-----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, UY4SYcedohde7n86eV+0XWn74+oOGRJN/CWUzDDaGzNU1zm81wd9IJwZoRYNw2t9 UNT0tGpMIttQyf5SmjQMNw== 0000019745-97-000008.txt : 19970815 0000019745-97-000008.hdr.sgml : 19970815 ACCESSION NUMBER: 0000019745-97-000008 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 7 CONFORMED PERIOD OF REPORT: 19970630 FILED AS OF DATE: 19970814 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: CHESAPEAKE UTILITIES CORP CENTRAL INDEX KEY: 0000019745 STANDARD INDUSTRIAL CLASSIFICATION: NATURAL GAS TRANSMISSION & DISTRIBUTION [4923] IRS NUMBER: 510064146 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-11590 FILM NUMBER: 97660130 BUSINESS ADDRESS: STREET 1: 909 SILVER LAKE BLVD STREET 2: PO BOX 615 CITY: DOVER STATE: DE ZIP: 19904 BUSINESS PHONE: 302-734-6799 EX 6724 MAIL ADDRESS: STREET 1: 909 SILVER LAKE BLVD CITY: DOVER STATE: DE ZIP: 19904 10-Q 1 10-Q - F/S, NOTES, MD&A 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: 001-11590 CHESAPEAKE UTILITIES CORPORATION ---------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 51-0064146 ---------------------------------------------------- (State of other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 909 Silver Lake Boulevard, Dover, Delaware 19904 -------------------------------------------------------- (Address of principal executive offices) (Zip Code) (302) 734-6798 ------------------------------------------------- (Registrant's Telephone Number, Including Area Code) ------------------------------------------------- (Former name, former address and former fiscal year, if changed since last report.) 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 [ ]. Common Stock, par value $.4867 - 4,467,121 shares issued as of June 30, 1997. PART I FINANCIAL INFORMATION CHESAPEAKE UTILITIES CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS
JUNE 30, DECEMBER 31, 1997 1996 ASSETS (UNAUDITED) (AS RESTATED) ----------- ----------- PROPERTY, PLANT AND EQUIPMENT Natural gas distribution $73,137,536 $70,497,872 Natural gas transmission 32,908,712 30,655,492 Propane distribution 25,979,255 25,279,217 Advanced information services 688,593 1,003,850 Other plant 4,852,694 4,769,431 Gas plant acquisition adjustment 795,004 795,004 ------------- ------------- Total property, plant and equipment 138,361,794 133,000,866 Less: Accumulated depreciation and amortization (41,512,353) (39,430,738) ------------- ------------- Net property, plant and equipment 96,849,441 93,570,128 ------------- ------------- INVESTMENTS 2,248,880 2,263,068 ------------- ------------- CURRENT ASSETS Cash and cash equivalents 1,442,021 2,213,529 Accounts receivable, less allowance for uncollectibles 7,973,745 14,488,945 Materials and supplies, at average cost 1,323,562 1,284,876 Propane inventory, at average cost 1,402,579 2,345,531 Storage gas prepayments 2,264,975 3,731,680 Underrecovered purchased gas costs 442,054 2,192,170 Income taxes receivable 0 112,942 Prepaid expenses 643,083 942,359 Deferred income taxes 734,477 158,010 ------------- ------------- Total current assets 16,226,496 27,470,042 ------------- ------------- DEFERRED CHARGES AND OTHER ASSETS Environmental cost 8,365,312 8,428,436 Order 636 transition cost 0 943,209 Other deferred charges and intangible assets 3,352,993 3,371,027 ------------- ------------- Total deferred charges and other assets 11,718,305 12,742,672 ------------- ------------- TOTAL ASSETS $127,043,122 $136,045,910 ============= =============
The accompanying notes are an integral part of these financial statements. CHESAPEAKE UTILITIES CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS
JUNE 30, DECEMBER 31, 1997 1996 CAPITALIZATION AND LIABILITIES (UNAUDITED) (AS RESTATED) ----------- ----------- CAPITALIZATION Stockholders' equity Common Stock, par value $.4867 per share; (authorized 12,000,000 shares; issued 4,467,121 and 4,439,516 shares, respectively) $2,174,064 $2,160,628 Additional paid-in capital 19,198,037 18,745,718 Retained earnings 28,773,677 26,957,049 Less: Unearned compensation - restricted stock awards (277,810) (364,529) Net unrealized gain on marketable securities 30,944 38,598 ------------- ------------- Total stockholders' equity 49,898,912 47,537,464 Long-term debt, net of current portion 28,647,000 30,776,919 ------------- ------------- Total capitalization 78,545,912 