-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, KFaMSFyN2Q3xZ2QWYckJICaroXcdW4JMfvzYgONYRf/U+B31ZFGt/v1D1xSH4zG6 iBnrjqwyxqJv7H59HFERkg== 0000057183-97-000008.txt : 19970804 0000057183-97-000008.hdr.sgml : 19970804 ACCESSION NUMBER: 0000057183-97-000008 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 10 CONFORMED PERIOD OF REPORT: 19970630 FILED AS OF DATE: 19970801 SROS: CSX SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: LACLEDE GAS CO CENTRAL INDEX KEY: 0000057183 STANDARD INDUSTRIAL CLASSIFICATION: NATURAL GAS DISTRIBUTION [4924] IRS NUMBER: 430368139 STATE OF INCORPORATION: MO FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-01822 FILM NUMBER: 97649991 BUSINESS ADDRESS: STREET 1: 720 OLIVE ST CITY: ST LOUIS STATE: MO ZIP: 63101 BUSINESS PHONE: 3143420500 MAIL ADDRESS: STREET 1: 720 OLIVE ST CITY: ST LOUIS STATE: MO ZIP: 63101 10-Q 1 QUARTERLY REPORT ON FORM 10-Q, 8/1/97 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, 1997 OR ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Transition Period from ________ to ________ Commission File Number 1-1822 LACLEDE GAS COMPANY (Exact name of registrant as specified in its charter) Missouri 43-0368139 (State of Incorporation) (I.R.S. Employer Identification Number) 720 Olive Street, St. Louis, Missouri 63101 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code 314-342-0500 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes (X) No ( ) Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. 17,557,540 shares, Common Stock, par value $1 per share at 7/31/97. Page 1 LACLEDE GAS COMPANY AND SUBSIDIARY COMPANIES PART I FINANCIAL INFORMATION The interim financial statements included herein have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. These financial statements should be read in conjunction with the financial statements and the notes thereto included in the Company's Form 10-K for the year ended September 30, 1996. Page 2 LACLEDE GAS COMPANY AND SUBSIDIARY COMPANIES STATEMENTS OF CONSOLIDATED INCOME (UNAUDITED) (In Thousands, Except Per Share Amounts)
Three Months Ended Nine Months Ended June 30, June 30, 1997 1996 1997 1996 ---- ---- ---- ---- Utility Operating Revenues $84,191 $86,022 $542,087 $499,240 ----------------- ------------------ Utility Operating Expenses: Natural and propane gas 38,016 43,241 330,398 293,762 Other operation expenses 21,217 20,301 65,464 63,502 Maintenance 4,607 4,366 13,632 13,799 Depreciation and amortization 6,426 6,223 19,375 18,434 Taxes, other than income taxes 8,956 9,620 39,667 37,515 Income taxes (Note 3) 244 (823) 22,101 22,227 ----------------- ------------------ Total Utility Operating Expenses 79,466 82,928 490,637 449,239 ----------------- ------------------ Utility Operating Income 4,725 3,094 51,450 50,001 Miscellaneous Income and Income Deductions - Net (less applicable income taxes) (Note 3) 602 621 1,458 2,996 ----------------- ------------------ Income Before Interest Charges 5,327 3,715 52,908 52,997 ----------------- ------------------ Interest Charges: Interest on long-term debt 3,543 3,542 10,627 10,396 Other interest charges 972 572 3,857 3,221 ----------------- ------------------ Total Interest Charges 4,515 4,114 14,484 13,617 ----------------- ------------------ Net Income (Loss) 812 (399) 38,424 39,380 Dividends on Preferred Stock 24 24 73 73 ----------------- ------------------ Earnings Applicable to Common Stock $ 788 $ (423) $ 38,351 $ 39,307 ================== ================== Average Number of Common Shares Outstanding 17,558 17,558 17,558 17,512 Earnings Per Share of Common Stock $ .04 $(.02) $2.18 $2.24 Dividends Declared Per Share of Common Stock $.325 $.315 $.975 $.945 See notes to consolidated financial statements.
Page 3 LACLEDE GAS COMPANY AND SUBSIDIARY COMPANIES CONSOLIDATED BALANCE SHEET
June 30 Sept. 30 1997 1996 ---- ---- (Thousands of Dollars) (UNAUDITED) ASSETS Utility Plant $782,845 $780,001 Less: Accumulated depreciation and amortization 320,494 327,836 -------------------- Net Utility Plant 462,351 452,165 -------------------- Other Property and Investments 25,647 24,265 -------------------- Current Assets: Cash and cash equivalents 4,778 4,360 Accounts receivable - net 56,667 45,578 Materials, supplies, and merchandise at avg cost 5,408 5,634 Natural gas stored underground for current use at LIFO cost 24,006 58,769 Propane gas for current use at FIFO cost 12,463 12,655 Prepayments 2,604 1,910 Deferred income taxes 8,010 4,477 Delayed customer billings 8,464 - -------------------- Total Current Assets 122,400 133,383 -------------------- Deferred Charges 97,373 79,582 -------------------- Total Assets $707,771 $689,395 ==================== See notes to consolidated financial statements.
Page 4 LACLEDE GAS COMPANY AND SUBSIDIARY COMPANIES CONSOLIDATED BALANCE SHEET (Continued)
June 30 Sept. 30 1997 1996 ---- ---- (Thousands of Dollars) (UNAUDITED) CAPITALIZATION AND LIABILITIES Capitalization: Common stock (19,423,178 shares issued) $ 19,423 $ 19,423 Paid-in capital 61,205 61,205 Retained earnings 205,464 184,232 Treasury stock, at cost (1,865,638 shares held) (24,017) (24,017) -------------------- Total common stock equity 262,075 240,843 Redeemable preferred stock 1,960 1,960 Long-term debt (less sinking fund requirements) 179,397 179,346 -------------------- Total Capitalization 443,432 422,149 -------------------- Current Liabilities: Notes payable 34,500 59,600 Accounts payable 29,280 20,637 Refunds due customers 250 1,248 Advance customer billings - 6,231 Taxes accrued 18,906 10,212 Unamortized purchased gas adjustments 6,027 26,744 Other 18,837 21,776 -------------------- Total Current Liabilities 107,800 146,448 -------------------- Deferred Credits and Other Liabilities: Deferred income taxes 92,463 78,149 Unamortized investment tax credits 7,367 7,669 Other 56,709 34,980 -------------------- Total Deferred Credits and Other Liabilities 156,539 120,798 -------------------- Total Capitalization and Liabilities $707,771 $689,395 ==================== See notes to consolidated financial statements.
Page 5 LACLEDE GAS COMPANY AND SUBSIDIARY COMPANIES STATEMENTS OF CONSOLIDATED CASH FLOWS (UNAUDITED)
Nine Months Ended June 30, 1997 1996 ---- ---- (Thousands of Dollars) Operating Activities: Net Income $ 38,424 $ 39,380 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 19,405 18,475 Deferred income taxes and investment tax credits 3,065 (12,748) Other - net (116) 55 Changes in assets and liabilities: Accounts receivable - net (11,089) (13,271) Unamortized purchased gas adjustments (20,717) 9,557 Deferred purchased gas costs 21,015 33,149 Delayed customer billings - net (14,695) (26,671) Accounts payable 8,643 3,622 Refunds due customers (998) (2,763) Taxes accrued 8,694 13,595 Natural gas stored underground 34,763 18,433 Other assets and liabilities (13,889) (8,322) -------------------- Net cash provided by operating activities $ 72,505 $ 72,491 -------------------- Investing Activities: Construction expenditures (31,491) (32,231) Investments - non-utility (1,708) 104 Employee benefit trusts 478 - Other 2,750 (462) -------------------- Net cash used in investing activities $(29,971) $(32,589) -------------------- Financing Activities: Repayment of short-term debt (25,100) (47,500) Issuance of common stock - 2,972 Dividends paid (17,016) (16,491) Issuance of first mortgage bonds - 25,000 Other - (201) -------------------- Net cash used in financing activities $(42,116) $ (36,220) --------------------- Net Increase in Cash and Cash Equivalents $ 418 $ 3,682 Cash and Cash Equivalents at Beginning of Period 4,360 1,555 -------------------- Cash and Cash Equivalents at End of Period $ 4,778 $ 5,237 ==================== Supplemental Disclosure of Cash Paid During the Period for: Interest $17,115 $15,669 Income taxes 9,249 19,399 See notes to consolidated financial statements.
