................. 114,626 106,837 104,381 104,270 119,402
Assets not allocated ................ 22,690 20,390 20,548 14,455 32,592
Total ............................. $465,364 $452,737 $455,065 $450,334 $468,008
Capitalization
Common Shareholders' Equity ......... $184,995 $180,367 $176,213 $170,168 $160,953
Redeemable Preferred Stock .......... 5,400 5,600 5,800 6,000 6,200
Long-term Debt ...................... 120,396 122,363 124,859 135,813 140,842
Short-term Debt ..................... 23,500 17,000 5,600 2,100 28,000
Total Capitalization .............. $334,291 $325,330 $312,472 $314,081 $335,995
<FN>
*Average shares outstanding and per share amounts have been restated to reflect a three-for-two stock split effective January 2,
1992.
**For the purpose of computing the ratio of earnings to fixed charges, earnings have been calculated by adding to income before
interest expense, current and deferred federal and state income taxes, investment tax credits deferred and restored charged
(credited) to operations, and the estimated interest component of rentals. Fixed charges represent interest expense, amortization
of debt discount, premium and expense, and the estimated interest component of rentals.
</TABLE>
<PAGE>
<PAGE>
[TEXT]
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations
See Item 8 below.
Item 8. Financial Statements and Supplementary Data
The required information for Items 7 and 8 is included in the Company's
Current Report on Form 8-K under Item 5, Exhibit 99, dated February 11, 1994,
Commission File No. 0-1125, except as listed below:
Quarterly Financial Information (Unaudited)
Quarters Ended (1)
March 31 June 30 Sept. 30 Dec. 31
(Thousands of Dollars)
1993
Operating Revenues:
Electric ..................... $34,771 $35,106 $43,066 $34,258
Gas .......................... 38,180 15,199 10,446 33,107
Total ...................... 72,951 50,305 53,512 67,365
Operating Expenses .............. 62,230 43,967 44,866 58,840
Net Operating Income ......... 10,721 6,338 8,646 8,525
Interest, Preferred Dividends,
and Other ...................... 2,677 2,479 2,451 2,437
Earnings on Common Stock .... $ 8,044 $ 3,859 $ 6,195 $ 6,088
Earnings per Common Share (2) ... $0.75 $0.36 $0.58 $0.57
1992
Operating Revenues:
Electric ..................... $33,626 $34,432 $40,754 $33,834
Gas .......................... 32,296 12,486 7,783 32,791
Total ...................... 65,922 46,918 48,537 66,625
Operating Expenses .............. 56,633 40,452 39,537 56,318
Net Operating Income ......... 9,289 6,466 9,000 10,307
Interest, Preferred Dividends,
and Other ...................... 2,829 3,106 2,923 2,903
Earnings on Common Stock .... $ 6,460 $ 3,360 $ 6,077 $ 7,404
Earnings per Common Share (2) ... $0.60 $0.31 $0.57 $0.69
Notes:
(1) The quarterly results of operations within a year are not comparable
because of seasonal and other factors.
(2) The sum of earnings per share of common stock for any four quarterly
periods may vary slightly from the earnings per share of common stock for
the equivalent 12-month period due to the effect of rounding each
quarterly period separately. <PAGE>
<PAGE>
Responsibility for Financial Statements
The management of Madison Gas and Electric Company is responsible for the
preparation and presentation of the financial information in this Annual
Report. The following financial statements have been prepared in accordance
with generally accepted accounting principles consistently applied and reflect
management's best estimates and informed judgments as required.
To fulfill these responsibilities, management has developed and maintains a
comprehensive system of internal operating, accounting, and financial
controls. These controls provide reasonable assurance that the Company's
assets are safeguarded, transactions are properly recorded, and the resulting
financial statements are reliable. An internal audit function assists
management in monitoring the effectiveness of the controls.
The Report of Independent Accountants on the financial statements by Coopers &
Lybrand appears below. The responsibility of the independent accountants is
limited to the audit of the financial statements presented and the expression
of an opinion as to their fairness.
The Board of Directors maintains oversight of the Company's financial
situation through its monthly review of operations and financial condition and
its selection of the independent accountants. The Audit Committee, comprised
of all Board members who are not employees or officers of the Company, also
meets periodically with the independent accountants and the Company's internal
audit staff who have complete access to and meet with the Audit Committee,
without management representatives present, to review accounting, auditing,
and financial matters. Pertinent items discussed at the meetings are reviewed
with the full Board of Directors.
/s/ David C. Mebane
David C. Mebane
President, Chief Executive Officer
and Chief Operating Officer
/s/ Joseph T. Krzos
Joseph T. Krzos
Vice President - Finance <PAGE>
<PAGE>
Report of Independent Public Accountants
To the Shareholders and Board of Directors,
Madison Gas and Electric Company:
We have audited the accompanying consolidated balance sheet and statement of
capitalization of MADISON GAS AND ELECTRIC COMPANY (a Wisconsin corporation)
and subsidiaries as of December 31, 1992, and the related consolidated
statements of income, retained income, and cash flows for each of the two
years in the period ended December 31, 1992. These financial statements are
the responsibility of the Company'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 financial position of Madison Gas and Electric
Company and subsidiaries as of December 31, 1992, and the results of their
operations and their cash flows for each of the two years ended December 31,
1992, in conformity with generally accepted accounting principles.
ARTHUR ANDERSEN & CO.
Chicago, Illinois
February 12, 1993
Item 9. Disagreements on Accounting and Financial Disclosure
None. <PAGE>
<PAGE>
PART III
Item 10. Directors and Executive Officers of the Registrant
Information concerning the Directors of the Company is contained in the
definitive proxy statement under the section "Election of Directors" filed on
March 24, 1994, with the Securities and Exchange Commission, which is
incorporated herein by reference.
Executive Officers of the Registrant (elected annually by Directors)
Service
Eff. Years as
Executive Title Date Officer
Frank C. Vondrasek Chairman 01/01/94 19
Age: 65 Chairman and CEO 10/01/91
President and COO 01/01/88
Executive VP 06/01/80
David C. Mebane President, CEO and COO 01/01/94 13
Age: 60 President and COO 10/01/91
Senior VP and General Counsel 01/01/88
Vice President and General Counsel 04/17/85
Robert E. Domek Senior VP - Human Resources 05/03/93 5
Age: 63 Vice President - Human Resources 12/01/91
Asst. VP - Human Resources 10/01/89
Director - Personnel 01/01/69
Joseph T. Krzos Vice President - Finance 12/01/92 8
Age: 50 Asst. VP - Accounting and Control 12/01/91
Treasurer 05/01/88
Assistant Treasurer 06/01/86
Richard H. Thies VP - Gas Systems Operation 07/01/86 8
Age: 52
Mark C. Williamson Vice President - Energy Services 05/03/93 2
Age: 40 Asst. VP - Energy Services 06/01/92
Exec. Director - Electric Supply 12/01/91
Corporate Attorney 12/01/89
Senior Staff Attorney 12/01/87
Gary J. Wolter VP - Administration and Secretary 12/01/91 3
Age: 39 Secretary and Corporate Attorney 12/01/89
Corporate Attorney 02/13/84
Terry A. Hanson Treasurer 12/01/91 3
Age: 42 Manager - Internal Audit 09/01/84
Burnett F. Adams Asst. VP - Procurement & Div. Oper. 05/03/93 1
Age: 41 Exec. Dir. - Materials and Fuel 12/01/91
Director - Gas Rates and Supply 07/01/88 <PAGE>
<PAGE>
James C. Boll Asst. VP - Law and Corp. Comm. 05/03/93 1
Age: 58 Exec. Dir. - Law and Corp. Comm. 01/13/92
Dir. - Public Affairs and Risk Mgmt. 06/01/91
Director - Risk Management 03/05/90
Thomas R. Krull Asst. VP - Elec. Trans. & Dist. 05/03/93 1
Age: 44 Exec. Dir. - Elec. Trans. & Dist. 12/01/91
Director - Elec. Trans. & Dist. 09/01/89
Asst. Dir. - Elec. Trans. & Dist. 04/01/89
Manager - Elec. Trans. & Dist. 07/01/85
Item 11. Executive Compensation
See Item 12 below.
Item 12. Security Ownership of Certain Beneficial Owners and Management
The required information for Items 11 and 12 is included in the Company's
definitive proxy statement under the section "Executive Compensation," not
including "Report on Executive Compensation" and "Company Performance," and
under the section "Beneficial Ownership of Common Stock by Directors and
Executive Officers" filed with the Securities and Exchange Commission on
March 24, 1994, which is incorporated herein by reference.
Item 13. Certain Relationships and Related Transactions
None. <PAGE>
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
MADISON GAS AND ELECTRIC COMPANY
(Registrant)
Date March 24, 1994 By /s/ David C. Mebane
David C. Mebane
President, Chief Executive Officer
and Chief Operating Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities indicated on March 24, 1994.
