<PAGE> 1
Exhibit 99
Financial Statements and Supplemental Schedules
of UGI Utilities, Inc. Savings Plan
and AmeriGas Propane, Inc. Savings Plan
for the year ended
December 31, 1999
<PAGE> 2
AMERIGAS PROPANE, INC.
SAVINGS PLAN
EIN #23-2786294 PLAN NUMBER 002
FINANCIAL STATEMENTS
for the year ended December 31, 1999
and the three months ended December 31, 1998
-1-
<PAGE> 3
AMERIGAS PROPANE, INC.
SAVINGS PLAN
INDEX TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
Page(s)
<S> <C>
Report of Independent Public Accountants 3
Financial Statements:
Statements of Net Assets Available for Benefits at
December 31, 1999 and 1998 4
Statements of Changes in Net Assets Available for Benefits
for the year ended December 31, 1999 and the
three months ended December 31, 1998 5
Notes to Financial Statements 6 to 18
Item 4(i) - Schedule of Assets Held for Investment Purposes -
December 31, 1999 19 - 20
</TABLE>
-2-
<PAGE> 4
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Benefits Committee of
AmeriGas Propane, Inc.:
We have audited the accompanying statements of net assets available for benefits
of the AmeriGas Propane, Inc. Savings Plan (the "Plan") as of December 31, 1999
and 1998, and the related statements of changes in net assets available for
benefits for the year ended December 31, 1999 and the three months ended
December 31, 1998. These financial statements and the supplemental schedule
referred to below are the responsibility of the Plan's management. Our
responsibility is to express an opinion on these financial statements and the
supplemental schedule based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan as of
December 31, 1999 and 1998 and the changes in its net assets available for
benefits for the year ended December 31, 1999 and the three months ended
December 31, 1998, in accordance with accounting principles generally accepted
in the United States.
Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of assets held
for investment purposes is presented for purposes of additional analysis and is
not a required part of the basic financial statements but is supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. The supplemental schedule has been subjected to the auditing procedures
applied in the audits 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.
Arthur Andersen LLP
Philadelphia, Pennsylvania
June 15, 2000
-3-
<PAGE> 5
AMERIGAS PROPANE, INC. SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
December 31,
1999 1998
------------------- ----------------
<S> <C> <C>
Investments - participant directed (Note 3) $ 165,935,715 $ 145,387,683
Loans to participants 3,886,564 3,481,222
------------------- ----------------
Net assets available for benefits $ 169,822,279 $ 148,868,905
=================== ================
</TABLE>
See accompanying notes to financial statements.
-4-
<PAGE> 6
AMERIGAS PROPANE, INC. SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
Three
Year Months
Ended Ended
December 31, December 31,
1999 1998
------------- -------------
<S> <C> <C>
Participants' contributions $ 7,720,171 $ 1,852,437
Company contributions 4,080,831 1,253,797
Investment income:
Dividends 11,947,777 3,225,077
Net appreciation
in value of investments 10,936,356 14,186,278
Plan administration expenses and loan administration fees (175,478) (19,269)
Other 294,550 69,906
Net transfers of participants' balances 1,917 118,927
Distributions to participants (13,852,750) (3,216,282)
------------- -------------
Net increase 20,953,374 17,470,871
Net assets available for benefits-
beginning of period 148,868,905 131,398,034
------------- -------------
Net assets available for benefits-
end of period $ 169,822,279 $ 148,868,905
============= =============
</TABLE>
See accompanying notes to financial statements.
-5-
<PAGE> 7
AMERIGAS PROPANE, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
1. DESCRIPTION OF THE PLAN
The following brief description of the AmeriGas Propane, Inc. Savings Plan
(Plan) provides general information on the provisions of the Plan in effect on
December 31, 1999 and during the periods covered by the financial statements.
More complete information is included in the Plan document.
GENERAL. The Plan is a defined contribution plan covering employees of AmeriGas
Propane, Inc. (a Pennsylvania corporation, hereinafter referred to as "the
Company"). Employees are eligible upon hire to participate in the Plan. The Plan
also holds assets of certain defined contribution pension plans that were
terminated in prior years and were merged into the Plan. Such assets include
what is referred to as the "Pension Account" and "Predecessor Pension Rollover
Account" and do not impact the general provisions of the Plan. The Plan is
subject to the provisions of the Employee Retirement Income Security Act of 1974
(ERISA). The Plan is administered by the AmeriGas Propane, Inc. Benefits
Committee (Plan Administrator), whose members are appointed by the President of
the Company and subject to approval by the Company's Compensation/Pension
Committee.
CHANGE IN PLAN YEAR. The Compensation/Pension Committee of AmeriGas Propane
Inc.'s Board of Directors approved a change to the Plan's fiscal year from one
ending on September 30 to one ending on December 31, effective October 1, 1998.
Accordingly, the Plan financial statements include the year ended December 31
1999 (1999 Plan Year) and the three months ended December 31, 1998 (1998 Short
Plan Year).
CONTRIBUTIONS. A participant may elect to contribute to the Plan on a before-tax
basis through payroll reduction an amount equal to from 1% to 15%, in whole
percentages, of eligible compensation. Calendar year contribution amounts are
subject to limits prescribed by the Internal Revenue Code (IRC). A participant
may increase, reduce or suspend his or her contributions at any time by calling
Fidelity Institutional Retirement Services Co. (FIRSCO).
The Plan also accepts on behalf of any employee, (i) the entire amount of cash
received as a distribution from another qualified trust forming part of a plan
described in Section 401(a) of the IRC or from a "rollover" individual
retirement plan described in Section 408 of the IRC, or (ii) a direct transfer
from another plan qualified under Section 401(a) of the IRC.
The Company shall contribute to the Plan an amount equal to 100% of
contributions made by each eligible participant for each payroll period of up to
a total of 5% of the participant's eligible compensation for each such payroll
period. A participant will be eligible to receive matching contributions after
he or she has completed a year of service.
-6-
<PAGE> 8
AMERIGAS PROPANE, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (Continued)
The Company may also make profit-sharing contributions for each Plan year, out
of its net profits, as shall be determined by its Board of Directors, in its
sole discretion, to all eligible participants. A participant will be eligible to
receive profit sharing contributions if he or she (a) has completed one year of
service, (b) was not eligible to participate in the AmeriGas Propane, Inc.
Supplemental Executive Retirement Plan as of the last day of a Plan year, and
(c) either (i) was actively employed or on a qualifying leave of absence on the
last day of a Plan year or (ii) retired, died, or became disabled (as defined in
the Plan) during a Plan year. Subject to certain limitations, the profit sharing
contribution to be credited to a participant's account shall be determined by
dividing the total amount of such contribution by the number of eligible Plan
participants. No such amounts were contributed to the Plan for the 1999 Plan
Year or the 1998 Short Plan Year.
Any participant who (a) satisfies the eligibility requirements described above
(b) was a participant in the former Retirement Income Plan for Employees of AP
Propane, Inc. as of December 31, 1988 and (c) had attained the age of 50 as of
that date, is entitled to an additional contribution as of the last day of each
Plan year as follows:
<TABLE>
<CAPTION>
Age as of Percentage of
December 31, 1988 Eligible Compensation
<S> <C>
50 to 54 2%
55 to 59 3%
60 and over 4%
</TABLE>
All contributions are invested in accordance with participant investment
elections in effect on the dates of the contributions.
A participant will at all times be fully (100%) vested in the portion of his or
her account attributable to participant contributions. A participant is fully
vested in the portion of his or her account attributable to the Company's
contributions (including Company contributions previously made to the AmeriGas
Propane, Inc. Pension Plan (the "Pension Plan") upon the earlier of (i) the
completion of five years of service or (ii) the attainment of normal retirement
age, total disability (as defined by the Plan document) or death while in the
employ of the Company or an affiliated company. For Plan purposes, a participant
will attain normal retirement age on the later of his or her 65th birthday or
the fifth anniversary of his or her date of hire.
-7-
<PAGE> 9
AMERIGAS PROPANE, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (Continued)
A participant who terminates employment before he or she is fully vested will
forfeit nonvested amounts attributable to Company contributions. These forfeited
amounts remain in the Plan and are available to reduce future Company
contributions. For the 1999 Plan Year and 1998 Short Plan Year, forfeitures of
$828,622 and $28,067, respectively, were used to reduce Company contributions.
During the 1999 Plan Year and 1998 Short Plan Year, $321,696 and $186,641,
respectively, were forfeited from participant accounts. During the 1999 Plan
Year and the 1998 Short Plan Year, forfeitures of $143,279 and $9,516,
respectively, were also used to pay certain plan administrative expenses. As of
December 31, 1999 and 1998, there was $79,099 and $716,619, respectively, of
forfeitures remaining in the Plan.