Page 6 LACLEDE GAS COMPANY AND SUBSIDIARY COMPANIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. In the opinion of management, this interim report includes all adjustments (consisting only of normal recurring accruals) necessary for the fair presentation of the results of the periods covered. 2. The registrant is a natural gas distribution utility having a material seasonal cycle; therefore, this interim statement of consolidated income is not necessarily indicative of annual results nor representative of succeeding quarters of the fiscal year. 3. Net provisions for income taxes were charged (credited) as follows during the periods set forth below:
Three Months Ended Nine Months Ended June 30, June 30, ------------------ ----------------- 1997 1996 1997 1996 ---- ---- ---- ---- (Thousands of Dollars) Utility Operations Current: Federal $(5,730) $ (880) $16,276 $29,763 State and local (974) (159) 2,742 4,992 Deferred: Federal 5,875 136 2,445 (10,834) State and local 1,073 80 638 (1,694) ----------------- ----------------- Subtotal $ 244 $ (823) $22,101 $22,227 ----------------- ----------------- Miscellaneous Income and Income Deductions Current: Federal $ 57 $ (207) $ 279 $ 503 State and local 40 (17) 60 74 Deferred: Federal (50) (122) (16) (191) State and local (7) (18) (2) (29) ----------------- ----------------- Subtotal $ 40 $ (364) $ 321 $ 357 ----------------- ----------------- Total $ 284 $ (1,187) $22,422 $22,584 ================= =================
Page 7 4. The Company's Gas Supply Incentive Plan, which became effective October 1, 1996 as part of the settlement reached in the Company's last rate case, continues to provide significant benefits for both the Company's share owners and customers. Under the Plan, the Company and its customers share in certain gains and losses as measured against benchmark levels of gas costs as related to the acquisition, utilization and management of the Company's gas supply assets. As part of this Plan, the Company sells gas supply and pipeline capacity in markets outside of its normal service territory. Results of the Plan are set forth below:
Three Months Ended Nine Months Ended June 1997 June 1997 ------------------ ----------------- (Thousands of Dollars) Incentive Plan Revenues $6,916 $27,920 Incentive Plan Gas Expense 5,229 22,634 ------ ------- Income Before Income Taxes $1,687 $ 5,286 ====== =======
5. In the past, the Company operated various manufactured gas plants which produced certain by-products and residuals. After performing, at the request of the United States Environmental Protection Agency (EPA), an investigation of one of the Company's former manufactured gas plant sites located in Shrewsbury, Missouri (the Shrewsbury Site) and reviewing the results of this investigation, the Company agreed to perform a limited removal of some contaminants on small areas of the site. As previously reported by the Company, the Company has been discussing with the EPA and the Missouri Department of Natural Resources (MoDNR) what additional actions are required for the site. At this time, given the lack of final agreement as to what additional actions should be taken, the ultimate costs to be incurred regarding the Shrewsbury Site remain unclear. Assuming the Company performs the limited removal actions agreed to with the EPA and those of the additional actions proposed by the EPA and MoDNR to which the Company has no objection, the Company estimates that the overall costs will be approximately $740,000. Currently, $540,000 of such overall costs have been paid, and an additional $200,000 has been reserved by the Company. The Company has notified its insurers that it intends to seek reimbursement from them of its investigation, remediation, clean-up and defense costs. The Company intends to seek recovery, if practicable, from any other potentially responsible parties. Page 8 In a separate matter, MoDNR has accepted the Company's application to place the site of a different former manufactured gas plant located in the City of St. Louis, Missouri (which site was also used by subsequent owners as the site of a coke manufacturing facility) in the Missouri environmental remediation program. MoDNR's preliminary tests at the site reflect the presence of coke and gas plant manufacturing wastes, as well as certain heavy metal wastes. The Company and MoDNR have agreed upon the parameters of the Company's initial investigation. The Company currently estimates that the cost of such investigation, MoDNR oversight costs and associated legal and engineering consulting costs relative to the site would together approximate $75,000. Currently, $36,000 has been paid and an additional $39,000 has been reserved on the Company's books. The City of St. Louis, the current owner of the site, has recently received proposals from several different groups to develop this site, and is in the process of evaluating such proposals. Various portions of the development proposals deal with the issue of the environmental condition of the site, and the impact of such condition on possible development plans. Until a development proposal is selected, the Company is unable to determine the impact, if any, that any proposed development will have on actions to be taken regarding the site, and the cost of any such actions. The Company has notified its insurers that the Company intends to seek reimbursement from them for investigation, remediation, clean-up and defense costs. The Company has also requested that other former site owners and/or operators participate in the cost of any site investigation, but none has yet agreed to do so. The Company plans to seek proportionate reimbursement of all costs incurred with respect to this site from such parties and/or any other potentially responsible parties, to the extent practicable. The Company is presently unable to evaluate or quantify further the scope or cost of any environmental response activity with regard to the above two former manufactured gas plant sites. In the Company's most recent rate case, the Missouri Public Service Commission approved, effective September 1, 1996, the continued use of a cost deferral mechanism, originally approved as part of a 1994 rate case settlement, for the Company's use in applying for appropriate rate recovery of various environmental costs in connection with former manufactured gas plants. This authorization will be null and void if the Company does not file to further adjust its rates by September 1, 1998; and, in any event, the recovery of costs thus deferred may be challenged in future rate proceedings. 6. Certain prior-period amounts have been reclassified to conform to current-period presentation. 7. This Form 10-Q should be read in conjunction with the Notes to Consolidated Financial Statements contained in the Company's 1996 Form 10-K. Page 9 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS For the quarter ended June 30, 1997, the Company recorded a positive earnings level of $.04 per share compared with a loss of $.02 per share for the same quarter last year. The $.06 per share increase was directly attributable to earnings produced by the Gas Supply Incentive Plan, which became effective October 1, 1996, and includes the sale of gas and pipeline capacity to non-traditional markets. The benefit of higher general rate levels (placed in effect September 1, 1996) was essentially offset by higher operating expenses. Utility operating revenues for the quarter ended June 30, 1997 were $84.2 million compared with $86.0 million for the quarter ended June 30, 1996. The $1.8 million, or 2.1%, decrease was principally due to lower wholesale gas costs (which are passed on to Laclede's customers under the Company's Purchased Gas Adjustment Clause), largely offset by revenues related to the aforementioned Incentive Plan and higher general rate levels (placed in effect September 1, 1996). System therms sold and transported decreased by 4.3 million therms, or 2.6%, below the quarter ended June 30, 1996. Utility operating expenses for the quarter ended June 30, 1997 decreased by $3.5 million, or 4.2%, below the same quarter last year. Natural and propane gas expense this quarter decreased $5.2 million, or 12.1%, below last year mainly due to decreased rates charged by the Company's suppliers and slightly lower volumes purchased for sendout, partially offset by gas expense related to the aforementioned Incentive Plan. Other operation and maintenance expenses increased $1.2 million, or 4.7%, principally due to lower gains applicable to lump-sum pension settlements, higher wage rates, increased distribution charges and other increases in the cost of doing business. These factors were partially offset by lower net pension costs. Depreciation and amortization expense increased 3.3% primarily due to additional property. Taxes, other than income taxes, decreased 6.9% mainly due to lower gross receipts taxes (reflecting decreased revenues), partially offset by higher real estate and personal property taxes this quarter. The $1.1 million increase in income taxes is principally due to higher taxable income. Miscellaneous income and income deductions was essentially the same as the corresponding period last year. In May 1997, Laclede completed the sale of certain oil and gas properties for $3.3 million, resulting in the recognition of a modest gain on such sale. Most of the properties sold were assets which had originally been acquired during the 1970s to provide a source of gas for the Company during an era of gas shortages and curtailments. Laclede has not been active in oil and gas exploration and development for a number of years. The benefit of the gain was mostly offset by reduced subsidiary income. The 9.7% increase in interest expense is mainly due to increased short-term interest expense reflecting higher borrowings. Page 10 Earnings for the nine months ended June 30, 1997 were $2.18 per share compared with $2.24 per share for the corresponding period last year. The $.06 per share decrease in earnings was primarily due to lower consumption by the Company's heating customers in response to sharply higher gas prices which were in effect for the first part of the winter, the effect of income from off system sales recorded during the same period last year and increased operating expenses. These decreases were only partially offset by the benefits of the Incentive Plan and last year's rate settlement (which resulted in higher general rate levels effective September 1, 1996). The Incentive Plan, which became effective October 1, 1996 as part of the settlement reached in the Company's last rate case, continues to provide significant benefits for both the Company's share owners and customers. Under the Plan, Laclede and its customers share in certain gains and losses, as measured against benchmark levels of gas costs, related to the acquisition, utilization, and