78,314,383 ------------- ------------- CURRENT LIABILITIES Current portion of long-term debt 717,368 1,285,938 Short-term borrowings 9,900,000 12,700,000 Accounts payable 7,389,991 14,426,983 Refunds payable to customers 241,049 353,734 Income taxes payable 2,036,844 0 Accrued interest 750,664 741,768 Dividends payable 1,083,277 883,621 Other accrued expenses 3,355,033 3,733,235 ------------- ------------- Total current liabilities 25,474,226 34,125,279 ------------- ------------- DEFERRED CREDITS AND OTHER LIABILITIES Deferred income taxes 10,191,835 9,798,676 Deferred investment tax credits 853,905 876,432 Environmental liability 6,539,084 6,650,088 Accrued pension costs 2,116,533 1,866,660 Order 636 transition liability 0 943,209 Other liabilities 3,321,627 3,471,183 ------------- ------------- Total deferred credits and other liabilities 23,022,984 23,606,248 ------------- ------------- TOTAL CAPITALIZATION AND LIABILITIES $127,043,122 $136,045,910 ============= =============
The accompanying notes are an integral part of these financial statements. CHESAPEAKE UTILITIES CORPORATION AND SUBSIDIARIES CONSOLIDATED INCOME STATEMENTS
FOR THE QUARTER ENDED JUNE 30, 1997 1996 (UNAUDITED) (AS RESTATED) ------------- ------------- OPERATING REVENUES $24,725,489 $25,215,069 ------------- ------------- OPERATING EXPENSES Purchased gas costs 13,912,083 14,640,392 Operations 6,144,227 6,167,166 Maintenance 598,908 578,688 Depreciation and amortization 1,348,961 1,412,486 Other taxes 923,281 853,043 Income taxes 389,058 478,902 ------------- ------------- Total operating expenses 23,316,518 24,130,677 ------------- ------------- OPERATING INCOME 1,408,971 1,084,392 OTHER INCOME AND DEDUCTIONS 63,654 72,396 ------------- ------------- INCOME BEFORE INTEREST CHARGES 1,472,625 1,156,788 INTEREST CHARGES 779,784 670,477 ------------- ------------- NET INCOME $692,841 $486,311 ============= ============= EARNINGS PER SHARE OF COMMON STOCK Earnings per share $0.16 $0.11 ------------- ------------- Average shares outstanding 4,463,213 4,408,718 ------------- -------------
The accompanying notes are an integral part of these financial statements. (1) See Exhibit 11-Computation of Primary and Fully Diluted Earnings Per Share CHESAPEAKE UTILITIES CORPORATION AND SUBSIDIARIES CONSOLIDATED INCOME STATEMENTS
FOR THE SIX MONTHS ENDED JUNE 30, 1997 1996 (UNAUDITED) (AS RESTATED) ------------- ------------- OPERATING REVENUES $68,371,075 $74,248,560 ------------- ------------- OPERATING EXPENSES Purchased gas costs 41,905,264 44,695,948 Operations 12,469,975 12,614,786 Maintenance 1,091,355 1,154,910 Depreciation and amortization 2,697,308 2,820,291 Other taxes 2,036,504 1,952,788 Income taxes 2,661,602 3,257,947 ------------- ------------- Total operating expenses 62,862,008 66,496,670 ------------- ------------- OPERATING INCOME 5,509,067 7,751,890 OTHER INCOME AND DEDUCTIONS 128,817 147,546 ------------- ------------- INCOME BEFORE INTEREST CHARGES 5,637,884 7,899,436 INTEREST CHARGES 1,578,931 1,412,968 ------------- ------------- NET INCOME $4,058,953 $6,486,468 ============= ============= EARNINGS PER SHARE OF COMMON STOCK (1): Primary: Earnings per share $0.91 $1.47 ------------- ------------- Average shares outstanding 4,481,467 4,414,307 ------------- ------------- Fully diluted: Earnings per share $0.88 $1.41 ------------- ------------- Average shares outstanding 4,721,806 4,658,366 ------------- -------------
The accompanying notes are an integral part of these financial statements. (1) See Exhibit 11-Computation of Primary and Fully Diluted Earnings Per Share CHESAPEAKE UTILITIES CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 1997 1996 (UNAUDITED) (AS RESTATED) ------------- ------------- OPERATING ACTIVITIES Net Income $4,058,953 $6,486,468 Adjustments to reconcile net income to net operating cash Depreciation and amortization 2,468,138 2,570,101 Deferred income taxes, net (176,775) (140,770) Investment tax credit adjustments (22,527) (22,527) Employee benefits 249,872 218,101 Employee compensation from lapsing stock restrictions 86,719 167,273 Other (149,555) 13,543 Changes in assets and liabilities: Accounts receivable 6,515,199 5,465,583 Inventory, materials, supplies and storage gas 2,370,972 1,230,830 Prepaid expenses 299,278 245,601 Other deferred charges (89,823) (16,608) Accounts payable (7,036,992) (4,981,099) Refunds payable to customers (112,685) (221,971) Over/(Under) recovered purchased gas costs 1,750,116 (267,456) Other current liabilities 1,780,479 1,320,610 ------------- ------------- Net cash provided by operating activities 11,991,369 12,067,679 ------------- ------------- INVESTING ACTIVITIES Property, plant and equipment expenditures, net (5,687,475) (5,106,967) ------------- ------------- Net cash used by investing activities (5,687,475) (5,106,967) ------------- ------------- FINANCING ACTIVITIES Common stock dividends net of amounts reinvested of $272,738 and $291,399, respectively (1,769,930) (1,342,571) Net repayments under line of credit agreements (2,800,000) (5,225,000) Proceeds from issuance of stock to Company 401(k) plan 193,017 159,089 Repayments of long-term debt (2,698,489) (595,953) ------------- ------------- Net cash used by financing activities (7,075,402) (7,004,435) ------------- ------------- NET DECREASE IN CASH (771,508) (43,723) CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 2,213,529 1,395,614 ------------- ------------- CASH AND CASH EQUIVALENTS AT END OF PERIOD $1,442,021 $1,351,891 ============= =============
The accompanying notes are an integral part of these financial statements. CHESAPEAKE UTILITIES CORPORATION AND SUBSIDIARIES NOTES TO FINANCIAL STATEMENTS (UNAUDITED) 1. QUARTERLY FINANCIAL DATA The financial information included herein is unaudited; however, the financial information reflects normal recurring adjustments, which are, in the opinion of management, necessary for a fair presentation of the Company's interim results. Due to the seasonal nature of the Company's business, there are substantial variations in the results of operations reported on a quarterly basis. Certain amounts in 1996 have been reclassified to conform with the 1997 presentation. 2. ACQUISITION On March 6, 1997, the Company acquired all of the outstanding common stock of Tri-County Gas Company, Inc. ("Tri-County") and associated properties. The principal business of Tri-County is the distribution of propane to both retail and wholesale customers on the Delmarva Peninsula. The transaction was effected through the exchange of 639,000 shares of the Company's common stock and accounted for as a pooling of interests. Accordingly, the financial statements for 1997 and 1996, as restated, include the financial results of Tri-County along with the shares of stock issued in connection with the acquisition as required by the accounting rules. The combined operations of the Company and Tri-County will serve approximately 32,000 propane customers on the Delmarva Peninsula during 1997. 3. FINANCIAL ACCOUNTING STANDARDS BOARD ("FASB") STATEMENTS ISSUED SFAS NO. 128 -- EARNINGS PER SHARE In February 1997, the FASB issued Statement of Financial Accounting Standards ("SFAS") No. 128 regarding earnings per share, requiring the dual presentation of basic and diluted earnings per share on the face of the income statement for all entities with a complex capital structure. The Company must adopt the requirements of this standard in its financial statements for the year ended December 31, 1997. Adoption of this standard is not expected to have a material impact on the financial statements of the Company. SFAS NO. 130 -- REPORTING COMPREHENSIVE INCOME In June 1997, the FASB issued SFAS No. 130 regarding the reporting of comprehensive income in the full set of financial statements. The Company must adopt the requirements of the standard in its financial statements for the year beginning January 1, 1998. The effects of the adoption of the standard are currently under evaluation by the Company. SFAS NO. 131 -- DISCLOSURE ABOUT SEGMENTS OF AN ENTERPRISE AND RELATED INFORMATION In June 1997, the FASB issued SFAS No. 131, establishing standards for the way that public business enterprises report information about operating segments in annual financial statements and requiring that those enterprises report selected information about operating segments in interim financial reports to shareholders. The Company will adopt the requirements of this standard in the first quarter for the fiscal year 1998. 