0001104659-06-054710.txt : 20060814 0001104659-06-054710.hdr.sgml : 20060814 20060814153420 ACCESSION NUMBER: 0001104659-06-054710 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 11 CONFORMED PERIOD OF REPORT: 20060630 FILED AS OF DATE: 20060814 DATE AS OF CHANGE: 20060814 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CORNING NATURAL GAS CORP CENTRAL INDEX KEY: 0000024751 STANDARD INDUSTRIAL CLASSIFICATION: NATURAL GAS TRANSMISSION & DISTRIBUTION [4923] IRS NUMBER: 160397420 STATE OF INCORPORATION: NY FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-00643 FILM NUMBER: 061029902 BUSINESS ADDRESS: STREET 1: 330 W WILLIAM ST STREET 2: P O BOX 58 CITY: CORNING STATE: NY ZIP: 14830 BUSINESS PHONE: 6079363755 MAIL ADDRESS: STREET 1: 330 W WILLIAM STREET STREET 2: P O BOX 58 CITY: CORNING STATE: NY ZIP: 14830 10-Q 1 a06-17982_110q.htm QUARTERLY REPORT PURSUANT TO SECTIONS 13 OR 15(D)

United States
Securities and Exchange Commission

Washington, D.C. 20549

Form 10-Q

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2006

o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number 0-643

Corning Natural Gas Corporation

(Exact name of registrant as specified in its charter)

New York		16-0397420
(State or other jurisdiction of Incorporation or organization)		(I.R.S. Employer Identification No.)

330 W William Street, PO Box 58 Corning, New York		14830
(Address of principal executive offices)		(Zip Code)

(607) 936-3755
(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months and (2) has been subject to such filing requirements for the past 90 days. YES x NO o

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). YES o NO x

Indicate the number shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date:

Number of shares of Common Stock outstanding at the end of the quarter: 506,918

There is only one class of Common Stock and no Preferred Stock outstanding.

INDEX

	Part I. Financial Information

Item 1. Financial Statements

Consolidated Statements of Income (unaudited) — Quarter Ended June 30, 2006 and 2005. Nine Months Ended June 30, 2006 and 2005

Consolidated Balance Sheets — June 30, 2006 (unaudited) and September 30, 2005 (audited)

Consolidated Statements of Cash Flows (unaudited) — Nine Months Ended June 30, 2006 and 2005

Notes to Consolidated Financial Statements

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Item 4. Controls and Procedures

	Part II. Other Information

Item 1. Legal Proceedings — The Company has nothing to report under this item.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds — The Company has nothing to report under this item.

Item 3. Defaults Upon Senior Securities — The Company has nothing to report under this item.

Item 4. Submission of Matters to a Vote of Security Holders — The Company has nothing to report under this item.

Item 5. Other Information — The Company has nothing to report under this item.

Item 6. Exhibits

Signatures

CORNING NATURAL GAS CORPORATION AND SUBSIDIARY

Consolidated Statements of Income

Unaudited

Form 10 Q

	Quarter Ended						Nine Months Ended
	June 30, 2006			June 30, 2005			June 30, 2006			June 30, 2005

Utility Operating Revenues	$	5,534,561		$	4,757,379		$	24,541,370		$	20,630,489

Cost and Expense
Natural Gas Purchased	3,845,959			2,971,677			18,042,660			13,401,830
Operating & Maintenance Expense	1,321,696			1,096,664			4,121,280			3,516,412
Taxes other than Federal Income Taxes	288,114			290,126			915,013			1,019,034
Depreciation	134,299			129,533			379,407			384,643
Other Deductions, Net	7,723			1,413			23,023			4,350
Total Costs and Expenses	5,597,791			4,489,413			23,481,383			18,326,269

Utility Operating Income (Loss)	(63,230		)	267,966			1,059,987			2,304,220

Other Income and (Expense)
Interest Expense	(444,497		)	(298,814		)	(1,184,616		)	(947,217		)
Investment Income	38,044			25,226			143,799			83,950

Net Income (Loss) from Utility Operations, Before Income Tax	(469,683		)	(5,622		)	19,170			1,440,953

Federal Income Tax (Expense) Benefit	185,810			31,881			61,898			(643,721		)

Income (Loss) from Non-Utility Operations, Net of Income Tax	(34,465		)	14,998			(75,990		)	31,284

Net Income (Loss) from Continued Operations	(318,338		)	41,257			5,078			828,516

Income (Loss) from Discontinued Operations, Net of Income Tax	(4,263		)	2,481			(28,717		)	(17,763		)

Net Income (Loss)	(322,601		)	43,738			(23,639		)	810,753
Other Comprehensive Income (Loss)	(54,323		)	14,022			(41,998		)	15,938
Total Comprehensive Income (Loss)	$	(376,924	)	$	57,760		$	(65,637	)	$	826,691

Weighted average earnings (loss) per share-basic & diluted:
From Continued Operations	$	(0.628	)	$	0.081		$	0.010		$	1.634
From Discontinued Operations	$	(0.008	)	$	0.005		$	(0.057	)	$	(0.035	)
	$	(0.636	)	$	0.086		$	(0.047	)	$	1.599

Weighted average shares outstanding	506,918			506,918			506,918			506,918

CORNING NATURAL GAS CORPORATION AND SUBSIDIARY

Consolidated Balance Sheets

	(Unaudited)
	June 30, 2006			September 30, 2005
Assets

Plant:
Utility property, plant and equipment	$	28,278,458		$	26,826,478
Non-utility property, plant and equipment	393,645			392,241
Non-utility assets - discontinued operations	178,130			180,930
Less: accumulated depreciation	(11,102,446		)	(10,567,331		)
Total plant utility and non-utility net	17,747,787			16,832,318

Investments:
Marketable securities available-for-sale at fair value	2,526,077			2,440,237
Investment in joint venture and associated companies	139,105			185,719
Total investments	2,665,182			2,625,956

Current assets:
Cash and cash equivalents	1,019,090			255,037
Customer accounts receivable, (net of allowance for uncollectible accounts of $97,000 and $92,000)	2,423,240			1,083,909
Gas stored underground, at average cost	98,644			3,734,795
Gas inventories	360,279			271,960
Prepaid expenses	884,074			658,857
Current assets - discontinued operations	418,114			309,865
Total current assets	5,203,441			6,314,423

Deferred debits and other assets:
Regulatory assets:
Unrecovered gas costs	2,547,632			3,090,280
Deferred pension and other	372,602			394,606
Goodwill (net of accumulated amortization of $521,294 for both periods)	1,457,117			1,457,117
Unamortized debt issuance cost (net of accumulated amortization of $281,911 and $269,849)	242,144			254,206
Other	415,507			420,528
Note Receivable - discontinued operations	464,505			491,852
Total deferred debits and other assets	5,499,507			6,108,589

Total assets	$	31,115,917		$	31,881,286

See accompanying notes to consolidated financial statements.

	(Unaudited)
	June 30, 2006			September 30, 2005
Capitalization and liabilities:

Common stockholders’ equity:
Common stock (common stock $5.00 par value per share. Authorized 1,000,000 shares; issued and outstanding 507,000 shares at June 30, 2006 and September 30, 2005)	$	2,534,590		$	2,534,590
Other paid-in capital	959,512			959,512
Retained earnings	2,936,084			2,959,723
Accumulated other comprehensive loss	(1,462,163		)	(1,420,165		)
Total common stockholders’ equity	4,968,023			5,033,660

Long-term debt, less current installments	9,098,006			9,196,060
Long-term debt, less current installments - discontinued operations	58,614			63,797
Total long-term debt	9,156,620			9,259,857

Current liabilities:
Current portion of long-term debt	592,730			612,390
Demand Note Payable	1,551,663			1,836,666
Borrowings under lines-of-credit	5,804,035			6,600,000
Accounts payable	1,223,058			270,139
Accrued expenses	479,070			745,119
Customer deposits and accrued interest	501,909			952,503
Accrued income taxes	562,582			460,055
Other current liabilities - discontinued operations	94,487			317,860
Total current liabilities	10,809,534			11,794,732

Deferred credits and other liabilities:
Accrued income taxes	701,260			837,727
Deferred compensation	2,066,786			1,910,686
Deferred pension costs & post-retirement benefits	2,836,136			2,429,958
Other	242,728			265,043
Other deferred liabilities - deferred federal income taxes discontinued operations	192,788			192,788
Other deferred credits and other liabilites - discontinued operations	142,042			156,835
Total deferred credits and other liabilities	6,181,740			5,793,037

Concentrations and commitments

Total capitalization and liabilities	$	31,115,917		$	31,881,286

See accompanying notes to consolidated financial statements.

CORNING NATURAL GAS CORPORATION AND SUBSIDIARY

Consolidated Statements of Cash Flows

For the Nine Months Ended June 30, 2006 and 2005

Unaudited

	2006			2005
Cash flows from operating activities:
Net income (Loss)	$	(23,639	)	$	810,753
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation	537,915			464,130
Unamortized debt issuance cost	12,062			14,601
Gain on sale of marketable securities	(105,115		)	(54,035		)
Deferred income taxes	(33,940		)	24,079

Changes in assets and liabilities:
(Increase) decrease in:
Accounts receivable	(1,339,331		)	(883,441		)
Gas stored underground	3,636,151			2,308,298
Gas inventories	(88,319		)	(4,197		)
Prepaid expenses	(225,217		)	(217,609		)
Unrecovered gas costs	542,648			(409,121		)
Deferred pension and other	22,004			65,988
Other	(75,881		)	31,948
Increase (decrease) in:
Accounts payable	952,919			713,904
Accrued expenses	(266,049		)	21,417
Customer deposit liability	(450,594		)	(544,095		)
Deferred income taxes	0			443,466
Deferred compensation	156,100			174,150
Deferred pension & post-retirement benefits	406,178			611,020
Other liabilities and deferred credits	(260,481		)	70,304
Net cash provided by operating activities	3,397,411			3,641,560

Cash flows from investing activities:
Purchase of securities available-for-sale	(114,523		)	(209,309		)
Sale of securities available-for-sale	138,414			35,766
Capital expenditures	(1,453,384		)	(737,628		)
Net cash used in investing activities	(1,429,493		)	(911,171		)

Cash flows from financing activities:
Proceeds under lines-of-credit	7,087,919			8,675,000
Repayment of lines-of-credit	(7,883,884		)	(11,500,000		)
Repayment of long-term debt	(407,900		)	(51,198		)
Net cash used in financing activities	(1,203,865		)	(2,876,198		)
Net increase in cash	764,053			(145,809		)

Cash and cash equivalents at beginning of period	255,037			253,863

Cash and cash equivalents at end of period	$	1,019,090		$	108,054

Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest	$	1,216,278		$	983,048

Income taxes	$	3,000		$	212,194

Corning Natural Gas Corporation

Notes to Consolidated Financial Statements

Note A – Basis of Presentation

The information furnished herewith reflects all adjustments, which are in the opinion of management necessary to a fair statement of the results for the period. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principals generally accepted in the United States of America have been condensed or omitted pursuant to SEC rules and regulations, although the Company believes the disclosures which are made are adequate to make the information presented not misleading.

The consolidated financial statements contained herein should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s latest annual report on Form 10-K. These unaudited interim financial statements have not been audited or certified by a firm of certified public accountants.

Note B – New Accounting Standards

In November 2004, the FASB issued SFAS No. 151, “Inventory Costs” (SFAS 151). This statement amends the guidance in ARB No. 43, Chapter 4, “Inventory Pricing,” to clarify the accounting for abnormal amounts of idle facility expense, freight, handling costs, and wasted material (spoilage). SFAS 151 requires that those items be recognized as current-period charges. In addition, this statement requires that allocation of fixed production overheads to costs of conversion be based upon the normal capacity of the production facilities. The provisions of SFAS 151 are effective for inventory cost incurred in fiscal years beginning after June 15, 2005. As such, the Company is required to adopt these provisions in the beginning of fiscal 2006. The adoption of SFAS 151 did not have a material impact on the consolidated financial statements.