management of the Company's gas supply assets. As part of this Plan, the Company sells gas supply and pipeline capacity in markets outside of its normal service territory. Such activity has been significant. For instance, gas purchases made for sales outside of the Company's service territory during March 1997 exceeded the amount of gas purchases made by the Company for consumption in its own service territory. To date, the Company has achieved overall gas cost savings of about $24.2 million, resulting in savings to Laclede's customers of $18.9 million and contributing about $5.3 million pre-tax income to the Company. Utility operating revenues for the first nine months of fiscal year 1997 increased $42.8 million, or 8.6%, above the corresponding period of fiscal year 1996. This increase was primarily due to higher wholesale gas costs (which are passed on to Laclede's customers under the Company's Purchased Gas Adjustment Clause), Incentive Plan revenues and the September 1, 1996 general rate increase. These increases were partially offset by lower gas sales volumes (arising mainly from lower customer consumption patterns). System therms sold and transported decreased by 54.2 million therms, or 5.2%, below the level experienced during the nine months ended June 30, 1996. Utility operating expenses for the nine months ended June 30, 1997 increased by $41.4 million, or 9.2%, above last year. Natural and propane gas expense during the first nine months of fiscal year 1997 increased $36.6 million, or 12.5%, above last year mainly due to higher rates charged by our suppliers and gas expense associated with the aforementioned Incentive Plan. These increases were partially offset by reduced volumes purchased for sendout (resulting from lower customer consumption patterns). Other operation and maintenance expenses increased $1.8 million, or 2.3%, principally due to lower gains applicable to lump-sum pension settlements, higher wage rates and other increases in the costs of doing business. These increases were partially offset by lower net pension costs, a lower provision for uncollectible accounts and reduced maintenance charges. Depreciation and amortization expense increased 5.1% primarily due to additional property. Taxes, other than income taxes, increased 5.7% principally due to higher real estate and personal property taxes and higher gross receipts taxes (mainly reflecting increased revenues). Page 11 Miscellaneous income and income deductions for the first nine months of fiscal 1997 decreased $1.5 million below the same period last year primarily due to reduced subsidiary income (mainly lower non-utility gas marketing income recognized by the Company's wholly-owned subsidiary, Laclede Energy Resources, Inc.). The 6.4% increase in interest expense is mainly due to higher short-term interest expense reflecting increased borrowings and higher interest on long-term debt resulting from the issuance of $25 million of 6-1/2% First Mortgage Bonds in November 1995. On June 25, 1997, the Company and Union representatives reached a new three- year labor agreement replacing the prior agreement which was to expire July 31, 1997. The new contract extends through July 31, 2000. The settlement resulted in wage increases of 2.5% in all three years, along with lump sum payment provisions and other benefit improvements. LIQUIDITY AND CAPITAL RESOURCES The Company's short-term borrowing requirements typically peak during colder months, principally because of required payments for natural gas made in advance of the receipt of cash from the Company's customers for the sale of that gas. Such short-term cash requirements have traditionally been met through the sale of commercial paper supported by lines of credit with banks. In January 1997, the Company renewed its primary lines of bank credit under which it may borrow up to $40 million prior to January 31, 1998, with renewal of any loans outstanding on that date permitted to June 30, 1998. This, along with a previously obtained $90 million supplemental line of credit which ran through March 1, 1997, provided a total line of credit of $130 million for the 1996-1997 heating season. Since seasonal cash needs typically decline at the end of the heating season, the Company reduced the supplemental line of credit to $40 million from March 1, 1997 through April 1, 1997 (the supplemental line was increased to $45 million for March 1, 1997 through March 3, 1997). The Company further reduced the supplemental line of credit to $25 million from April 2, 1997 through April 14, 1997 and to $15 million from April 15, 1997 through July 31, 1997. Such line was increased to $25 million on August 1, 1997 and extends through August 31, 1997. Our basic credit line of $40 million along with a supplemental credit line of $25 million will be sufficient to meet the Company's cash needs through the period ended August 31, 1997. During fiscal 1997 to date, the Company sold commercial paper aggregating to a maximum of $104.0 million at any one time, but did not borrow from the banks under the aforementioned agreements. Short-term borrowings amounted to $34.5 million at June 30, 1997. The Missouri Public Service Commission approved the Company's application seeking a two year extension, to April 21, 1999, of its previously granted authority to sell up to $50 million of additional First Mortgage Bonds. The original authorization was for $100 million of First Mortgage Bonds of which $50 million have already been issued and sold. The amount and timing of any issuance will be subject to management's evaluation of need, financial market conditions, and other factors. Page 12 In the past, the Company operated various manufactured gas plants which produced certain by-products and residuals. After performing, at the request of the United States Environmental Protection Agency (EPA), an investigation of one of the Company's former manufactured gas plant sites located in Shrewsbury, Missouri (the Shrewsbury Site) and reviewing the results of this investigation, the Company agreed to perform a limited removal of some contaminants on small areas of the site. As previously reported by the Company, the Company has been discussing with the EPA and the Missouri Department of Natural Resources (MoDNR) what additional actions are required for the site. See the "OTHER PERTINENT MATTERS" Section of the Company's most recent Form 10-K. At this time, given the lack of final agreement as to what additional actions should be taken, the ultimate costs to be incurred regarding the Shrewsbury Site remain unclear. Assuming the Company performs the limited removal actions agreed to with the EPA and those of the additional actions proposed by the EPA and MoDNR to which the Company has no objection, the Company estimates that the overall costs will be approximately $740,000. Currently, $540,000 of such overall costs have been paid, and an additional $200,000 has been reserved by the Company. The Company has notified its insurers that it intends to seek reimbursement from them of its investigation, remediation, clean-up and defense costs. The Company intends to seek recovery, if practicable, from any other potentially responsible parties. In a separate matter, MoDNR has accepted the Company's application to place the site of a different former manufactured gas plant located in the City of St. Louis, Missouri (which site was also used by subsequent owners as the site of a coke manufacturing facility) in the Missouri environmental remediation program. MoDNR's preliminary tests at the site reflect the presence of coke and gas plant manufacturing wastes, as well as certain heavy metal wastes. The Company and MoDNR have agreed upon the parameters of the Company's initial investigation. The Company currently estimates that the cost of such investigation, MoDNR oversight costs and associated legal and engineering consulting costs relative to the site would together approximate $75,000. Currently, $36,000 has been paid and an additional $39,000 has been reserved on the Company's books. The City of St. Louis, the current owner of the site, has recently received proposals from several different groups to develop this site, and is in the process of evaluating such proposals. Various portions of the development proposals deal with the issue of the environmental condition of the site, and the impact of such condition on possible development plans. Until a development proposal is selected, the Company is unable to determine the impact, if any, that any proposed development will have on actions to be taken regarding the site, and the cost of any such actions. The Company has notified its insurers that the Company intends to seek reimbursement from them for investigation, remediation, clean-up and defense costs. The Company has also requested that other former site owners and/or operators participate in the cost of any site investigation, but none has yet agreed to do so. The Company plans to seek proportionate reimbursement of all costs incurred with respect to this site from such parties and/or any other potentially responsible parties, to the extent practicable. The Company is presently unable to evaluate or quantify further the scope or cost of any environmental response activity with regard to the above two former manufactured gas plant sites. Page 13 In the Company's most recent rate case, the Missouri Public Service Commission (MoPSC) approved, effective September 1, 1996, the continued use of a cost deferral mechanism, originally approved as part of a 1994 rate case settlement, for the Company's use in applying for appropriate rate recovery of various environmental costs in connection with former manufactured gas plants. This authorization will be null and void if the Company does not file to further adjust its rates by September 1, 1998; and, in any event, the recovery of costs thus deferred may be challenged in future rate proceedings. The Company's Purchased Gas Adjustment (PGA) Clause provides for changes in the prices of wholesale gas costs to be passed on to the Company's customers. Under new procedures approved by the Missouri Public Service Commission (MoPSC) in July 1997, the Company will make only two scheduled PGA filings each year, one for the winter period and one for the summer. In addition, the Company may make one unscheduled adjustment during the winter if significant, unforeseen increases or decreases in gas costs occur. The new procedures also authorize the Company to purchase financial instruments that should protect the Company and its customers from any unusually large winter period gas price increases. The cost of purchasing these instruments will be recoverable by the Company through the operation of the PGA Clause. These new procedures will provide better gas price stability for the Company's customers. Construction expenditures for the nine months ended