UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
F O R M 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Year Ended December 31, 1999
NATIONAL FUEL GAS COMPANY
TAX-DEFERRED SAVINGS PLAN
(Full title of the Plan)
NATIONAL FUEL GAS COMPANY
(Name of issuer of the securities held pursuant to the Plan)
10 Lafayette Square, Buffalo, New York 14203
(Address of principal executive office)
<PAGE>
REQUIRED INFORMATION
(1) Plan financial statements and schedules prepared in accordance with
financial reporting requirements of ERISA.
See accompanying Index on page 4.
(2) Signature
(3) Exhibits
Exhibit Number Description of Exhibit
(1) Consent of Independent
Accountants
<PAGE>
NATIONAL FUEL GAS COMPANY
-------------------------
TAX-DEFERRED SAVINGS PLAN
-------------------------
FINANCIAL STATEMENTS AND SCHEDULES
----------------------------------
DECEMBER 31, 1999 AND 1998
--------------------------
<PAGE>
NATIONAL FUEL GAS COMPANY
-------------------------
TAX-DEFERRED SAVINGS PLAN
-------------------------
INDEX TO FINANCIAL STATEMENTS AND SCHEDULES
-------------------------------------------
Page
Number
------
Report of Independent Accountants 1
Financial Statements:
Statement of Net Assets Available for Plan
Benefits at December 31, 1999 2
Statement of Net Assets Available for Plan
Benefits at December 31, 1998 3
Statement of Changes in Net Assets Available
for Plan Benefits for the Year Ended
December 31, 1999 with Comparative
Totals for the Year Ended December 31, 1998 4
Notes to Financial Statements 5 - 7
Supplemental Schedule:
Schedule of Assets Held for Investment
at December 31, 1999 8
<PAGE>
Report of Independent Accountants
To the Participants and
Plan Administrator of the
National Fuel Gas Company
Tax-Deferred Savings Plan
We have audited the accompanying statements of net assets available for Plan
benefits of the National Fuel Gas Company Tax-Deferred Savings Plan as of
December 31, 1999, and the related statement of changes in net assets available
for Plan benefits for the year then ended. These financial statements are the
responsibility of the Plan's administrator. Our responsibility is to express an
opinion on these financial statements based on our audit. The financial
statements of National Fuel Gas Company Tax-Deferred Savings Plan as of and for
the year ended December 31, 1998 were audited by other auditors whose report
dated June 24, 1999 expressed an unqualified opinion on those statements.
We conducted our audit 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 audit provides a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for Plan benefits of National
Fuel Gas Company Tax-Deferred Savings Plan as of December 31, 1999 and the
changes in net assets available for Plan benefits for the year then ended in
conformity with generally accepted accounting principles.
Our audit was performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule is presented
for purposes of complying with the Department of Labor's Rules and Regulations
for Reporting and Disclosure under the Employee Retirement Income Security Act
of 1974. This supplemental schedule is the responsibility of the Plan's
management. The supplemental schedule has been subjected to the auditing
procedures applied in the audit of the basic financial statements and, in our
opinion, is fairly stated in all material respects in relation to the basic
financial statements taken as a whole.
Freed Maxick Sachs & Murphy, PC
June 23, 2000
Buffalo, New York
<PAGE>
<TABLE>
<CAPTION>
NATIONAL FUEL GAS COMPANY
TAX-DEFERRED SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
DECEMBER 31, 1999
Employer Participant Total
Directed Directed December 31,
Investments Investments 1999
---------------------- ------------------- ---------------------
<S> <C> <C> <C>
Investments at market value:
National Fuel Gas Company Common
Stock Funds $12,755,025 $14,788,143 $27,543,168
Vanguard Retirement Savings Trust - 4,197,273 4,197,273
Vanguard 500 Index Fund - 33,110,446 33,110,446
Vanguard Extended Market Index
Fund - 338,498 338,498
Vanguard Pacific Stock Index Fund - 1,160,370 1,160,370
Vanguard European Stock Index Fund - 3,027,205 3,027,205
Vanguard Prime Money Market Fund - 3,002,445 3,002,445
Vanguard Total Bond Market Index
Fund - 2,529,969 2,529,969
Participant Loan Account - 2,364,013 2,364,013
---------------------- ------------------- ---------------------
12,755,025 64,518,362 77,273,387
Receivables:
Employer Contributions 132,049 - 132,049
Participant Contributions - 523,006 523,006
---------------------- ------------------- ---------------------
Net Assets Available for Plan
Benefits $12,887,074 $65,041,368 $77,928,442
====================== =================== =====================
</TABLE>