4. COMMITMENTS AND CONTINGENCIES -- ENVIRONMENTAL MATTERS DOVER GAS LIGHT SITE In 1984, the State of Delaware notified the Company that a parcel of land it purchased in 1949 from Dover Gas Light Company, a predecessor gas company, contains hazardous substances. The State also asserted that the Company is responsible for any cleanup and prospective environmental monitoring of the site. The Delaware Department of Natural Resources and Environmental Control ("DNREC") investigated the site and surroundings, finding coal tar residue and some ground-water contamination. In October 1989, the Environmental Protection Agency Region III ("EPA") listed the Dover Site on the National Priorities List under the Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA" or "Superfund"). Under CERCLA, both the State of Delaware and the Company were named as potentially responsible parties ("PRP") for clean up of the site at that time. The EPA issued the site Record of Decision ("ROD") dated August 16, 1994. The remedial action selected by the EPA in the ROD addresses the ground-water contamination with a combination of hydraulic containment and natural attenuation. Remediation selected for the soil at the site is to meet stringent cleanup standards for the first two feet of soil and less stringent standards for the soil below two feet. The ROD estimates the costs of selected remediation of ground-water and soil at $2.7 million and $3.3 million, respectively. On November 18, 1994, EPA issued a "Special Notice Letter" (the "Letter") to Chesapeake and three other PRPs. The Letter includes, inter alia, (1) a demand for payment by the PRPs of EPA's past costs (estimated to be approximately $300,000) and future costs incurred overseeing Site work; (2) notice of EPA's commencement of a 60-day moratorium on certain EPA response activities at the Site; (3) a request by EPA that Chesapeake and the other PRPs submit a "good faith proposal" to conduct or finance the work identified in the ROD; and (4) proposed consent orders by which Chesapeake and other parties may agree to perform the good faith proposal. In January 1995, Chesapeake submitted to the EPA a good faith proposal to perform a substantial portion of the work set forth in the ROD, which was subsequently rejected. The Company and the EPA each attempted to secure voluntary performance of part of the remediation by other parties. These parties include the State of Delaware, which is the owner of the property and was identified in the ROD as a PRP, and a business identified in the ROD as a PRP for having contributed to ground-water contamination. On March 6, 1995, the Company commenced litigation against the State of Delaware for contribution to the remedial costs being incurred to carry out the ROD. In December of 1995, this case was dismissed without prejudice based on a settlement agreement between the parties (the "Settlement"). Under the Settlement, the State agreed to support the Company's proposal to reduce the soil remedy for the site, described below, contribute $600,000 toward the cost of implementing the ROD and to reimburse the EPA for $400,000 in oversight costs. The Settlement is contingent upon a formal settlement agreement between EPA and the State of Delaware being reached within the next two years. Upon satisfaction of all conditions of the Settlement, the litigation will be dismissed with prejudice. On May 17, 1995, EPA issued an order to the Company under section 106 of CERCLA (the "Order"), which requires the Company to fund or implement the ROD. The Order was also issued to General Public Utilities Corporation, Inc. ("GPU"), which both EPA and the Company believe is liable under CERCLA. Other PRPs such as the State of Delaware were not ordered to perform the ROD. EPA may seek judicial enforcement of its Order, as well as significant financial penalties for failure to comply. Although notifying EPA of objections to the Order, the Company agreed to comply. GPU informed EPA that it did not intend to comply with the Order. On July 7, 1995, the Company submitted to EPA a study proposing to reduce the level and cost of soil remediation from that identified in the ROD. Although this proposal was supported by the State of Delaware, as required by the Settlement, it was rejected by the EPA on January 30, 1996. On June 25, 1996, the Company initiated litigation against GPU for contribution to the remedial costs incurred by Chesapeake in connection with complying with the ROD. At this time, management cannot predict the outcome of the litigation