June 30, 1997 were $31.5 million compared with $32.2 million for the same period last year. Capitalization at June 30, 1997 increased $21.3 million since September 30, 1996 and consisted of 59.1% common stock equity, .4% preferred stock equity and 40.5% long-term debt. Page 14 LACLEDE GAS COMPANY AND SUBSIDIARY COMPANIES Part II OTHER INFORMATION Page 15 LACLEDE GAS COMPANY AND SUBSIDIARY COMPANIES Item 1. Legal Proceedings For a discussion of environmental matters, see Note 5 of the Notes to Consolidated Financial Statements in Part I, Financial Information. During the quarter ended June 30, 1997, there were no new legal proceedings required to be disclosed. Item 5. Other Information On May 22, 1997 the Board of Directors of Laclede Gas Company selected ChaseMellon Shareholder Services, L.L.C. ("CMSS") to serve, effective August 1, 1997, as transfer agent, as well as in various other capacities including rights agent, with regard to shareholders' stock interests in the Company. CMSS will succeed Boatmen's Trust Company ("Boatmen's") in these capacities. This change was necessitated by the fact that Boatmen's will no longer be providing these types of services. On July 24, 1997, the Company's Board of Directors amended the Company's By-laws, effective at the close of business on July 24, 1997, by adding to Article III thereof a new Section 8, relating to the nomination by shareholders of persons to stand for election as directors, and a new Section 9, relating to proposals by shareholders. Under these By-law provisions, notice of shareholder proposals or nominations for annual meetings must, among other things, normally be submitted in writing to the Corporate Secretary not less than sixty (60) nor more than ninety (90) days prior to the anniversary date of the prior year's annual meeting of shareholders, and must contain certain specified items of pertinent information. The amendments are included as Exhibit 3 to this Report and are incorporated herein by reference. The foregoing description of the By-Law amendments is qualified in its entirety by reference to said Exhibit 3. Item 6. Exhibits and Reports on Form 8-K (a) See Exhibit Index (b) Reports on Form 8-K The Company filed no reports on Form 8-K during the quarter ended June 30, 1997. Page 16 LACLEDE GAS COMPANY AND SUBSIDIARY COMPANIES SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. LACLEDE GAS COMPANY Date: July 31, 1997 /s/ G. T. McNeive, Jr. ------------------------ G. T. McNeive, Jr. Sr. Vice President - Finance (Authorized Signatory and Chief Financial Officer) Page 17 Index to Exhibits Sequentially Exhibit Numbered Number Exhibit Page - ------- ------- ------------ 3.0 Amendments to the Company's By-Laws, effective 19 at the close of business on July 24, 1997, adopted by the Company's Board of Directors on July 24, 1997. 4.1 Amendments to the Laclede Gas Company Salary 22 Deferral Savings Plan adopted April 21, 1997. 4.2 Amendments to the Laclede Gas Company Wage 27 Deferral Savings Plan adopted April 21, 1997. 4.3 Amendments to the Missouri Natural Gas Division 31 of Laclede Gas Company Dual Savings Plan adopted April 21, 1997. 10.1 April 1, 1997 supplemental line of credit 36 agreement with The Chase Manhattan Bank. 10.2 April 15, 1997 supplemental line of credit 38 agreement with the Chase Manhattan Bank. 10.3 April 30, 1997 supplemental line of credit 40 agreement with The Chase Manhattan Bank. 10.4 July 1, 1997 supplemental line of credit agreement 42 with the Chase Manhattan Bank. 27 Financial Data Schedule UT 44 Page 18 EX-3.0 2 New Sections 8 and 9 are hereby added to Article III of Laclede Gas Company's By-Laws, effective the close of business on July 24, 1997, reading as follows: Section 8. Notice of Stockholder Nominees for Directors. Only persons who are nominated in accordance with the procedures set forth in this Section 8 shall be eligible for election as directors of the Company. Nominations of persons for election to the Board of Directors of the Company may be made: (a) by or at the direction of the Board of Directors; or (b) at a meeting of stockholders by any stockholder of the Company entitled to vote at such meeting for the election of directors and who complies with the procedures set forth in this Section 8. All nominations by stockholders shall be made pursuant to timely notice in proper written form to the Secretary of the Company, as hereinafter described. To be timely, a stockholder's notice shall be delivered or mailed to, and received by, the Secretary of the Company at the principal executive offices of the Company: (a) in the case of an annual meeting of stockholders, not less than 60 days nor more than 90 days prior to the first anniversary date of the immediately preceding year's annual meeting of stockholders (the "Anniversary Date"); provided, however, that in the event that the date of the annual meeting is more than 30 days before or more than 60 days after the Anniversary Date, notice by the stockholder to be timely must be received not earlier than 90 days prior to the date of the annual meeting and not later than the later of (i) 60 days prior to the date of the annual meeting, or (ii) 10 days following the date on which public announcement of the date of the annual meeting is first made by the Company; and (b) in the case of a special meeting of stockholders, not less than 25 days prior to the date of the meeting; provided, however, that if less than 25 days' notice or prior public announcement of the date of the meeting is given or made to stockholders by the Company, notice by the stockholder to be timely must be so received not later than the tenth day following the day on which such notice of the date of the meeting was mailed or such public announcement was made. In no event shall the public announcement of an adjournment of a stockholders' meeting commence a new time period for the giving of a stockholder's notice as described in this Section 8. For purposes of this Section 8, and for the purpose of Section 9 of this Article III, "public announcement" shall mean disclosure in a press release reported by the Dow Jones News Service, Associated Press or a comparable national news service or in a document publicly filed by the Company with the Securities and Exchange Commission pursuant to the Section 13, 14 or 15(d) of the Securities Exchange Act of 1934, as amended (hereinafter, in this Section 8, and in Section 9 of this Article III, called the "Exchange Act"), or any successor law or agency rule. To be in proper written form, any stockholder's notice shall set forth in writing: (a) as to each person whom the stockholder proposes to nominate for election (i) the name, age, business address and residence address of such person, (ii) the principal occupation or employment of such person for the previous five years, (iii) the class and number of shares of the Company's capital stock beneficially owned by such person, (iv) such person's written consent to being named in a proxy statement as a nominee and to serving as a director if elected, and (v) any other information relating to such person that is required to be disclosed in solicitations of proxies for election of directors, or is otherwise required, in each case pursuant to Regulation 14A under the Exchange Act (or any successor law or agency rule); and (b) as to each stockholder giving the notice and the beneficial owner, if any, on whose behalf the nomination is made ("Relevant Beneficial Owner"): (i) the Page 19 name and address, as they appear on the Company's stockholder records, of such stockholder and any such Relevant Beneficial Owner; and (ii) the class and number of shares of the Company's capital stock which are owned beneficially and of record by such stockholder and any such Relevant Beneficial Owner. At the request of the Board of Directors, any person nominated by the Board of Directors for election as a director shall furnish to the Secretary of the Company that information which pertains to the nominees and required to be set forth in a stockholder's notice of nomination. In the event that a stockholder seeks to nominate one or more directors, the Chairman of the Board of Directors shall determine whether a stockholder has complied with this Section 8. If the Chairman of the Board of Directors shall determine that a stockholder has not complied with this Section 8, such Chairman shall declare to the meeting that the nomination was not made in accordance with the procedures prescribed by the By-Laws of the Company, and the defective nomination shall be disregarded. Notwithstanding the foregoing provisions of this Section 8, a stockholder shall also comply with all applicable requirements of the Exchange Act and the rules and regulations thereunder (or any successor law or agency rule) with respect to the matters set forth in this Section 8. Nothing in this Section 8 shall be deemed to affect any rights of holders of any series of Preferred Stock to elect directors under specified circumstances, as provided in the Company's Articles of Incorporation. Section 9. Procedures for Submission of Stockholder Proposals at Stockholders' Meetings. At any meeting of the stockholders of the Company, only such business shall be conducted as shall have been brought before the meeting: (i) by or at the direction of the Board of Directors; or (ii) by any stockholder of the Company entitled to vote on such business at such meeting who complies with the procedures set forth in this Section 9. For business properly to be brought before a meeting by a stockholder, the stockholder must have given timely notice thereof in proper written form to the Secretary of the Company and must otherwise be a proper matter for stockholder action. To be timely, a stockholder's notice shall be delivered or mailed to, and received by, the Secretary of the Company at the principal executive offices of the Company: (a) in the case of an annual meeting of stockholders, not less than 60 days nor more than 90 days prior to the first anniversary date of the immediately preceding year's annual meeting of stockholders (the "Anniversary Date"); provided, however, that in the event that the date of the annual meeting is more than 30 days before or more than 60 days after the Anniversary Date, notice by the stockholder to be timely must be so received not earlier than 90 days prior to the date of the annual meeting and not later than the later of (i) 60 days prior to the date of the annual meeting, or (ii) 10 days following the date on which public announcement of the date of the annual meeting is first made by the Company; and (b) in the case of a special meeting of stockholders, not less than 25 days prior to the date of the meeting; provided, however, that if less than 25 days' notice or prior public announcement of the date of the meeting is given or made to stockholders by the Company, notice