The accompanying notes are an integral part of these financial statements
<PAGE>
<TABLE>
<CAPTION>
NATIONAL FUEL GAS COMPANY
TAX-DEFERRED SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
DECEMBER 31, 1998
Employer Participant Total
Directed Directed December 31,
Investments Investments 1998
---------------------- ---------------------- ------------------
<S> <C> <C> <C>
Investments at market value:
National Fuel Gas Company Common
Stock Funds $11,573,265 $14,641,718 $26,214,983
Vanguard Retirement Savings Trust - 3,868,004 3,868,004
Vanguard 500 Index Fund - 26,701,453 26,701,453
Vanguard Pacific Stock Index Fund - 480,851 480,851
Vanguard European Stock Index Fund - 2,812,109 2,812,109
Vanguard Prime Money Market Fund - 2,672,830 2,672,830
Vanguard Total Bond Market Index
Fund - 2,626,461 2,626,461
Participant Loan Account - 2,128,799 2,128,799
---------------------- ---------------------- ------------------
11,573,265 55,932,225 67,505,490
Receivables:
Employer Contributions 129,424 - 129,424
Participant Contributions - 519,137 519,137
---------------------- ---------------------- ------------------
Net Assets Available for Plan
Benefits $11,702,689 $56,451,362 $68,154,051
====================== ====================== ==================
</TABLE>
The accompanying notes are an integral part of these financial statements
<PAGE>
<TABLE>
<CAPTION>
NATIONAL FUEL GAS COMPANY
TAX-DEFERRED SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1999 (WITH COMPARATIVE TOTALS FOR THE YEAR ENDED DECEMBER 31, 1998)
Employer Participant Total all Investments Combined
------------------------------------
Directed Directed December 31,
Investments Investments 1999 1998
---------------------- ------------------- --------------- --------------------
<S> <C> <C> <C> <C>
Investment Income From National Fuel
Gas Company Common Stock Funds $470,566 $568,589 $1,039,155 $978,330
Interest Income - 416,922 416,922 376,798
Investment Income from Mutual Funds - 966,249 966,249 764,615
---------------------- ------------------- --------------- --------------------
Total Investment Income 470,566 1,951,760 2,422,326 2,119,743
Net Appreciation in Fair Value of
Investments 311,360 6,165,561 6,476,921 3,998,579
Employer Matching Contributions 1,351,979 - 1,351,979 1,364,038
Participant Contributions - 5,365,609 5,365,609 5,520,694
Participant Purchase and Loan Fees - (10,466) (10,466) (8,792)
Rollovers and Other Individual
Transfers In 3,121 12,329 15,450 697,948
Payments to Participants or
Beneficiaries (952,641) (4,894,787) (5,847,428) (3,452,854)
---------------------- ------------------- --------------- --------------------
Increase in Net Assets Available for
Plan Benefits 1,184,385 8,590,006 9,774,391 10,239,356
Net Assets Available for Plan
Benefits:
Beginning of Year 11,702,689 56,451,362 68,154,051 57,914,695
---------------------- ------------------- --------------- --------------------
End of Year $12,887,074 $65,041,368 $77,928,442 $68,154,051
====================== =================== =============== ====================
</TABLE>
The accompanying notes are an integral part of these financial statements
<PAGE>
NATIONAL FUEL GAS COMPANY
-------------------------
TAX-DEFERRED SAVINGS PLAN
-------------------------
NOTES TO FINANCIAL STATEMENTS
-----------------------------
NOTE 1 - DESCRIPTION OF PLAN
----------------------------
General:
-------
The following is a brief description of the National Fuel Gas Company
Tax-Deferred Savings Plan (the Plan) provided for general information purposes
only. Participants should refer to the Plan document for more complete
information. The Plan is a defined contribution plan as permitted under Section
401(k) of the Internal Revenue Code. The Plan was adopted March 21, 1989,
effective as of July 1, 1989, and has been amended since that time. It is
subject to the Employee Retirement Income Security Act of 1974, as amended.
Eligibility and Participation:
-----------------------------
Originally, the Plan was established for the benefit of employees of
National Fuel Gas Company and its subsidiaries ("Company") who were subject to a
collective bargaining agreement between the Company and the International
Brotherhood of Electrical Workers ("IBEW"), Locals 2154, 2199 and 2199-J. These
employees became eligible to participate in the Plan on July 1, 1989 or, if
later, after completing 1,000 hours of employment and attaining age 21.
Employees subject to collective bargaining agreements between the Company and
the IBEW Local 2279 and the International Brotherhood of Firemen and Oilers,
Locals 22, 23, 25 and 251 also became eligible to participate in the Plan on
August 1, 1990 or, if later, after completing 1,000 hours of employment and
attaining age 21.