or the amount of proceeds to be received, if any. The Company is currently engaged in investigations related to additional parties who may be PRPs. Based upon these investigations, the Company will consider suit against other PRPs. The Company expects continued negotiations with PRPs in an attempt to resolve these matters. In July 1996, the Company commenced the design phase of the ROD, which consists of on-site pre-design and investigation. A pre-design investigation report ("the report") was filed in October 1996 with the EPA. The report, which requires EPA approval, provided up to date status on the site, which the EPA will use to determine if the remedial design selected in the ROD is still the appropriate remedy. In the report, the Company proposed a modification to the soil cleanup remedy selected in the ROD to take into account existing land use restriction that bans future development at the site. In April of 1997, the EPA issued a fact sheet stating that the EPA was considering the proposed modification. The fact sheet included an overall cost estimate of $5.7 million for the proposed modified remedy and a new overall cost estimate of $13.2 million for the remedy selected in the ROD. On April 30, 1997, the EPA held a public meeting to receive comments concerning the proposed modification. A statement on behalf of the Company supporting a reduced level of soil remediation was filed at the meeting. Attached to the Company's statement were letters from the State of Delaware and DNREC supporting the Company's proposal. If the EPA elects to modify the ROD, the EPA will file an Explanation of Significant Differences ("ESD") for public comment before taking final action. In the third quarter of 1994, the Company increased its accrued liability recorded with respect to the Dover Site to $6.0 million. This amount reflected the EPA's estimate, as stated in the ROD, for remediation of the site according to the ROD. Current estimates for remediation of the site range from $5.7 million to $13.2 million, depending on the remedy selected by the EPA. At this time, it is management's opinion that no one amount within the range can be determined to be a better estimate of the cost to remediate the site. Accordingly, the Company has not adjusted its $6.0 million accrual. The recorded liability may be adjusted upward or downward, depending on the outcome of the EPA's consideration of the remedy and the Company's estimate of the cost of the remedy selected. The Company has also recorded a regulatory asset of $6.0 million, corresponding to the recorded liability. Management believes that in addition to the $600,000 expected to be contributed by the State of Delaware under the Settlement, the Company will be equitably entitled to contribution from other responsible parties for a portion of the expenses to be incurred in connection with the remedies selected in the ROD. Management also believes that the amounts not so contributed will be recoverable in the Company's rates. As of June 30, 1997, the Company has incurred approximately $4.4 million in costs relating to environmental testing and remedial action studies. In 1990, the Company entered into settlement agreements with a number of insurance companies resulting in proceeds to fund actual environmental costs incurred over a five to seven-year period beginning in 1990. In December 1995, the Delaware Public Service Commission authorized a process to review and provide recovery of all current and future unrecovered environmental costs incurred by a means of a rider (supplement) to base rates, applicable to all firm service customers. The costs would be recovered through a five-year amortization offset by the deferred tax benefit associated with those environmental costs. The deferred tax benefit equals the projected cash flow savings realized by the Company in connection with a reduced income tax liability due to the possibility of accelerated deductions allowed on certain environmental costs when incurred. Each year a new rider rate will be calculated to become effective December 1. The rider rate will be based on the amortization of expenditures through September of the filing years plus amortization of expenses from previous years. The rider reduces the administrative costs of obtaining recovery of environmental expenditures. As of June 30, 1997, the