by the stockholder to be timely must be so received not later than the tenth day following the day on which such notice of the date of the meeting was mailed or such public announcement was made. In no event shall the public announcement of an adjournment of an annual meeting commence a new time period for the giving of a stockholder's notice as described in this Section 9. To be in proper written form, any stockholder's notice to the Secretary of the Company shall set forth as to each matter the stockholder proposes to Page 20 bring before the meeting of stockholders: (i) a brief description of the business desired to be brought before the meeting and the reasons for conducting such business at the meeting; (ii) the name and address, as they appear on the Company's stockholder records, of the stockholder proposing such business and the beneficial owner, if any, on whose behalf the proposal is made; (iii) the class and number of shares of the Company's capital stock which are owned beneficially and of record by the stockholder and any such beneficial owner; and (iv) any material interest of the stockholder and any such beneficial owner, in such business. Notwithstanding anything in these By-Laws to the contrary, no business shall be conducted at a meeting of stockholders, except in accordance with the procedures set forth in Section 8 or this Section 9 of the Company's By- Laws. The Chairman of the Board of Directors shall, if the facts warrant, determine and declare to the meeting that business was not properly brought before the meeting in accordance with the provisions of this Section 9, and, if he should so determine and declare, any such business not properly brought before the meeting shall be disregarded. Notwithstanding any of the foregoing provisions of this Section 9, a stockholder shall also comply with all applicable requirements of the Exchange Act and the rules and regulations thereunder (or any successor law or agency rule) with respect to the matters set forth in this Section 9. Nothing in this Section 9 shall be deemed to affect any rights of stockholders to request inclusion of proposals in the Company's proxy statement pursuant to Rule 14a-8 under the Exchange Act (or any successor law or agency rule). Page 21 EX-4.1 3 Date: April 21, 1997 Robert C. Jaudes (as Chairman of the Board, President and Chief Executive Officer of Laclede Gas Company), and Gerald T. McNeive, Jr. (as Senior Vice President - Finance of Laclede Gas Company), pursuant to resolutions adopted by the Board of Directors on August 28, 1986, which resolutions, among other things, granted to any two executive officers who hold one of the following offices: Chairman of the Board; President; Executive Vice President; or Senior Vice President; the authority to amend any or all of the benefit plans and/or related trust agreements of the Company (collectively the "Plans") to the extent such amendments deal with changes necessary or appropriate: (1) to comply with, or obtain the benefit of, applicable laws and/or regulations, as amended from time to time; (2) to reflect minor or routine administrative factors; (3) to clarify the meaning of any of the provisions of the Plans; and/or (4) to evidence changes in then existing Plans to reflect the interrelationship thereof with newly adopted Plans or amendments to Plans, which newly adopted Plans or amendments affect the terms of such other then existing Plans; do hereby amend the Laclede Gas Company Salary Deferral Savings Plan as set forth in the attached exhibit, such amendment to be effectuated and evidenced by our signatures on said exhibit. Page 22 AMENDMENTS TO THE LACLEDE GAS COMPANY SALARY DEFERRAL SAVINGS PLAN ------------------------------------- The following amendments are all effective October 1, 1989. 1. The following new sentences are hereby added at the end of Section 2.8 to read as follows: "For purposes of applying the annual compensation limit described in the two immediately preceding sentences, the family unit of an Employee, who is either: (a) a five percent (5%) owner or (b) both a highly compensated Employee and one of the ten most highly compensated Employees during the Plan Year, will be treated as a single Employee. For this purpose a family unit consists of: the Employee who is a five percent (5%) owner or is both a highly compensated Employee and one of the ten most highly compensated Employees; such Employee's Employee spouse; and such Employee's Employee lineal descendants who have not attained age nineteen (19) before the close of the year. The provisions set forth in the immediately preceding two sentences shall expire on September 30, 1997." 2. The first sentence of Section 2.9 is hereby deleted, and the second sentence (which shall be the first sentence after such deletion) of Section 2.9 is hereby amended to read in its entirety as follows: "A period commencing on an Employee's employment commencement date or reemployment commencement date, and ending on the Employee's severance date, as hereinafter defined." 3. Section 2.14 is hereby amended to read in its entirety as follows: "2.14 "Employee" --------------- Any person who is employed by Laclede Gas Company in any capacity. An individual's employment status and position shall be determined by the job classification assigned to him or her by the Company. Notwithstanding the preceding paragraph of this Section 2.14, the term "Employee" shall exclude "leased employees", as defined in Code Section 414(n), for all purposes except the determination of Year of Service, as defined in Section 2.33." 4. A new sentence is hereby added immediately before the last sentence in Section 4.2(a) to read as follows: "If salary deferrals exceed the Code Section 402 limit, they shall be distributed to the Participant, after first being reduced by any excess salary deferrals previously distributed to the Participant for the Plan Year beginning within the Participant's taxable year." 5. Section 4.4(a) is hereby amended by adding the following new unnumbered paragraph immediately following subparagraph (ii) of Section 4.4(a) to read as follows: "For Plan Years beginning before October 1, 1997, the actual deferral percentage of a Family Group, as defined below, shall be determined by calculating the ratio of the aggregated Salary Deferral Contributions Page 23 of the Family Group to the Compensation of the Family Group. The actual deferral percentage of the Family Group shall be used in the calculation of the actual deferral percentage test for the Highly Compensated Employee group. If a Participant is required to be aggregated as a member of more than one Family Group in a plan, all Participants who are members of those Family Groups that include the Participant are aggregated as one Family Group. For the purpose of this section, Family Group is defined as: a Highly Compensated Employee, who is a five percent (5%) owner or one of the ten (10) most Highly Compensated Employees; such Employee's Employee spouse; and such Employee's lineal Employee ascendants and Employee descendants (and Employee spouses of such ascendants and descendants). A Family Group will be treated as a single Employee for Plan Years beginning before October 1, 1997." 6. Section 4.4(b) is hereby amended by replacing the unnumbered paragraph immediately following subparagraph (ii) of Section 4.4(b) with the two new unnumbered paragraphs to read as follows: "The higher amount of (b)(i) and (b)(ii) above is hereinafter in this Section 4.4 called the "Base Percentage". If the actual deferral percentage for the Highly Compensated Employee group exceeds the Base Percentage (any such excess being hereinafter in this Section 4.4 called the "Excess"), then prior to the end of the Plan Year, the actual deferral percentage of each of those Participants in the Highly Compensated Employee group whose actual deferral percentage shall be greater than the Base Percentage shall be reduced as necessary (to eliminate the Excess), in a manner whereby the actual deferral percentage of such Participants shall be equal to the Base Percentage, by refunding the Excess to such affected Participants. The actual deferral percentage for the Highly Compensated Employee with the highest percentage shall be reduced to the extent necessary to satisfy the actual deferral percentage test or to cause such ratio to equal the actual deferral percentage of the Highly Compensated Employee with the next highest ratio. This process shall be repeated until the actual deferral percentage test is satisfied. Any such refunded salary deferrals shall include any applicable income earned on such deferrals during the Plan Year. For Plan Years beginning before October 1, 1997, the actual matching percentage of a Family Group, as defined below, shall be determined by calculating the ratio of the aggregated Matching Contributions of the Family Group to the Compensation of the Family Group. The actual matching percentage of the Family Group shall be used in the calculation of the actual matching percentage test for the Highly Compensated Employee group. If a Participant is required to be aggregated as a member of more than one Family Group in a plan, all Participants who are members of those Family Groups that include the Participant are aggregated as one Family Group. For the purpose of this section, Family Group is defined as: a Highly Compensated Employee, who is a five percent (5%) owner or one of the ten (10) most Highly Compensated Employees; such Employee's Employee spouse; and such Employee's lineal Employee ascendants and Employee descendants (and Employee spouses of such ascendants and descendants). A Family Group will be treated as a single Employee for Plan Years beginning before October 1, 1997." Page 24 7. The last unnumbered paragraph of subparagraph (ii) of Section 5.1(b) is hereby replaced in its entirety with two new unnumbered paragraphs to read as follows: "The higher amount of (b)(ii)(aa) and (b)(ii)(bb) above is hereinafter in this Section 5.1 called the "Base Percentage". If the actual matching percentage for the Highly Compensated Employee group exceeds the Base Percentage (any such excess being hereinafter in this Section 5.1 called the "Excess"), then prior to the end of the Plan Year, the Company Matching Contribution of each of those Participants in the Highly Compensated Employee group whose actual matching percentage shall be greater than the Base Percentage shall be reduced as necessary (to eliminate the Excess), in a manner whereby the actual matching percentage of such Participants shall be equal to the Base Percentage, by refunding the Excess to the Company. The actual matching percentage for the Highly Compensated Employee with the highest percentage shall be reduced to the extent necessary to satisfy the actual matching percentage test or to cause such ratio to equal the actual matching percentage of the Highly Compensated Employee with the next highest ratio. This process shall be repeated until the actual matching percentage test is satisfied. Any such refunded matching contributions shall include any applicable income earned on such matching contributions during the Plan Year. For Plan Years beginning before October 1, 1997, the actual matching percentage of a Family Group, as defined below, shall be determined by calculating the ratio of the aggregated Matching Contributions of the Family Group to the Compensation of the Family Group. The actual matching percentage of the Family Group shall be used in the calculation of the actual matching percentage test for the Highly Compensated Employee group. If a Participant is required to be aggregated as a member of more than one Family Group in a plan, all Participants who are members of those Family Groups that include the Participant are aggregated as one Family Group. For the purpose of this section, Family Group is defined as: a Highly Compensated Employee, who is a five percent (5%) owner or one of the ten (10) most Highly Compensated Employees; such Employee's Employee spouse; and such Employee's lineal Employee ascendants and Employee descendants (and Employee spouses of such ascendants and descendants). A Family Group will be treated as a single Employee for Plan Years beginning before October 1, 1997." 