Contributions:
-------------
Plan participants may direct the Company to reduce their base pay by a
specified full percentage of at least 2% and not more than 15% (19% effective
February 1, 2000). The 15% (19% effective February 1, 2000) limit is reduced by
1% for each percent of base pay contributed to the National Fuel Gas Company
Employees' Thrift Plan ("Thrift Plan") by the employee for the same payroll
period. These wage reductions are subject to certain Plan and Internal Revenue
Code limitations, and the Company remits them to the Plan Trustee on the
participants' behalf. In addition, the Company makes an employer matching
contribution that ranges from 1% to 3.5% of the participants' base pay depending
upon their years of service and rate of wage reduction contributions. However,
these employer matching contributions are reduced by the Thrift Plan matching
contributions for such participants for such payroll period.
"Base pay" is defined in the Plan generally to mean a participant's
basic compensation for a payroll period. An individual participant's wage
reduction contributions to the Plan are subject to ceilings imposed by the Tax
Reform Act of 1986. However, Company matching contributions are not subject to
such ceilings. The ceiling was $10,000 for 1999 and increased to $10,500 for
2000.
<PAGE>
Participants' accounts, including all wage reduction contributions,
employer matching contributions, and the increments thereon, are at all times
fully vested and nonforfeitable.
Employer Matching Contributions:
-------------------------------
Employer matching contributions are invested in a fund consisting
primarily of the common stock of National Fuel Gas Company ("National Stock Fund
B"). This fund also maintains a small cash position in Vanguard Prime Money
Market Fund and may also include receivables and/or payables for unsettled
security transactions and receivables for accrued dividends. A separate account
is maintained for each participant showing his interest in this fund.
Participants may not redirect their interests in this fund into any other fund.
Withdrawals, Loans and Distributions:
------------------------------------
Plan participants (or their beneficiaries) may receive distributions
from the Plan upon death, retirement, disability or other termination, in
accordance with a qualified domestic relations order, or in the event of
hardship, subject to the Plan's limitations and restrictions. Additionally, Plan
participants may borrow from their accounts in accordance with various Plan
rules. In certain cases, participants may postpone receipt of Plan
distributions.
Participant Accounts:
--------------------
Each participant's account is credited with the participant's
contribution and an allocation of (a) the Company's contribution and, (b) Plan
earnings, and charged with an allocation of investment fees. Allocations are
based on participant earnings or account balances, as defined. The benefit to
which a participant is entitled is the benefit that can be provided from the
participant's vested account.
Administration:
--------------
National Fuel Gas Company is the Administrator of the Plan. A
Tax-Deferred Savings Plan Committee appointed by National Fuel Gas Company's
Board of Directors exercises National Fuel Gas Company's duties as
Administrator. The assets of the Plan are held by the Trustee, Vanguard
Fiduciary Trust Company ("Vanguard").
Although it has not expressed any intent to do so, National Fuel Gas
Company has the right to terminate, amend, or modify, in whole or part, the Plan
at any time.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
---------------------------------------------------
Basis of Accounting and Valuation:
---------------------------------
The accounts of the Plan are maintained on the accrual basis. National
Stock Funds A (participant directed) and B (non-participant directed) are
reported on a current value basis using the quoted market value of National Fuel
Gas Company common stock and the value of the cash positions and receivables at
the close of the Plan year. Mutual funds are reported on a current value basis,
using quoted market values of the investments at the close of the Plan year. The
investment contracts in the Vanguard Retirement Savings Trust are carried at net
asset value at year-end. National Fuel Gas Company stock distributed to
participants is reflected at market value at the date of distribution. Purchases
and sales of investments are recorded on a trade-date basis. Interest income is
accrued when earned. Dividend income is recorded on the ex-dividend date.
Capital gain distributions are included in dividend income.
Use of Estimates:
----------------
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of additions and deductions during the
reporting period. Actual results could differ from those estimates.
<PAGE>
Administrative Expenses:
-----------------------
Expenses related to administration of the Plan and Trust are borne by
the Company. The Company paid Vanguard $51,231 and $51,511, respectively, for
services in connection with the Plan and Trust for the years ended December 31,
1999 and December 31, 1998. Brokerage commissions and similar costs of acquiring
or selling securities (if any) that are incurred by the investment funds are
borne by the participant. Loan origination fees and annual maintenance fees for
each loan are also borne by the participant.
NOTE 3 - INCOME TAXES
---------------------
The Internal Revenue Service has determined that the Plan qualifies
under Section 401(a) and Section 401(k) of the Internal Revenue Code of 1986, as
amended. Accordingly, no provision for income taxes has been recorded.