INVESTMENT FUNDS. A participant may elect to have his or her funds invested in
one or more investment funds. The Plan's investment funds are categorized as
follows:
- Money Market Fund
- Fidelity Cash Reserves Fund
This investment category comprises an unaffiliated registered
investment company mutual fund whose investments comprise
high-quality, short-term certificates of deposit, repurchase
agreements, commercial paper or other similar short-term investments
and whose investment objective is to achieve current income while
maintaining a stable share price.
- Managed Income Fund
- Fidelity Managed Income Portfolio II Fund
This investment category comprises an unaffiliated commingled pool
whose investments principally comprise guaranteed investment contracts
offered by insurance companies and financial institutions and whose
investment objective is to provide a fixed rate of investment return
guaranteed by the insurance company or financial institution for a
specified period of time, generally between one and seven years.
- Bond Funds
- Fidelity Intermediate Bond Fund
- Fidelity Capital & Income Fund
-8-
<PAGE> 10
AMERIGAS PROPANE, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (Continued)
This investment category comprises unaffiliated registered investment
company mutual funds whose investments comprise principally fixed
income obligations and whose investment objective is to achieve
current income.
- Index Funds
- Fidelity U.S. Bond Index Fund
- Fidelity Spartan U.S. Equity Index Fund
This investment category comprises unaffiliated registered investment
company mutual funds whose investments broadly represent the U.S. bond
market as measured by the Lehman Brothers Aggregate Bond Index and the
U.S. stock market as measured by the Standard & Poor's Composite Index
of 500 Stocks, respectively. The investment objective of this
investment category is to track the performance of the respective
indices.
- Growth and Income Funds
- Fidelity Equity Income Fund
- Fidelity Fund
- Fidelity Puritan Fund
- Fidelity Growth & Income Portfolio
- Fidelity Balanced Fund
- Fidelity Equity Income II Fund
- Fidelity Real Estate Investment Portfolio
This investment category comprises registered investment company
mutual funds whose investments comprise income-producing debt and
equity securities and whose investment objective is to achieve current
income and capital appreciation.
- Growth Funds
- Fidelity Magellan Fund
- Fidelity Growth Company Fund
- Fidelity OTC Portfolio
- Fidelity Capital Appreciation Fund
- Fidelity Blue Chip Growth Fund
- Fidelity Low-Priced Stock Fund
- Fidelity Small Cap Selector Fund
- Fidelity Value Fund
This investment category comprises registered investment company
mutual funds whose investments comprise principally equity securities
and whose investment objective is to achieve capital appreciation over
an extended period of time.
-9-
<PAGE> 11
AMERIGAS PROPANE, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (Continued)
- International Funds
- Fidelity Overseas Fund
- Fidelity International Growth & Income Fund
- Fidelity Worldwide Fund
This investment category comprises unaffiliated registered investment
company mutual funds whose investments comprise debt and equity
securities principally of foreign issuers and whose investment
objective is to achieve capital appreciation over an extended period
of time.
- Fidelity Freedom Funds
- Fidelity Freedom Income Fund
- Fidelity Freedom 2000 Fund
- Fidelity Freedom 2010 Fund
- Fidelity Freedom 2020 Fund
- Fidelity Freedom 2030 Fund
This investment category comprises unaffiliated registered investment
company mutual funds which invest in a combination of underlying
Fidelity funds according to an asset allocation strategy that becomes
increasingly conservative over time as each fund's target retirement
date approaches. When each of these target retirement date funds
matches the asset allocation of the Fidelity Freedom Income Fund
(approximately five to ten years after the respective fund's target
retirement date), it is expected that each fund will be combined with
the Fidelity Freedom Income Fund. These funds' investment objectives
are to achieve high total return over an extended period of time.
- Employer Stock Fund
- UGI Common Stock Fund
This fund invests principally in shares of UGI Corporation Common
Stock. Participants in the fund do not individually own specific
shares of UGI Corporation Common Stock but rather own units in the
fund that invests in such shares. The value of a unit in the UGI
Common Stock Fund was initially set at $10.00 and is recalculated
daily by dividing the fair value of the fund's assets (comprising
shares of UGI Corporation Common Stock and temporary cash investments)
by the total number of units outstanding. The UGI Common Stock Fund
holds a small cash position in order to allow participants to perform
certain
-10-
<PAGE> 12
AMERIGAS PROPANE, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (Continued)
transactions on a daily basis without having to wait for the purchase
or sale of UGI Common Stock to settle.
Generally, participants may transfer amounts between funds at any time with no
limit. Participants may change their investment elections for future
contributions at any time.
Fidelity Management Trust Company is the Plan's trustee for all investment
assets of the Plan.
DISTRIBUTIONS. The Plan benefit of a participant who terminates employment as a
result of retirement, death or total disability, as defined by the Plan
document, shall be equal to the proceeds of liquidation of 100% of the balance
of his or her account. Participants may elect to receive their interest in the
UGI Common Stock Fund in the form of shares of UGI Corporation Common Stock. The
Plan benefit of a participant who terminates employment for reasons other than
retirement, death or total disability shall be equal to the proceeds of
liquidation of the vested portion of his or her account.
Distributions will generally be made in the form of a lump sum. If the value of
a participant's account exceeds $5,000 and the participant is married, the
participant's Pension Account and Predecessor Pension Rollover Account will be
distributed in the form of a joint and survivor annuity. Under a joint and
survivor annuity, the participant will receive a monthly benefit for his or her
lifetime; upon the participant's death, the participant's surviving spouse, if
any, will receive a monthly benefit equal to 50% of the benefit the participant
was receiving. If the value of the participant's account exceeds $5,000 and the
participant is not married, the participant's Pension Account and Predecessor
Pension Rollover Account will be distributed in the form of a single life
annuity. In lieu of a joint and survivor annuity or a single life annuity, a
participant may generally elect to receive his or her Pension Account and
Predecessor Pension Rollover Account in the form of (i) a lump sum, (ii) a
single life annuity, (iii) a joint and survivor annuity with 50% or 100% of the
participant's monthly payments continuing, after the participant's death, for
the life of the participant's beneficiary, or (iv) installments over 5 or 10
years, as elected by the participant. Any such election will be subject to
spousal consent, if applicable.
Where the amount to be distributed exceeds $5,000, no distribution shall be made
to any Plan participant prior to his or her normal retirement age (as defined
above) unless the participant elects to receive such distribution. Where the
amount to be distributed does not exceed $5,000 and has not exceeded $5,000 at
the time of any prior distribution, a Plan participant's benefit will be
distributed as soon as practicable after the participant's termination of
employment.
A participant who continues to work past age 70-1/2 may elect to defer
distribution until he or she terminates employment. Otherwise, distributions
must generally be made as soon as practicable after the participant reaches the
normal retirement age as defined above.
-11-
<PAGE> 13
AMERIGAS PROPANE, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (Continued)
DEATH. If a participant dies prior to receiving a distribution of his or her
account, the participant's designated beneficiary shall be entitled to receive a
distribution of the proceeds of liquidation of 100% of the vested balance of the
participant's account. Generally, the account will be distributed to the
beneficiary as soon as practicable following the date of death. The beneficiary
of a participant who is married at the time of the participant's death will be
the participant's spouse, unless the participant designated another beneficiary
and the spouse consented to such designation in accordance with procedures
specified by the Plan document.
Death benefits are generally paid in the form of a lump sum. Death benefits
payable to a spouse from the Pension Account and the Predecessor Pension
Rollover Account are paid in the form of a single life annuity unless the spouse
elects a lump sum distribution.
WITHDRAWALS. Generally, a participant may withdraw up to 50% of the balance of
his or her account attributable to previously permitted after-tax contributions
(including after-tax contributions that were matched by the Company) at any
time. However, the withdrawal must be in an amount of at least $250. No more
than one withdrawal is permitted in any calendar year from each of the matched
and unmatched portions of a participant's after-tax contribution account.
A participant may withdraw once per calendar year up to 100% of amounts
attributable to participation in certain "predecessor plans" and rollover
contributions from other 401(a) or individual retirement plan accounts, however
the amount must be at least $500 or, if less, the total value of the applicable
account.
A participant may withdraw before-tax contributions (and earnings attributable
thereto credited as of December 31, 1988) only on account of financial hardship
resulting from (a) medical expenses; (b) educational expenses; (c) foreclosure
on a primary residence; or (d) purchase of a primary residence. A hardship
withdrawal will be permitted if the Plan Administrator determines that (i) the
withdrawal is on account of an immediate and heavy financial need of the
participant and (ii) the withdrawal is necessary to satisfy such financial need.