8. The unnumbered continuing paragraph of Section 5.1(b)(iii) immediately following subclause (2) of Section 5.1(b)(iii)(bb) is hereby amended to read as follows: "then, prior to the end of the Plan Year, either or both, as needed, of the actual deferral percentage or actual matching percentage for such participating Highly Compensated Employees shall be reduced as set forth under Sections 4.4(b) and 5.1(b) herein until there is no such excess." 9. Paragraph (a) of Section 8.2 is hereby amended to read in its entirety as follows: "(a) The Company shall contribute on behalf of each Non-Key Employee an amount which is the lesser of: Page 25 (1) three percent (3%) of the Employee's compensation during the Plan Year; or (2) the percentage at which the total of Company and Employee contributions are made under the Plan for the Key Employee for whom such percentage is highest for the Plan Year. Such minimum Company contribution amount calculated for Non-Key Employees shall not include the Non-Key Employees' salary deferrals; however, salary deferrals made by Key Employees shall be included in the calculation of the minimum Company contributions. This paragraph shall not apply to any Non-Key Employee who is a participant in a defined benefit plan of the Company if such Non-Key Employee receives the Top-Heavy Plan minimum benefit thereunder." 10. The last sentence in paragraph (b) of Section 10.1 is hereby deleted. ROBERT C. JAUDES -------------------------------------- Title: Chairman, President and Chief Executive Officer GERALD T. MCNEIVE --------------------------------------- Title: Senior Vice President - Finance Page 26 EX-4.2 4 Date: April 21, 1997 Robert C. Jaudes (as Chairman of the Board, President and Chief Executive Officer of Laclede Gas Company), and Gerald T. McNeive, Jr. (as Senior Vice President - Finance of Laclede Gas Company), pursuant to resolutions adopted by the Board of Directors on August 28, 1986, which resolutions, among other things, granted to any two executive officers who hold one of the following offices: Chairman of the Board; President; Executive Vice President; or Senior Vice President; the authority to amend any or all of the benefit plans and/or related trust agreements of the Company (collectively the "Plans") to the extent such amendments deal with changes necessary or appropriate: (1) to comply with, or obtain the benefit of, applicable laws and/or regulations, as amended from time to time; (2) to reflect minor or routine administrative factors; (3) to clarify the meaning of any of the provisions of the Plans; and/or (4) to evidence changes in then existing Plans to reflect the interrelationship thereof with newly adopted Plans or amendments to Plans, which newly adopted Plans or amendments affect the terms of such other then existing Plans; do hereby amend the Laclede Gas Company Wage Deferral Savings Plan as set forth in the attached exhibit, such amendment to be effectuated and evidenced by our signatures on said exhibit. Page 27 AMENDMENTS TO THE LACLEDE GAS COMPANY WAGE DEFERRAL SAVINGS PLAN ------------------------------------- The following amendments are all effective July 1, 1989. 1. The first sentence of Section 2.9 is hereby deleted and the second sentence (which shall be the first sentence after such deletion) is hereby amended to read in its entirety as follows: "A period commencing on an Employee's employment commencement date or reemployment commencement date and ending on the Employee's severance date, as hereinafter defined." 2. The fourth sentence of Section 2.14 is hereby amended to read in its entirety as follows: "A person ceases to be an "Employee" when such person has been on temporary layoff for a continuous period of more than six (6) months, or when such person takes an unauthorized leave of absence, or when such person otherwise ceases to be employed with the Laclede Division or St. Charles Division of the Company." 3. Two new sentences are hereby added at the end of paragraph (a) of Section 4.2 to read as follows: "The aggregate amount of wage deferrals for each individual Participant (during the Participant's taxable year) shall not exceed the limitation on deferrals under Section 402 of the Code (as such limitation is, or may be, adjusted or increased by Section 415(d) or any other provision of the Code) for an individual's taxable year. If wage deferrals exceed the Code Section 402 limit, they shall be distributed to the Participant, after first being reduced by any excess wage deferrals previously distributed to the Participant for the Plan Year beginning within the Participant's taxable year." 4. Section 4.4(a) is hereby amended by adding a new paragraph immediately following subparagraph (ii) of Section 4.4(a) to read as follows: "For Plan Years beginning before August 1, 1997, the actual deferral percentage of a Family Group, as defined below, shall be determined by calculating the ratio of the aggregated Wage Deferral Contributions of the Family Group to the Compensation of the Family Group. The actual deferral percentage of the Family Group shall be used in the calculation of the actual deferral percentage test for the Highly Compensated Employee group. If a Participant is required to be aggregated as a member of more than one Family Group in a plan, all Participants who are members of those Family Groups that include the Participant are aggregated as one Family Group. For the purpose of this section, Family Group is defined as: a Highly Compensated Employee, who is a five percent (5%) owner or one of the ten (10) most Highly Compensated Employees; such Employee's Employee spouse; and such Employee's lineal Employee ascendants and Employee descendants (and Employee spouses of such ascendants and descendants). A Family Group will be treated as a single Employee for Plan Years beginning before August 1, 1997." Page 28 5. Section 4.4(b) is hereby amended by replacing the unnumbered paragraph immediately following subparagraph (ii) of Section 4.4(b) with an unnumbered paragraph to read as follows: "The higher amount of (b)(i) and (b)(ii) above is hereinafter in this Section 4.4 called the "Base Percentage". If the actual deferral percentage for the Highly Compensated Employee group exceeds the Base Percentage (any such excess being hereinafter in this Section 4.4 called the "Excess"), then prior to the end of the Plan Year, the actual deferral percentage of each of those Participants in the Highly Compensated Employee group whose actual deferral percentage shall be greater than the Base Percentage shall be reduced as necessary (to eliminate the Excess), in a manner whereby the actual deferral percentage of such Participants shall be equal to the Base Percentage, by refunding the Excess to such affected Participants. The actual deferral percentage for the Highly Compensated Employee with the highest percentage shall be reduced to the extent necessary to satisfy the actual deferral percentage test or to cause such ratio to equal the actual deferral percentage of the Highly Compensated Employee with the next highest ratio. This process shall be repeated until the actual deferral percentage test is satisfied. Any such refunded wage deferrals shall include any applicable income earned on such deferrals during the Plan Year." 6. The last unnumbered paragraph of subparagraph (ii) of Section 5.1(b) is hereby replaced in its entirety with two new unnumbered paragraphs to read as follows: "The higher amount of (b)(ii)(aa) and (b)(ii)(bb) above is hereinafter in this Section 5.1 called the "Base Percentage". If the actual matching percentage for the Highly Compensated Employee group exceeds the Base Percentage (any such excess being hereinafter in this Section 5.1 called the "Excess"), then prior to the end of the Plan Year, the Company Matching Contribution of each of those Participants in the Highly Compensated Employee group whose actual matching percentage shall be greater than the Base Percentage shall be reduced as necessary (to eliminate the Excess), in a manner whereby the actual matching percentage of such Participants shall be equal to the Base Percentage, by refunding the Excess to the Company. The actual matching percentage for the Highly Compensated Employee with the highest percentage shall be reduced to the extent necessary to satisfy the actual matching percentage test or to cause such ratio to equal the actual matching percentage of the Highly Compensated Employee with the next highest ratio. This process shall be repeated until the actual matching percentage test is satisfied. Any such refunded matching contributions shall include any applicable income earned on such matching contributions during the Plan Year. For Plan Years beginning before August 1, 1997, the actual matching percentage of a Family Group, as defined below, shall be determined by calculating the ratio of the aggregated Matching Contributions of the Family Group to the Compensation of the Family Group. The actual matching percentage of the Family Group shall be used in the calculation of the actual matching percentage test for the Highly Compensated Employee group. If a Participant is required to be aggregated as a member of more than one Family Group in a plan, all Participants who are members of those Family Groups that include the Participant are aggregated as one Family Group. For the purpose of Page 29 this section, Family Group is defined as: a Highly Compensated Employee, who is a five percent (5%) owner or one of the ten (10) most Highly Compensated Employees; such Employee's Employee spouse; and such Employee's Employee ascendants and Employee descendants (and Employee spouses of such ascendants and descendants). A Family Group will be treated as a single Employee for Plan Years beginning before August 1, 1997." 