Note C - Pension and Other Post-retirement Benefit Plans

The Company uses June 30 as the measurement date for its plans.

Components of Net Periodic Benefit Cost:

	Nine months ended June 30, 2006
	Pension Benefits						Other Benefits
	2006			2005			2006			2005

Service cost	$	302,654		$	270,745		$	23,417		$	25,302
Interest cost	503,733			562,884			42,950			52,558
Expected return on plan assets	(558,813		)	(526,636		)	0			0
Amortization of prior service cost	30,278			53,654			36,559			36,559
Amortization of net (gain) loss	331,198			244,733			(17,024		)	(16,420		)
Net periodic benefit cost	$	609,050		$	605,380		$	85,902		$	97,999

Pension Plan Assets

The Company’s pension plan weighted-average asset allocations by asset category are as follows:

	Plan Assets
	At June 30
Asset Category	2006		2005
Equity Securities	56	%	56	%
Debt Securities	42	%	41	%
Other	2	%	3	%
	100	%	100	%

There is no Company common stock included in the plan assets.

Amounts recognized in the Balance Sheets consist of:

	Pension Benefits						Other Benefits
	2006			2005			2006			2005

Accrued Benefit Cost	$	(2,620,841	)	$	(3,023,498	)	$	(1,100,466	)	$	(1,037,380	)
Intangible Assets	167,751			208,121			—			—
Accumulated Other
Comprehensive Income	1,839,173			2,354,643			—			—
Net Amount Recognized	$	(613,917	)	$	(460,734	)	$	(1,100,466	)	$	(1,037,380	)

The accumulated benefit obligation for all defined benefit pension plans is $13,949,368 at September 30, 2006 and $13,446,250 at September 30, 2005, respectively.

Information for pension plans with an accumulated benefit obligation in excess of plan assets:

	September 30
	2006		2005

Projected Benefit Obligation	$	15,438,815	$	14,881,213
Accumulated Benefit Obligation	13,949,368		13,446,250
Fair Value of Plan Assets	10,120,454		9,251,719

The plan objective is to provide real (inflation adjusted) growth in assets vs. benchmark over a complete market cycle. The plan’s objective assumes asset growth will meet or exceed 8% of (risk adjusted) growth over a complete market cycle.

Investment guidelines are based upon an investment horizon of greater than five years. There is a requirement to maintain sufficient liquid reserves to provide for payment of retirement benefits.

The asset allocation guidelines for the plan are as follows:

	Minimum		Maximum
Domestic Common Stock
Large/Mid Cap	15	%	50	%
Small Cap	5	%	15	%
Reits	0	%	20	%
International Common Stock	10	%	20	%
Total Equities	30	%	75	%
Total Fixed Income	20	%	60	%
Cash	0	%	10	%

These asset allocation guidelines reflect the plan’s desire for investment return. They also reflect the full discretion of the Investment Manager to shift the asset mix within the specified ranges.

The desired investment objective is a long-term rate of return on assets that is approximately 8%. The target rate of return for the plan has been based upon the assumption that future real returns will approximate the long-term rates of return experienced for each asset class of the Investment Policy Statement over a complete business cycle. The plan’s overall annualized total return after deducting advisory, money management and custodial fees, as well as total transaction costs should perform above an index comprised of market indices weighted by the strategic asset allocation of the plan.

In order to accomplish the investment goals, the Investment Committee believes that the investments of the plan must be diversified to provide the Investment Manager with the flexibility to invest in various types of assets. The Investment Committee recognizes that a moderate amount of risk must be assumed to achieve the Plan’s long-term objectives. The Investment Committee believes that the Company’s prospects for the future, current financial conditions, and several other factors suggest collectively that the plan can tolerate some interim fluctuations in market value and rates of return in order to achieve long-term objectives.

Contributions

The Company expects to contribute $452,181 to its Pension Plan in 2006. The Post Retirement Benefit Plan is not funded.

Estimated Future Benefit Payments

The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid:

	Pension Benefits		Other Benefits

2006	$	598,619	$	59,144
2007	705,382		65,155
2008	685,733		65,014
2009	666,467		66,640
2010	662,684		69,606
Years 2011 – 2015	3,430,564		390,471

Assumed health care cost trend rates have a significant effect on the amounts reported for health care plans. A one-percentage-point change in assumed health care cost trend rates would have the following effect:

	1 – Percentage-		1-Percentage
	Point Increase		Point Decrease
Effect on total of service and interest cost	$	3,694	$	(3,177	)
Effect on postretirement benefit obligation	$	47,845	$	(41,421	)

Note D - Segment Overview

The following table reflects year-to-date results of the segments consistent with the Company’s internal financial reporting process. The following results are used in part, by management, both in evaluating the performance of, and in allocating resources to, each of these segments.

	Utility			Non-Utility Operations									Discontinued Operations
	Gas Company			Corning Realty			Corning Mortgage			Subtotal			(2) Appliance			(3) Tax Center			(4) Foodmart Plaza		Subtotal			Total Consolidated
Revenue:(1)
2006	$	24,541,370		$	2,190,594		$	290		$	2,190,884		$	58,195		$	0		$	0	$	58,195		$	26,790,449
2005	20,630,489			2,445,803			(15,252		)	2,430,551			169,484			29,263			0		198,747			23,259,787
Transportation Revenue
2006	2,259,302			0			0			0			0			0			0		0			2,259,302
2005	2,360,007			0			0			0			0			0			0		0			2,360,007
Net income (loss):(1)
2006	81,068			(38,319		)	(37,671		)	(75,990		)	(28,717		)	0			0		(28,717		)	(23,639		)
2005	797,232			48,939			(17,655		)	31,284			9,345			(27,108		)	0		(17,763		)	810,753
Interest income:(1)
2006	143,799			0			0			0			79,388			0			0		79,388			223,187
2005	83,950			0			0			0			121,196			9,078			0		130,274			214,224
Interest expense:(1)
2006	1,184,616			48,239			4,710			52,949			4,111			0			0		4,111			1,241,676
2005	947,217			51,937			7,416			59,353			14,801			0			0		14,801			1,021,371
Total assets:
2006	28,310,743			1,593,578			147,920			1,741,498			1,063,676			0			0		1,063,676			31,115,917
2005	25,664,926			1,625,504			179,439			1,804,943			795,339			120,762			0		916,101			28,385,970
Capital expenditures:
2006	1,451,980			1,404			0			1,404			0			0			0		0			1,453,384
2005	728,023			9,605			0			9,605			0			0			0		0			737,628
Federal income tax expense (benefit):
2006	(61,898		)	(15,684		)	(19,406		)	(35,090		)	(14,793		)	0			0		(14,793		)	(111,781		)
2005	643,721			30,078			(9,236		)	20,842			4,815			(14,760		)	0		(9,945		)	654,618

(1) Before elimination of intercompany interest.

(2) The Appliance Co. discontinued operations in September 2003.

(3) Tax Center International discontinued operations in October 2004.

(4) Foodmart discontinued operations in July 2004.

Interest income and expense have been displayed in the segment in which it has been earned or incurred. Segment interest expense other than the Gas Company is included within unregulated expenses in the consolidated statements of income.

There were no sales of unregistered securities (debt or equity) during the quarter ended June 30, 2006.

Note E – Subsequent Event

On May 15, 2006, Corning Natural Gas Corporation (CNG) and C&T Enterprises filed a joint petition with the New York State Public Service Commission (PSC) for approval of a stock acquisition and merger.

On July 19, 2006, The PSC approved the stock acquisition and merger proposal of Corning Natural Gas Corporation and C&T Enterprises, Inc, with certain conditions. The PSC determined that the merger and acquisition is in the public interest, will not adversely affect the development of competitive markets, and will provide significant customer benefits.

Also on July 19, 2006, the Company (CNG) filed a preliminary Proxy Statement and Notice of Special Meeting of Stockholders with the Securities and Exchange Commission (SEC) for their review. On August 8, 2006, a limited number of comments were received from the SEC. It is expected that the Company will file its amended proxy statement expeditiously with a shareholder mailing to follow.

CORNING NATURAL GAS CORPORATION
FORM 10-Q for the quarter ended June 30, 2006

Item 2 - Management’s Discussion and Analysis of Financial Condition and Results of Operations

Overview

The company’s primary business is natural gas distribution. We serve approximately 14,000 customers through 400 miles of pipeline. Our service territory is very saturated with very little residential growth. Growth opportunities exist in the industrial market, as well as in local production. Focus is given to controlling costs and making timely rate applications to the Public Service Commission. Key performance indicators are net income and rate of return. Other indicators that are tracked include degree days (a measure of weather), working capital changes and debt level trends.

Earnings

2006 compared with 2005

Consolidated net loss amounted to $322,600 or ($.636) per share in the third quarter of 2006 compared to earnings of $43,700 or $.086 per share in the third quarter of 2005. Consolidated net loss in the nine months ended June 30, 2006 was $23,600 or ($.047) per share compared to consolidated net income of $810,700 or $1.599 per share in the nine months ended June 30, 2005. The decrease is the result of a significant decrease in local production revenues, increased interest expense on short-term borrowings and increased legal and consulting services incurred as a result of proceedings before the PSC. Also, reduction in Corning Mortgage earnings due to soft local real estate market, as shown in the table below.

Earnings (Loss) by Segment

	Quarter			Quarter			YTD			YTD
	2006			2005			2006			2005
Utility	$	(283,874	)	$	26,259		$	81,068		$	797,232
Corning Realty	(25,473		)	21,688			(38,319		)	48,939
Corning Mortgage	(8,991		)	(6,690		)	(37,671		)	(17,655		)
Total from Continuing Operations	(318,338		)	41,257			5,078			828,516

Earnings from Discontinued Operations	(4,263		)	2,481			(28,717		)	(17,763		)
Total Consolidated	$	(322,601	)	$	43,738		$	(23,639	)	$	810,753

Revenue

	Quarter		Quarter		YTD		YTD
	2006		2005		2006		2005
Utility Operating Revenue
Retail Revenue:
Residential	$	3,366,649	$	2,894,767	$	14,544,409	$	11,883,350
Commercial	714,423		574,789		3,287,226		2,408,746
Industrial	50,244		19,426		229,528		110,128
	4,131,316		3,488,982		18,061,163		14,402,224
Transportation	608,466		556,831		2,259,302		2,360,007
Wholesale	624,479		443,137		3,576,710		2,672,232
Local Production	65,723		206,308		269,797		828,591
Other	104,577		62,121		374,398		367,435
	$	5,534,561	$	4,757,379	$	24,541,370	$	20,630,489

2006 compared with 2005

Utility operating revenue increased $777,000 in the third quarter of 2006 compared to the third quarter of 2005. Utility operating revenue YTD 2006 increased $3,911,000 compared to YTD 2005 due primarily to an increase from higher gas costs. Gas costs are charged to customers through the Company’s Gas Adjustment Clause.

Non-Utility Revenue

2006 compared to 2005

Non-utility revenue by operating segment can be found in note D to the financial statements. Non-utility revenue in 2006 decreased $239,700 or 10 percent due to the Corning Realty segment because of the competitiveness of that segment.

Operating Expenses

Utility

2006 compared with 2005

Purchase gas expense increased $874,300 or 29 percent in the third quarter of 2006 compared to the third quarter of 2005. The Company’s average cost of gas, including reconciliation amounts increased to $17.53 per mcf in June 2006 from $9.24 per mcf in June 2005. Other operating and maintenance expense increased by 21 percent.

Non-Utility

2006 compared with 2005

Corning Realty commission and fees expense increased by 19 percent in the third quarter of 2006 compared to the third quarter of 2005 as a result of an increase in referrals paid out. Realty occupancy and advertising expenses decreased $22,000 in the third quarter of 2006 compared to the third quarter of 2005 due to a net decrease in advertising costs.

Other Income and Expense

Investment income increased $12,800 in the third quarter of 2006 versus 2005. The change is due to realized gains and losses on a trust fund established to fund post-retirement compensations to certain officers. Interest expense increased $145,700 in the third quarter of 2006 compared to the same period in 2005 due to rising interest rates.