While a participant is still employed by the Company, withdrawals of amounts
attributable to Company contributions, and post-1988 earnings on participant
before-tax contributions, are not permitted.
-12-
<PAGE> 14
AMERIGAS PROPANE, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (Continued)
LOAN PROVISION. The Plan includes an employee loan provision. Generally, at the
time a loan is to be made, the amount of all loans to be outstanding may not
exceed the lesser of (a) 50% of a participant's before-tax and rollover account
balances, or (b) $50,000 less the highest balance of any loan during the prior
twelve-month period. Each loan bears interest at a rate determined in accordance
with generally prevailing market conditions for similar types of loans. The
minimum loan amount is $1,000. The amount of the loan withdrawn from a
participant's account is allocated in proportion to the value of the
participant's salary deferral and rollover account balances in each investment
fund. Repayments, including interest, are made in equal installments through
payroll deductions and are allocated to participant accounts in accordance with
current investment elections. No loan may have a final maturity in excess of
five years except that, if the loan is used to purchase a principal residence
for the participant, the loan may have a final maturity of up to ten years. No
participant shall be permitted to have more than two loans outstanding at any
one time.
ADMINISTRATIVE EXPENSES. Administrative expenses of the Plan are chargeable to
the Plan unless paid for by the Company. The Company currently pays Plan
administrative expenses directly or from forfeited company contributions. Loan
administration fees are charged to participants. Mutual fund expenses are paid
to fund managers from mutual fund assets.
PLAN TERMINATION. Although it has not expressed any intent to do so, the Company
has the right to terminate the Plan in whole or in part at any time for any
reason. In the event of a complete or partial termination of the Plan, the
affected participants will become fully vested in their account balances.
PLAN AMENDMENT. The Company may amend the Plan at any time for any reason by
written action of its Board of Directors. Amendments required to comply with
applicable legal requirements, however, may be made by an officer of the Company
without Board approval.
VOTING RIGHTS OF UGI COMMON STOCK FUND PARTICIPANTS. A participant has the right
to instruct the trustee of the Plan how to vote, at each meeting of
shareholders, all shares of UGI Corporation Common Stock (including fractional
shares) represented by the value of the participant's interest in the UGI Common
Stock Fund, and a pro rata portion of unvoted shares. A participant also has the
right to direct the trustee of the Plan whether or not to tender shares in
response to a tender offer.
-13-
<PAGE> 15
AMERIGAS PROPANE, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (Continued)
2. ACCOUNTING POLICIES
The accompanying financial statements are prepared on the accrual basis of
accounting in accordance with the AICPA audit guide, "Audits of Employee Benefit
Plans." Certain prior year amounts have been reclassified to conform to current
year presentation.
The Plan's investments in registered investment company mutual funds are valued
at quoted market prices which represent the net asset value of shares held by
the Plan. Guaranteed investment contracts included in the Fidelity Managed
Income Portfolio II Fund, an unaffiliated commingled pool, are carried at
contract value which represents deposits plus accrued interest. The Plan
Administrator believes contract value approximates fair value. Shares of UGI
Common Stock included in the UGI Common Stock Fund are reflected at fair value
based upon quoted market prices.
Dividend income is recorded on the record date. Interest earned on investments
is recorded on the accrual basis. Purchases and sales of securities are recorded
on a trade date basis.
The Plan presents in the Statement of Changes in Net Assets Available for
Benefits the net appreciation (depreciation) in fair value of investments which
consists of realized gains or losses and unrealized appreciation (depreciation)
in the fair value of those investments.
Distributions are made to Plan participants based upon the fair value of each
participant's investment account (except for investments of the Fixed Income
Fund for which distributions are based upon contract value) as of the date of
distribution.
Transfers of participant balances represent amounts transferred to or from the
UGI Utilities, Inc. Savings Plan, an affiliate plan.
The preparation of financial statements in conformity with generally accepted
accounting principles requires the Plan Administrator to make estimates and
assumptions that affect the reported amount of net assets available for benefits
and changes therein. Actual results could differ from these estimates.
-14-
<PAGE> 16
AMERIGAS PROPANE, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
3. TRUST INVESTMENTS
The components of trust investments by fund at December 31, 1999 and 1998 are
as follows:
<TABLE>
<CAPTION>
December 31,
1999 1998
------------- -------------
<S> <C> <C>
Fidelity Cash Reserves Fund (shares -- 25,785,212 and 28,415,877, respectively) $ 25,785,212 * $ 28,415,877 *
------------- -------------
Fidelity Managed Income Portfolio II Fund (shares -- 18,253,322
19,352,975, respectively) 18,253,322 * 19,352,975 *
------------- -------------
Fidelity Intermediate Bond Fund (shares -- 445,272 and 368,434, respectively) 4,345,855 3,783,823
------------- -------------
Fidelity Capital and Income Fund (shares -- 34,210 and 69, respectively) 317,812 641
------------- -------------
Fidelity U.S. Bond Index Fund (shares -- 28,127 and 3,461, respectively) 286,615 38,136
------------- -------------
Fidelity Spartan U.S. Equity Index Fund (shares -- 115,199 and 108,203, respectively) 6,000,706 4,756,641
------------- -------------
Fidelity Equity Income Fund (shares -- 545,248 and 563,783, respectively) 29,159,866 * 31,318,132 *
------------- -------------
Fidelity Fund (shares -- 150,156 and 143,182, respectively) 6,398,164 5,253,333
------------- -------------
Fidelity Puritan Fund (shares -- 27,977 and 6,827, respectively) 532,394 137,019
------------- -------------
Fidelity Growth & Income Portfolio (shares -- 12,720 and 2,734, respectively) 599,895 125,328
------------- -------------
Fidelity Balanced Fund (shares -- 57,903 and 8,890, respectively) 889,393 145,440
------------- -------------
Fidelity Equity Income II Fund (shares -- 3,531 and 605, respectively) 96,647 18,142
------------- -------------
Fidelity Real Estate Investment Portfolio (shares -- 2,117 and 512, respectively) 31,114 7,961
------------- -------------
Fidelity Magellan Fund (shares -- 371,250 and 359,141, respectively) 50,723,919 * 43,391,423 *
------------- -------------
Fidelity Growth Company Fund (shares -- 119,295 and 90,467, respectively) 10,056,565 * 4,615,647
------------- -------------
Fidelity OTC Portfolio (shares -- 16,425 and 289, respectively) 1,116,421 12,606
------------- -------------
Fidelity Capital Appreciation Fund (shares -- 3,540 and 139, respectively) 105,737 3,069
------------- -------------
Fidelity Blue Chip Growth Fund (shares -- 17,161 and 1,744, respectively) 1,031,540 87,882
------------- -------------
Fidelity Low-Priced Stock Fund (shares -- 3,753 and 61, respectively) 84,961 1,396
------------- -------------
Fidelity Small Cap Selector Fund (shares -- 3,933 and 340, respectively) 63,283 4,824
------------- -------------
</TABLE>
-15-
<PAGE> 17
AMERIGAS PROPANE, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
3. TRUST INVESTMENTS (CONTINUED)
<TABLE>
<CAPTION>
December 31,
1999 1998
------------- -------------
<S> <C> <C>
Fidelity Value Fund (shares -- 2,636 and 24, respectively) 115,495 1,108
------------- -------------
Fidelity Overseas Fund (shares -- 37,147 and 33,650, respectively) 1,783,444 1,210,728
------------- -------------
Fidelity International Growth and Income Fund (shares -- 5,596 and 382, respectively) 168,429 7,985
------------- -------------
Fidelity Worldwide Fund (shares -- 2,554 and 458, respectively) 50,823 7,578
------------- -------------
Fidelity Freedom Income Fund (shares -- 389 and 62, respectively) 4,410 698
------------- -------------
Fidelity Freedom 2000 Fund (shares -- 102,169 and 9,422, respectively) 1,327,169 116,181
------------- -------------
Fidelity Freedom 2010 Fund (shares -- 118,973 and 8,490, respectively) 1,769,124 112,917
------------- -------------
Fidelity Freedom 2020 Fund (shares -- 97,719 and 1,811, respectively) 1,600,635 25,265
------------- -------------
Fidelity Freedom 2030 Fund (shares -- 18,672 and 138, respectively) 315,187 1,919
------------- -------------
UGI Common Stock Fund
UGI Corporation Unitized Stock Fund (units -- 327,322 and 235,513, respectively) 2,870,613 2,397,524
Dividends receivable 50,965 35,485
------------- -------------
2,921,578 2,433,009
------------- -------------
Total trust investments - fair value, except for group annuity contracts
included in the Fidelity Managed Income Portfolio II Fund which
are carried at contract value $ 165,935,715 $ 145,387,683
============= =============
Total trust investments - cost $ 135,293,288 $ 119,796,511
============= =============
</TABLE>
* - Investment represents five percent or more of net assets available for
benefits.