SIGNATURE TITLE
/s/ David C. Mebane President, Chief Executive
David C. Mebane Officer and Chief Operating
Officer and Director (Principal
Executive Officer)
/s/ Joseph T. Krzos Vice President - Finance
Joseph T. Krzos (Principal Financial Officer
and Principal Accounting
Officer)
/s/ Frank C. Vondrasek Chairman and Director
Frank C. Vondrasek
/s/ Jean Manchester Biddick Director
Jean Manchester Biddick
/s/ Richard E. Blaney Director
Richard E. Blaney
Director
Robert M. Bolz
/s/ Donald J. Helfrecht Director
Donald J. Helfrecht
/s/ Frederic E. Mohs Director
Frederic E. Mohs
/s/ Robert B. Rennebohm Director
Robert B. Rennebohm
/s/ Phillip C. Stark Director
Phillip C. Stark
/s/ H. Lee Swanson Director
H. Lee Swanson <PAGE>
<PAGE>
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K
a)1. Financial Statements (consolidated, as of December 31, 1993 and 1992, and
for each of the three years in the period ended December 31, 1993).
Statements of Income*
Balance Sheets*
Statements of Capitalization*
Statements of Retained Income*
Statements of Cash Flows*
Notes to Consolidated Financial Statements*
Management's Responsibility for Financial Statements (included under
Item 8 herein, page II-4)
Report of Independent Accountants (for fiscal 1993)*
*Incorporated by reference in Item 8 herein.
2. Financial Statement Schedules.
The following financial statement schedules of the Company, and the
accountants' report thereon, and other report appear on the indicated
pages in this Form 10-K Annual Report:
Description Page
Report of Independent Accountants on Financial Statement
Schedules (for fiscal 1993) IV-2
Schedule V - Utility Plant -- for the years ended
December 31, 1993, 1992, and 1991 F-1 - F-3
Schedule VI - Accumulated Provision for Depreciation --
for the years ended December 31, 1993, 1992, and 1991 F-4
Schedule X - Supplementary Income Statement Information --
for the years ended December 31, 1993, 1992, and 1991 F-5
Report of former Independent Public Accountants on fiscal
years 1992 and 1991 Financial Statements II-5
Report of former Independent Public Accountants on fiscal
years 1992 and 1991 Financial Statement Schedules IV-3
<PAGE>
<PAGE>
Report of Independent Accountants
Our report on the consolidated financial statements of Madison Gas and
Electric Company has been incorporated by reference in this Form 10-K from
Exhibit 99 of the Form 8-K, dated February 11, 1994, of Madison Gas and
Electric Company. In connection with our audit of such financial statements,
we have also audited the related financial statement schedules for the year
ended December 31, 1993, listed in the index in Item 14(a)2. of this
Form 10-K.
In our opinion, the financial statement schedules referred to above, when
considered in relation to the basic financial statements taken as a whole,
present fairly, in all material respects, the information required to be
included therein.
COOPERS & LYBRAND
Milwaukee, Wisconsin
February 11, 1994 <PAGE>
<PAGE>
Report of Independent Public Accountants
We have audited, in accordance with generally accepted auditing standards, the
consolidated balance sheet and statement of capitalization of Madison Gas and
Electric Company and subsidiaries as of December 31, 1992, and the related
consolidated statements of income, retained income, and cash flows for each of
the two years in the period ended December 31, 1992, included in the Company's
Annual Report to Shareholders incorporated by reference in this Annual Report
on Form 10-K, and have issued our report thereon dated February 12, 1993.
Our audits were made for the purpose of forming an opinion on those statements
taken as a whole. The financial statement schedules listed in Item 14(a)2 as
of December 31, 1992, and the two years then ended are the responsibility of
the Company's management and are presented for purposes of complying with the
Securities and Exchange Commission's rules and are not part of the basic
financial statements. These financial statement schedules have been subjected
to the auditing procedures applied in the audits of the basic financial
statements and, in our opinion, fairly state in all material respects the
financial data required to be set forth therein in relation to the basic
financial statements taken as a whole.
ARTHUR ANDERSEN & CO.
Chicago, Illinois
February 12, 1993 <PAGE>
<PAGE>
3. All exhibits, including those incorporated by reference.
Exhibits:
No. Description of Document
3A Articles of Incorporation as in effect at January 5, 1994.
3B By-Laws as in effect at January 1, 1991. (Incorporated by
reference to Exhibit 3B with 1991 10-K in File No. 0-1125.)
4A Indenture of Mortgage and Deed of Trust between the Company and
Firstar Trust Company, as Trustee, dated as of January 1, 1946, and
filed as Exhibit 7-D to SEC File No. 0-1125 and the following
indentures supplemental thereto are incorporated herein by
reference:
Supplemental SEC
Indenture Dated as of Exhibit No. File No.
Fourth 4/01/61 2-B-5 2-17774
Fifth 6/01/66 4-B-6 2-25244
Sixth 7/01/69 2-B-7 2-33250
Seventh 1/15/71 2.08 2-38980
Eighth 5/01/74 2.03 2-50507
Ninth 11/15/75 2.04 2-54821
Tenth1 11/01/76 2.03 2-60227
Eleventh1&2 12/01/82 2 0-1125
Twelfth 11/15/86 4.2 33-9054
Thirteenth1 10/14/88 4B 0-1125 (1988 10-K)
Fourteenth 04/01/92 4C 0-1125 (1992 10-K)
Fifteenth 04/01/92 4D 0-1125 (1992 10-K)
Sixteenth 10/01/92 4E 0-1125 (1992 10-K)
Seventeenth 02/01/93 4F 0-1125 (1992 10-K)
1Exempted transaction under Section 4(2) of the Securities Act.
2Filed in connection with Form 8-K.
10A Copy of Joint Power Supply Agreement with Wisconsin Power and
Light Company and Wisconsin Public Service Corporation dated
February 2, 1967. (Incorporated by reference to Exhibit 4.09
in File No. 2-27308.)
10B Copy of Joint Power Supply Agreement (Exclusive of Exhibits)
with Wisconsin Power and Light Company and Wisconsin Public
Service Corporation dated July 26, 1973, amending Exhibit 5.04.
(Incorporated by reference to Exhibit 5.04A in File
No. 2-48781.)
10D Copy of revised Agreement for Construction and Operation of
Columbia Generating Plant with Wisconsin Power and Light
Company and Wisconsin Public Service Corporation dated July 26,
1973. (Incorporated by reference to Exhibit 5.07 in File
No. 2-48781.)
10F Copy of severance agreement with certain key employees dated
June 16, 1989. (Incorporated by reference to Exhibit 10F with
1989 10-K in File No. 0-1125.) <PAGE>
<PAGE>
12 Statement regarding computation of ratios (page II-2).
21 Subsidiaries of the Registrant.
23.1 Consent of Independent Accountants.
23.2 Consent of Independent Public Accountants.
(b) Reports on Form 8-K.
No Current Report on Form 8-K was filed for the quarter ended
December 31, 1993.
On March 4, 1994, the Company filed a Current Report on Form 8-K dated
February 11, 1994, under Item 5, "Other Events," which contains, under
Exhibit 99, the audited consolidated financial statements of the Company
for the year ended December 31, 1993; Notes to Consolidated Financial
Statements; and Management's Discussion and Analysis of Financial
Condition and Operations.
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
Schedule V - 1993
Madison Gas and Electric Company and Consolidated Subsidiaries
Schedule V - Utility Plant
December 31, 1993
(Thousands of Dollars)
Column A Column B Column C Column D Column E Column F
Other
Balance at Retirements Changes Balance
Beginning Additions or Sales Debit at End
Classification of Period at Cost at Cost (Credit) of Period
<S> <C> <C> <C> <C> <C>
Utility Plant
In Service -
Electric Plant -
Steam Production .................. $120,938 $ 424 $ 189 $ - $121,173
Nuclear Production ................ 54,582 912 91 - 55,403
Other Production .................. 3,867 - - - 3,867
Transmission ...................... 99,205 743 475 - 99,473
Distribution ...................... 133,981 7,453 726 - 140,708
General ........................... 25,586 82 14 (18) 25,636
Total Electric Plant ............ 438,159 9,614 1,495 (18) 446,260 (e)
Gas Plant -
Production ........................ 933 63 430 - 566
Distribution ...................... 139,178 4,061 192 - 143,047
General ........................... 1,822 204 13 - 2,013
Total Gas Plant ................. 141,933 4,328 635 - 145,626
Common Utility Plant ............... 33,602 2,947 3,008 15 33,556
Total Utility Plant In Service ... $613,694 $16,889 (b) $5,138 (3) $625,442
Construction Work in Progress -
Electric .......................... $ 5,215 $ 2,653 (a) $ - $ - $ 7,868
Gas ............................... 996 958 (a) - - 1,954
Common ............................ 513 1,916 (a) - - 2,429
Total Construction Work
in Progress ..................... $ 6,724 $ 5,527 $ - $ - $ 12,251
Nuclear Fuel ....................... $ 61,915 $ 2,911 (a) $ - $ - $ 64,826
Investment in Future Nuclear Fuel .. 542 1 (a) - - 543
Total Nuclear Fuel ............... $ 62,457 $ 2,912 $ - $ - $ 65,369
Decommissioning Fund ................. $ 23,100 $ - $ - $2,399 (d) $ 25,499
Other Property
Plant Held for Future Use ........... $ 884 $ 35 $ - $ - $ 919
Nonutility Property and Other ....... 8,026 1,529 - (652)(c) 8,903
Total Other Property .............. $ 8,910 $ 1,564 $ - $ (652) $ 9,822
<FN>
(a) Represents net change during year other than transfers and reclassifications.