Income Taxes

Utility income tax expense (benefit) for the quarter ended June 30, 2006 was ($185,800), compared to ($31,900) for the same period last year. For the nine months ended June 30, 2006, we reported income tax expense (benefit) of ($61,900) compared to $643,700 for the same period last year.

The effective tax rate for the quarter ended June 30, 2006 was 40 percent, compared to 18 percent in the prior year period. The effective tax rate in the prior period reflects an adjustment resulting from prior period accelerated depreciation deductions. The effective tax rate for the nine months ended June 30, 2006 was 31 percent compared to 45 percent in the same period last year. The effective tax rate in the current period reflects an adjustment to prior period deferred income taxes.

Operating Segments

Note D to the financial statements, which also contain the results by segment for the nine months ended June 30, 2006 and 2005.

Liquidity and Capital Resources

Internally generated cash from operating activities consists of net income, adjusted for non-cash expenses and changes in operating assets and liabilities. Non-cash items include depreciation and amortization and deferred income taxes. In the utility segment, over or under recovered gas costs significantly impacts cash flow. In addition, there are significant year-to-year changes in regulatory assets that impact cash flow. Cash flows from investing activities consist primarily of capital expenditures. Capital expenditures have historically exceeded $1 million annually and the same is expected in the coming year. Cash flows from financing activities consist of repayment of long-term debt and borrowings and repayments under our lines-of-credit. For consolidated operations, the Company had $6,600,000 for the quarter ended June 30, 2006 available through lines of credit at local banks, of which $5,800,000 is outstanding at June 30, 2006. As security for the Company’s line of credit, collateral assignments have been executed which assign to the lender various rights in the investment trust account, membership

interest in Corning Realty Associates, LLC and proceeds from the note agreement. In addition, the lender has a purchase money interest in and to all natural gas purchases by debtor utilizing funds advanced by the bank under the line-of-credit agreement and all proceeds of sale thereof and accounts receivable pertaining to such sale. The Company relies heavily on its credit lines and a large portion is utilized throughout the entire year.

The Company has reached an agreement with a Virginia based company, “Virginia Power Energy” to manage all of its gas supply capacity and purchases effective April 2006.

Regulatory Matters

Rate Case Decision of May 22, 2006

On May 22, 2006, the New York Public Service Commission (the “Commission”) issued a decision in three proceedings involving the Company: Case 05-G-1359, to examine the Company’s October 31, 2005 filing for increased rates; Case 05-G-1268, to review the Company’s practices particularly relating to natural gas supply in light of the difficulties experienced by the Company in the summer and fall of 2005 in procuring supplies for the 2005-2006 winter heating season; and Case 04-G-1032, to consider the Company’s request for deferral and recovery of costs formerly allocated to the appliance business that had been sold in 2003. The decision, entitled “Order Setting Gas Delivery Service Rates, Adopting Performance Targets and Incentives, Allowing Deferral and Rate Recovery of Certain Costs, and Crediting Customers with $1.4 Million of Prior Gas Commodity Costs” (the “May Order”), resolved the issues presented in the three proceedings, adopting, with certain modifications, the provisions of the Gas Rates Joint Proposal (the “Joint Proposal”) dated March 15, 2006 that had been agreed upon by the Company, the Staff of the Department of Public Service (“Staff”), Multiple Intervenors (an association of large customers), and, in part, Fortuna Energy Inc. (a natural gas exploration and production corporation utilizing Company facilities to transport its natural gas to market).

In the May Order, the Commission authorized the Company to increase its base rates for natural gas service by approximately $2.7 million of the $3.4 million requested by the Company in its October 31, 2005 rate filing. Although the Company’s rate filing and the Joint Proposal originally were based on the assumption that rates would go into effect as of October 1, 2006, the Joint Proposal had been amended on April 14, 2006 (the “Amendment”) to propose that the increased rates go into effect as of June 1, 2006 to enhance the Company’s cash flow and access to credit on favorable terms. The May Order adopted that recommendation on the condition, also suggested in the Amendment, that the additional amount collected by the Company as a result of early implementation, calculated to be approximately $420,000, be returned to customers over the period June 1, 2007 through September 30, 2007, to correspond to the period during which it will be collected. The Commission granted recovery of approximately $2.63 million of deferred costs associated with the appliance business, offsetting against that amount $1.4 million of costs identified in the Joint Proposal as attributable to excessive gas costs incurred in 2005.

The Commission adopted the hypothetical capital structure of 70 percent debt and 30 percent equity recommended in the Joint Proposal to enhance the Company’s financial outlook. In the event that the Company earns in excess of 11.0 percent on equity using that structure, 50 percent of the excess will be retained by shareholders and 50 percent will be deferred to be applied to the benefit of customers in a manner to be determined by the Commission.

The Commission further adopted the revenue allocation proposals contained in the Joint Proposal designed to better match revenues with the costs of providing service in the three distinct areas served by the Company, Corning, Hammondsport and Bath (through Bath Electric, Gas and Water Systems, a municipal utility). In addition, the May Order approved increases in the customer minimum charge that were designed to collect more of the fixed costs of serving customers in that component of the bill. Although, for an average residential customer using 10 dekatherms per month, the increase in the minimum charge alone would amount to approximately 40.77 percent, viewed as a percentage of the entire bill, including the commodity cost of natural gas, the increase would be approximately 11 percent.

The May Order also adopted a number of measures included in the Joint Proposal designed to enhance sound practices in three major areas: Health and Safety; Gas Procurement and Capacity Asset Management; and Accounting. Included in the Health and Safety measures are requirements for the testing, repair and replacement of certain types of pipe that are determined to pose potential safety concerns and periodic reporting on results. Gas Procurement and Capacity Asset Management measures include meeting specific deadlines and quantity requirements for the procurement of natural gas supplies, including storage gas and hedging of future supplies; adherence to specific Natural Gas Supply and Acquisition Plan requirements, including procedures for modification of that Plan; and maintaining capacity contracts and minimizing stranded capacity costs consistent with a Commission Policy Statement on those matters. Accounting measures include providing to the Commission’s Office of Accounting and Finance daily cash-flow reports; monthly reconciliations of cash balances per the Company’s books with bank account balances; rolling cash flow forecasts; monthly income statements and balance sheets; and quarterly reports of General Ledger activity, long- and short-term debt, and investment activity in non-utility businesses. The Accounting measures further include separation of the Treasurer and Chief Financial Officer functions; reporting on specific opportunities for improvement in accounting and recordkeeping practices; reconciliation of accruals with payments/refunds for vendors; reconciliation of Federal and State Income Tax returns with amounts recorded on the books; adherence to Commission record-retention policies; exploration of opportunities for new lines of bank credit; and development of a succession plan for key employees. Continued use of the hypothetical capital structure referred to above is conditioned on the Company’s adherence to a series of conditions set forth in the Joint Proposal and adopted by the May Order.

Pursuant to the May Order, if the Company is deficient in any of the enumerated obligations, it will incur a regulatory liability for the benefit of customers, determined in accordance with a matrix set forth in the May Order. The matrix groups different types of deficiencies according to their perceived seriousness and assigns different amounts to those different categories. The minimum amount that can be incurred for a single deficiency is $9,000 and the maximum amount that can be incurred for a series of failures is $519,000.

To enhance interest in an acquisition of the Company by a responsible purchaser, the Joint Proposal included, and the Commission adopted, a “Merger Package” consisting of a series of commitments from and to a prospective buyer. Among these measures are an opportunity to “freeze” rates for a three-year period, an increase in the earnings threshold, removal of certain requirements that are intended to apply only if the Company is not sold, and options for passing back to customers the $1.4 million of costs identified in the Joint Proposal as attributable to excessive gas costs.

On May 24, 2006, the Company agreed unconditionally to accept and abide by the terms and conditions of the May Order and the new rates authorized by the May Order went into effect as of June 1, 2006.

Critical Accounting Policies

The Company’s most significant accounting policies are described below. It is increasingly important to understand that the application of generally accepted accounting principles involve certain assumptions, judgments and estimates that affect reported amounts of assets, liabilities, revenues and expenses. Thus, the application of these principles can result in varying results from company to company.

Accounting for Utility Revenue and Cost of Gas Recognition. The Company records revenues from residential and commercial customers based on meters read on a cycle basis throughout each month, while certain large industrial and utility customers’ meters are read at the end of each month. The Company does not accrue revenue for gas delivered but not yet billed, as the New York PSC requires that such accounting must be adopted during a rate proceeding, which the Company has not done. The Company’s tariffs contain mechanisms that provide for the recovery of the cost of gas applicable to firm customers, which includes estimates. Under these mechanisms, the Company periodically adjusts its rates to reflect increases and decreases in the cost of gas. Annually, the Company reconciles the difference between the total gas costs collected from customers and the cost of gas. The Company

defers any excess or deficiency and subsequently either recovers it from, or refunds it to, customers over the following twelve-month period. To the extent estimates are inaccurate; a regulatory asset on the balance sheet is increased or decreased.

Accounting for Regulated Operations - Regulatory Assets and Liabilities. A significant portion of the Company’s business is subject to regulation. The Company’s regulated utility records the results of its regulated activities in accordance with Statement of Financial Accounting Standards (SFAS) No. 71, Accounting for the Effects of Certain Types of Regulation, which results in differences in the application of generally accepted accounting principles between regulated and non-regulated businesses. SFAS No. 71 requires the recording of regulatory assets and liabilities for certain transactions that would have been treated as revenue and expense in non-regulated businesses. In certain circumstances, SFAS No. 71 allows entities whose rates are determined by third-party regulators to defer costs as “regulatory” assets in the balance sheet to the extent that the entity expects to recover these costs in future rates. Management believes that currently available facts support the continued application of SFAS No. 71 and that all regulatory assets and liabilities are recoverable or refundable through the regulatory environment.

Pension and Post-Retirement Benefits. The amounts reported in the Company’s financial statements related to its pension and other post-retirement benefits are determined on an actuarial basis, which uses many assumptions in the calculation of such amounts. These assumptions include the discount rate, the expected return on plan assets, the rate of compensation increase and, for other post-retirement benefits, the expected annual rate of increase in per capita cost of covered medical and prescription benefits. Changes in actuarial assumptions and actuarial experience could have a material impact on the amount of pension and post-retirement benefit costs and funding requirements experienced by the Company. However, the Company expects to recover substantially all of its net periodic pension and other post-retirement benefit costs attributed to employees in its Utility segment in accordance with the applicable regulatory commission authorization. For financial reporting purposes, the difference between the amounts of such costs as determined under applicable accounting principles is recorded as either a regulatory asset or liability.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This report contains statements which, to the extent they are not recitations of historical facts, constitute “forward-looking statements” within the meaning of the Securities Litigation Reform Act of 1995 (Reform Act). In this respect, the words “estimate”, “project”, “anticipate”, “expect”, “intend”, “believe” and similar expressions are intended to identify forward-looking statements. All such forward-looking statements are intended to be subject to the safe harbor protection provided by the Reform Act. A number of important factors affecting the Company’s business and financial results could cause actual results to differ materially from those stated in the forward-looking statements.

Item 3 – Quantitative and Qualitative Disclosures About Market Risk

Interest Rate Risk

The Company’s exposure to interest rate risk arises from borrowing under short-term debt instruments. At June 30, 2006, these instruments consisted of a term loan and bank credit line borrowings outstanding of $5,800,000. The interest rate (prime rate as published in the Wall Street Journal) on these lines was 8.25 percent at June 30, 2006.

Item 4 - Controls and Procedures

a. Evaluation of Disclosure Controls and Procedures. As of the end of the period covered by this quarterly report Form 10-Q the Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including our Chief Executive Officer and our Chief Financial Officer, of the effectiveness of the design and operation of our “disclosure controls and procedures” (as defined in the Securities Exchange Act of 1934 Rules 13a-15). Based upon that

evaluation, or Chief Executive Officer and Chief Financial Officer concluded that, as of the Evaluation Date, our disclosure controls and procedures were effective to ensure that material information relating to us and our consolidated subsidiaries is recorded, processed, summarized and reported in a timely manner.

b. Changes in Internal Controls. There have been no changes in our internal controls over financial reporting that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Part II – Other Information

Item 6 – Exhibits

The following documents are filed as exhibits to this Report:

31.1		Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32.1		Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350

99.1		Amended and Restated Employment Agreement by and between Coring Natural Gas Corporation and Thomas K. Barry executed December 14, 2000.