The net appreciation (depreciation) in fair value of investments during the
year ended December 31, 1999 and three months ended December 31, 1998 by major
investment category follows:
<TABLE>
<CAPTION>
Three
Year Months
Ended Ended
December 31, December 31,
1999 1998
------------- -------------
<S> <C> <C>
Registered investment company mutual funds $ 11,157,425 $ 14,097,577
UGI Common Stock Fund (221,069) 88,701
------------- -------------
$ 10,936,356 $ 14,186,278
============= =============
</TABLE>
-16-
<PAGE> 18
AMERIGAS PROPANE, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
The numbers of Plan participants with account balances by investment option at
December 31, 1999 and 1998 are as follows:
<TABLE>
<CAPTION>
1999 1998
-------- -------
<S> <C> <C>
Fidelity Cash Reserves Fund 2,609 3,225
Fidelity Managed Income Portfolio II Fund 2,387 2,692
Fidelity Intermediate Bond Fund 872 925
Fidelity Capital & Income Fund 61 11
Fidelity U.S. Bond Index Fund 81 16
Fidelity Spartan U.S. Equity Index Fund 751 657
Fidelity Equity Income Fund 2,192 2,401
Fidelity Fund 746 697
Fidelity Puritan Fund 125 34
Fidelity Growth & Income Portfolio 225 42
Fidelity Balanced Fund 194 39
Fidelity Equity Income II Fund 84 19
Fidelity Real Estate Investment Portfolio 61 17
Fidelity Magellan Fund 2,719 2,680
Fidelity Growth Company Fund 890 911
Fidelity OTC Portfolio 143 12
Fidelity Capital Appreciation Fund 52 8
Fidelity Blue Chip Growth Fund 345 63
Fidelity Low-Priced Stock Fund 41 11
Fidelity Small Cap Selector Fund 38 10
Fidelity Value Fund 45 10
Fidelity Overseas Fund 407 389
Fidelity International Growth & Income Fund 116 26
Fidelity Worldwide Fund 59 20
Fidelity Freedom Income Fund 4 2
Fidelity Freedom 2000 Fund 30 7
Fidelity Freedom 2010 Fund 77 11
Fidelity Freedom 2020 Fund 91 7
Fidelity Freedom 2030 Fund 96 8
UGI Common Stock Fund 846 833
Participant loans 854 900
</TABLE>
-17-
<PAGE> 19
AMERIGAS PROPANE, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
The total number of Plan participants with account balances at December 31, 1999
and 1998 of 5,180 and 5,201, respectively, was less than the sum of the numbers
of participants shown in the schedule above because many participants invest in
more than one fund.
During the 1999 Plan Year and the 1998 Short Plan Year, the Plan purchased, at
market prices, 23,844 and 5,987 shares of UGI Corporation Common Stock directly
from UGI Corporation for $491,205 and $141,715, respectively.
The Plan's principal financial instruments subject to credit risk are the
investments of the separate investment funds. The degree and concentration of
credit risk varies by fund depending upon the type and diversity of investments.
The Schedule of Assets Held for Investment Purposes depicts the types of
investment funds available and the proportionate share of assets held in each
particular investment option.
4. FEDERAL INCOME TAX STATUS
On July 31, 1995, the Internal Revenue Service issued a favorable determination
letter concerning the qualified status of the Plan in effect as of September 30,
1994 under Section 401(a) of the IRC. The Plan has since been amended, however,
the Plan Administrator believes that the Plan is designed and is currently being
operated in compliance with the applicable requirements of the IRC. No U.S.
income taxes are required to be paid by the trust created under the Plan (the
Trust) and participants are not taxed on Company contributions to the Trust or
income earned by the Trust. When a participant, or his or her beneficiary or
estate, receives a distribution under the Plan, the taxability of the value of
such distribution depends on the form and time of payment.
-18-
<PAGE> 20
AMERIGAS PROPANE, INC. SAVINGS PLAN
Item 4(i) - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
<TABLE>
<CAPTION>
December 31, 1999
--------------------------------------------------------------------
Number of
Shares or Fair Value/
Principal Contract
NAME OF ISSUER AND TITLE OF ISSUE Amount Cost Value % (2)
--------------------------------- --------------- ------------ ------------ -------
<S> <C> <C> <C> <C>
FIDELITY CASH RESERVES FUND (1) (3) 25,785,212 shrs $ 25,785,212 $ 25,785,212 100.00%
------------ ------------ -------
FIDELITY MANAGED INCOME
PORTFOLIO II FUND (1) (3) 18,253,322 shrs 18,253,322 18,253,322 100.00%
------------ ------------ -------
FIDELITY INTERMEDIATE BOND FUND (3) 445,272 shrs 4,519,530 4,345,855 100.00%
------------ ------------ -------
FIDELITY CAPITAL AND INCOME FUND (3) 34,210 shrs 325,280 317,812 100.00%
------------ ------------ -------
FIDELITY U.S. BOND INDEX FUND (3) 28,127 shrs 299,372 286,615 100.00%
------------ ------------ -------
FIDELITY SPARTAN U.S. EQUITY INDEX FUND (3) 115,199 shrs 4,248,674 6,000,706 100.00%
------------ ------------ -------
FIDELITY EQUITY INCOME FUND (1) (3) 545,248 shrs 23,546,806 29,159,866 100.00%
------------ ------------ -------
FIDELITY FUND (3) 150,156 shrs 4,766,997 6,398,164 100.00%
------------ ------------ -------
FIDELITY PURITAN FUND (3) 27,977 shrs 545,238 532,394 100.00%
------------ ------------ -------
FIDELITY GROWTH & INCOME
PORTFOLIO (3) 12,720 shrs 587,069 599,895 100.00%
------------ ------------ -------
FIDELITY BALANCED FUND (3) 57,903 shrs 946,556 889,393 100.00%
------------ ------------ -------
FIDELITY EQUITY INCOME II FUND (3) 3,531 shrs 105,981 96,647 100.00%
------------ ------------ -------
FIDELITY REAL ESTATE INVESTMENT
PORTFOLIO (3) 2,117 shrs 32,194 31,114 100.00%
------------ ------------ -------
FIDELITY MAGELLAN FUND (1) (3) 371,250 shrs 33,662,857 50,723,919 100.00%
------------ ------------ -------
FIDELITY GROWTH COMPANY FUND (1) (3) 119,295 shrs 6,235,968 10,056,565 100.00%
------------ ------------ -------
FIDELITY OTC PORTFOLIO (3) 16,425 shrs 870,202 1,116,421 100.00%
------------ ------------ -------
FIDELITY CAPITAL APPRECIATION FUND (3) 3,540 shrs 89,663 105,737 100.00%
------------ ------------ -------
FIDELITY BLUE CHIP GROWTH FUND (3) 17,161 shrs 903,535 1,031,540 100.00%
------------ ------------ -------
FIDELITY LOW-PRICED STOCK FUND (3) 3,753 shrs 84,211 84,961 100.00%
------------ ------------ -------
FIDELITY SMALL CAP SELECTOR FUND (3) 3,933 shrs 53,490 63,283 100.00%
------------ ------------ -------
FIDELITY VALUE FUND (3) 2,636 shrs 126,925 115,495 100.00%
------------ ------------ -------
FIDELITY OVERSEAS FUND (3) 37,147 shrs 1,335,769 1,783,444 100.00%
------------ ------------ -------
</TABLE>
-19-
<PAGE> 21
AMERIGAS PROPANE, INC. SAVINGS PLAN
Item 4(i) - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES (continued)
<TABLE>
<CAPTION>
December 31, 1999
--------------------------------------------------------------------
Number of
Shares or Fair Value/
Principal Contract
NAME OF ISSUER AND TITLE OF ISSUE Amount Cost Value % (2)
--------------------------------- --------------- ------------ ------------ -------
<S> <C> <C> <C> <C>
FIDELITY INTERNATIONAL GROWTH
& INCOME FUND (3) 5,596 shrs 143,436 168,429 100.00%
------------- ------------- -------
FIDELITY WORLDWIDE FUND (3) 2,554 shrs 45,994 50,823 100.00%
------------- ------------- -------
FIDELITY FREEDOM INCOME FUND (3) 389 shrs 4,346 4,410 100.00%
------------- ------------- -------
FIDELITY FREEDOM 2000 FUND (3) 102,169 shrs 1,278,242 1,327,169 100.00%
------------- ------------- -------
FIDELITY FREEDOM 2010 FUND (3) 118,973 shrs 1,655,249 1,769,124 100.00%
------------- ------------- -------
FIDELITY FREEDOM 2020 FUND (3) 97,719 shrs 1,503,306 1,600,635 100.00%
------------- ------------- -------
FIDELITY FREEDOM 2030 FUND (3) 18,672 shrs 282,851 315,187 100.00%
------------- ------------- -------
UGI COMMON STOCK FUND (3)
UGI Corporation Unitized Stock Fund 327,322 units 3,004,048 2,870,613 98.26%
------------- ------------- -------
Dividends receivable $ 50,965 50,965 50,965 1.74%
------------- ------------- -------
3,055,013 2,921,578 100.00%
============= ============= =======
PARTICIPANT LOANS
Loan principal outstanding (7.0% - 11.52%) (3) (4) - 3,886,564 100.00%
------------- ------------- -------
Total - all funds $ 135,293,288 $ 169,822,279
============= =============
</TABLE>
(1) Investment represents 5% or more of the net assets available for benefits.