(b) Includes $130 for allowance for funds used during construction.
(c) Represents primarily reclassification of various properties on books of subsidiary and transfer of property from subsidiary
to parent.
(d) Funds received through depreciation rates (in 1993 and prior years) and interest on funds to be used for the future
decommissioning of the Kewaunee Nuclear Plant.
(e) Includes $84,620 for the Company's portion of the Columbia Energy Center and $56,872 for the Company's portion of the
Kewaunee Nuclear Plant.
/TABLE
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
Schedule V - 1992
Madison Gas and Electric Company and Consolidated Subsidiaries
Schedule V - Utility Plant
December 31, 1992
(Thousands of Dollars)
Column A Column B Column C Column D Column E Column F
Other
Balance at Retirements Changes Balance
Beginning Additions or Sales Debit at End
Classification of Period at Cost at Cost (Credit) of Period
<S> <C> <C> <C> <C> <C>
Utility Plant
In Service -
Electric Plant -
Steam Production .................. $121,332 $ 284 $ 678 $ - $120,938
Nuclear Production ................ 54,176 419 13 - 54,582
Other Production .................. 3,869 - 2 - 3,867
Transmission ...................... 98,447 965 207 - 99,205
Distribution ...................... 127,506 7,312 837 - 133,981
General ........................... 25,345 240 24 25 25,586
Total Electric Plant ............ 430,675 9,220 1,761 25 438,159 (e)
Gas Plant -
Production ........................ 933 - - - 933
Distribution ...................... 136,284 3,043 149 - 139,178
General ........................... 1,794 39 11 - 1,822
Total Gas Plant ................. 139,011 3,082 160 - 141,933
Common Utility Plant ............... 33,741 1,170 1,283 (26) 33,602
Total Utility Plant In Service ... $603,427 $13,472 (b) $3,204 $ (1) $613,694
Construction Work in Progress -
Electric .......................... $ 4,207 $ 1,008 (a) $ - $ - $ 5,215
Gas ............................... 838 158 (a) - - 996
Common ............................ 356 156 (a) - 1 513
Total Construction Work
in Progress ..................... $ 5,401 $ 1,322 - 1 $ 6,724
Nuclear Fuel ....................... $ 59,841 $ 2,074 (a) $ - $ - $ 61,915
Investment in Future Nuclear Fuel .. 541 1 (a) - - 542
Total Nuclear Fuel ............... $ 60,382 $ 2,075 $ - $ - $ 62,457
Decommissioning Fund ................. $ 20,827 $ - $ - $2,273 (d) $ 23,100
Other Property
Plant Held for Future Use ........... $ 884 $ - $ - $ - $ 884
Nonutility Property and Other ....... 3,494 1,067 - 3,465 (c) 8,026
Total Other Property .............. $ 4,378 $ 1,067 $ - $3,465 $ 8,910
<FN>
(a) Represents net change during year other than transfers and reclassifications.
(b) Includes $71 for allowance for funds used during construction.
(c) Represents primarily reclassification of various properties on books of subsidiary and transfer of property from subsidiary
to parent.
(d) Funds received through depreciation rates (in 1992 and prior years) and interest on funds to be used for the future
decommissioning of the Kewaunee Nuclear Plant.
(e) Includes $84,550 for the Company's portion of the Columbia Energy Center and $56,017 for the Company's portion of the
Kewaunee Nuclear Plant.
</TABLE>
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
Schedule V - 1991
Madison Gas and Electric Company and Consolidated Subsidiaries
Schedule V - Utility Plant
December 31, 1991
(Thousands of Dollars)
Column A Column B Column C Column D Column E Column F
Other
Balance at Retirements Changes Balance
Beginning Additions or Sales Debit at End
Classification of Period at Cost at Cost (Credit) of Period
<S> <C> <C> <C> <C> <C>
Utility Plant
In Service -
Electric Plant -
Steam Production .................. $121,082 $ 303 $ 53 $ - $121,332
Nuclear Production ................ 52,387 1,961 172 - 54,176
Other Production .................. 3,869 - - - 3,869
Transmission ...................... 97,168 3,049 1,810 40 98,447
Distribution ...................... 123,620 4,500 614 - 127,506
General ........................... 25,030 367 52 - 25,345
Total Electric Plant ............ 423,156 10,180 2,701 40 430,675 (e)
Gas Plant -
Production ........................ 933 - - - 933
Distribution ...................... 133,912 2,502 130 - 136,284
General ........................... 1,746 54 6 - 1,794
Total Gas Plant ................. 136,591 2,556 136 - 139,011
Common Utility Plant ............... 33,531 695 486 1 33,741
Total Utility Plant In Service ... $593,278 $13,431 (b) $3,323 $ 41 $603,427
Construction Work in Progress -
Electric .......................... $ 1,851 $ 2,354 (a) $ - $ 2 $ 4,207
Gas ............................... 122 716 (a) - - 838
Common ............................ 17 793 (a) - (454) 356
Total Construction Work
in Progress ..................... $ 1,990 $ 3,863 $ - $ (452) $ 5,401
Nuclear Fuel ....................... $ 57,164 $ 2,669 (a) $ - $ 8 $ 59,841
Investment in Future Nuclear Fuel .. 540 1 (a) - - 541
Total Nuclear Fuel ............... $ 57,704 $ 2,670 $ - $ 8 $ 60,382
Decommissioning Fund ................. $ 18,541 $ - $ - $2,286 (d) $ 20,827
Other Property
Plant Held for Future Use ........... $ 656 $ 228 $ - $ - $ 884
Nonutility Property and Other ....... 4,634 (282) - (858)(c) 3,494
Total Other Property .............. $ 5,290 $ (54) $ - $ (858) $ 4,378
<FN>
(a) Represents net change during year other than transfers and reclassifications.
(b) Includes $128 for allowance for funds used during construction.
(c) Represents primarily reclassification of various properties on books of subsidiary and transfer of property from subsidiary
to parent.
(d) Funds received through depreciation rates (in 1991 and prior years) and interest on funds to be used for the future
decommissioning of the Kewaunee Nuclear Plant.
(e) Includes $85,148 for the Company's portion of the Columbia Energy Center and $55,533 for the Company's portion of the
Kewaunee Nuclear Plant.
/TABLE
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
Schedule VI - 1993-1991
Madison Gas and Electric Company and Consolidated Subsidiaries
Schedule VI - Accumulated Provision for Depreciation of Utility Plant
and Amortization of Nuclear Fuel
Years Ended December 31, 1993, 1992, and 1991
(Thousands of Dollars)
Column A Column B Column C Column D Column E Column F
Additions Charged To Deductions
Balance at Clearing Balance
Beginning and Other Net Other at End
Description of Period Income Accounts Retirements Salvage Changes of Period
<S> <C> <C> <C> <C> <C> <C> <C>
1993
Electric ............... $205,178 $16,255 $ - $1,128 $237 $(166) $220,376
Gas .................... 64,142 4,388 - 635 48 664 68,607
Common ................. 14,928 1,137 450 3,008 (16) 430 13,921
Subtotal ............ 284,248 21,780 (a) 450 4,771 269 928 302,904
Nuclear Fuel ........... 54,578 2,486 - - - - 57,064
Total ............... $338,826 $24,266 $ 450 $4,771 $269 $ 928 $359,968 (b)
1992
Electric ............... $190,879 $ 15,961 $ - $1,761 $ 120 $ (21) $205,178
Gas .................... 60,023 4,285 - 160 (33) 27 64,142
Common ................. 14,376 1,421 382 1,283 - 32 14,928
Subtotal ............ 265,278 21,667 (a) 382 3,204 87 38 284,248
Nuclear Fuel ........... 51,581 2,997 - - - - 54,578
Total ............... $316,859 $ 24,664 $ 382 $3,204 $ 87 $ 38 $338,826 (b)
1991
Electric ............... $176,944 $ 15,741 $ - $ 935 $ (6) $(865) $190,879
Gas .................... 55,858 4,393 - 136 (71) (21) 60,023
Common ................. 12,625 1,861 371 485 - 4 14,376
Subtotal ............ 245,427 21,995 (a) 371 1,556 (77) (882) 265,278
Nuclear Fuel ........... 48,353 3,228 - - - - 51,581
Total ............... $293,780 $ 25,223 $ 371 $1,556 $ (77) $(882) $316,859 (b)
<FN>
(a) These amounts exclude the amortization of property losses and the amortization of utility plant acquisition adjustments. The
amount(s) excluded are $11 for 1993, ($240) for 1992, and ($970) for 1991. Such amounts are included in "Straight-line
depreciation and amortization" in the Consolidated Statement of Income.
(b) The Accumulated Provision for Depreciation has been adjusted to reflect reclassifications to conform with the Federal Energy
Regulatory Commission Chart of Accounts adopted by the Public Service Commission of Wisconsin on January 1, 1990. Such
reclassifications relate primarily to income taxes and contributions in aid of construction.