99.2.		Amended and Restated Employment Agreement by and between Coring Natural Gas Corporation and Kenneth J. Robinson executed December 14, 2000.

99.3.		Amended and Restated Survivor Benefit Deferred Compensation Agreement by and between Corning Natural Gas Corporation and Thomas K. Barry executed December 14, 2000.

99.4.		Amended and Restated Survivor Benefit Deferred Compensation Agreement by and between Corning Natural Gas Corporation and Kenneth J. Robinson executed December 14, 2000.

99.5.		Amended and Restated Severance Agreement by and between Corning Natural Gas Company and Thomas K. Barry executed December 14, 2000.

99.6.		Amended and Restated Severance Agreement by and between Corning Natural Gas Company and Kenneth J. Robinson executed December 14, 2000.

99.7.		Assignment Agreement by and between Corning Natural Gas Corporation and Thomas K. Barry executed July 10, 2001.

99.8.		Assignment Agreement by and between Corning Natural Gas Corporation and Kenneth J. Robinson executed July 10, 2001.

SIGNATURES

In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date:
August 14, 2006
	/s/ Thomas K. Barry
	Thomas K. Barry, Chairman of the Board, President and CEO


Date:
August 14, 2006
	/s/ Kenneth J. Robinson
	Kenneth J. Robinson, Executive Vice President


Date:
August 14, 2006
	/s/ Firouzeh Sarhangi
	Firouzeh Sarhangi, Chief Financial Officer and Treasurer

EX-31.1 2 a06-17982_1ex31d1.htm EX-31

Exhibit 31.1

CERTIFICATION PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Thomas K. Barry, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Corning Natural Gas Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the small business issuer as of, and for, the periods presented in this report;

4. The small business issuer’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f) for the small business issuer and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the small business issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the small business issuer’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the small business issuer’s internal control over financial reporting that occurred during the small business issuer’s most recent fiscal quarter (the small business issuer’s fourth fiscal quarter in the case of an annual report) that has materially affected, or reasonably likely to materially affect, the small business issuer’s internal control over financial reporting; and

5. The small business issuer’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the small business issuer’s auditors and the audit committee of the small business issuer’s board of directors (or persons performing the equivalent function):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the small business issuer’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer’s internal control over financial reporting.

Date: August 14, 2006


/s/ Thomas K. Barry
Thomas K. Barry, Chairman of the Board, Chief Executive Officer

I, Firouzeh Sarhangi, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Corning Natural Gas Corporation;

reasonably likely to materially affect, the small business issuer’s internal control over financial reporting; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the small business issuer’s internal control over financial reporting.

Date: August 14, 2006


/s/ Firouzeh Sarhangi
Firouzeh Sarhangi, Chief Financial Officer and Treasurer

EX-32.1 3 a06-17982_1ex32d1.htm EX-32

Exhibit 32

Corning Natural Gas Corporation Certification under Section 906 of the Sarbanes/Oxley Act-filed as part of the 10-Q for Quarter Ended June 30, 2006.

Presented on signature page of 10-Q

CERTIFICATION

Each of the undersigned hereby certifies in his capacity as an officer of Corning Natural Gas Corporation (the “Company”) that the Quarterly Report of the Company on Form 10-Q for the period ended June 30, 2006 fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 and that the information contained in such report fairly presents, in all material respects, the financial condition of the Company at the end of such period and the results of operations of the Company for such period.

Dated: August 14, 2006


/s/ THOMAS K. BARRY
Thomas K. Barry, Chairman of the Board,
Chief Executive Officer


/s/ FIROUZEH SARHANGI
Firouzeh Sarhangi, Chief Financial Officer and Treasurer

EX-99.1 4 a06-17982_1ex99d1.htm EX-99

Exhibit 99.1

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

EMPLOYMENT AGREEMENT, entered into as of this 14th day of December, 2000, by and among CORNING NATURAL GAS CORPORATION, a New York corporation with an office at 330 W. William Street, Corning, New York 14830 (hereinafter called the “Company”) and THOMAS K. BARRY (hereinafter called the “Executive”) residing at 181 W. Lake Road, Hammondsport, New York 14840.

RECITALS

WHEREAS, the Executive is employed by the Company as President and Chief Executive Officer of the Company and its subsidiary (“Subsidiary”), and has performed the duties of his employment in a capable and efficient manner, resulting in substantial benefit to the Company; and

WHEREAS, the Company desires to assure the continued service of Executive, and Executive is desirous of committing himself to continued service to the Company on the terms herein provided; and

WHEREAS, the Company and the Employee previously entered into that certain Employment Agreement on January 1, 1992 (the “1992 Agreement”); and

WHEREAS, the 1992 Agreement was amended by a First Amendment on April 22, 1997, a Second Amendment on October 1, 1998 and a Third Amendment on December 17, 1999; and

WHEREAS, the Company and the Employee desire to incorporate the changes made by such Amendments and to amend certain provisions of the 1992 Agreement;

AGREEMENTS

NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged by the parties hereto, the Company and the Executive agree as follows:

1. Employment. The Company will employ the Executive and the Executive accepts employment on the terms and conditions set forth in this Agreement.

2. Duties. The Executive shall serve the Company and Subsidiary as President and Chief Executive Officer, under the terms and conditions provided herein. He shall also serve as a director of the Subsidiary and, so long as he is elected, as a director of the Company. The Executive’s duties hereunder shall include such duties as are normally incident to the position of Chief Executive Officer. The Executive shall perform his duties hereunder faithfully and to the best of his abilities and in furtherance of the business of the Company and shall devote his full

business time, energy, attention and skill to the business of the Company and to the promotion of its interests.

3. Term of Employment. The term of the Executive’s employment hereunder shall be for a five year period beginning on January 1, 2001 and ending January 1, 2006. On January 1, 2003, and on each January 1st thereafter (each such date being hereinafter referred to as a “Renewal Date”) the term of the Executive’s employment hereunder shall automatically be extended for an additional one (1) year period unless the Company notifies the Executive in writing at least ninety (90) days prior to the applicable Renewal Date that the Company does not wish to extend this Agreement beyond the expiration of the term or extended term hereof, as the case may be, in which event this Agreement shall terminate on the date three years following such applicable Renewal Date. The Executive may terminate this Agreement upon one year’s advance written notice to the Company.

4. Salary. The Company agrees to pay and the Executive agrees to accept, in accordance with the provisions contained herein, as compensation for performance of his duties and obligations to the Company hereunder, a salary at an annual rate set by the Board of Directors of the Company (the “Board”), exclusive of the benefits described in Sections 5, 6 and 7 hereof and directors fees paid to Executive. Such salary shall be payable in equal monthly installments, less usual, customary and required payroll deductions. The Executive’s salary shall be reviewed annually by the Board for possible increases. In addition, the Company agrees to pay and the Executive agrees to accept, in accordance with the provisions contained herein, as compensation for performance of his duties and obligations to the Company hereunder, any fees or payments authorized by the Board to be paid to the Executive for membership on the Board or any committee thereof. All amounts described in this Section shall be referred to in this Agreement collectively as the Executive’s “Salary”.

5. Bonuses. In addition to the Salary hereinabove provided, the Executive may be awarded, with respect to his services hereunder, such bonus or bonuses in such amounts as may be determined by the Board or by the Executive Committee of the Board.

6. Expenses. All reasonable travel and other expenses incidental to the rendering of services by the Executive hereunder shall be paid by the Company in accordance with the Company’s policies and procedures.

7. Benefits.

(a) Benefit Plans. The Executive shall be entitled to participate in all employee benefit plans, including, without limitation, medical, hospital, insurance, pension and 401(k) plans now in existence or hereafter adopted by the Company or Subsidiary for its executive employees, and to receive any other fringe benefits that may be made generally available to the Company’s executive employees from time to time.

(b) Vacations. The Executive shall be entitled to vacations each year in accordance with the Company’s policies in effect from time to time, of up to five (5) weeks.

(c) Automobile. In recognition that the Executive will be required to do a considerable amount of driving in connection with his duties hereunder, the Company shall provide to the Executive an automobile of his choice, subject to the reasonable approval of the Company, and the Company shall pay all expenses of such automobile including gas, oil, repairs and insurance.

(d) Club Dues. In recognition that the Executive’s duties hereunder will require entertainment of the Company’s customers, suppliers and other business contacts and an informal environment for business discussions, the Company shall pay the dues to a country club in the Corning, New York area to be selected by Executive with the reasonable approval of the Company.

(e) Survivor Benefit Deferred Compensation Agreement. The benefits and amounts payable to the Executive or the beneficiary of the Executive pursuant to the terms of the Amended and Restated Survivor Benefit Deferred Compensation Agreement of even date hereof, by and between the Company and the Executive are independent of and in addition to all payments and benefits payable to the Executive pursuant to this Agreement. A termination of this Employment Agreement shall not cause a termination of said Survivor Benefit Deferred Compensation Agreement.

(f) Health Benefits. Notwithstanding any other provision of this Agreement or any other agreement between Executive and the Company, the Company agrees:

(i) upon the termination of Executive’s employment for any reason other than Cause (as hereinafter defined), or upon Executive’s retirement, the Company shall provide at its sole cost, to Executive, Executive’s spouse and dependents, if any, the same level of health care benefits as currently provided to Executive on the date hereof; without the restriction of the term of this Agreement or otherwise, and

(ii) upon Executive’s death whether occurring: (x) during the term hereof, (y) after Executive’s retirement or (z) after the termination of Executive’s employment for any reason other than Cause, the Company shall provide at its sole cost, for a period of ten (10) years, to Executive’s spouse and dependents, if any, the same level of health care benefits as currently provided to Executive on the date hereof.

The Company further agrees that in the event that the level of health care benefits provided by the Company to its executive employees is expanded at any time prior to the occurrence of the triggering event described in either Section 7(f)(i) or Section 7(f)(ii) hereof, the health care benefit that is required to be provided by Section 7(f)(i) or Section 7(f)(ii) shall be at such expanded level.

(g) Excess Pension Benefit.

(1) Excess Pension Benefit. At his commencement date specified in Section 7(g)(3) hereof, Executive’s annual “excess pension benefit” (the “Excess Pension Benefit”) shall equal:

(a) the Executive’s annual retirement benefit calculated under Section VII of the Company’s Pension Plan as set forth on the date hereof or as subsequently amended, as applicable, and payable in accordance with Section VII of the Company’s Pension Plan, notwithstanding any restrictions imposed by Section VIII of the Pension Plan (or such other provision as contains the Internal Revenue Code Sections 415(b) and 415(e) limitations) or any dollar limitation imposed by Internal Revenue Code Section 401(a)(17), less

(b) the actual amount of annual benefit that is payable from the Company’s Pension Plan under the normal form of payment applicable to Executive after application of any restrictions imposed by Section XXI of the Company’s Pension Plan (or such other provision as contains the Internal Revenue Code Sections 415(b) and 415(e) limitations) or any dollar limitation imposed by Internal Revenue Code Section 401(a)(17).

(2) Form of Payment. Executive will receive his Excess Pension Benefit hereunder in the form of a life annuity, or, if the Executive is eligible for such form of payment under the Company’s Pension Plan, as a Qualified Joint and Survivor Annuity as provided under Section VIII of the Company’s Pension Plan. Such Excess Pension Benefit paid hereunder shall be subject to the withholding and other similar requirements of any applicable governmental law or regulation with respect to taxes or similar provisions.

(3) Commencement of Excess Pension Benefit At Retirement. Executive’s Excess Pension Benefit shall commence as of the date Executive terminates employment and first becomes eligible to receive benefits under the Company Pension Plan, even if such Executive elects not to commence receiving such Company Pension Plan benefits at that time.