7. The unnumbered continuing paragraph of Section 5.1(b)(iii) immediately following subclause (2) of Section 5.1(b)(iii)(bb) is hereby amended to read as follows: "then, prior to the end of the Plan Year, either or both, as needed, of the actual deferral percentage or actual matching percentage for such participating Highly Compensated Employees shall be reduced as set forth under Sections 4.4(b) and 5.1(b) herein until there is no such excess." ROBERT C. JAUDES -------------------------------------- Title: Chairman, President and Chief Executive Officer GERALD T. MCNEIVE --------------------------------------- Title: Senior Vice President - Finance Page 30 EX-4.3 5 Date: April 21, 1997 Robert C. Jaudes (as Chairman of the Board, President and Chief Executive Officer of Laclede Gas Company), and Gerald T. McNeive, Jr. (as Senior Vice President - Finance of Laclede Gas Company), pursuant to resolutions adopted by the Board of Directors on August 28, 1986, which resolutions, among other things, granted to any two executive officers who hold one of the following offices: Chairman of the Board; President; Executive Vice President; or Senior Vice President; the authority to amend any or all of the benefit plans and/or related trust agreements of the Company (collectively the "Plans") to the extent such amendments deal with changes necessary or appropriate: (1) to comply with, or obtain the benefit of, applicable laws and/or regulations, as amended from time to time; (2) to reflect minor or routine administrative factors; (3) to clarify the meaning of any of the provisions of the Plans; and/or (4) to evidence changes in then existing Plans to reflect the interrelationship thereof with newly adopted Plans or amendments to Plans, which newly adopted Plans or amendments affect the terms of such other then existing Plans; do hereby amend the Missouri Natural Gas Division of Laclede Gas Company Dual Savings Plan as set forth in the attached exhibit, such amendment to be effectuated and evidenced by our signatures on said exhibit. Page 31 AMENDMENTS TO THE MISSOURI NATURAL GAS DIVISION OF LACLEDE GAS COMPANY DUAL SAVINGS PLAN -------------------------------------------------- The following amendments are all effective November 1, 1989. 1. The first sentence of paragraph (a) of Section IV is hereby amended to read in its entirety as follows: "Each Participant shall designate as such Participant's Participant Matchable Deposit hereunder 2%, 3%, 4%, 5%, or 6% of such Participant's Earnings in any Plan Year as either Pre-Tax Deposits for credit to such Participant's Pre-Tax Deposit Account or as Post-Tax Deposits for credit to such Participant's Post-Tax Deposit Account, whichever such Participant designates." 2. The last sentence of paragraph (c) of Section IV is hereby amended to read in its entirety as follows: "Each Participant must also designate the portion of such Participant's Participant Non-Matchable Deposits which are Pre-Tax Deposits to be credited to such Participant's Pre-Tax Deposit Account and/or which are Post-Tax Deposits to be credited to such Participant's Post-Tax Deposit Account." 3. A new unnumbered paragraph is added at the beginning of paragraph (d) of Section IV to read as follows: "The aggregate amount of Participant Pre-Tax Deposits for each individual Participant (during the Participant's taxable year) shall not exceed the limitation on deferrals under Section 402 of the Code (as such limitation is, or may be, adjusted or increased by Section 415(d) or any other provision of the Code) for an individual's taxable year. If Pre-Tax Deposits exceed the Code Section 402 limit, they shall be distributed to the Participant, after first being reduced by any excess Pre-Tax Deposits previously distributed to the Participant for the Plan Year beginning within the Participant's taxable year." 4. A new unnumbered paragraph is hereby added at the end of subparagraph (1) of Section IV(e) to read as follows: "For Plan Years beginning before November 1, 1997, the ADP of a Family Group, as defined below, shall be determined by calculating the ratio of the aggregated Pre-Tax Deposits of the Family Group to the Earnings of the Family Group. The ADP of the Family Group shall be used in the calculation of the ADP for the Highly Compensated Employee group. If a Participant is required to be aggregated as a member of more than one Family Group in a plan, all Participants who are members of those Family Groups that include the Participant are aggregated as one Family Group. For the purpose of this section, Family Group is defined as: a Highly Compensated Employee, who is a five percent (5%) owner or one of the ten (10) most Highly Compensated Employees; such Employee's Employee spouse; and such Employee's lineal Employee ascendants and Employee descendants (and Employee spouses of such ascendants and descendants). A Family Group will be treated as a single Employee for Plan Years beginning before November 1, 1997." Page 32 5. The last unnumbered paragraph of subparagraph (2) of Section IV(e) is hereby amended to read in its entirety as follows: "The higher amount of (i) and (ii) in this subparagraph (2) is hereinafter in this Section IV(e) called the "Base Deferral Percentage". If the ADP for the Highly Compensated Employees' group exceeds the Base Deferral Percentage (any such excess being hereinafter in this Section IV(e) called the "Excess Deferral"), then prior to the end of the Plan Year, the Pre-Tax Deposit percentage of each of those Participants in the Highly Compensated Employees group whose ADP shall be greater than the Base Deferral Percentage shall be reduced as necessary (to eliminate the Excess Deferral) in a manner whereby the ADP of such Participants shall be equal to the Base Deferral Percentage, by refunding such Excess Deferral to such Participants. The ADP for the Highly Compensated Employee with the highest percentage shall be reduced to the extent necessary to satisfy the ADP test or to cause such ratio to equal the ADP of the Highly Compensated Employee with the next highest ratio. This process shall be repeated until the ADP test is satisfied. Any refunded amounts shall include any applicable income earned on such amounts during the Plan Year." 6. The last unnumbered paragraph of subparagraph (3) of Section IV(e) is hereby replaced in its entirety with two new unnumbered paragraphs to read as follows: "The higher amount of (i) and (ii) in this subparagraph (3) is hereinafter in this Section IV(e) called the "Base Contribution Percentage". If the ACP for the Highly Compensated Employees' group exceeds the Base Contribution Percentage (any such excess being hereinafter in this Section IV(e) called the "Excess Contribution"), then prior to the end of the Plan Year, the Post-Tax Deposit percentage and/or the Company contribution of each of those Participants in the Highly Compensated Employees' group whose ACP shall be greater than the Base Contribution Percentage shall be reduced as necessary (to eliminate the Excess Contribution) in a manner whereby the ACP of such Participants shall be equal to the Base Contribution Percentage, by refunding the Excess Contribution to such Participants and/or the Company. The ACP for the Highly Compensated Employee with the highest percentage shall be reduced to the extent necessary to satisfy the ACP test or to cause such ratio to equal the ACP of the Highly Compensated Employee with the next highest ratio. This process shall be repeated until the ACP test is satisfied. Any such refunded amounts shall include any applicable income earned on such amounts during the Plan Year. For Plan Years beginning before November 1, 1997, the ACP of a Family Group, as defined below, shall be determined by calculating the ratio of the aggregated Post-Tax Deposits and/or Company contributions of the Family Group to the Earnings of the Family Group. The ACP of the Family Group shall be used in the calculation of the ACP for the Highly Compensated Employee group. If a Participant is required to be aggregated as a member of more than one Family Group in a plan, all Participants who are members of those Family Groups that include the Participant are aggregated as one Family Group. For the purpose of this section, Family Group is defined as: a Highly Compensated Employee, who is a five percent (5%) owner or one of the ten (10) most Highly Compensated Employees; such Employee's Employee spouse; and such Employee's lineal Employee ascendants and Employee descendants (and Page 33 Employee spouses of such ascendants and descendants). A Family Group will be treated as a single Employee for Plan Years beginning before November 1, 1997." 7. Subclause (B) of Section IV(e)(4)(ii) is hereby amended to read in its entirety as follows: "(B) 2.00 times the smaller of the ADP or ACP for all such remaining Employees, then prior to the end of the Plan Year, either or both, as needed, of the ADP and ACP for such participating Highly Compensated Employees shall be reduced using the procedures defined in subparagraphs (2) and (3) of this Section IV(e) until there is no such excess." 8. A new unnumbered paragraph is hereby added at the end of subparagraph (5) of Section IV(e) to read as follows: "For Plan Years beginning before November 1, 1997, a Family Group, as defined below, of a Highly Compensated Employee shall be treated as a single Employee under the Plan. A Family Group is defined as: a Highly Compensated Employee, who is a five percent (5%) owner or one of the ten (10) most Highly Compensated Employees; such Employees' Employee spouse; and such Employee's lineal Employee ascendants and Employee descendants (and Employee spouses of such ascendants and descendants). If a Participant is required to be aggregated as a member of more than one Family Group in a plan, all Participants who are members of those Family Groups that include the Participant are aggregated as one Family Group." 9. Paragraph (c) of Section VI is hereby amended to read in its entirety as follows: "(c) A Participant who has completed five (5) Years of Service and who terminates employment with the Company on or after November 1, 1989, shall be 100% vested in such Participant's Post-Tax Match Account." 