(2) Percentages represent percentage of fair value / contract value of each
fund.
(3) Party in interest.
(4) Range of interest rates for loans outstanding as of December 31, 1999.
-20-
<PAGE> 22
UGI UTILITIES, INC.
SAVINGS PLAN
EIN #23-1174060 Plan Number 008
FINANCIAL STATEMENTS
for the year ended December 31, 1999
and the three months ended December 31, 1998
-1-
<PAGE> 23
UGI UTILITIES, INC.
SAVINGS PLAN
INDEX TO FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
Page(s)
---------
<S> <C>
Report of Independent Public Accountants 3
Financial Statements:
Statements of Net Assets Available for Benefits at
December 31, 1999 and 1998 4
Statements of Changes in Net Assets Available for
Benefits for the year ended December 31, 1999
and the three months ended December 31, 1998 5
Notes to Financial Statements 6 to 17
Item 4(i) - Schedule of Assets Held for Investment Purposes -
December 31, 1999 18 to 19
</TABLE>
-2-
<PAGE> 24
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Retirement Committee of
UGI Utilities, Inc.:
We have audited the accompanying statements of net assets available for benefits
of the UGI Utilities, Inc. Savings Plan (the "Plan") as of December 31, 1999 and
1998, and the related statements of changes in net assets available for benefits
for the year ended December 31, 1999 and the three months ended December 31,
1998. These financial statements and the supplemental schedule referred to below
are the responsibility of the Plan's management. Our responsibility is to
express an opinion on these financial statements and supplemental schedule based
on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan as of
December 31, 1999 and 1998 and the changes in net assets available for benefits
for the year ended December 31, 1999 and the three months ended December 31,
1998, in accordance with accounting principles generally accepted in the United
States.
Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of assets held
for investment purposes is presented for purposes of additional analysis and is
not a required part of the basic financial statements but is supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. The 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.
Arthur Andersen LLP
Philadelphia, Pennsylvania
June 15, 2000
-3-
<PAGE> 25
UGI UTILITIES, INC. SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
December 31,
1999 1998
------------- -------------
<S> <C> <C>
Investments - participant directed (Note 3) $ 57,734,627 $ 47,387,403
Loans to participants 1,458,891 1,334,510
Employers' contributions receivable 1,115,105 303,223
------------- -------------
Net assets available for benefits $ 60,308,623 $ 49,025,136
============= =============
</TABLE>
See accompanying notes to financial statements.
-4-
<PAGE> 26
UGI UTILITIES, INC. SAVINGS PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
Three
Year Months
Ended Ended
December 31, December 31,
1999 1998
------------ ------------
<S> <C> <C>
Participants' contributions $ 4,342,712 $ 1,239,750
Employers' contributions 1,115,105 303,223
Investment income:
Dividends 4,178,868 1,083,200
Net appreciation
in value of investments 3,838,779 5,072,623
Other 42,841 29,649
Net transfers of participants' balances (1,917) (118,927)
Distributions to participants (2,232,901) (1,067,146)
------------ ------------
Net increase 11,283,487 6,542,372
Net assets available for benefits-
beginning of period 49,025,136 42,482,764
------------ ------------
Net assets available for benefits-
end of period $ 60,308,623 $ 49,025,136
============ ============
</TABLE>
See accompanying notes to financial statements.
-5-
<PAGE> 27
UGI UTILITIES, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
1. DESCRIPTION OF THE PLAN
The following brief description of the UGI Utilities, Inc. Savings Plan (Plan)
provides general information on the provisions of the Plan in effect on December
31, 1999 and during the periods covered by the financial statements. More
complete information is included in the Plan document.
GENERAL. The Plan is a defined contribution plan covering employees of UGI
Utilities, Inc. (UGI Utilities), its holding company parent UGI Corporation
(UGI), and certain affiliated companies (collectively, the Employers). Employees
of the Employers are eligible upon hire to participate in the Plan. The Plan is
subject to the provisions of the Employee Retirement Income Security Act of 1974
(ERISA). The Plan is administered by the UGI Utilities Retirement Committee
(Plan Administrator) whose members are appointed by the Board of Directors of
UGI Utilities.
CHANGE IN PLAN YEAR. The Pension Committee of UGI Utilities' Board of Directors
approved a change to the Plan's fiscal year from one ending on September 30 to
one ending on December 31, effective October 1, 1998. Accordingly, the Plan
financial statements include the year ended December 31, 1999 (1999 Plan Year)
and the three months ended December 31, 1998 (1998 Short Plan Year).
CONTRIBUTIONS. A participant may elect to contribute to the Plan on a before-tax
basis through payroll reduction an amount equal to from 1% to 15%, in whole
percentages, of eligible compensation. In addition, a participant may elect to
contribute to the Plan on an after-tax basis through payroll deduction an amount
equal to from 1% to 6%, in whole percentages, of eligible compensation provided
that the combination of before-tax and after-tax contributions does not exceed
15% of eligible compensation. Calendar year before-tax and after-tax
contribution amounts are subject to limits prescribed by the Internal Revenue
Code (IRC). A participant may increase the rate of, or reduce or suspend, his or
her before-tax or after-tax contributions at any time by filing a written
request with the Plan Administrator. A participant will at all times be fully
(100%) vested in the portion of his or her account attributable to participant
contributions.
The Plan also accepts on behalf of any employee (i) the entire amount of cash
received as a distribution from another qualified trust forming part of a plan
described in section 401(a) of the IRC or from a "rollover" individual
retirement plan described in section 408 of the IRC, or (ii) a direct transfer
from another plan qualified under Section 401(a) of the IRC.
For each Plan year, each of the Employers may, at their discretion, make a
contribution to the Plan equal to a percentage of participant before-tax and
after-tax contributions, up to a total of 6% of compensation for each eligible
participant. In order to be entitled to the Employers' contribution, a
participant must either (i) be actively employed by any of the Employers, or on
a
-6-
<PAGE> 28
UGI UTILITIES, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (Continued)
qualifying leave of absence on the last day of the Plan year or (ii) have
retired, become disabled (as defined in the Plan), or died while an employee
during the Plan year. Employers' contributions for the 1999 Plan Year and the
1998 Short Plan Year, which were made in January 2000 and January 1999,
respectively, were invested in accordance with participant investment elections
in effect on the dates of the contributions.
A participant is fully vested in the portion of his or her account attributable
to Employers' matching contributions upon the earlier of (i) the completion of
five years of service or (ii) the attainment of normal retirement age, total
disability (as defined by the Plan document) or death while in the employ of the
Employers or an affiliated company. For Plan purposes, a participant will attain
normal retirement age on the later of his or her 65th birthday or the fifth
anniversary of his or her date of hire.
A participant who terminates employment before he or she is fully vested will
forfeit nonvested amounts attributable to the Employers' contributions. These
forfeited amounts remain in the Plan and are available to reduce future Employer
contributions. For the 1999 Plan Year and the 1998 Short Plan Year, forfeitures
of $30,000 and $1,421, respectively, were used to reduce the Employers'
contributions. During the 1999 Plan Year and the 1998 Short Plan Year, $40,286
and $444, respectively, were forfeited from participants' accounts. As of
December 31, 1999 and 1998, there were $8,665 and $11, respectively, of
forfeitures remaining in the Plan.