(4) Accrued Excess Pension Benefit. Executive’s accrued Excess Pension Benefit at any point in time prior to retirement shall equal the amount determined under Section 7(g)(1) hereof based upon his Compensation (as defined in Section II of the Company’s Pension Plan) and Years of Service (as defined in Section II of the Company’s Pension Plan) as of the date of determination.

Benefit shall commence as of the date Executive first becomes eligible to receive benefits under the Company’s Pension Plan, even if Executive elects not to commence receiving such Company’s Pension Plan benefits at that time, and such benefit from this Plan shall not be recalculated thereafter unless Section 7(g)(8) is applicable.

(6) Excess Pension Pre-Retirement Death Benefit. Upon the death of Executive any Accrued Excess Pension Benefit shall be applied to provide Executive’s surviving spouse or Beneficiary with an Excess Pension Pre-retirement Death Benefit under the same terms and in the same manner as provided by the applicable death benefit provisions of the Company’s Pension Plan.

(7) Suspension of Excess Pension Benefit. The payment of an Excess Pension Benefit otherwise due on behalf of Executive shall be suspended for any calendar month in which his Pension Benefit under the Company’s Pension Plan is suspended, provided that payment of an Excess Pension Benefit which has been so suspended shall commence or resume when his Pension Benefits under the Company’s Pension Plan resume. Notice of suspension of payment of any Excess Pension Benefit shall be given to Executive and such suspension of payment shall be governed by procedures established by the Plan Administrator.

(8) Adjustment of Excess Pension Plan Benefit. If Executive terminates employment after age 55 and before reaching age 62 and his age and years of service at such termination date equals a total of seventy-five (75), his Excess Pension Benefit will be reduced at age 62 by the excess of

(a) the reduction in the amount which would have been payable from the Company’s Pension Plan at age 62 notwithstanding any restrictions imposed by Section VIII of the Pension Plan (or such other provision as contains the Internal Revenue Code Sections 415(b) and 415(e) limitation) or any dollar limitations imposed by Internal Revenue Code Section 401(a)(17)), over

(b) the reduction in the actual amount payable from the Company’s Pension Plan at age 62.

(h) Certain Additional Payments by the Company. The Company shall pay to Executive, as additional compensation, the amount equal to (i) the FICA taxes the Executive must pay (excluding income taxes) and (ii) an additional sum of money, in compensation for any federal, state and local income taxes payable upon such payments made pursuant to this Section 7(h) including any such taxes upon payments pursuant to this subsection 7(h)(ii), the intention being that payments pursuant to this Section 7(h) will equal such amount as is required to entirely repay any cost to Executive for any such taxes. Payment of amounts pursuant to this Section 7(h) shall be calculated at the highest marginal rate to which Executive is subject for the year in which the income is recognized, including any such income described above, and shall be paid to the Executive for as long as such FICA taxes are applicable.

(i) Life Insurance. The Company shall maintain a whole life insurance policy on the Executive until the Executive reaches the age of 65. The premiums for such policy shall be paid for by the Company, however, the Executive (or the beneficiary designated by him) shall be the beneficial owner of the policy.

8. Termination.

(a) Death. The Executive’s employment hereunder shall terminate upon his death.

(b) Cause. The Company may terminate the Executive’s employment hereunder for Cause. For the purpose of this Agreement, the Company shall have “Cause” to terminate the Executive’s employment hereunder upon (i) the willful failure of the Executive to substantially perform his duties hereunder; (ii) the engaging by the Executive in dishonesty or other misconduct materially injurious to the Company; (iii) the commission by the Executive of a felony (whether or not involving the Company); or (iv) a material breach by the Executive of this Agreement, provided that such breach shall not have been cured by the Executive within thirty (30) days after written notice thereof from the Company to the Executive. Notwithstanding the foregoing, the Executive shall not be deemed to have been terminated for Cause unless and until there shall have been delivered to the Executive a copy of a resolution, duly adopted by the affirmative vote of not less than seventy-five percent (75%) of the entire membership of the Board of Directors of the Company at a meeting of the Board called and held for the purpose (after thirty (30) days prior written notice to the Executive and an opportunity for him, together with his counsel, to be heard before the Board), finding that in the good faith opinion of the Board the Executive was guilty of conduct set forth above in clause (i), (ii), (iii) or (iv) of this Section 8(b) and specifying the particulars thereof in detail.

(c) Resignation for Good Reason. The Executive may terminate his employment hereunder for Good Reason. For the purpose of this Agreement “Good Reason” shall mean:

(1) a material breach by the Company, by act or omission, of this Agreement, which the Company fails to cure within thirty (30) days after receipt of written notice from the Executive of such material breach (or, in the case of a material breach which the Company cannot reasonably cure within said thirty (30) day period which the Company fails to commence within said thirty day period to diligently cure);

(2) material change by the Company of the Executive’s functions, duties or responsibilities which change would cause the Executive’s position with the Company to become of less dignity, responsibility, importance, prestige or scope, including, without limitation, a change from being a senior officer of a publicly held company;

(3) assignment or reassignment by the Company of the Executive without the Executive’s consent to another place of employment more than 50 miles from the Executive’s current place of employment; or

(4) a reduction which is more than de minimis in the Executive’s base pay or bonus opportunity except if such reduction is part of a reduction for all executive officers of the Company and any parent Company thereof.

No such event described above shall constitute Good Reason unless the Executive gives written notice to the Company, specifying the event relied upon for such termination and given at any time within one year after the occurrence of such event and the Company has not remedied such within 30 days of the notice. The Company and Executive, upon mutual written agreement may waive any of the foregoing provisions which would otherwise constitute a Good Reason.

(d) Disability. If, as a result of the Executive’s incapacity due to physical or mental illness, the Executive shall have been absent from his duties hereunder on a full time basis for 90 consecutive business days, the Company may terminate the Executive’s employment hereunder.

9. Effect of Termination.

(a) Termination by the Company for Cause or Due to Executive’s Death. If the Executive’s employment hereunder shall be terminated due to the Executive’s death or for Cause, the Company shall pay the Executive his full Salary and other benefits through the date of termination at the rate then in effect, and the Company shall have no further obligations to the Executive under this Agreement.

(b) Termination by the Company Due to the Executive’s Disability. During any period that the Executive is prevented from performing his duties hereunder as a result of incapacity due to physical or mental illness, the Executive shall continue to receive his Salary and benefits in the amounts or rates in effect upon the commencement of his disability (less any amounts payable to the Employee under any Company disability insurance policy or plan) until the Executive’s employment hereunder is terminated by the Company pursuant to Section 8(d) hereof. Upon termination of the Executive’s employment pursuant to subsection 8(d) hereof, the Company shall have no further obligations to the Executive under this Agreement.

Company agrees to pay as a severance pay an amount equal to the Salary which would have been payable over the remaining term of this Agreement or, if such remaining term is less than twelve (12) months, then for a period of twelve (12) months immediately following the termination. The Company shall also provide to the Executive the benefits described in Sections 7(a) and 7(c) hereof for a term not shorter than the period that said severance pay shall be payable. In addition, the Company shall pay to the Executive any accrued bonus through the date of termination. The Company’s notice of non-extension of this Agreement, described in Section 3 hereof, shall not constitute a termination by the Company for the purposes of this Section 9(c).

10. Change in Control. If, and only if, the Executive’s employment is terminated following a Change in Control of the Company (as that term is defined in the Amended and Restated Severance Agreement between the Executive and the Company, of even date hereof (the “Severance Agreement”)), the provisions in Section 9(c) shall be superceded by the terms of the Severance Agreement and any other applicable Company plan, policy, arrangement or agreement (other than this Agreement).

11. Assignment; Successors. Any attempt to assign this Agreement shall be void; provided, however, that, subject to the provisions of Section 10 hereof, if the Company shall be merged or consolidated into any other corporation or if substantially all of the assets of the Company shall be transferred to another corporation, the provisions of this Agreement shall be binding upon and inure to the benefit of the corporation resulting from such merger or consolidation or to which assets shall have been transferred (the “Surviving Corporation”), and this provision shall apply in the event of any subsequent merger, consolidation or transfer. In any such event, the Surviving Corporation shall enter into an agreement with the Executive whereby the Surviving Corporation and the Executive shall agree to perform this Agreement, including Section 10 hereof, in the same manner and to the same extent the Company would be required to perform it if no such merger, consolidation or transfer had taken place, and the Executive shall enter into such agreement; and the Company shall thereafter have no further obligations under this Agreement.

12. Agreement Not to Compete.

(a) The Executive hereby covenants and agrees that, provided the Company makes any payments and provides any benefits which may be required under Section 9 and 10 hereof, at no time during the Executive’s employment by the Company, nor for a period of six (6) months immediately following the termination thereof, will the Executive for himself or on behalf of any other person, partnership, company or corporation, directly or indirectly, acquire any financial or beneficial interest in, provide consulting services to, be employed by, contract with, or own, manage, operate or control any business producing, manufacturing, selling, distributing, promoting or dealing in products or services identical or similar to the products or services of the Company or Subsidiaries or otherwise compete with the Company or Subsidiaries in the Company’s Service Area (as hereinafter defined). Nothing in this Agreement shall prevent the Executive from holding or investing in securities listed on a national securities exchange or sold in the over-the-counter market, provided such investments do not exceed in the aggregate one percent (1%) of the issued and outstanding capital stock of a corporation described in this Section. As used herein, the term

“Company Service Area” shall mean the geographical locations identified in the Company’s tariffs, as may be in effect from time to time.

(b) The Executive hereby covenants and agrees that, provided the Company makes any payments which may be required under Section 9 and 10 hereof, at all times during his employment by the Company, and for six (6) months after termination of such employment, the Executive shall not directly or indirectly employ or seek to employ any person or entity employed at that time by the Company, Subsidiary, affiliates or licensees or otherwise encourage or entice such person or entity to leave employment or terminate such employment.

(c) In the event that this Section 12 shall be determined by arbitrators or by any court of competent jurisdiction to be unenforceable by reason of its extending for too great a period of time or over too large a geographic area or over too great a range of activities, it shall be interpreted to extend only over the maximum period of time, geographic area or range of activities as to which it may be enforceable.

13. Confidential Information. The Executive agrees to use his best efforts to keep secret and retain in the strictest confidence all confidential matters which relate to the Company, Subsidiary or any affiliate of the Company, including, without limitation, customer lists, supplier lists, trade secrets, pricing policies and other business affairs of the Company, Subsidiary and any affiliate of the Company, learned by him before or after the date of this Agreement, and not to disclose any such confidential matter to anyone outside the Company, Subsidiary or any affiliates, whether during or after his period of service with the Company, except in the course of performing his duties hereunder. Upon request by the Company, the Executive agrees to deliver promptly to the Company upon termination of employment by the Company, or at any time thereafter as the Company may request, all Company, Subsidiary or any affiliate memoranda, notes, records, reports, manuals, drawings, designs, computer files in any media and other documents (and all copies thereof) relating to the Company’s, Subsidiary’s or any affiliate’s business and all property of the Company, Subsidiary or any affiliate of the Company, which he may then possess or have under his control.

14. Remedies. Should the Executive engage in or perform, either directly or indirectly, any of the acts prohibited by Sections 12 or 13 hereof, it is agreed that the Company shall be entitled to recover any damages incurred by it as a result of such violation by the Executive in an action at law, and to injunctive relief, to be issued by any competent court of equity, enjoining and restraining the Executive and each and every other person, firm, organization, association, or corporation concerned therein, from the continuance of such violative acts. The foregoing remedies available to the Company shall not be deemed to limit or prevent the exercise by the Company or the Executive of any or all further rights and remedies which may be available to the Company or the Executive hereunder or at law or in equity, except that neither the Company nor the Executive shall be entitled to recover exemplary or punitive damages.