</TABLE>
<PAGE>
<PAGE>
[TEXT]
Schedule X
MADISON GAS AND ELECTRIC COMPANY AND CONSOLIDATED SUBSIDIARIES
SCHEDULE X--SUPPLEMENTARY INCOME STATEMENT INFORMATION
FOR THE YEARS ENDED DECEMBER 31, 1993, 1992, AND 1991
The amounts of maintenance and repairs, amortization of intangible assets, and
taxes that have been charged to other accounts are not significant. Rents and
advertising costs charged to income and clearing accounts are not significant.
No royalties were paid. Provisions for gross receipts tax charged to tax
expense is as follows:
Year Ended December 31,
1993 1992 1991
(Thousands of Dollars)
Gross Receipts .......... $5,371 $5,495 $5,223
<PAGE>
Exhibit No. 3A
RESTATED
ARTICLES OF INCORPORATION
OF
MADISON GAS AND ELECTRIC COMPANY
(Including all amendments made through January 5, 1994)
The following Restated Articles of Incorporation duly adopted pursuant to
the authority and provisions of the Wisconsin Business Corporation Law
supersede and take the place of the heretofore existing Articles of
Organization and amendments thereto:
Article First. The name of the corporation is MADISON GAS AND ELECTRIC
COMPANY.
Article Second. The purpose of the Company shall be to engage in any
lawful activity within the purposes for which corporations may be organized
under the Wisconsin Business Corporation Law, including but not by way of
limitation, the production, purchase, transmission, distribution and sale of
gas and electricity and any related products, by-products and merchandise,
either directly or indirectly, to or for the public, whether by itself or in
conjunction with others, and to transact any and all business incidental to
such purposes.
Article Third. A. Authorized Capital.
The authorized capital stock of the Company shall be Two Hundred Fifty-
Three Million Nine Hundred Seventy-Five Thousand Dollars ($253,975,000) and
shall consist of One Million One Hundred Ninety-Nine Thousand (1,199,000)
shares of Cumulative Preferred Stock, each of which said shares shall be $25
Par Value, and Twenty-Eight Million (28,000,000) shares of Common Stock, each
of which said shares shall be $8 Par Value.
B. Cumulative Preferred Stock.
(I) Series and Variations Between Series. The Cumulative Preferred Stock may
be divided into and issued in series. The Board of Directors is hereby
expressly vested with authority to divide such shares into series and cause
such shares to be issued from time to time in series, and, by resolution
adopted prior to the issue of shares of a particular series, to fix and
determine the following relative rights and preferences with respect to such
series, as to which matters the shares of a particular series may vary from
those of any or all other series:
(a) the distinctive serial designation of the shares of such series;
(b) the rate of dividend thereof;
(c) the amount payable upon the shares in event of voluntary or
involuntary liquidation (except as fixed in this Division B);
(d) the price or prices at and the terms and conditions on which shares
may be redeemed (except as fixed in this Division B); <PAGE>
<PAGE>
(e) sinking fund provisions for the redemption or purchase of such
shares; and
(f) the terms and conditions on which such shares may be converted if
the shares of any series are issued with the privilege of
conversion.
Except as the shares of a particular series may vary from those of any or all
other series in the foregoing respects, all of the shares of the Cumulative
Preferred Stock, regardless of series, shall in all respects be equal and
shall have the relative rights and preferences herein fixed.
(II) Dividends. (a) The holders of shares of Cumulative Preferred Stock of
each series shall be entitled to receive, as and when declared payable by the
Board of Directors from funds legally available for the payment thereof,
preferential dividends in lawful money of the United States of America at the
rate per annum fixed and determined as herein authorized for the shares of
such series, but no more, payable quarterly on dates to be established for all
series when established by the Board of Directors for the first series (the
quarterly dividend payment dates), in each year with respect to the quarterly
period ending on the day prior to each such respective dividend payment date.
Such dividends shall be cumulative with respect to each share from and
including the quarterly dividend payment date next preceding the date of issue
thereof unless (1) the date of issue be a quarterly dividend payment date, in
which case dividends shall be cumulative from and including the date of issue,
(2) issued during an interval between a record date for the payment of a
quarterly dividend on shares of such series and the payment date for such
dividend, in which case dividends shall be cumulative from and including such
payment date, or (3) the Board of Directors shall determine that the first
dividend with respect to shares of a particular series issued during an
interval between quarterly dividend payment dates shall be cumulative from and
including a date during such interval, in which event dividends shall be
cumulative from and including such date. No dividends shall be declared on
shares of Cumulative Preferred Stock of any series in respect of accumulations
for any quarterly dividend period or portion thereof unless dividends shall
likewise be or have been declared with respect to accumulations on all then
outstanding shares of Cumulative Preferred Stock of each other series for the
same period or portion thereof; and the ratios of the dividends declared to
dividends accumulated with respect to any quarterly dividend period on the
shares of each series outstanding shall be identical. Accumulations of
dividends shall not bear interest.
(b) So long as any shares of Cumulative Preferred Stock remain
outstanding, no dividend shall be paid or declared, or other distribution
made, on shares of junior stock, nor shall any shares of junior stock be
purchased, redeemed, retired or otherwise acquired for a consideration (1)
unless preferential dividends on outstanding shares of Cumulative Preferred
Stock for the current and all past quarterly dividend periods shall have been
paid, or declared and set apart for payment, provided, however, that the
restrictions of this subparagraph (1) shall not apply to the declaration and
payment of dividends on shares of junior stock if payable solely in shares of
junior stock, nor to the acquisition of any shares of junior stock through
application of proceeds of any shares of junior stock sold at or about the
time of such acquisition, nor shall such restrictions prevent the transfer of
any amount from surplus to stated capital; and (2) except to the extent of
earned surplus, provided, however, that the restriction in this subparagraph
<PAGE>
<PAGE>
(2) shall not apply to any of the acts described in the proviso set forth in
subparagraph (1) above and shall not apply either to the acquisition of any
shares of junior stock issued after April 1, 1970, to the extent of the
proceeds received for the issue of such shares, or to the payment of any
dividend within 60 days after the date of declaration thereof, if at said date
of declaration said dividend conforms with the provisions of this subparagraph
(2).
(III) Liquidation Preferences. (a) In the event of voluntary dissolution or
liquidation of the Company, the holders of shares of Cumulative Preferred
Stock of each series outstanding shall be entitled to receive out of the
assets of the Company an amount per share equal to that which such holders
would have been entitled to receive had shares held by them been redeemed
(otherwise than through operation of a sinking fund) on the date fixed for
payment, but no more, unless shares are not so redeemable at such date, and
then an amount per share to be fixed in the resolution of the Board of
Directors establishing the series of which the shares are a part. In the
event of involuntary dissolution or liquidation of the Company, the holders of
shares of Cumulative Preferred Stock of each series outstanding shall be
entitled to receive out of the assets of the Company $25 per share, plus
preferential dividends at the rate fixed and determined for such series as
herein authorized, accrued and unpaid to the date fixed for payment, but no
more. Until payment to the holders of outstanding shares of Cumulative
Preferred Stock as aforesaid, or until moneys or other assets sufficient for
such payment shall have been set apart for payment by the Company, separate
and apart from its other funds and assets for the account of such holders, so
as to be and continue to be available for payment to such holders, no payment
or distribution shall be made to holders of shares of junior stock in
connection with or upon such dissolution or liquidation. If upon any such
dissolution or liquidation the assets of the Company available for payment and
distribution to shareholders are insufficient to make payment in full, as
hereinabove provided, to the holders of shares of Cumulative Preferred Stock,
payment shall be made to such holders ratably in accordance with the number of
shares held by them, respectively.
(b) Neither a consolidation nor merger of the Company with or into any
other corporation, nor a merger of any other corporation into the Company nor
the purchase or redemption of all or any part of the outstanding shares of any
class or classes of stock of the Company, nor the sale or transfer of the
property and business of the Company as or substantially as an entirety shall
be construed to be a dissolution or liquidation of the Company within the
meaning of the foregoing provisions.
(IV) Redemption. (a) Except for any series which may not at the time be
redeemable, the Company may, at its option expressed by vote of the Board of
Directors, at any time or from time to time redeem the whole or any part of
the Cumulative Preferred Stock, or of any series thereof, at the redemption
price or prices at the time in effect, any such redemption to be on such
redemption date and at such place in the City of Madison, State of Wisconsin,
City of Chicago, State of Illinois, or in the City, County and State of New
York, or any combination of the three, as shall be determined by vote of the
Board of Directors. Notice of any proposed redemption of shares of Cumulative
Preferred Stock stating the series to be redeemed, the certificates within
such series to be redeemed if less than all of the shares of such series are
to be redeemed, and the date and place of redemption, shall be given by the
Company by depositing a copy of such notice in the U.S. mails, not more than
<PAGE>
<PAGE>
60 or less than 30 days prior to the redemption date, addressed to the holders
of record of shares of Cumulative Preferred Stock to be redeemed, at their
respective addresses then appearing on the books of the Company and such
notice shall be deemed delivered when so deposited; and by publishing such
notice at least once in each week for two successive weeks in a newspaper
customarily published at least on each business day, other than Saturdays,
Sundays and holidays, which is printed in the English language and published
and of general circulation in the Borough of Manhattan, City and State of New
York, and in such a newspaper so printed which is published and of general
circulation in the City of Chicago, State of Illinois. Publication of such
notice shall be commenced not more than 60 days, and shall be concluded not
less than 30 days, prior to the redemption date, but such notice need not
necessarily be published on the same day of each week or in the same
newspaper. If publication is made, unintentional omissions or errors in names
or addresses in the mailed notice shall not impair the validity of the notice.