INVESTMENT FUNDS. A participant may elect to have his or her funds invested in
one or more investment funds. Certain of the Plan's investment funds were not
used during the periods covered by the financial statements. References to
"Fidelity" below refer to investment funds managed by Fidelity Management and
Research Company (FMR). The Plan's investment funds are categorized as follows:
- Money Market Fund
- Fidelity Cash Reserves Fund
This investment category comprises an unaffiliated registered
investment company mutual fund whose investments comprise
high-quality, short-term certificates of deposit, repurchase
agreements, commercial paper or other similar short-term investments
and whose investment objective is to achieve current income while
maintaining a stable share price.
-7-
<PAGE> 29
UGI UTILITIES, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (Continued)
- Managed Income Fund
- Fidelity Managed Income Portfolio II Fund
This investment category comprises an unaffiliated
commingled pool whose investments principally comprise
guaranteed investment contracts offered by insurance
companies and financial institutions and certain types of
fixed income securities and whose investment objective is to
preserve principal while earning interest income.
- Bond Funds
- Fidelity Intermediate Bond Fund
- Fidelity Capital & Income Fund
This investment category comprises unaffiliated registered
investment company mutual funds whose investments comprise
principally fixed income obligations and whose investment
objective is to achieve current income.
- Index Funds
- Fidelity U.S. Bond Index Fund
- Fidelity Spartan U.S. Equity Index Fund
This investment category comprises unaffiliated registered
investment company mutual funds whose investments broadly
represent the U.S. bond market as measured by the Lehman
Brothers Aggregate Bond Index and the U.S. stock market as
measured by the Standard & Poor's Composite Index of 500
Stocks, respectively. The investment objective of this
investment category is to track the performance of the
respective indices.
-8-
<PAGE> 30
UGI UTILITIES, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (Continued)
- Growth and Income Funds
- Fidelity Equity Income Fund
- Fidelity Fund
- Fidelity Puritan Fund
- Fidelity Growth & Income Portfolio
- Fidelity Balanced Fund
- Fidelity Equity Income II Fund
- Fidelity Real Estate Investment Portfolio
This investment category comprises registered investment company
mutual funds whose investments comprise income-producing debt and
equity securities and whose investment objective is to achieve current
income and capital appreciation.
- Growth Funds
- Fidelity Magellan Fund
- Fidelity Blue Chip Growth Fund
- Fidelity Growth Company Fund
- Fidelity Low-Priced Stock Fund
- Fidelity OTC Portfolio
- Fidelity Small Cap Selector Fund
- Fidelity Capital Appreciation Fund
- Fidelity Value Fund
This investment category comprises registered investment company
mutual funds whose investments comprise principally equity securities
and whose investment objective is to achieve capital appreciation over
an extended period of time.
- International Funds
- Fidelity Overseas Fund
- Fidelity International Growth & Income Fund
- Fidelity Worldwide Fund
This investment category comprises unaffiliated registered investment
company mutual funds whose investments comprise debt and equity
securities principally of foreign issuers and whose investment
objective is to achieve capital appreciation over an extended period
of time.
- Fidelity Freedom Funds
- Fidelity Freedom Income Fund
- Fidelity Freedom 2000 Fund
- Fidelity Freedom 2010 Fund
- Fidelity Freedom 2020 Fund
- Fidelity Freedom 2030 Fund
This investment category comprises unaffiliated registered investment
company mutual funds which invest in a combination of underlying
Fidelity funds
-9-
<PAGE> 31
UGI UTILITIES, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (Continued)
according to an asset allocation strategy that becomes increasingly
conservative over time as each fund's target retirement date
approaches. When each of these target retirement date funds matches
the asset allocation of the Fidelity Freedom Income Fund
(approximately five to ten years after the respective fund's target
retirement date), it is expected that each fund will be combined with
the Fidelity Freedom Income Fund. These funds' investment objectives
are to achieve high total return over an extended period of time.
- Employer Stock Fund
- UGI Common Stock Fund
This fund invests principally in shares of UGI Corporation Common
Stock. Participants in the fund do not individually own specific
shares of UGI Corporation Common Stock but rather own units in the
fund that invests in such shares. The value of a unit in the UGI
Common Stock Fund was initially set at $10.00 and is recalculated
daily by dividing the fair value of the fund's assets (comprising
shares of UGI Corporation Common Stock and temporary cash investments)
by the total number of units outstanding. The UGI Common Stock Fund
holds a small cash position in order to allow participants to perform
certain transactions on a daily basis without having to wait for the
purchase or sale of UGI Common Stock to settle.
Generally, participants may transfer amounts between funds at any time with no
limit. Participants may change their investment elections for future
contributions at any time.
Fidelity Management Trust Company is the Plan's trustee for all investment
assets of the Plan.
DISTRIBUTIONS. The Plan benefit of a participant who terminates employment as a
result of retirement, death or total disability, as defined by the Plan
document, shall be equal to the proceeds of liquidation of 100% of the balance
of his or her account. Participants may elect to receive their interest in the
UGI Common Stock Fund in the form of shares of UGI Corporation Common Stock. The
Plan benefit of a participant who terminates employment for reasons other than
retirement, death or total disability shall be equal to the proceeds of
liquidation of the vested portion of his or her account. Where the amount to be
distributed exceeds $5,000 no distribution shall be made to any Plan participant
prior to his or her normal retirement age (as defined above) unless the
participant elects to receive such distribution. Where the amount to be
distributed does not exceed $5,000 and has not exceeded $5,000 at the time of
any prior distribution, a Plan participant's benefit will be distributed as soon
as practicable after the participant's termination of employment.
-10-
<PAGE> 32
UGI UTILITIES, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (Continued)
A participant who continues to work past age 70-1/2 may elect to defer
distribution until he or she terminates employment. In all other cases,
distributions must be made or commence by April 1 of the calendar year following
the year in which the participant attains age 70-1/2.
DEATH. If a participant dies prior to receiving a distribution of his or her
account, the participant's designated beneficiary shall be entitled to receive a
lump-sum distribution of the proceeds of liquidation of 100% of the balance
credited to the participant's account. Generally, the account will be
distributed to the beneficiary as soon as practicable following the date of
death. The beneficiary of a participant who is married at the time of the
participant's death will be the participant's spouse, unless the participant
designated another beneficiary and the spouse consented to such designation in
accordance with procedures specified by the Plan document.
WITHDRAWALS. Generally, a participant may withdraw up to 50% of the balance of
his or her account attributable to after-tax contributions (including after-tax
contributions that were matched by the Employer) at any time. However, the
withdrawal must be in an amount of at least $250. If any portion of the amount
withdrawn is attributable to Employer contributions, the participant's
participation in the Plan will be suspended for the three-month period following
the withdrawal. No more than one withdrawal in any calendar year is permitted
from each of the matched and unmatched portions of a participant's after-tax
contribution account.
A participant may withdraw before-tax contributions (and earnings attributable
thereto credited as of December 31, 1988) and rollover contributions, only on
account of financial hardship resulting from (a) medical expenses; (b)
educational expenses; (c) foreclosure on a primary residence; or (d) purchase of
a primary residence. A hardship withdrawal will be permitted if the Plan
Administrator determines that (i) the withdrawal is on account of an immediate
and heavy financial need of the participant and (ii) the withdrawal is necessary
to satisfy such financial need.
While a participant is still employed by any of the Employers, withdrawals of
amounts attributable to Employer's contributions and post-1988 earnings on
participant before-tax contributions, are not permitted.
LOAN PROVISION. The Plan includes an employee loan provision. Generally, at the
time a loan is to be made, the amount of all loans to be outstanding may not
exceed the lesser of (a) 50% of a participant's before-tax and rollover account
balances, or (b) $50,000 less the highest balance of any loan during the prior
twelve-month period. Each loan bears interest at a rate determined in accordance
with generally prevailing market conditions for similar types of loans. The
minimum loan amount is $1,000. The amount of the loan withdrawn from a
participant's account is allocated in proportion to the value of the
participant's salary deferral and rollover account balances in each investment
fund. Repayments, including interest, are made in equal installments through
payroll deductions and are allocated to participant accounts in accordance with
current investment elections. No loan may have a final maturity in excess of
five years except that, if the loan is used to purchase a principal residence
for the participant, the loan may have a final
-11-
<PAGE> 33
UGI UTILITIES, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (Continued)
maturity of up to ten years. No participant shall be permitted to have more than
two loans outstanding at any one time.
ADMINISTRATIVE EXPENSES. All administrative expenses of the Plan are chargeable
to the Plan unless paid for by the Employers. The Employers currently pay such
expenses. Mutual fund expenses are paid to fund managers from mutual fund
assets.