Executive or others. In no event shall the Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Executive under any of the provisions of this Agreement. The Company agrees to pay, upon written demand therefor by the Executive, all legal fees and expenses which the Executive may reasonably incur as a result of any dispute or contest (regardless of the outcome thereof) by or with the Company or others regarding the validity or enforceability of, or liability under, any provision of this Agreement, plus in each case interest at the applicable Federal rate provided for in Section 7872(f)(2) of the Internal Revenue Code. In any such action brought by the Executive for damages or to enforce any provisions of this Agreement, the Executive shall be entitled to seek both legal and equitable relief and remedies, including, without limitation, specific performance of the Company’s obligations hereunder, in the Executive’s sole discretion. If the parties hereto so agree in writing, any disputes under this Agreement may be settled by arbitration. The obligation of the Company under this Section 14 shall survive the termination for any reason of this Agreement (whether such termination is by the Company, by the Executive, upon the expiration of this Agreement or otherwise).

15. Arbitration. Except that the Company may elect to pursue remedies as set forth in the first sentence of Section 14, in the event of any dispute or difference between the Company and the Executive with respect to the subject matter of this Agreement and the enforcement of rights hereunder, the Executive may, in the Executive’s sole discretion by written notice to the Company, require such dispute or difference to be submitted to arbitration. The arbitrator or arbitrators shall be selected by agreement of the parties or, if they cannot agree on an arbitrator or arbitrators within 30 days after the Executive has notified the Company of the Executive’s desire to have the question settled by arbitration, then the arbitrator or arbitrators shall be selected by the American Arbitration Association (the “AAA”) in the City of Rochester, New York upon the application of the Executive. The determination reached in such arbitration shall be final and binding on both parties without any right of appeal or further dispute. Execution of the determination by such arbitrator may be sought in any court of competent jurisdiction. The arbitrators shall not be bound by judicial formalities and may abstain from following the strict rules of evidence and shall interpret this Agreement as an honorable engagement and not merely as a legal obligation. Unless otherwise agreed by the parties, any such arbitration shall take place in Rochester, New York in accordance with New York law, and shall be conducted in accordance with the Rules of the AAA. The parties hereby consent to the jurisdiction of the courts of the State of New York and of the United States District Court for the Western District of New York for all purposes in connection with the arbitration. The parties hereto consent that any process or notice of motion or other application to either of said courts and any document or paper in connection with arbitration, may be served by certified mail, return receipt requested, to the address to which notices may be given as specified herein, or by personal service, or in such other manner as may be permissible under the rules of the applicable court or the arbitration tribunal, provided a reasonable time for appearance is allowed. The parties further agree that arbitration proceedings must be instituted within one year after the claimed breach occurred, and that failure to institute arbitration proceedings within such period shall constitute an absolute bar to the institution of any proceedings and the waiver of all claims. The parties further agree that all arbitration costs and expenses, including attorneys’ fees for counsel representing the Executive and counsel representing the Company, shall be paid by the Company, except that

attorneys’ fees for counsel representing the Executive shall not be paid by the Company in the event the Arbitrator determines that the employment of the Executive hereunder was properly terminated for Cause.

16. Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of New York.

17. Entire Agreement. This Agreement constitutes the full and complete understanding and agreement of the parties with respect to the subject matter hereof, supersedes all prior understandings and agreements as to employment of the Executive, and cannot be amended, changed, modified or terminated without the written consent of the parties hereto; provided, however, the Employment and Consulting Agreement between the Company and Executive dated September 18, 1984 remains in full force and effect.

18. Waiver of Breach. No provision of this Agreement shall be deemed waived unless such waiver is in writing and signed by the party making such waiver. The waiver by either party of a breach of any term of this Agreement shall not operate nor be construed as a waiver of any subsequent breach thereof.

19. Notices. Any notice hereunder shall be in writing and shall be given by personal delivery or certified or registered mail, return receipt requested, to the following addresses:

If to the Executive:

Thomas K. Barry

181 W. Lake Road

Hammondsport, NY 14840

or to such other address as the Executive may have furnished to the Company in writing:

If to the Company:

Chairman

Corning Natural Gas Corporation

P.O. Box 58

Corning, NY 14830

with a copy to:

Eric J. Krathwohl, Esq.

Rich, May, Bilodeau & Flaherty, P.C.

176 Federal Street

Boston, MA 02110

or to such other address as the Company may have furnished to the Executive in writing.

20. Severability. If any one or more of the provisions contained in this Agreement shall be invalid, illegal or unenforceable in any respect under any applicable law, the validity, legality and enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby.

21. Headings. The headings, titles or captions of the Sections of this Agreement are included only to facilitate reference, and they shall not define, limit, extend or describe the scope or intent of this Agreement or any provision hereof; and they shall not constitute a part hereof or affect the meaning or interpretation of this Agreement or any part hereof.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.

EXECUTIVE


/s/ Thomas K. Barry
Thomas K. Barry


CORNING NATURAL GAS CORPORATION


By:	/s/ Kenneth J. Robinson
Title:		Exec. Vice President

EX-99.2 5 a06-17982_1ex99d2.htm EX-99

Exhibit 99.2

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

EMPLOYMENT AGREEMENT, entered into as of this 14th day of December 2000, by and between CORNING NATURAL GAS CORPORATION, a New York corporation with an office at 330 W. William Street, Corning, New York 14830 (hereinafter called the “Company”) and KENNETH J. ROBINSON (hereinafter called the “Executive”) residing at 46 Wilson Street, Corning, NY 14830.

RECITALS

WHEREAS, the Executive is employed by the Company as Executive Vice President of the Company and its subsidiary (“Subsidiary”), and has performed duties of his employment in a capable and efficient manner, resulting in substantial benefit to the Company; and

WHEREAS, the Company desires to assure the continued service of Executive, and Executive is desirous of committing himself to continued service to the Company on the terms herein provided; and

WHEREAS, the Company and the Employee previously entered into that certain Employment Agreement on January 1, 1992 (the “1992 Agreement”); and

WHEREAS, the 1992 Agreement was amended by a First Amendment on April 22, 1997, a Second Amendment on October 1, 1998 and a Third Amendment on December 17, 1999; and

WHEREAS, the Company and the Employee desire to incorporate the changes made by such Amendments and to amend certain provisions of the 1992 Agreement;

AGREEMENTS

1. Employment. The Company will employ the Executive and the Executive accepts employment on the terms and conditions set forth in this Agreement.

2. Duties. The Executive shall serve the Company and Subsidiary as Executive Vice President, under the terms and conditions provided herein. The Executive’s duties hereunder shall include such duties as are normally incident to the position of Executive Vice President. The Executive shall perform his duties hereunder faithfully and to the best of his abilities and in furtherance of the business of the Company and shall devote his full business time, energy, attention and skill to the business of the Company and to the promotion of its interests.

3. Term of Employment. The term of the Executive’s employment hereunder shall be for a five year period beginning on January 1, 2001 and ending January 1, 2006. On January 1, 2003, and on each January 1st thereafter (each such date being hereinafter referred to as a “Renewal Date”), the term of the Executive’s employment hereunder shall automatically be extended for an additional one (1) year period unless the Company notifies the Executive in writing at least ninety (90) days prior to the applicable Renewal Date that the Company does not wish to extend this Agreement beyond the expiration of the term or extended term hereof, as the case may be, in which event this Agreement shall terminate on the date three years following such applicable Renewal Date. The Executive may terminate this Agreement upon one year’s advance written notice to the Company.

4. Salary. The Company agrees to pay and the Executive agrees to accept, in accordance with the provisions contained herein, as compensation for performance of his duties and obligations to the Company hereunder, a salary at an annual rate set by the Board of Directors of the Company (the “Board”) exclusive of the benefits described in Section 5, 6 and 7 hereof. Such salary shall be payable in equal monthly installments, less usual, customary and required payroll deductions. The Executive’s salary shall be reviewed annually by the Board for possible increases. In addition, the Company agrees to pay and the Executive agrees to accept, in accordance with the provisions contained herein, as compensation for performance of his duties and obligations to the Company hereunder, any fees or payments authorized by the Board to be paid to the Executive for membership on the Board or any committee thereof. All amounts described in this Section shall be referred to in this Agreement collectively as the Executive’s “Salary”.

7. Benefits.

(b) Vacations. The Executive shall be entitled to vacations each year in accordance with the Company’s policies in effect from time to time, of up to five (5) weeks.

(c) Survivor Benefit Deferred Compensation Agreement. The benefits and amounts payable to the Executive or the beneficiary of the Executive pursuant to the terms of the

Amended and Restated Survivor Benefit Deferred Compensation Agreement of even date hereof by and between the Company and the Executive are independent of and in addition to all payments and benefits payable to the Executive pursuant to this Agreement. A termination of this Employment Agreement shall not cause a termination of said Survivor Benefit Deferred Compensation Agreement.

(d) Health Benefits. Notwithstanding any other provision of this Agreement or any other agreement between Executive and the Company, the Company agrees:

The Company further agrees that in the event that the level of health care benefits provided by the Company to its executive employees is expanded at any time prior to the occurrence of the triggering event described in either Section 7(d)(i) or Section 7(d)(ii) hereof, the health care benefit that is required to be provided by Section 7(d)(i) or Section 7(d)(ii) shall be at such expanded level.

(e) Excess Pension Benefit.

(1) Excess Pension Benefit. At his commencement date specified in Section 7(e)(3) hereof, Executive’s annual “excess pension benefit” (the “Excess Pension Benefit”) shall equal:

Sections 415(b) and 415(e) limitations) or any dollar limitation imposed by Internal Revenue Code Section 401(a)(17).

(4) Accrued Excess Pension Benefit. Executive’s accrued Excess Pension Benefit at any point in time prior to retirement shall equal the amount determined under Section 7(e)(1) hereof based upon his Compensation (as defined in Section II of the Company’s Pension Plan) and Years of Service (as defined in Section II of the Company’s Pension Plan) as of the date of determination.

(5) Vested Excess Pension Benefit. If Executive’s employment with the Company terminates after he has completed at least 15 years of Service, he shall be entitled to a Vested Excess Pension Benefit based on his accrued Excess Pension Benefit determined under Section 7(e)(4). The Company’s payment of the Vested Excess Pension Benefit shall commence as of the date Executive first becomes eligible to receive benefits under the Company’s Pension Plan, even if Executive elects not to commence receiving such Company’s Pension Plan benefits at that time, and such benefit from this Plan shall not be recalculated thereafter unless Section 7(e)(8) is applicable.

(b) the reduction in the actual amount payable from the Company’s Pension Plan at age 62.

(f) Certain Additional Payments by the Company. The Company shall pay to Executive, as additional compensation, the amount equal to (i) the FICA taxes the Executive must pay (excluding income taxes) and (ii) an additional sum of money, in compensation for any federal, state and local income taxes payable upon such payments made pursuant to this Section 7(f) including any such taxes upon payments pursuant to this subsection 7(f)(ii), the intention being that payments pursuant to this Section 7(f) will equal such amount as is required to entirely repay any cost to Executive for any such taxes. Payment of amounts pursuant to this Section 7(f) shall be calculated at the highest marginal rate to which Executive is subject for the year in which the income is recognized, including any such income described above, and shall be paid to the Executive for as long as such FICA taxes are applicable.

(g) Life Insurance. The Company shall maintain a whole life insurance policy on the Executive until the Executive reaches the age of 65. The premiums for such policy shall be paid for by the Company, however, the Executive (or the beneficiary designated by him) shall be the beneficial owner of the policy.

8. Termination.

(a) Death. The Executive’s employment hereunder shall terminate upon his death.

affirmative vote of not less than seventy-five percent (75%) of the entire membership of the Board of Directors of the Company at a meeting of the Board called and held for the purpose (after thirty (30) days prior written notice to the Executive and an opportunity for him, together with his counsel, to be heard before the Board), finding that in the good faith opinion of the Board the Executive was guilty of conduct set forth above in clause (i), (ii), (iii) or (iv) of this Section 8(b) and specifying the particulars thereof in detail.