NOTE 4 - PARTIES-IN-INTEREST
----------------------------
The Plan invests in shares of mutual funds managed by an affiliate of
Vanguard Fiduciary Trust Company (VFTC). VFTC acts as trustee for only those
investments as defined by the Plan. The Plan also invests in common stock of
National Fuel Gas Company. Transactions in such investments qualify as
party-in-interest transactions which are exempt from the prohibited transaction
rules.
NOTE 5 - INVESTMENTS
--------------------
As of December 31, 1999 and 1998, the following investments comprised
more than 5% of Plan assets:
<TABLE>
<CAPTION>
1999 1998
---- ----
<S> <C> <C>
National Stock Fund A $14,788,143 $14,641,718
National Stock Fund B (Non-Participant Directed) 12,755,025 11,573,265
Vanguard 500 Index Fund 33,110,446 26,701,453
Vanguard Retirement Savings Trust 4,197,273 3,868,004
</TABLE>
The net appreciation (depreciation) in fair value of investments for
the years ended December 31, 1999 and 1998 are as follows:
<TABLE>
<CAPTION>
For the Year Ended
December 31,
1999 1998
---- ----
<S> <C> <C>
National Stock Fund A $ 474,541 $(1,099,913)
National Stock Fund B (Non-Participant Directed) 311,360 (774,391)
Vanguard 500 Index Fund 5,110,462 5,355,229
Vanguard Extended Market Index Fund 46,581 -
Vanguard Pacific Stock Index Fund 349,741 11,255
Vanguard European Stock Index Fund 366,137 468,937
Vanguard Total Bond Market Index Fund (181,901) 37,462
---------- -------------
$6,476,921 $3,998,579
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE I
----------
NATIONAL FUEL GAS COMPANY
-------------------------
TAX-DEFERRED SAVINGS PLAN
-------------------------
SCHEDULE OF ASSETS HELD FOR INVESTMENT
--------------------------------------
DECEMBER 31, 1999
-----------------
(c) Description of Investment
(b) Identity of Issue, Including Maturity Date, Rate
Borrower, Lessor of Interest, Collateral, Par (e) Current
(a) or Similar Party or Maturity Value (d) Cost Value
--- ----------------------- ---------------------------------------- -------- -------------
<S> <C> <C> <C> <C>
* National Fuel Gas Company
Stock Funds:
National Fuel Gas Company Stock Fund A (889,780 units) $14,788,143
National Fuel Gas Company Stock Fund B (767,450 units) $ 9,841,648 12,755,025
-----------
Total National Fuel Gas Company
Stock Funds 27,543,168
-----------
Mutual Funds (1):
* Vanguard Group of 500 Index Fund
Investment Companies (244,664 units) 33,110,446
Vanguard Group of Extended Market Index Fund
Investment Companies (9,131 units) 338,498
* Vanguard Group of Pacific Stock Index Fund
Investment Companies (94,957 units) 1,160,370
* Vanguard Group of European Stock Index Fund
Investment Companies (105,002 units) 3,027,205
* Vanguard Group of Prime Money Market Fund
Investment Companies (3,002,445 units) 3,002,445
* Vanguard Group of Total Bond Market Index Fund
Investment Companies (264,641 units) 2,529,969
-----------
Total Vanguard Mutual Funds 43,168,933
-----------
Common/Collective Trust (2):
* Vanguard Group of Retirement Savings Trust
Investment Companies (4,197,273 units) 4,197,273
* National Fuel Gas Company
Tax-Deferred Savings Plan Participant Loan Account 2,364,013
-----------
TOTAL ASSETS HELD FOR INVESTMENT $77,273,387
===========
</TABLE>
* Denotes known party-in-interest to the Plan.
(1) The financial statements of the mutual funds have been filed with the
Securities and Exchange Commission by the Vanguard Group of Investment
Companies, investment companies registered under the Investment Company
Act of 1940.
(2) The audited annual report for the Vanguard Retirement Savings Trust has
been filed with the Department of Labor by the Vanguard Fiduciary Trust
Company. The entity's tax identification number is 23-2186884.
<PAGE>
SIGNATURE
The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934,
the trustees (or other persons who administer the employee benefit plan) have
duly caused this annual report to be signed on its behalf by the undersigned
hereunto duly authorized.
NATIONAL FUEL GAS COMPANY
TAX DEFERRED SAVINGS PLAN
(Name of Plan)
By /s/ Joseph P. Pawlowski
------------------------------------
Joseph P. Pawlowski
Treasurer and Principal Accounting
Officer of National Fuel Gas Company,
Member of the Tax-Deferred Savings
Plan Committee
Date: June 28, 2000
<PAGE>
EXHIBIT INDEX
Exhibit Number Description of Exhibit
(1) Consent of Independent
Accountants