In case less than all of the shares of any series are to be redeemed, the
shares so to be redeemed shall be determined by lot in such manner as may be
prescribed by the Board of Directors unless a method other than by lot is set
forth in the resolution of the Board of Directors establishing such series.
The certificates evidencing the shares to be so redeemed shall be specified by
number in the notice of such redemption and if less than all the shares
evidenced by any of the said certificates are to be redeemed, then the number
of shares to be redeemed shall be specified. On the redemption date the
Company shall, and at any time within 60 days prior to such redemption date
may, deposit in trust, for the account of the holders of shares of Cumulative
Preferred Stock to be redeemed, funds necessary for such redemption with a
bank or trust company in good standing, organized under the laws of the United
States of America or of the State of Wisconsin or of the State of New York or
of the State of Illinois, doing business in the Cities of Milwaukee or
Madison, the State of Wisconsin, or in the City, County and State of New York
or in the City of Chicago, the State of Illinois, and having combined capital,
surplus and undivided profit of at least $5,000,000, which shall be designated
in such notice of redemption.
(b) If notice of redemption shall have been duly given, or said bank or
trust company has been irrevocably authorized by the Company to give such
notice, and funds necessary for such redemption have been deposited, all as
aforesaid, then all shares of Cumulative Preferred Stock with respect to which
such deposit shall have been made shall forthwith, whether or not the date
fixed for such redemption shall have occurred or the certificates for such
shares shall have been surrendered for cancellation, be deemed no longer to be
outstanding for any purpose, and all rights with respect to such shares shall
thereupon cease and terminate, excepting only the right of the holders of the
certificates for such shares to receive, out of the funds so deposited in
trust, on the redemption date (unless an earlier date is fixed by the Board of
Directors), the redemption funds, without interest, to which they are
entitled, and the right to exercise any privilege of conversion not
theretofore expiring, the Company to be entitled to the return of any funds
deposited for redemption of shares converted pursuant to such privilege. At
the expiration of 6 years after the redemption date such trust shall
terminate. Any such moneys then remaining on deposit, together with any
interest thereon which may be allowed by the bank or trust company with which
the deposit shall have been made, shall be paid by it to the Company, free of
trust, and thereafter the holders of the certificates for such shares shall
have no claim against such bank or trust company but only claims as unsecured
<PAGE>
<PAGE>
creditors against the Company for the amounts payable upon redemption thereof,
without interest. Interest, if any, allowed by the bank or trust company as
aforesaid shall belong to the Company.
(c) Subject to applicable law and this Article Third, the Company may
from time to time purchase or otherwise acquire outstanding shares of
Cumulative Preferred Stock at a price per share not exceeding the amount
(inclusive of any premium over par value and any accrued dividends) then
payable in the event of redemption thereof otherwise than through operation of
a sinking fund, if any.
(d) No shares of Cumulative Preferred Stock shall be purchased, redeemed
or otherwise acquired for a valuable consideration (1) in any case if all
dividends on the Cumulative Preferred Stock for all past quarter yearly
dividend periods shall not have been paid or declared and a sum sufficient for
the payment thereof set apart, or (2) at any time when the Company shall be in
default or deficient under any requirement of a sinking fund established with
respect to outstanding shares of any series of Cumulative Preferred Stock for
any period then elapsed, except for the purpose of wholly or partially
eliminating such default or deficiency.
(e) Subject to the provisions of this Article Third, any and all shares
of Cumulative Preferred Stock which at any time shall have been:
(1) Redeemed or otherwise retired by the Company, except in the
manner set forth in (2) below, shall assume the status of authorized but
unissued Cumulative Preferred Stock and may thereafter be reissued in the
same manner as other authorized but unissued Cumulative Preferred Stock.
(2) Redeemed or purchased through operation of any sinking fund
with respect thereto, or which shall have been converted into or
exchanged for shares of any other class or classes or other securities of
the Company pursuant to a right of conversion or exchange reserved in
such Cumulative Preferred Stock, shall be canceled and shall not be
reissued, and the Company shall, from time to time, take such corporate
action as may be appropriate or necessary to reduce the authorized number
of shares of Cumulative Preferred Stock accordingly.
(V) Voting Rights. The holders of Cumulative Preferred Stock shall have no
vote in the affairs of the corporation except as is provided below or at the
time may be mandatorily required by statute:
(a) So long as any shares of Cumulative Preferred Stock are outstanding,
the Company shall not, without the consent (given by vote in person or by
proxy at a meeting called for that purpose) of the holders of at least two-
thirds of the shares of Cumulative Preferred Stock then outstanding:
(1) Create or authorize any shares of senior stock, or create or
authorize any obligation or security convertible into any such shares; or
(2) Alter or change the relative rights or preferences of then
outstanding Cumulative Preferred Stock so as to affect the holders
thereof adversely, provided, however, if any such alteration or change
would adversely affect the holders of one or more, but not all, of the
series of Cumulative Preferred Stock at the time outstanding, only the
consent of holders of two-thirds of the shares of each series so affected
shall be required; or <PAGE>
<PAGE>
(3) Issue, sell or otherwise dispose of shares of Cumulative
Preferred Stock, or any shares of senior or parity stock, or securities
convertible into shares of Cumulative Preferred Stock or into shares of
senior or parity stock, other than in exchange for, or in connection with
the retirement (by redemption or otherwise) of, not less than a like
number of shares of Cumulative Preferred Stock or shares of senior or
parity stock, or securities convertible into not less than a like number
of such shares, as the case may be at the time outstanding, unless:
(i) Immediately after such proposed issue, sale or other
disposition, the aggregate of the capital of the Company
applicable to all shares of Common Stock then to be outstanding
(including premium on all shares of Common Stock) plus earned
surplus and capital surplus, shall be at least equal to the
involuntary liquidation preference of all shares of Cumulative
Preferred Stock and shares of senior or parity stock then to be
outstanding, provided that until such additional shares or
securities, as the case may be, or the equivalent thereof (in
terms of involuntary liquidating preference) in shares of
Cumulative Preferred Stock or senior or parity stock, shall
have been retired, earned surplus of the Company used to meet
the requirements of this clause in connection with the issuance
of additional shares of Cumulative Preferred Stock or shares of
senior or parity stock or securities convertible into either
thereof shall not, after the issue of such shares or
securities, be available for dividends or other distributions
on Common Stock (other than dividends payable in Common Stock),
except in an amount equal to the cash subsequently received by
the Company as a contribution to its Common Stock capital or as
consideration for the issuance of additional shares of Common
Stock; and
(ii) The gross income of the Company for a period of 12 consecutive
calendar months within the 15 calendar months immediately
preceding the issuance, sale or other disposition of such
shares, determined in accordance with such system of accounts
as may be prescribed by governmental authorities having
jurisdiction in the premises, or, in the absence thereof, in
accordance with sound accounting practice (but in any event
after deducting the amount for said period charged by the
Company on its books to depreciation expense and taxes) to be
available for the payment of interest, shall have been equal to
at least one and one-half times the sum of (x) the interest
charges for one year on all interest-bearing indebtedness of
the Company (plus all amortization of debt discount and
expense, and less all amortization of premium on debt,
applicable to the aforesaid 12 months' period) and (y) the
dividend requirements for one year on all outstanding
Cumulative Preferred Stock, and on all outstanding senior and
parity stock; and for the purpose of both such computations the
shares and any indebtedness then proposed to be issued shall be
included, and any indebtedness and shares then proposed to be
retired shall be excluded, and in determining such gross income
the Board of Directors shall make such adjustments, by way of
increase or decrease in such gross income, as shall in its
opinion be necessary to give effect, for the entire 12 months
<PAGE>
<PAGE>
for which such gross income is determined, to any acquisition
or disposition of property, the income from which can be
separately ascertained,
in which event such consent shall not be required.
(b) So long as any Cumulative Preferred Stock is outstanding, the
Company shall not, without the consent (given by vote in person or by proxy at
a meeting called for that purpose) of the holders of at least a majority of
the shares of Cumulative Preferred Stock then outstanding:
(1) Merge or consolidate with or into any other corporation,
provided that this provision shall not apply to a purchase or other
acquisition by the Company of franchises or assets of another corporation
in any manner which does not involve a statutory merger or consolidation;
(2) Sell, lease, or exchange all or substantially all of its
property and assets, unless the fair value of the net assets of the
Company, after completion of such transaction, shall at least equal the
then involuntary liquidation value of the Cumulative Preferred Stock of
all series, and of all senior or parity stock, then outstanding.
(c) No consent hereinbefore provided for in this subdivision (V)(a) and
(b) shall be required in the case of the holders of any shares of Cumulative
Preferred Stock which are to be redeemed at or prior to the time when an
alteration or change is to take effect, or at or prior to the time of
authorization, issuance, sale or other disposition of any additional
Cumulative Preferred Stock or shares of senior or parity stock or convertible
securities, or a consolidation or merger is to take effect, as the case may
be.