(c) Resignation for Good Reason. The Executive may terminate his employment hereunder for Good Reason. For the purpose of this Agreement “Good Reason” shall mean:

9. Effect of Termination.

(c) Termination by the Company without Cause or by the Executive with Good Reason. If the Executive’s employment hereunder shall be terminated by the Company other than for death, Cause or disability or shall be terminated by the Executive with Good Reason, the Company agrees to pay as a severance pay an amount equal to the Salary which would have been payable over the remaining term of this Agreement or, if such remaining term is less than twelve (12) months, then for a period of twelve (12) months immediately following the termination. The Company shall also provide to the Executive the benefits described in Sections 7(a) and 7(c) hereof for a term not shorter than the period that said severance pay shall be payable. In addition, the Company shall pay to the Executive any accrued bonus through the date of termination. The Company’s notice of non-extension of this Agreement, described in Section 3 hereof, shall not constitute a termination by the Company for the purposes of this Section 9(c).

10. Change in Control. If, and only if, the Executive’s employment is terminated following a Change in Control of the Company (as that term is defined in the Amended and Restated Severance Agreement between the Executive and the Company, of even date hereof (the “Severance Agreement”)), the provisions in Section 9(c) of this Agreement shall be superceded by the terms of the Severance Agreement and any other applicable Company plan, policy, arrangement or agreement (other than this Agreement).

binding upon and inure to the benefit of the corporation resulting from such merger or consolidation or to which assets shall have been transferred (the “Surviving Corporation”), and this provision shall apply in the event of any subsequent merger, consolidation or transfer. In any such event, the Surviving Corporation shall enter into an agreement with the Executive whereby the Surviving Corporation and the Executive shall agree to perform this Agreement, including Section 10 hereof, in the same manner and to the same extent the Company would be required to perform it if no such merger, consolidation or transfer had taken place, and the Executive shall enter into such agreement; and the Company shall thereafter have no further obligations under this Agreement.

12. Agreement Not to Compete.

affiliate of the Company, learned by him before or after the date of this Agreement, and not to disclose any such confidential matter to anyone outside the Company, Subsidiary or any affiliates, whether during or after his period of service with the Company, except in the course of performing his duties hereunder. Upon request by the Company, the Executive agrees to deliver promptly to the Company upon termination of employment by the Company, or at any time thereafter as the Company may request, all Company, Subsidiary or any affiliate memoranda, notes, records, reports, manuals, drawings, designs, computer files in any media and other documents (and all copies thereof) relating to the Company’s, Subsidiary’s or any affiliate’s business and all property of the Company, Subsidiary or any affiliate of the Company, which he may then possess or have under his control.

The Company’s obligation to make the payments provided for in this Agreement and otherwise to perform its obligations hereunder shall not be affected by any set-off, counterclaim, recoupment, defense or other claim, right or action which the Company may have against the Executive or others. In no event shall the Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to the Executive under any of the provisions of this Agreement. The Company agrees to pay, upon written demand therefor by the Executive, all legal fees and expenses which the Executive may reasonably incur as a result of any dispute or contest (regardless of the outcome thereof) by or with the Company or others regarding the validity or enforceability of, or liability under, any provision of this Agreement, plus in each case interest at the applicable Federal rate provided for in Section 7872(f)(2) of the Internal Revenue Code. In any such action brought by the Executive for damages or to enforce any provisions of this Agreement, the Executive shall be entitled to seek both legal and equitable relief and remedies, including, without limitation, specific performance of the Company’s obligations hereunder, in the Executive’s sole discretion. If the parties hereto so agree in writing, any disputes under this Agreement may be settled by arbitration. The obligation of the Company under this Section 14 shall survive the termination for any reason of this Agreement (whether such termination is by the Company, by the Executive, upon the expiration of this Agreement or otherwise).

require such dispute or difference to be submitted to arbitration. The arbitrator or arbitrators shall be selected by agreement of the parties or, if they cannot agree on an arbitrator or arbitrators within 30 days after the Executive has notified the Company of the Executive’s desire to have the question settled by arbitration, then the arbitrator or arbitrators shall be selected by the American Arbitration Association (the “AAA”) in the City of Rochester, New York upon the application of the Executive. The determination reached in such arbitration shall be final and binding on both parties without any right of appeal or further dispute. Execution of the determination by such arbitrator may be sought in any court of competent jurisdiction. The arbitrators shall not be bound by judicial formalities and may abstain from following the strict rules of evidence and shall interpret this Agreement as an honorable engagement and not merely as a legal obligation. Unless otherwise agreed by the parties, any such arbitration shall take place in Rochester, New York in accordance with New York law, and shall be conducted in accordance with the Rules of the AAA. The parties hereby consent to the jurisdiction of the courts of the State of New York and of the United States District Court for the Western District of New York for all purposes in connection with the arbitration. The parties hereto consent that any process or notice of motion or other application to either of said courts and any document or paper in connection with arbitration, may be served by certified mail, return receipt requested, to the address to which notices may be given as specified herein, or by personal service, or in such other manner as may be permissible under the rules of the applicable court or the arbitration tribunal, provided a reasonable time for appearance is allowed. The parties further agree that arbitration proceedings must be instituted within one year after the claimed breach occurred, and that failure to institute arbitration proceedings within such period shall constitute an absolute bar to the institution of any proceedings and the waiver of all claims. The parties further agree that all arbitration costs and expenses, including attorneys’ fees for counsel representing the Executive and counsel representing the Company, shall be paid by the Company, except that attorneys’ fees for counsel representing the Executive shall not be paid by the Company in the event the Arbitrator determines that the employment of the Executive hereunder was properly terminated for Cause.

16. Governing Law. This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of New York.

19. Notices. Any notice hereunder shall be in writing and shall be given by personal delivery or certified or registered mail, return receipt requested, to the following addresses:

If to the Executive:

Kenneth J. Robinson

46 Wilson Street

Corning, NY 14830

or to such other address as the Executive may have furnished to the Company in writing:

If to the Company:

Chairman

Corning Natural Gas Corporation

P.O. Box 58

Corning, NY 14830

with a copy to:

Eric, J. Krathwohl, Esq.

Rich, May, Bilodeau & Flaherty, P.C.

176 Federal Street

Boston, MA 02110

or to such other address as the Company may have furnished to the Executive in writing.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.

EXECUTIVE

/s/ Kenneth J. Robinson
Kenneth J. Robinson


CORNING NATURAL GAS CORPORATION


By:	/s/ Thomas K. Barry


Title:		President & CEO

EX-99.3 6 a06-17982_1ex99d3.htm EX-99

Exhibit 99.3

CORNING NATURAL GAS CORPORATION
AMENDED AND RESTATED
SURVIVOR BENEFIT
DEFERRED COMPENSATION AGREEMENT
FOR
THOMAS K. BARRY

W I T N E S S E T H

THIS AGREEMENT entered into by and between CORNING NATURAL GAS CORPORATION, a corporation organized and existing under the laws of the State of New York, (hereinafter referred to as the “Company”), and THOMAS K. BARRY (hereinafter referred to as the “Employee”).

WHEREAS, the Employee is employed by the Company; and

WHEREAS, the Employee has performed the duties of employment in a capable and efficient manner, resulting in substantial benefit to the Company; and

WHEREAS, the experience of the Employee is such that assurance of the Employee’s continued services is important to the future growth and progress of the Company; and

WHEREAS, the Company desires to continue the service of the Employee; and

WHEREAS, the Employee is willing to continue in the employ of the Company if the Company will agree to pay certain benefits in accordance with the provisions and conditions hereinafter set forth; and

WHEREAS, the Company and the Employee previously entered into that certain Survivor Benefit and Deferred Compensation Agreement on June 27, 1990 (the “1990 Agreement”); and

WHEREAS, the 1990 Agreement was amended by a First Amendment on April 22, 1997 and a Second Amendment on October 1, 1998; and

WHEREAS, the Company and the Employee desire to incorporate the changes made by such Amendments and to amend certain provisions of the 1990 Agreement;

NOW, THEREFORE, in consideration of the agreements between the parties, the parties covenant and agree as follows:

ARTICLE I

Promise to Pay

Notwithstanding any other agreements between the parties during the Employee’s employment, the Company agrees to pay the Employee additional amounts, payments of which will be deferred pursuant to the terms of this Agreement as hereinafter set forth.

ARTICLE II

Pre-Retirement Death Benefit

In the event of the Employee’s death while he is still employed by the Company, there shall be paid from the Company, to such beneficiaries as the Employee shall have selected in accordance with Article VI, monthly payments equal to Fifty percent (50%) of the Employee’s monthly salary as said salary existed on the date of the Employee’s death. For purposes of this agreement, the Employee’s salary shall be the gross salary as recommended and awarded to him by the Executive Compensation Committee of the Board of Directors of Corning Natural Gas Corporation. Such payments shall be payable for one hundred eighty (180) months (commencing on the first day of the month following the month in which occurs the Employee’s death).

ARTICLE III

Retirement Date

The Company agrees that the Employee may retire at any time after the first day of any month coincident with or next following his fifty-fifth (55th) birthday if, but not before, he has completed at least ten (10) years of service with the Company. The date of his actual retirement shall be referred to herein as the “Retirement Date.”

ARTICLE IV

Retirement Benefit

I. Upon his retirement the Employee (and his beneficiaries if he dies after retirement but prior to receipt of all his benefits) shall be entitled to receive from the Company monthly payments for his entire lifetime ending with the payment due immediately before the Employee’s death, or for a period of one hundred eighty (180) months if longer, commencing on the Retirement Date an amount determined according to whichever shall be applicable of subparagraphs “A” and “B” hereof.

A. If the Employee shall retire on or, after his sixty-second (62nd) birthday, the. monthly amount to which the Employee shall be entitled pursuant to this Article shall be an amount equal to Thirty-five percent (35%) of the monthly salary of the Employee as said salary existed on the actual date of his retirement. The amount that shall be so payable

shall increase in each year (commencing with the payment next due after each anniversary of his Retirement Date) by an amount equal to Four percent (4%) of the amount to which the Employee, or his beneficiary, was entitled as a monthly benefit at such anniversary.

B. If the Employee shall retire prior to his sixty-second (62nd) birthday, the monthly amount to which the Employee shall be entitled pursuant to this Article shall be an amount equal to a percentage, based upon the attained age of the Employee at the date of retirement, according to the table detailed below, of what the Employee would have been entitled if he had retired after his sixty-second (62nd) birthday.

The monthly amount that shall be so payable shall be adjusted by the 4% amount as set forth above in paragraph A.

Age at Retirement	Percentage of Benefit
55	72	%
56	76	%
57	80	%
58	84	%
59	88	%
60	92	%
61	96	%

ARTICLE V

Termination Prior to Retirement

If the employment of the Employee shall terminate for any reason before his completion of ten (10) years of service with the Company and attainment of age Fifty-five (55), he and his beneficiaries shall be entitled to no benefits under this agreement, except that if such termination is by reason of the Employee’s death, this Article shall not apply and the provisions of Article II shall apply to said Employee.

ARTICLE VI

Beneficiary of Death Benefit

In the event that the Employee should die while he is still employed by the Company as described in Article II hereunder or in the event that the Employee should die prior to receipt from the Company of any amount to which the Employee is entitled under Article IV hereunder, any amounts due under said Article II remaining unpaid under said Article IV shall be paid to such beneficiary as the Employee may designate by filing with the Company a notice in writing, but in the absence of any such designation, said amounts shall be so paid to the Employee’s estate.

ARTICLE VII

Non-Assignable Rights

It is agreed that, except as the Company may otherwise agree in writing and except as set forth below with respect to the Employee, neither the Employee nor any beneficiary hereunder shall have any right to commute, sell, assign, transfer or otherwise convey the right to receive any payments hereunder, which payments and the rights thereto are expressly declared to be non-assignable and non-transferable.

ARTICLE VIII

Independence of Agreement

The benefits payable under this Agreement from the Company shall be independent of, and in addition to, any other employment agreement that may exist from time to time between the parties hereto, or any other compensation payable by the Company to the Employee, whether as salary, bonus or otherwise. This Agreement shall not be deemed to constitute a contract of employment between the parties hereto, and nothing contained herein shall in any way restrict the right of the Company to discharge the Employee, or the right of the Employee to terminate employment.