10. Paragraph (e) of Section VI is hereby amended to read in its entirety as follows: "(e) A Participant shall become 100% vested in such Participant's Post-Tax Match Account on the first day of the month following six (6) months of layoff, upon death, upon attainment of such Participant's 65th birthday, upon such Participant's retirement within the meaning of Section VIII(b) of the Plan, or upon permanent and total disability within the meaning of Section VIII(c) of the Plan." 11. Paragraphs (b) and (c) of Section XIV are hereby amended to read in their entirety, respectively, as follows: "(b) Termination or Discontinuance of Company Contributions. ------------------------------------------------------ The Company shall have the right at any time to terminate the Plan. The Company shall promptly give notice of such termination to all Participants. Upon termination of the Plan or upon complete discontinuance of the Company's contributions, each Participant's Company Contribution Account shall become fully vested, and shall not thereafter be subject to forfeiture. Page 34 Upon termination of the Plan, the Committee shall direct the Trustee to distribute, as soon as practicable, all assets remaining in the Plan's trust fund, after payment of any expenses properly chargeable against such trust fund, to the Participants, in accordance with the value of each Participant's accounts as of the date of such termination, in cash or in kind. Distribution will not be made to the Participants if the Company establishes a successor plan as provided under Code Section 401(k); but such distributions will be made into the successor plan for the benefit of the Participants. "(c) Partial Termination. ------------------- The Company shall have the right at any time to terminate partially the Plan with respect to a group of Participants. The Company shall promptly give notice of such partial termination to all affected Participants. Upon such partial termination of the Plan, the Company Contribution Account of each affected Participant shall become fully vested, and shall not thereafter be subject to forfeiture. Upon partial termination of the Plan, the Committee shall direct the Trustee to distribute, as soon as practicable, all assets credited to the accounts of the affected Participants remaining in the Plan's trust fund, after payment of any expenses properly chargeable against the Plan's trust fund, to the affected Participants, in accordance with the value of each of the affected Participant's accounts as of the date of such partial termination, in cash or in kind. Distribution will not be made to the affected Participants if the Company establishes a successor plan as provided under Code Section 401(k); but such distributions will be made into the successor plan for the benefit of the affected Participants." ROBERT C. JAUDES -------------------------------------- Title: Chairman, President and Chief Executive Officer GERALD T. MCNEIVE --------------------------------------- Title: Senior Vice President - Finance Page 35 EX-10.1 6 The Chase Manhattan Bank One Chase Manhattan Plaza New York, NY 10081 April 1, 1997 Mr. Ronald L. Krutzman Treasurer Laclede Gas Company 720 Olive Street St. Louis, MO 63101 Dear Ron: The Chase Manhattan Bank (the "Bank") is pleased to advise you that it is prepared to offer a line of credit to Laclede Gas Company (the "Company") up to the maximum amount of $25,000,000. The Bank will consider requests for advances under the line of credit until April 14, 1997. The purpose of the line of credit is general corporate purposes. Accordingly, our officers may, at their discretion, make short term loans to the Company on such terms as may be mutually agreed upon from time to time. Notes issued under this arrangement shall mature not more than fourteen days (14) from date of issuance. Interest shall be payable at maturity or on the date of any prepayment. Notes issued under this arrangement may be prepaid at any time without penalty. We ask that you continue to supply us with current financial and other information, which current information will be furnished to the Bank as it may from time to time reasonably request. It is understood that any loans obtained by any subsidiary of the Company whether or not they are guaranteed by the Company are excluded from this arrangement and shall not be charged against the credit stated above. Nothing in this letter is intended to alter the arrangement set forth in the agreement dated January 17, 1997 or the availability of up to $10,000,000 of advances thereunder from the Bank on the terms set forth in said January 17, 1997 Agreement. It is understood that this arrangement is subject to an arrangement fee of $750.00. Please acknowledge your understanding of the above by signing and returning the attached copy of this letter by March 31, 1997. The Chase Manhattan Bank Page 36 s/Ronald Potter Ronald Potter Managing Director Acknowledged: Laclede Gas Company By: s/Ronald L. Krutzman Name: Ronald L. Krutzman Title: Treasurer Page 37 EX-10.2 7 The Chase Manhattan Bank One Chase Manhattan Plaza New York, NY 10081 April 15, 1997 Mr. Ronald L. Krutzman Treasurer Laclede Gas Company 720 Olive Street St. Louis, MO 63101 Dear Ron: The Chase Manhattan Bank (the "Bank") is pleased to advise you that it is prepared to offer a line of credit to Laclede Gas Company (the "Company") up to the maximum amount of $15,000,000. The Bank will consider requests for advances under the line of credit until May 1, 1997. The purpose of the line of credit is general corporate purposes. Accordingly, our officers may, at their discretion, make short term loans to the Company on such terms as may be mutually agreed upon from time to time. Notes issued under this arrangement shall mature not more than sixteen days (16) from date of issuance. Interest shall be payable at maturity or on the date of any prepayment. Notes issued under this arrangement may be prepaid at any time without penalty. We ask that you continue to supply us with current financial and other information, which current information will be furnished to the Bank as it may from time to time reasonably request. It is understood that any loans obtained by any subsidiary of the Company whether or not they are guaranteed by the Company are excluded from this arrangement and shall not be charged against the credit stated above. Nothing in this letter is intended to alter the arrangement set forth in the agreement dated January 17, 1997 or the availability of up to $10,000,000 of advances thereunder from the Bank on the terms set forth in said January 17, 1997 Agreement. Please acknowledge your understanding of the above by signing and returning the attached copy of this letter by April 15, 1997. The Chase Manhattan Bank Page 38 s/Paul V. Farrell Paul V. Farrell Vice President Acknowledged: Laclede Gas Company By: s/Ronald L. Krutzman Name: Ronald L. Krutzman Title: Treasurer Page 39 EX-10.3 8 The Chase Manhattan Bank One Chase Manhattan Plaza New York, NY 10081 April 30, 1997 Mr. Ronald L. Krutzman Treasurer Laclede Gas Company 720 Olive Street St. Louis, MO 63101 Dear Ron: The Chase Manhattan Bank (the "Bank") is pleased to advise you that it is prepared to offer a line of credit to Laclede Gas Company (the "Company") up to the maximum amount of $15,000,000. The Bank will consider requests for advances under the line of credit until June 30, 1997. The purpose of the line of credit is general corporate purposes. Accordingly, our officers may, at their discretion, make short term loans to the Company on such terms as may be mutually agreed upon from time to time. Notes issued under this arrangement shall mature not more than sixty days (60) from date of issuance. Interest shall be payable at maturity or on the date of any prepayment. Notes issued under this arrangement may be prepaid at any time without penalty. We ask that you continue to supply us with current financial and other information, which current information will be furnished to the Bank as it may from time to time reasonably request. It is understood that any loans obtained by any subsidiary of the Company whether or not they are guaranteed by the Company are excluded from this arrangement and shall not be charged against the credit stated above. Nothing in this letter is intended to alter the arrangement set forth in the agreement dated January 17, 1997 or the availability of up to $10,000,000 of advances thereunder from the Bank on the terms set forth in said January 17, 1997 Agreement. Please acknowledge your understanding of the above by signing and returning the attached copy of this letter by April 30, 1997. The Chase Manhattan Bank Page 40 s/Paul V. Farrell Paul V. Farrell Vice President Acknowledged: Laclede Gas Company By: s/Ronald L. Krutzman 4/30/97 Name: Ronald L. Krutzman Title: Treasurer Page 41 EX-10.4 9 The Chase Manhattan Bank One Chase Manhattan Plaza New York, NY 10081 July 1, 1997 Mr. Ronald L. Krutzman Treasurer Laclede Gas Company 720 Olive Street St. Louis, MO 63101 Dear Ron: The Chase Manhattan Bank (the "Bank") is pleased to advise you that it is prepared to offer a line of credit to Laclede Gas Company (the "Company") up to the maximum amount of $15,000,000. The Bank will consider requests for advances under the line of credit until July 31, 1997. The purpose of the line of credit is general corporate purposes. Accordingly, our officers may, at their discretion, make short term loans to the Company on such terms as may be mutually agreed upon from time to time. Notes issued under this arrangement shall mature not more than thirty days (30) from date of issuance. Interest shall be payable at maturity or on the date of any prepayment. Notes issued under this arrangement may be prepaid at any time without penalty. We ask that you continue to supply us with current financial and other information, which current information will be furnished to the Bank as it may from time to time reasonably request. It is understood that any loans obtained by any subsidiary of the Company whether or not they are guaranteed by the Company are excluded from this arrangement and shall not be charged against the credit stated above. Nothing in this letter is intended to alter the arrangement set forth in the agreement dated January 17, 1997 or the availability of up to $10,000,000 of advances thereunder from the Bank on the terms set forth in said January 17, 1997 Agreement. It is understood that this arrangement is subject to an arrangement Fee of $1,025.00 (8BPS). Please acknowledge your understanding of the above by signing and returning the attached copy of this letter by fax, by July 1, 1997. The Chase Manhattan Bank s/Paul V. Farrell Paul V. Farrell Vice President Page 42 Acknowledged: Laclede Gas Company By: s/Ronald L. Krutzman Name: Ronald L. Krutzman Title: Treasurer Page 43 EX-27 10
UT 1,000 9-MOS SEP-30-1997 JUN-30-1997 PER-BOOK 462,351 25,647 122,400 97,373 0 707,771 19,423 37,188 205,464 262,075 1,960 0 179,397 0 0 34,500 0 0 0 0 229,839 707,771 542,087 22,101 468,536 490,637 51,450 1,458 52,908 14,484 38,424 73 38,351 17,119 10,627 72,505 2.18 2.18 Capital-surplus-paid-in is net of $24,017 of treasury stock. Page 44
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