PLAN TERMINATION. Although it has not expressed any intent to do so, UGI
Utilities has the right to terminate the Plan in whole or in part at any time
for any reason. In the event of a complete or partial termination of the Plan,
the affected participants will become fully vested in their account balances.
PLAN AMENDMENT. UGI Utilities may amend the Plan at any time for any reason by
written action of its Board of Directors. Amendments required to comply with
applicable legal requirements, however, may be made by an officer of the company
without Board approval.
VOTING RIGHTS OF UGI COMMON STOCK FUND PARTICIPANTS. A participant has the right
to instruct the trustee of the Plan how to vote, at each meeting of
shareholders, all shares of UGI Corporation Common Stock (including fractional
shares) represented by the value of the participant's interest in the UGI Common
Stock Fund, and a pro rata portion of unvoted shares. A participant also has the
right to direct the trustee of the Plan whether or not to tender shares in
response to a tender offer.
2. ACCOUNTING POLICIES
The accompanying financial statements are prepared on the accrual basis of
accounting in accordance with the AICPA audit guide, "Audits of Employee Benefit
Plans." Certain prior year amounts have been reclassified to conform to current
year presentation.
The Plan's investments in registered investment company mutual funds are valued
at quoted market prices which represent the net asset value of shares held by
the plan. Guaranteed investment contracts included in the Fidelity Managed
Income Portfolio II fund, an unaffiliated commingled pool, are carried at
contract value which represents deposits plus accrued interest. The Plan
Administrator believes contract value approximates fair value. Shares of UGI
Common Stock included in the UGI Common Stock Fund are reflected at fair value
based upon quoted market prices.
Dividend income is recorded on the record date. Interest earned on investments
is recorded on the accrual basis. Purchases and sales of securities are recorded
on a trade date basis.
-12-
<PAGE> 34
UGI UTILITIES, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (Continued)
The Plan presents in the Statement of Changes in Net Assets Available for
Benefits the net appreciation (depreciation) in fair value of investments which
consists of realized gains or losses and unrealized appreciation (depreciation)
in the fair value of those investments.
Distributions are made to Plan participants based upon the fair value of each
participant's investment account (except for investments of the Fixed Income
Fund for which distributions are based upon contract value) as of the date of
the distribution.
Transfers of participant balances represent amounts transferred to or from the
AmeriGas Propane, Inc. Savings Plan, an affiliate plan.
The preparation of financial statements in conformity with generally accepted
accounting principles requires the Plan Administrator to make estimates and
assumptions that affect the reported amounts of net assets available for
benefits and changes therein. Actual results could differ from these estimates.
-13-
<PAGE> 35
UGI UTILITIES, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
3. TRUST INVESTMENTS
The components of trust investments by fund at December 31, 1999 and 1998 are as
follows:
<TABLE>
<CAPTION>
December 31,
1999 1998
---------- -----------
<S> <C> <C>
Fidelity Cash Reserves Fund (shares -- 2,772,891 and 3,007,127, respectively) $2,772,891 $ 3,007,127 *
---------- -----------
Fidelity Managed Income Portfolio II Fund (shares -- 7,867,529 and
7,317,528, respectively) 7,867,529 * 7,317,528 *
---------- -----------
Fidelity Intermediate Bond Fund (shares -- 72,721 and 78,064, respectively) 709,758 801,714
---------- -----------
Fidelity U.S. Bond Index Fund (shares -- 13,408 and 8,808, respectively) 136,623 97,065
---------- -----------
Fidelity U.S. Spartan Equity Index Fund (shares -- 48,395 and
45,168, respectively) 2,520,880 1,985,582
---------- -----------
Fidelity Equity Income Fund (shares -- 196,047 and 203,147, respectively) 10,484,612 * 11,284,808 *
---------- -----------
Fidelity Fund (shares -- 59,687 and 46,871, respectively) 2,543,254 1,719,694
---------- -----------
Fidelity Puritan Fund (shares -- 1,594 and 1,578, respectively) 30,342 31,661
---------- -----------
Fidelity Growth & Income Portfolio (shares -- 4,600 and 788, respectively) 216,950 36,116
---------- -----------
Fidelity Balanced Fund (shares -- 3,383 and 1,224, respectively) 51,960 20,021
---------- -----------
Fidelity Equity Income II Fund (shares -- 2,457 and 99, respectively) 67,241 2,984
---------- -----------
Fidelity Real Estate Investment Portfolio (shares -- 154 and 11, respectively) 2,258 164
---------- -----------
Fidelity Magellan Fund (shares -- 149,746 and 131,898, respectively) 20,459,729 * 15,935,862 *
---------- -----------
Fidelity Growth Company Fund (shares -- 33,725 and 22,209, respectively) 2,843,000 1,133,121
---------- -----------
Fidelity OTC Portfolio (shares -- 13,816 and 377, respectively) 939,080 16,464
---------- -----------
Fidelity Capital Appreciation Fund (shares -- 2,699 and 2, respectively) 80,626 42
---------- -----------
Fidelity Blue Chip Growth Fund (shares -- 11,305 and 2,810, respectively) 679,514 141,612
---------- -----------
Fidelity Low-Priced Stock Fund (shares -- 771 and 620, respectively) 17,452 14,175
---------- -----------
Fidelity Small Cap Selector Fund (shares -- 1,881 and 2,333, respectively) 30,258 33,098
---------- -----------
</TABLE>
-14-
<PAGE> 36
UGI UTILITIES, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
3. TRUST INVESTMENTS (CONTINUED)
<TABLE>
<CAPTION>
December 31,
1999 1998
------------ ------------
<S> <C> <C>
Fidelity Overseas Fund (shares -- 17,894 and 14,235, respectively) 859,106 512,192
------------ ------------
Fidelity International Growth & Income Fund (shares -- 2,066 and 507, respectively) 62,197 10,611
------------ ------------
Fidelity Worldwide Fund (shares -- 672 and 168, respectively) 13,375 2,774
------------ ------------
Fidelity Freedom Income Fund (shares -- 11,444 and 19,621, respectively) 129,662 219,366
------------ ------------
Fidelity Freedom 2000 Fund (shares -- 13,490 and 12,680, respectively) 175,236 156,341
------------ ------------
Fidelity Freedom 2010 Fund (shares -- 21,701 and 5,418, respectively) 322,700 72,061
------------ ------------
Fidelity Freedom 2020 Fund (shares -- 17,669 and 7,241, respectively) 289,413 101,016
------------ ------------
Fidelity Freedom 2030 Fund (shares -- 8,838 and 1,353, respectively) 149,184 18,796
------------ ------------
Fidelity Capital & Income Fund (shares -- 17,197) 159,756
------------
Fidelity Value Fund (shares -- 220) 9,636
------------
UGI Common Stock Fund
UGI Corporation Unitized Stock Fund (units -- 348,646 and 262,301,
respectively) 3,057,623 * 2,675,469 *
Dividends receivable 52,782 39,939
------------ ------------
3,110,405 2,715,408
------------ ------------
Total trust investments - fair value, except for group annuity contracts
included in the Fidelity Managed Income Portfolio II Fund
which are carried at contract value $ 57,734,627 $ 47,387,403
============ ============
Total trust investments - cost $ 46,265,010 $ 38,267,216
============ ============
</TABLE>
* - Investment represents five percent or more of the net assets available
for benefits.