amount of environmental cost not included in the rider, effective January 1, 1997 was $482,000. With the rider mechanism established, it is management's opinion that these costs and any future costs, net of the deferred income tax benefit, will be recoverable in rates. SALISBURY TOWN GAS LIGHT SITE In cooperation with the Maryland Department of the Environment ("MDE"), the Company has completed an assessment of the Salisbury manufactured gas plant site. The assessment determined that there was localized contamination of ground-water. A remedial design report was submitted to MDE in November 1990 and included a proposal to monitor, pump and treat any contaminated ground-water on-site. Through negotiations with the MDE, the remedial action work plan was revised with final approval from MDE obtained in early 1995. The remediation process for ground-water was revised from pump-and-treat to Air Sparging and Soil-Vapor Extraction, resulting in a substantial reduction in overall costs. During 1996, the Company completed construction and began remediation procedures at the Salisbury site and will be reporting the remediation and monitoring results to the MDE on an ongoing basis. The cost of remediation is estimated to range from $140,000 to $190,000 per year for operating expenses. Based on these estimated costs, the Company recorded both a liability and a deferred regulatory asset of $650,088 on December 31, 1996, to cover the Company's projected remediation costs for this site. The liability payout for this site is expected to be over a five-year period. As of June 30, 1997, the Company has incurred approximately $2.3 million for remedial actions and environmental studies and has charged such costs to accumulated depreciation. In January 1990, the Company entered into settlement agreements with a number of insurance companies resulting in proceeds to fund actual environmental costs incurred over a three to five-year period beginning in 1990. The final insurance proceeds were requested and received in 1992. In December 1995, the Maryland Public Service Commission approved recovery of all environmental costs incurred through September 30, 1995 less amounts previously amortized and insurance proceeds. The amount approved for a 10-year amortization period was $964,251. Of the $2.3 million in costs reported above, approximately $528,000 has not been recovered through insurance proceeds or received ratemaking treatment. It is management's opinion that these costs incurred and future costs incurred, if any, will be recoverable in rates. WINTER HAVEN COAL GAS SITE The Company is currently conducting investigations of a site in Winter Haven, Florida, where the Company's predecessors manufactured coal gas earlier this century. A Contamination Assessment Report ("CAR") was submitted to the Florida Department of Environmental Protection ("FDEP") in July 1990. The CAR contained the results of additional investigations of conditions at the site. These investigations confirmed limited soil and ground-water impacts to the site. In March 1991, FDEP directed the Company to conduct additional investigations on-site to fully delineate the vertical and horizontal extent of soil and ground-water impacts. Additional contamination assessment activities were conducted at the site in late 1992 and early 1993. In March 1993, a Contamination Assessment Report Addendum ("CAR Addendum") was delivered to FDEP. The CAR Addendum concluded that soil and ground-water impacts have been adequately delineated as a result of the additional field work. The FDEP approved the CAR and CAR Addendum in March of 1994. The next step is a Risk Assessment ("RA") and a Feasibility Study ("FS") on the site. A draft of the RA and FS were filed with the FDEP during 1995; however, the RA and FS are not complete until accepted as final by the FDEP. On May 10, 1996, the Company transmitted to FDEP an Air Sparging and Soil Vapor Extraction Pilot Study Work Plan for FDEP's review and approval. The Work Plan described the Company's proposal to undertake an Air Sparging and Soil Vapor Extraction pilot study to evaluate the effectiveness of air sparging as a ground-water remedy combined with soil vapor extraction at the site. The Company is currently awaiting FDEP's comments to the Work Plan. It is not possible to determine whether remedial action will be required