(d) If at any time dividends on any of the outstanding shares of
Cumulative Preferred Stock shall be in default in an amount equivalent to four
or more full quarterly dividends, the holders of outstanding shares of
Cumulative Preferred Stock, voting separately as a class, shall be entitled to
elect either one-fourth or two (whichever shall be greater) of the Directors
of the Company (herein called Certain Directors), which right shall continue
in force and effect until all arrears of dividends on outstanding shares of
Cumulative Preferred Stock shall have been declared and paid or deposited in
trust with a bank or trust company having the qualification set forth in
subdivision (IV) of this Division B for payment on or before the next
succeeding dividends payment date, in which event, such right to elect Certain
Directors shall cease and terminate unless and until the equivalent of four or
more full quarterly dividends shall again be in default on outstanding shares
of Cumulative Preferred Stock. Such right to elect Certain Directors is
subject to the following terms and conditions:
(1) Such right to elect Certain Directors may be exercised at any
annual meeting of shareholders, or, within the limitations herein
provided, at a special meeting of shareholders held for such purpose.
Whenever such right to elect Certain Directors shall vest, on request
signed by any holder of record of shares of Cumulative Preferred Stock
then outstanding and delivered to the Company's principal office not less
than 120 days prior to the date of the annual meeting next following the
date when such right vests, the President or a Vice-President of the
Company shall call a special meeting of shareholders to be held within 60
<PAGE>
<PAGE>
days after receipt of such request for the purpose of electing a new
Board of Directors of which holders of outstanding shares of Cumulative
Preferred Stock shall be entitled to elect Certain Directors and holders
of outstanding shares otherwise entitled to vote shall be entitled to
elect the remaining Directors, in each case to serve until the next
annual meeting of shareholders or until their successors shall be elected
and shall qualify.
(2) Whenever, under the terms hereof, holders of outstanding shares
of Cumulative Preferred Stock shall be divested of the right to elect
Certain Directors, upon request signed by any holder of record of shares
otherwise entitled to vote and delivered to the Company at its principal
office not less than 120 days prior to the date for the annual meeting
next following the date of such divesting, the President or a Vice-
President of the Company shall call a special meeting of the holders of
shares otherwise entitled to vote, to be held within 60 days after
receipt of such request for the purpose of electing a new Board of
Directors to serve until the next annual meeting or until their
respective successors shall be elected and shall qualify.
(3) If, while holders of outstanding shares of Cumulative Preferred
Stock are entitled to elect Certain Directors, the holders of shares
entitled as a class to elect Directors shall fail to elect the full
number of Directors which they are entitled to elect, either at an annual
meeting of shareholders or a special meeting thereof held as in this
subdivision (V) provided, or at an adjourned session of either thereof
held within a period of 90 days beginning with the date of such meeting,
then after the expiration of such period holders of outstanding shares of
Cumulative Preferred Stock and holders of outstanding shares otherwise
entitled to vote, voting as a single class, shall be entitled to elect
such number of Directors as shall not have been elected during such
period by holders of outstanding shares of the class or classes then
entitled to elect the same, to serve until the next annual meeting of
shareholders or until their successors shall be elected and shall
qualify. The term of office of all Directors in office immediately prior
to the date of such annual or special meeting shall terminate as and when
a full Board of Directors shall have been elected at such meeting or a
later meeting of shareholders for the election of Directors, or an
adjourned session of either thereof.
(4) At any annual or special meeting of the shareholders or
adjournment thereof, held for the purpose of electing Directors while the
holders of outstanding shares of Cumulative Preferred Stock shall be
entitled to elect Certain Directors, the presence in person or by proxy
of the holders of a majority of outstanding shares of Cumulative
Preferred Stock shall be necessary to constitute a quorum of Cumulative
Preferred Stock for the election by such class of members to the Board of
Directors and the presence in person or by proxy of the holders of a
majority of outstanding shares otherwise entitled to vote shall be
necessary to constitute a quorum of such shares for the election of
Directors which holders of such shares are then entitled to elect. In
case of a failure by the holders of any class or classes to elect, at
such meeting or an adjourned session held within said period of 90 days,
the number of Directors which they are entitled to elect at such meeting,
such meeting shall be deemed ipso facto to have been adjourned to
reconvene at 11:00 A.M., Local Time, on the fourth full business day next
<PAGE>
<PAGE>
following the close of such 90-day period, at which time, or at a
subsequent adjourned session of such meeting, such number of Directors as
shall not have been elected during such period by holders of outstanding
shares of the class or classes then entitled to elect the same, may be
elected by holders of outstanding shares of Cumulative Preferred Stock
and holders of outstanding shares otherwise entitled to vote, voting as a
single class. Subject to the preceding provisions of this subdivision
(V), a majority of the holders of shares of any class or classes at the
time present in person or by proxy shall have power to adjourn such
meeting for the election of Directors by holders of shares of such class
or classes from time to time without notice other than announcement at
the meeting.
(5) While the holders of outstanding shares of Cumulative Preferred
Stock remain entitled to elect Certain Directors, any holder of record of
outstanding shares of Cumulative Preferred Stock shall have the right,
during regular business hours, in person or by a duly authorized
representative, to examine the Company's stock records of Cumulative
Preferred Stock for the purpose of communicating with other holders of
shares of such stock with respect to the exercise of such right of
election, and to make a list of such holders.
(e) Except as by statute at the time mandatorily provided, holders of
shares of Cumulative Preferred Stock shall not be entitled to receive notice
of any meeting of shareholders at which they are not entitled to vote or
consent.
(VI) (Vacant)
(VII) (Vacant)
(VIII) (Vacant)
(IX) (Vacant)
(X) Series E Cumulative Preferred Stock. (a) Establishment of Series and
Designation Thereof. There is established a series of Cumulative Preferred
Stock, the serial designation of the shares of which shall be, and the shares
of which shall be known as, Series E Cumulative Preferred Stock. Such series
shall be a closed series consisting of 300,000 shares of Cumulative Preferred
Stock.
(b) Rate of Dividend. The rate of preferred dividends on the shares of
Series E Cumulative Preferred Stock shall be $2.175 per share per annum, which
shall be cumulative from and including August 31, 1978, and shall be payable
in quarterly installments on February 1, May 1, August 1, and November 1 of
each year.
(c) Price at Which Redeemable. (1) The shares of Series E Cumulative
Preferred Stock shall be redeemable at the option of the Company at any time,
or from time to time, after the issue thereof, and prior to August 1, 1983, at
$27.00 per share; on or after August 1, 1983, but prior to August 1, 1988, at
$26.60 per share; on or after August 1, 1988, but prior to August 1, 1993, at
$26.20 per share; on or after August 1, 1993, but prior to August 1, 1998, at
$25.80 per share; on or after August 1, 1998, but prior to August 1, 2003, at
$25.40 per share; and on or after August 1, 2003, at $25.00 per share; plus,
in each case, an amount equivalent to preferential dividends at the rate <PAGE>
<PAGE>
aforesaid accrued and unpaid to the date of redemption; provided, however, the
shares of Series E Cumulative Preferred Stock shall not be redeemable at the
option of the Company prior to August 1, 1983, directly or indirectly, (i)
from or in anticipation of moneys borrowed by or for the account of the
Company, or (ii) from or in anticipation of the proceeds of the issuance of
any other shares of Cumulative Preferred Stock, or senior or parity stock (as
such terms are defined in Division E), if such borrowing has an effective
interest cost to the Company or such shares have an effective dividend cost to
the Company of less than 8.70% per annum, or if such borrowing or such shares
have, as of the date of the proposed redemption, a weighted average life less
than the remaining weighted average life of the Series E Cumulative Preferred
Stock. Weighted average life of any borrowing or preferred stock means as at
the time of the determination thereof the number of years obtained by dividing
the then remaining dollar-years of such borrowing by the principal amount of
such borrowing or the aggregate involuntary liquidation preference of the
shares of such preferred stock. The term "remaining dollar-years of any
borrowing or preferred stock" means the amount obtained by (1) multiplying the
amount of each then remaining sinking fund, serial maturity, or other required
repayment, redemption, or purchase, including repayment, redemption, or
purchase, at final maturity, by the number of years (calculated at the nearest
one-twelfth) which will elapse between the date of proposed redemption and the
date of that required repayment, redemption, or purchase, and (2) totaling all
the products obtained in (1). If the Company makes any redemption of shares
of Series E Cumulative Preferred Stock on or after August 1, 1983, but prior
to August 1, 1988, which if made prior to August 1, 1983, would have been
prohibited by the terms of this paragraph, then the redemption price shall be
$28.00 per share plus an amount equivalent to preferential dividends at the
rate aforesaid accrued and unpaid to the date of redemption. The shares of
Series E Cumulative Preferred Stock shall be redeemable for purposes of the
sinking fund hereinafter provided at the price of $25.00 per share plus an
amount equivalent to preferential dividends at the rate aforesaid accrued and
unpaid to the date of redemption.