ARTICLE IX

Non-Secured Promise

Except as provided in the final sentence of Article X, the rights of the Employee against the Company under this Agreement and of any beneficiary of the Employee shall be solely those of an unsecured creditor of the Company. Any insurance policy or any other asset acquired or held by the Company in connection with the liabilities assumed by it hereunder, shall not be deemed to be held under any trust for the benefit of the Employee or his spouse or beneficiaries or to be security for the performance of the obligations of the Company, but shall be, and remain, a general, unpledged, unrestricted asset of the Company.

ARTICLE X

Change of Business Form

The Company agrees that it will not merge or consolidate with any other corporation or organization, or permit its business activities to be taken over by any other organization, unless and until the succeeding or continuing corporation or other organization shall expressly assume the rights and obligations of the Company herein set forth. The Company further agrees that it will not cease its business activities or terminate its existence, other than as heretofore set forth in this Article, without having made adequate provision for the fulfilling of its obligations. In the

event the Company shall violate the terms of this Article, the Employee (or other obligee) shall have a continuing lien on all corporate assets until such default be corrected.

ARTICLE XI

Termination of Agreement

This Agreement is terminable at will by either party at any time, and in such event all rights of the Employee that were not vested prior to such termination of this Agreement shall terminate. For the purpose of this Article XI, the pre-retirement death benefit set forth in Article II shall not vest until the Employee’s death, and the retirement benefit set forth in Article IV shall not vest until the Employee’s Retirement Date.

ARTICLE XII

Disability

If the Employee shall become disabled within the meaning of the long term disability plan of the Company and prior to his retirement, the Employee shall be considered to be continuing in employment for as long as such disability exists, but not after age seventy (70).

ARTICLE XIII

Amendment of Agreement

This Agreement may be amended in whole or in part by a writing signed by both parties hereto. This Agreement sets forth the entire agreement of the parties hereto.

ARTICLE XIV

Informal Funding

I. The benefits under this Agreement will be paid by the Company from its general assets. To cover part or all of its potential liabilities under this Agreement, the Company may, but need not, purchase life insurance policies on the life of the Employee, but neither the Employee nor any of his beneficiaries will have any preferred claim against, or beneficial ownership in, such policies or the proceeds therefrom.

II. When and if the Company applies for life insurance on the life of the Employee, it will so notify the Employee and request him to take whatever actions may be necessary to enable the Company to fulfill the requirements of the life insurance company for issuance of the insurance policy. A condition of eligibility for benefits under this Agreement is the Employee’s cooperation in connection with the securing of any insurance policies, including the completion and signing of such forms as may be reasonably required, and to undergo any medical examinations or tests which may be necessary.

III. No benefit shall be payable under this Agreement to the beneficiaries or estate of the Employee if he dies by suicide within two years after the effective date of this Agreement. Nor shall any benefit be payable under this Agreement to the Employee or his beneficiaries or his estate if the Employee makes any untrue statements on insurance forms, which statements cause the Company to fail to receive insurance proceeds under any policies upon the Employee’s death, or which cause said proceeds to be reduced in any manner.

ARTICLE XV

Claims Procedure

In accordance with Section 503 of ERISA and the regulations of the Secretary of Labor prescribed thereunder:

A. All claims for benefits under this Agreement shall be filed in writing with the Company in accordance with such procedures as the Company shall reasonably establish.

B. The Company shall, within ninety (90) days of submission of a claim, provide adequate notice in writing to any claimant whose claim for benefits under the Agreement has been denied. Such notice shall contain the specific reason or reasons for the denial and references to specific Agreement provisions on which the denial is based. It will also provide the claimant with a description of any material or information which is necessary in order for the claimant to perfect his claim and an explanation of why such information is necessary. If special circumstances require an extension of time for processing the claim, the Company shall furnish the claimant a written notice of such extension prior to the expiration of the ninety (90) day period described above. The extension notice shall indicate the reasons for the extension and the expected date for a final decision, which date shall not be more than one hundred eighty (180) days from the initial claim.

C. The Company shall, upon written request by a claimant within sixty (60) days of the notice that his claim has been denied, afford a reasonable opportunity to such claimant for a full and fair review by the Company of the decision denying the claim. The Company will afford the claimant an opportunity to review pertinent documents and submit issues and comments in writing. The claimant shall have the right to be represented by counsel.

D. The Company shall, within sixty (60) days of a request for a review, render a written decision on its review. If special circumstances require extra time for the Company to review its decision, the Company will attempt to make its decision as soon as practicable, and in no event will the Company take more than one hundred twenty (120) days to send a claimant a written notice of its decision.

ARTICLE XVI

Applicable Law

The provisions of this Agreement shall be construed, administered and enforced according to the laws of the United States, and to the extent permitted by such laws, in accordance with the law of the State of New York.

ARTICLE XVII

Miscellaneous Matters

Throughout this Agreement where appropriate, every reference in any of the masculine, feminine, or neuter shall be deemed to include all of the masculine, feminine and neuter, and every reference in either the singular or plural shall be deemed to include both the singular and plural, unless the context clearly requires otherwise.

ARTICLE XVIII

Severability

If in the respect any provision of this Agreement, in whole or in part, shall prove to be invalid for any reason, each invalidity shall only affect the part of such provision which shall be invalid, and in all other respects shall stand as if such invalid provision had not been made, and it shall fail to the extent and only to the extent of such invalid provision and no other portion or provision of this Agreement shall be invalidated, impaired or affected thereby.

ARTICLE XIX

Termination of Benefits

Any benefit otherwise available to the Employee under this Agreement may be terminated by the Company at any time for good cause. For purposes of this provision, good cause shall be deemed to include fraud against the Company, misappropriation or embezzlement of Company funds, or the like, willful and continued gross negligence in the performance of the Employee’s duties with the Company, violation of the provisions of the following Article XX, or violation of any reasonable rules and regulations imposed by the Company concerning the conduct of its employees.

ARTICLE XX

Noncompetition

The Employee hereby covenants and agrees that at no time during the Employee’s employment by the Company, nor for a period of six (6) months immediately following the termination thereof, will the Employee for himself or on behalf of any other person, partnership, company or corporation, directly or indirectly, acquire any financial or beneficial interest in, provide consulting services to, be employed by, contract with, or own, manage, operate or control

any business producing, manufacturing, selling, distributing, promoting or dealing in products or services identical or similar to the products or services of the Company or Subsidiaries or otherwise compete with the Company or Subsidiaries in the Company’s Service Area (as hereinafter defined). Nothing in this Agreement shall prevent the Employee from holding or investing in securities listed on a national securities exchange or sold in the over-the-counter market, provided such investments do not exceed in the aggregate one percent (1%) of the issued and outstanding capital stock of a corporation described in this Section. As used herein, the term “Company Service Area” shall mean the geographical locations identified in the Company’s tariffs, as may be in effect from time to time.

ARTICLE XXI

Change of Control

Notwithstanding the aforementioned terms and provisions of this Agreement, the Employee’s benefits under this Agreement shall be nonforfeitable in the even of a Change in Control (as hereinafter defined) of the Company. For this purpose:

(i) if the employment of the Employee shall terminate for any reason subsequent to a Change in Control (as hereinafter defined) of the Company prior to attaining his fifty-fifth (55th) birthday, the Employee shall be entitled to monthly payments as calculated under Article II of this Agreement as if said Employee had died while still employed by the Company on the date of said Employee’s termination; and

(ii) if the employment of the Employee shall terminate for any reason subsequent to a Change in Control (as hereinafter defined) of the Company on or after attaining his fifty-fifth (55th) birthday, the Employee shall be entitled to monthly payments as calculated under Article IV of this Agreement as if said employee had retired while still an employee of the Company on the date of said Employee’s termination; and

(iii) in the event the Employee shall die subsequent to a Change in Control (as hereinafter defined) of the Company while still employed by the Company prior to attaining his fifty-fifth (55th) birthday, such beneficiaries as the Employee shall have selected under the provisions of Article VI of this Agreement shall be entitled to the monthly payments as calculated under Article II of this Agreement; and

(iv) in the event the Employee shall die subsequent to a Change in Control (as hereinafter defined) of the Company while still employed by the Company on or after attaining his fifty-fifth (55th) birthday, such beneficiaries as the Employee shall have selected under the provisions of Article VI of this Agreement shall be entitled to the monthly payments as calculated under Article IV of this Agreement; and

(v) in the event the Employee shall die while receiving any payments as described in this Article XXI, any amounts remaining unpaid shall be paid to such beneficiaries as the Employee shall have designated under the provisions of Article VI of this Agreement.

For the purposes of this Agreement, a Change in Control of the Company shall be deemed to have occurred if:

(i) there shall be consummated any consolidation or merger of the Company in which the Company is not the continuing or surviving corporation or pursuant to which shares of the Common Stock of the Company would be converted into cash, other securities or other property, or any sale, lease, exchange or other transfer (in one transaction or a series of related transactions) of all or substantially all of the assets of the Company, except for any consolidation or merger or sale, lease, exchange or other transfer of assets in which:

(a) the stockholders of the Company immediately prior to the consolidation, merger or transfer have the same proportionate ownership in the stock entitled to vote generally for the election of directors of the consolidated, surviving or transferee corporation immediately after the transaction; or

(b) the transaction is entirely among the Company and any subsidiary;

(ii) the stockholders of the Company approve any plans or proposals for the liquidation or dissolution of the Company;

(iii) there is a change in the Board of Directors of the Company as a result of an election contest following a solicitation of proxies subject to Rule 14a-11 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”); or

(iv) any Person (as hereinafter defined), shall become directly or indirectly, the Owner or Beneficial Owner (as hereinafter defined) of 20% or more of the stock entitled to vote generally for the election of directors of the Company, or any successor of the Company pursuant to a transaction described in (i) above.

For the purposes of determining proportionate or percentage ownership of any stock referred to in the foregoing definition, all options, warrants and other rights to purchase or otherwise acquire any such stock shall be treated as if such options, warrants and other rights had been fully exercised and such stock issued to the holders of such rights immediately prior to the time at which such proportionate or percentage ownership is determined. For purposes of the foregoing definition, “Person” means any person, as such term is used in Section 13(d) and 14(d)(2) of the Exchange Act and “Owner or Beneficial Owner” means any owner or beneficial owner within the meaning of Rule 13d-3 under the Exchange Act.

IN WITNESS WHEREOF, the said CORNING NATURAL GAS CORPORATION has caused this Agreement to be signed in its name by its duly authorized officer, and impressed with its seal, and properly attested to, and the said Employee has signed and sealed this Agreement, all of this 14th day of December, 2000.

ATTEST:	CORNING NATURAL GAS CORPORATION


/s/ Phyllis J. Groeger	By:	/s/ Kenneth J. Robinson Exec. Vice President
		(Authorized Officer)


/s/ Phyllis J. Groeger	/s/ Thomas K. Barry
Witness	Thomas K. Barry
	(“Employee”)

CORNING NATURAL GAS CORPORATION
Deferred Compensation Agreement
for
Thomas K. Barry
Designation of Beneficiary

I hereby designate the following as beneficiary of any amounts due under the above agreement at my death:

To my daughter Rebecca L. Barry, and my daughter, Susan V. Barry, and my son Sean W. Barry, in equal shares; provided, however, that if any of them shall predecease me, then such person’s share shall go to his or her then living descendants, per stirpes, or, if none, to increase ratably the shares distributed hereunder.

12/14/00		/s/ Thomas K. Barry
Date		Thomas K. Barry


12/14/00		/s/ Kenneth J. Robinson
Date		Witness

EX-99.4 7 a06-17982_1ex99d4.htm EX-99

Exhibit 99.4

CORNING NATURAL GAS CORPORATION
AMENDED AND RESTATED
SURVIVOR BENEFIT
DEFERRED COMPENSATION AGREEMENT
FOR
KENNETH J. ROBINSON

W I T N E S S E T H

THIS AGREEMENT entered into by and between CORNING NATURAL GAS CORPORATION, a corporation organized and existing under the laws of the State of New York, (hereinafter referred to as the “Company”), and KENNETH J. ROBINSON (hereinafter referred to as the “Employee”).