The net appreciation (depreciation) in fair value of investments during the year
ended December 31, 1999 and the three months ended December 31, 1998 by major
investment category follows:
<TABLE>
<CAPTION>
Three
Year Months
Ended Ended
December 31, December 31,
1999 1998
------------ ------------
<S> <C> <C>
Registered investment company mutual funds $ 4,106,714 $ 5,003,676
UGI Common Stock Fund (267,935) 68,947
------------ ------------
Total net appreciation (depreciation) in fair value $ 3,838,779 $ 5,072,623
============ ============
</TABLE>
-15-
<PAGE> 37
UGI UTILITIES, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
The numbers of Plan participants with account balances by investment option at
December 31, 1999 and 1998 are as follows:
<TABLE>
<CAPTION>
December 31, December 31,
1999 1998
------------- ------------
<S> <C> <C>
Fidelity Cash Reserves Fund 406 451
Fidelity Managed Income Portfolio II Fund 565 624
Fidelity Intermediate Bond Fund 122 141
Fidelity Capital & Income Fund 10 -
Fidelity U.S. Bond Index Fund 10 5
Fidelity Spartan U.S. Equity Index Fund 240 234
Fidelity Equity Income Fund 594 656
Fidelity Fund 238 216
Fidelity Puritan Fund 17 10
Fidelity Growth & Income Portfolio 32 12
Fidelity Balanced Fund 19 4
Fidelity Equity Income II Fund 16 3
Fidelity Real Estate Investment Portfolio 8 2
Fidelity Magellan Fund 789 775
Fidelity Growth Company Fund 203 179
Fidelity OTC Portfolio 49 5
Fidelity Capital Appreciation Fund 6 1
Fidelity Blue Chip Growth Fund 95 25
Fidelity Low-Priced Stock Fund 6 4
Fidelity Small Cap Selector Fund 11 7
Fidelity Value Fund 6 -
Fidelity Overseas Fund 123 135
Fidelity International Growth & Income Fund 19 5
Fidelity Worldwide Fund 8 3
Fidelity Freedom Income Fund 5 2
Fidelity Freedom 2000 Fund 4 3
Fidelity Freedom 2010 Fund 19 7
Fidelity Freedom 2020 Fund 19 12
Fidelity Freedom 2030 Fund 20 7
UGI Common Stock Fund 474 480
Participant loans 343 252
</TABLE>
The total number of Plan participants with account balances at December 31, 1999
and 1998 of 1,258 and of 1,234, respectively, was less than the sum of the
numbers of participants shown in the schedule above because many participants
invest in more than one fund.
-16-
<PAGE> 38
UGI UTILITIES, INC.
SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
During the 1999 Plan Year and the 1998 Short Plan Year, the Plan purchased, at
market prices, 11,250 and 6,478 shares of UGI Corporation Common Stock directly
from UGI Corporation for $233,242 and $150,557, respectively.
The Plan's principal financial instruments subject to credit risk are the
investments of the separate investment funds. The degree and concentration of
credit risk varies by fund depending upon the type and diversity of investments.
The Schedule of Assets Held for Investment Purposes depicts the types of
investment funds available and the proportionate share of assets held in each
particular investment option.
4. FEDERAL INCOME TAX STATUS
On July 31, 1995, the Internal Revenue Service issued a favorable determination
letter concerning the qualified status of the Plan in effect as of September 30,
1994 under Section 401(a) of the IRC. The Plan has since been amended, however,
the Plan Administrator believes that the Plan is designed and is currently being
operated in compliance with the applicable requirements of the IRC. No U.S.
income taxes are required to be paid by the trust created under the Plan (the
Trust) and participants are not taxed on Employers' contributions to the Trust
or income earned by the Trust. When a participant, or his or her beneficiary or
estate, receives a distribution under the Plan, the taxability of the value of
such distribution depends on the form and time of payment.
-17-
<PAGE> 39
UGI UTILITIES, INC. SAVINGS PLAN
Item 4(i) - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
<TABLE>
<CAPTION>
December 31, 1999
---------------------------------------------------------------------
Number of
Shares or Fair Value /
Principal Contract
NAME OF ISSUER AND TITLE OF ISSUE Amount Cost Value % (2)
--------------------------------- -------------------- ---------------- ---------------- -----------
<S> <C> <C> <C> <C>
FIDELITY CASH RESERVES FUND (3) 2,772,891 shrs $ 2,772,891 $ 2,772,891 100.00%
---------------- ---------------- -----------
FIDELITY MANAGED INCOME
PORTFOLIO II FUND (1) (3) 7,867,529 shrs 7,867,529 7,867,529 100.00%
---------------- ---------------- -----------
FIDELITY INTERMEDIATE BOND FUND (3) 72,721 shrs 742,594 709,758 100.00%
---------------- ---------------- -----------
FIDELITY U.S. BOND INDEX FUND (3) 13,408 shrs 146,385 136,623 100.00%
---------------- ---------------- -----------
FIDELITY SPARTAN U.S. EQUITY
INDEX FUND (3) 48,395 shrs 1,830,320 2,520,880 100.00%
---------------- ---------------- -----------
FIDELITY EQUITY INCOME FUND (1) (3) 196,047 shrs 8,436,968 10,484,612 100.00%
---------------- ---------------- -----------
FIDELITY FUND (3) 59,687 shrs 1,969,634 2,543,254 100.00%
---------------- ---------------- -----------
FIDELITY PURITAN FUND (3) 1,594 shrs 32,138 30,342 100.00%
---------------- ---------------- -----------
FIDELITY GROWTH & INCOME
PORTFOLIO (3) 4,600 shrs 212,615 216,950 100.00%
---------------- ---------------- -----------
FIDELITY BALANCED FUND (3) 3,383 shrs 56,677 51,960 100.00%
---------------- ---------------- -----------
FIDELITY EQUITY INCOME II FUND (3) 2,457 shrs 73,001 67,241 100.00%
---------------- ---------------- -----------
FIDELITY REAL ESTATE INVESTMENT
PORTFOLIO (3) 154 shrs 2,264 2,258 100.00%
---------------- ---------------- -----------
FIDELITY MAGELLAN FUND (1) (3) 149,746 shrs 13,806,714 20,459,729 100.00%
---------------- ---------------- -----------
FIDELITY GROWTH COMPANY FUND (3) 33,725 shrs 1,808,686 2,843,000 100.00%
---------------- ---------------- -----------
FIDELITY OTC PORTFOLIO (3) 13,816 shrs 724,538 939,080 100.00%
---------------- ---------------- -----------
FIDELITY CAPITAL APPRECIATION FUND (3) 2,699 shrs 70,966 80,626 100.00%
---------------- ---------------- -----------
FIDELITY BLUE CHIP GROWTH FUND (3) 11,305 shrs 578,705 679,514 100.00%
---------------- ---------------- -----------
FIDELITY LOW-PRICED STOCK FUND (3) 771 shrs 16,770 17,452 100.00%
---------------- ---------------- -----------
FIDELITY SMALL CAP SELECTOR FUND (3) 1,881 shrs 25,482 30,258 100.00%
---------------- ---------------- -----------
FIDELITY OVERSEAS FUND (3) 17,894 shrs 657,679 859,106 100.00%
---------------- ---------------- -----------
FIDELITY INTERNATIONAL GROWTH
& INCOME FUND (3) 2,066 shrs 54,522 62,197 100.00%
---------------- ---------------- -----------
FIDELITY WORLDWIDE FUND (3) 672 shrs 12,839 13,375 100.00%
---------------- ---------------- -----------
</TABLE>
-18-
<PAGE> 40
UGI UTILITIES, INC. SAVINGS PLAN
Item 4(i) - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES (continued)
<TABLE>
<CAPTION>
December 31, 1999
---------------------------------------------------------------------
Number of
Shares or Fair Value /
Principal Contract
NAME OF ISSUER AND TITLE OF ISSUE Amount Cost Value % (2)
--------------------------------- -------------------- ---------------- ---------------- -----------
<S> <C> <C> <C> <C>
FIDELITY FREEDOM INCOME FUND (3) 11,444 shrs 126,308 129,662 100.00%
---------------- ---------------- -----------
FIDELITY FREEDOM 2000 FUND (3) 13,490 shrs 163,074 175,236 100.00%
---------------- ---------------- -----------
FIDELITY FREEDOM 2010 FUND (3) 21,701 shrs 297,083 322,700 100.00%
---------------- ---------------- -----------
FIDELITY FREEDOM 2020 FUND (3) 17,669 shrs 252,311 289,413 100.00%
---------------- ---------------- -----------
FIDELITY FREEDOM 2030 FUND (3) 8,838 shrs 130,954 149,184 100.00%
---------------- ---------------- -----------
FIDELITY CAPITAL & INCOME FUND (3) 17,197 shrs 167,623 159,756 100.00%
---------------- ---------------- -----------
FIDELITY VALUE FUND (3) 220 shrs 10,422 9,636 100.00%
---------------- ---------------- -----------
UGI COMMON STOCK FUND (1) (3)
UGI Corporation Unitized Stock Fund 348,646 units 3,164,536 3,057,623 98.30%
Dividends receivable $ 52,782 52,782 52,782 1.70%
---------------- ---------------- -----------
3,217,318 3,110,405 100.00%
---------------- ---------------- -----------
PARTICIPANT LOANS
Loan principal outstanding (7.00% - 10.00%) (3)(4) - 1,458,891 100.00%
---------------- ---------------- ------------
Total - all funds $ 46,265,010 $ 59,193,518
---------------- ----------------
</TABLE>
(1) Investment represents 5% or more of the net assets available for benefits.
(2) Percentages represent percentage of fair value of each fund.
(3) Party in interest.
(4) Range of interest rates for loans outstanding as of December 31, 1999.
-19-