(2) If the Company shall, at any time, redeem at its option less than
all of the then outstanding shares of Series E Cumulative Preferred Stock, it
shall redeem such shares as follows:
(i) From each purchaser on original issue, or any nominee of such
purchaser ("Original Purchaser"), a number of full shares of Series E
Cumulative Preferred Stock, which bears (as nearly as may be practicable)
the same ratio to the total number of such shares to be redeemed as (A)
the total number of shares of Series E Cumulative Preferred Stock held by
such Original Purchaser on the date on which notice of such redemption is
given bears to (B) the total number of such shares outstanding on such
date, including such shares held by the Company as treasury shares; and
(ii) From holders of shares of Series E Cumulative Preferred Stock
other than Original Purchasers and other than the Company, by redemption
by lot, a number of shares of Series E Cumulative Preferred Stock equal
to the total number of such shares to be redeemed, less the number of
such shares which the Company shall be required to redeem from Original
Purchasers in accordance with the provisions of the preceding
subparagraph (i). <PAGE>
<PAGE>
(d) Sinking Fund. (1) Within each 12 months' period commencing with
the 12 months' period ending August 1, 1984, and ending with the 12 months'
period ending August 1, 1993, the Company shall acquire, subject to the
restrictions contained in this Article Third, either by redemption thereof or
by purchase thereof, at a price not exceeding the optional redemption price
then in effect, and shall retire 4,000 shares of Series E Cumulative Preferred
Stock, or the number of shares of such series outstanding, whichever shall be
less; and in each of the 12 months' periods commencing with the 12-month
period ending August 1, 1994, and ending with the 12-month period ending
August 1, 1998, the Company shall similarly acquire 8,000 shares of Series E
Cumulative Preferred Stock; and in each of the 12 month-periods commencing
with the 12-month period ending August 1, 1999, and ending with the 12-month
period ending August 1, 2008, the Company shall similarly acquire 22,000
shares of Series E Cumulative Preferred Stock; provided, however, that the
obligation hereunder shall be cumulative so that if the Company shall be
prevented by the restrictions contained in this Article Third from acquiring
during any 12 months' period the number of shares of Series E Cumulative
Preferred Stock which, in the absence of such restrictions, it would be
required to acquire during such period, then, although the Company shall not
be deemed to have defaulted in the performance of the requirements of this
clause (d), it shall be and remain deficient in such performance, and such
deficiency shall be made good as soon as practicable.
(2) Such shares required to be acquired during each such 12 months'
period shall be acquired as follows:
(i) From each Original Purchaser, by redemption or by purchase, a
number of full shares of Series E Cumulative Preferred Stock which bears
(as nearly as may be practicable) the same ratio to the total number of
such shares required to be retired during such 12 months' period as (A)
the total number of shares of Series E Cumulative Preferred Stock held by
such Original Purchaser on the August 1 beginning such 12 months' period
bears to (B) the total number of such shares outstanding on such August
1, including such shares held by the Company as treasury shares;
provided, however, that the Company's unsatisfied obligation to acquire
shares during any such 12 months' period from any Original Purchaser
shall at no time during such period exceed the number of shares then held
by such Original Purchaser, and
(ii) From holders of shares of Series E Cumulative Preferred Stock
other than Original Purchasers and other than the Company, by redemption
by lot or by purchase, a number of shares of Series E Cumulative
Preferred Stock equal to the total number of such shares required to be
acquired during such 12 months' period less the number of shares which
the Company shall have acquired or shall be required to acquire during
such 12 months' period from Original Purchasers in accordance with the
provisions of the preceding subparagraph (i).
(3) During any 12-month period referred to in paragraph (1) of this
clause (d), the Company shall have the option to redeem at the sinking fund
redemption price up to that number of shares of Series E Cumulative Preferred
Stock which the Company is obligated to acquire during such 12-month period
pursuant to paragraph (1) of this clause (d). Such shares shall be redeemed
from the Original Purchasers and each other stockholder in accordance with the
provisions of paragraph (2) of this clause (d). Such option to redeem
additional shares of Series E Cumulative Preferred Stock shall not be <PAGE>
<PAGE>
cumulative and shares so redeemed pursuant to this paragraph (3) shall not be
credited against the obligation of the Company to acquire shares of Series E
Cumulative Preferred Stock pursuant to paragraph (1) of this clause (d).
(4) Any shares of Series E Cumulative Preferred Stock which shall be
redeemed by the Company at the optional redemption price then in effect or
purchased by the Company in any such 12 months' period at a price not
exceeding the optional redemption price, and which shall not be applied to
meet the Company's sinking fund obligation for such 12 months' period, may be
credited on the amounts required to be acquired in any one or more of the
following 12 months' periods which the Company may designate. The shares of
its Series E Cumulative Preferred Stock of the Company redeemed or purchased
and applied to meet its sinking fund obligations shall be canceled and shall
not be reissued.
(e) No Conversion Privilege. The shares of Series E Cumulative
Preferred Stock shall not be convertible into other shares or securities of
the Company.
C. Common Stock
(I) Dividends. Subject to the limitations in this Article Third set forth,
dividends may be paid on Common Stock out of any funds legally available for
the purpose, when and as declared by the Board of Directors.
(II) Liquidation Rights. In the event of any liquidation or dissolution of
the Company, after there shall have been paid to or set aside for the holders
of outstanding shares having superior liquidation preferences to Common Stock
the full preferential amounts to which they are respectively entitled, the
holders of outstanding shares of Common Stock shall be entitled to receive pro
rata, according to the number of shares held by each, the remaining assets of
the Company available for distribution.
(III) Voting Rights. Except as set forth in this Article Third or in Article
Eighth or as by statute otherwise mandatorily provided, the holders of the
Common Stock shall exclusively possess full voting powers for the election of
Directors and for all other purposes.
D. Preemptive Rights.
No holder of stock of this corporation of any class shall be entitled as
of right to subscribe for, purchase or receive any part of any new or
additional issue of stock of any class, whether now or hereafter authorized,
or of any bonds, debentures or other securities convertible into stock of any
class, and all such additional shares of stock, bonds, debentures or other
securities convertible into stock may be issued and disposed of by the Board
of Directors to such person or persons, and on such terms and for such
consideration (so far as may be permitted by law) as the Board of Directors in
their absolute discretion may deem advisable.
E. Certain Definitions.
In this Article Third, and in any resolution of the Board of Directors
adopted pursuant to this Article Third establishing a series of the Cumulative
Preferred Stock and fixing the designation, description and terms thereof, the
meanings below assigned shall control: <PAGE>
<PAGE>
"Senior stock" shall mean shares of stock of any class ranking prior to
shares of Cumulative Preferred Stock as to dividends or upon dissolution or
liquidation;
"Parity stock" shall mean shares of stock of any class ranking on a
parity with, but not prior to, shares of Cumulative Preferred Stock as to
dividends or upon dissolution or liquidation;
"Junior stock" shall mean shares of stock of any class ranking
subordinate to shares of Cumulative Preferred Stock as to dividends and upon
dissolution or liquidation; and
Preferential dividends accrued and unpaid on a share of Cumulative
Preferred Stock to any particular date shall mean an amount per share at the
annual dividend rate applicable to such share for the period beginning with
the date from and including which dividends on such share are cumulative and
concluding on the day prior to such particular date, less the aggregate of all
dividends paid with respect to such share during such period.
Article Fourth. The number of Directors constituting the Board of
Directors, the classification of such Directors, and their terms shall be
fixed by the Bylaws of the Company. There shall not be more than three
classes of Directors, nor shall the terms of any class of Directors be for
more than three years. In no event shall there be less than three Directors.
Article Fifth. The bylaws of the Company may be adopted either by the
shareholders or the Board of Directors, but no bylaw adopted by the
shareholders shall be amended or repealed by the Directors unless the bylaw
adopted by the shareholders confers such authority upon the Directors. Any
bylaw adopted by the Board of Directors shall be subject to amendment or
repeal by the shareholders as well as by the Directors.
Article Sixth. At the time of the adoption of these Restated Articles of
Incorporation, the name of the registered agent and the address of the
registered office of the Company are:
Agent: Gary J. Wolter
Office: Madison Gas and Electric Company
133 South Blair Street
(P.O. Box 1231)
Madison, Wisconsin 53701
Article Seventh. These articles may be amended by resolution setting
forth such amendment or amendments, adopted at any meeting of the shareholders
by a vote of at least two-thirds of all of the stock of the Company then
outstanding and then entitled to vote.
Article Eighth. A. Certain Definitions.
For purposes of this Article Eighth:
(I) "Affiliate" and "Associate" shall have the respective meanings
ascribed to such terms in Rule 12b-2 under the Securities Exchange Act of
1934 as in effect on February 6, 1985 (the term "registrant" in Rule 12b-
2 meaning in this case the Company). <PAGE>
<PAGE>
(II) A person shall be a "beneficial owner" of any shares of Voting
Stock (a) which such person or any of its Affiliates or Associates
beneficially owns, directly or indirectly; (b) which such person or any
of its Affiliates or Associates has, directly or indirectly, (i) the
right to acquire (whether such right is exercisable immediately or
subject only to the passage of time), pursuant to any agreement,
arrangement or understanding or upon the exercise of conversion rights,
exchange rights, warrants or options, or otherwise, or (ii) the right to
vote pursuant to any agreement, arrangement or understanding; or (c)
which are beneficially owned, directly or indirectly, by any other person
with which such person or any of its Affiliates or Associates has any
agreement, arrangement or understanding for the purpose of acquiring,
holding, voting or disposing of any shares of Voting Stock. For the
purposes of determining whether a person is a Substantial Shareholder
pursuant to subdivision (V) of this division A, the number of shares of
Voting Stock deemed to be outstanding shall include shares deemed
beneficially owned by such person through application of this subdivision
(II) of division A, but shall not include any other shares of Voting
Stock that may be issuable pursuant to any agreement, arrangement or
understanding, or upon exercise of conversion rights, warrants or
options, or otherwise.
(III) "Person" shall mean any individual, firm, corporation or
other entity and shall include any group comprised of any person and any
other person with whom such person or any Affiliate or Associate of such
person has any agreement, arrangement or understanding, directly or
indirectly, for the purpose of acquiring, holding, voting or disposing of
shares of Voting Stock.
(IV) "Subsidiary" shall mean any corporation of which a majority of
each class of equity security is beneficially owned by the Company.
(V) "Substantial Shareholder" shall mean any person (other than the
Company or any Subsidiary and other than any profit-sharing, employee
stock ownership or other employee benefit plan of the Company or any
Subsidiary or any trustee of or fiduciary with respect to any such plan
when acting in such capacity) who (without giving effect to the
provisions of division B of this Article Eighth) is the beneficial owner
of shares of Voting Stock representing ten percent (10%) or more of the
votes entitled to be cast by the holders of all then outstanding shares
of Voting Stock.
(VI) "Voting Stock" shall mean the Common Stock of the Company and
any class or series of preferred or preference stock (other than the
Company's Cumulative Preferred Stock, authorized pursuant to division B
of Article Third) authorized and outstanding from time to time pursuant
to Article Third entitling the holder thereof to vote on the matter with
respect to which a determination is being made pursuant to this Article
Eighth; provided, however, that the shareholders or the Board of
Directors, as the case may be, may specify in the resolution authorizing
any such class or series of preferred or preference stock that the shares
of such class or series shall not constitute Voting Stock and that such
shares and the holders thereof shall be exempt from the provisions of
this Article Eighth. <PAGE>
<PAGE>
B. Limitation of Voting Rights.
Any provision of these Restated Articles of Incorporation to the contrary
notwithstanding, so long as any person is a Substantial Shareholder, the
shareholders of record of the shares of Voting Stock beneficially owned by
such Substantial Shareholder shall have limited voting rights on any matter
requiring their vote or consent, as follows:
(I) With respect to the shares of Voting Stock which would entitle
such shareholders of record in the aggregate to cast up to ten percent
(10%) of the total number of votes entitled to be cast by the holders of
all outstanding shares of Voting Stock, such shareholders of record shall
be entitled to cast the votes per share specified in or pursuant to
Article Third.
(II) With respect to the shares of Voting Stock which would entitle
such shareholders of record in the aggregate to cast in excess of ten
percent (10%) of the total number of votes entitled to be cast by the
holders of all outstanding shares of Voting Stock, such shareholders of
record shall be entitled to cast only one/one-hundredth (1/100th) of the
votes per share to which a holder of such shares would otherwise be
entitled to cast.
(III) Notwithstanding the foregoing, in the event that, after
giving effect to the provisions of subdivisions (I) and (II) of this
division B, the aggregate voting power of such shareholders of record
would still exceed fifteen percent (15%) of the votes entitled to be cast
by the holders of all outstanding shares of Voting Stock, the aggregate
voting power of such shareholders of record shall be further limited so
that such shareholders of record shall be entitled to cast only such
number of votes that would equal (after giving effect to the provisions
of this Article Eighth) fifteen percent (15%) of the number of votes
entitled to be cast by all holders of outstanding shares of Voting Stock.
(IV) The aggregate voting power of such shareholders of record, as
limited pursuant to the provisions of division B, subdivisions (II) and
(III) of this Article Eighth, for all shares of Voting Stock beneficially
owned by such Substantial Shareholder shall be allocated proportionately
among such shareholders of record. In this connection, each such
shareholder of record shall be entitled to cast in respect of his shares
of Voting Stock the number of votes equal to (a) the aggregate number of
votes entitled to be cast (after giving effect to the provisions in this
Article Eighth) in respect of the outstanding shares of Voting Stock
beneficially owned by the Substantial Shareholder, multiplied by (b) a
fraction the numerator of which is the number of votes which the shares
of Voting Stock owned by such shareholder of record would have entitled
such shareholder of record to cast were no effect given to the provision
of this Article Eighth, and the denominator of which is the total number
of votes which all shares of Voting Stock beneficially owned by the
Substantial Shareholder would have entitled their record holders to cast
were no effect given to the provisions of this Article Eighth. <PAGE>
<PAGE>
C. Quorum.
The presence, in person or by proxy, of the holders of record of shares
of Voting Stock entitling the holders thereof to cast a majority of the votes
(after giving effect, if required, to the provisions of this Article Eighth)
entitled to be cast by the holders of all outstanding shares of Voting Stock
entitled to vote shall constitute a quorum at all meetings of the
shareholders.
D. Factual Determinations.
(I) The Board of Directors shall have the power and duty to
determine for the purposes of this Article Eighth, on the basis of
information known to them after reasonable inquiry, (a) whether a person
is a Substantial Shareholder, (b) the number of shares of Voting Stock
beneficially owned by any person, (c) whether a person is an Affiliate or
an Associate of another, and (d) the persons who may be deemed to be the
record holders of shares of which a Substantial Shareholder is a
beneficial owner. Any such determination made in good faith shall be
binding and conclusive on all parties.
(II) The Board of Directors shall have the right to demand that any
person who is reasonably believed to be a Substantial Shareholder (or
holds of record shares of Voting Stock beneficially owned by a
Substantial Shareholder) supply the Company with complete information as
to (a) the record holder(s) of all shares beneficially owned by such
person who is reasonably believed to be a Substantial Shareholder, (b)
the number of shares of Voting Stock beneficially owned by such person
who is reasonably believed to be a Substantial Shareholder and held of
record by each such shareholder of record, and (c) any other factual
matter relating to the applicability or effect of this Article Eighth, as
may reasonably be requested of such person, and such person shall furnish
such information within ten (10) days after the receipt of such demand.
E. No Derogation of Fiduciary Obligations.
Nothing contained in this Article Eighth shall be construed to relieve
any Substantial Shareholder from any fiduciary obligation imposed by law.
F. Severability.
In the event that any provision or portion of a provision of this Article
Eighth is determined to be invalid, void, illegal or unenforceable, the
remainder of the provisions of this Article Eighth shall continue to be valid
and enforceable and shall in no way be affected, impaired or invalidated.
<PAGE>
Exhibit No. 21
MADISON GAS AND ELECTRIC COMPANY AND CONSOLIDATED SUBSIDIARIES
EXHIBIT NO. 21--SUBSIDIARIES OF THE REGISTRANT
As of December 31, 1993, the Company owned 100 percent of the voting
securities of the following subsidiaries (all Wisconsin corporations):
MG&E NUCLEAR FUEL INC. -- holds title to Company's portion of the nuclear
fuel for Kewaunee.
MAGAEL INC. -- holds title to property acquired by the Company for future
utility plant expansion.
MAGAEL Material Resources, Inc. -- partner in uranium mining operation
whose purpose is to acquire uranium mining reserves and support related
mining and production operations to assure an adequate fuel supply for
Kewaunee.
Central Wisconsin Development Corporation -- to assist new and expanding
businesses throughout Central Wisconsin.
Great Lakes Energy Corp. -- Markets natural gas supplies and pipeline
capacity to commercial and industrial customers outside of the Company's
territory.
Wisconsin Resources Corporation -- Inactive
North Central Technologies, Inc. -- Inactive
Mid America Technologies, Inc. -- Inactive
As of December 31, 1993, the Company owned 50 percent of the voting securities
of the following subsidiary (a Wisconsin corporation):
Superior Lamp Recycling, Inc. -- Recycles fluorescent lamps that are
banned from landfills.
<PAGE>
Exhibit No. 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration statement of
Madison Gas and Electric Company on Form S-3 (File No. 33-52491) of our
reports dated February 11, 1994, on our audit of the consolidated financial
statements and financial statement schedules of Madison Gas and Electric
Company as of December 31, 1993, and for the year then ended, which reports
are included or incorporated by reference in this annual report on Form 10-K.
COOPERS & LYBRAND
Milwaukee, Wisconsin
March 28, 1994
<PAGE>
Exhibit No. 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in Registration Statement No. 33-11431 on Form S-3, Registration
No. 33-52491 on Form S-3, and Registration No. 33-46192 on Form S-3 of our
report dated February 12, 1993, covering the consolidated balance sheet and
statement of capitalization of Madison Gas and Electric Company and
subsidiaries as of December 31, 1992, and the related statements of income,
retained income, and cash flows for each of the two years in the period ended
December 31, 1992, included in the Company's Form 10-K for the year ended
December 31, 1993 (Commission File No. 0-1125). It should be noted that we
have not audited any financial statements of the Company subsequent to the
date of our report.
ARTHUR ANDERSEN & CO.
Chicago, Illinois
March 28, 1994