by FDEP and, if so, the cost of such remediation. The Company has spent approximately $668,000 on these investigations as of June 30, 1997, and expects to recover these expenses, as well as any future expenses, through base rates. These costs have been accounted for as charges to accumulated depreciation. The Company requested and received from the Florida Public Service Commission ("FPSC") approval to amortize through base rates $359,659 of cleanup and removal costs incurred as of December 31, 1986. As of December 31, 1992, these costs were fully amortized. In January 1993, the Company received approval to recover, through base rates, approximately $217,000 in additional costs related to the former manufactured gas plant. This amount represents recovery of $173,000 of costs incurred from January 1987 through December 1992, as well as prospective recovery of estimated future costs which had not yet been incurred at that time. The FPSC has allowed for amortization of these costs over a three-year period and provided for rate base treatment for the unamortized balance. In a separate docket before the FPSC, the Company has requested and received approval to apply a refund of 1991 over earnings of approximately $118,000 against the balance of unamortized environmental charges incurred as of December 31, 1992. As a result, these environmental charges were fully amortized as of June 1994. The FPSC issued an order in January 1997, applying a refund of $292,000, pertaining to 1994 and 1995 over earnings, toward the balance of unamortized environmental charges. Of the $668,000 in costs reported above, all costs have received ratemaking treatment. The FPSC has allowed the Company to continue to accrue for future environmental costs. At June 30, 1997, the Company has $424,000 accrued. It is management's opinion that future costs, if any, will be recoverable in rates. SMYRNA COAL GAS SITE On August 29, 1989 and August 4, 1993, representatives of DNREC conducted sampling on property owned by the Company in Smyrna, Delaware. This property is believed to be the location of a former manufactured gas plant. Analysis of the samples taken by DNREC show a limited area of soil contamination. On November 2, 1993, DNREC advised the Company that it would require a remediation of the soil contamination under the state's Hazardous Substance Cleanup Act and submitted a draft Consent Decree to the Company for its review. The Company met with DNREC personnel in December 1993 to discuss the scope of any remediation of the site and in January 1994, submitted a proposed work plan, together with comments on the proposed Consent Decree. The final Work Plan was submitted on September 27, 1994. DNREC has approved the Work Plan and the Consent Decree. Remediation based on the Work Plan was completed in 1995, at a cost of approximately $263,000. In June 1996, the Company received the certificate of completion from DNREC. It is management's opinion that these costs will be recoverable in rates. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS FOR THE QUARTER ENDED JUNE 30, 1997 The Company recognized net income of $692,841 for the three months ended June 30, 1997, representing an increase in net income of $206,530 as compared to the corresponding period in 1996. The financial results for 1997 and 1996 include the operating results of Tri-County Gas Company, Inc. ("Tri-County"), which was acquired on March 6, 1997 and was accounted for as a pooling of interests. As indicated in the table below, the increase in earnings before interest and taxes ("EBIT") is due to higher earnings by the natural gas transmission and advanced information services segments coupled with a reduction in loss before interest and taxes ("LBIT") by the propane distribution segment. These were partially offset by a decrease in EBIT contributed by the natural gas distribution segment. FOR THE QUARTER ENDED JUNE 30, 1997 1996 Change ---- ---- ------ Earnings Before Interest and Taxes Natural Gas Distribution $ 998,202 $1,126,234 $(128,032) Natural Gas Transmission 696,878 641,989 54,889 Propane Distribution (311,326) (633,923) 322,597 Advanced Information Services 310,217 256,162 54,055 Eliminations & Other 104,058 172,831 (68,773) ---------- ---------- --------- Total EBIT 1,798,029 1,563,293 234,736 Operating Income Taxes 389,058 478,902 (89,844) Interest 779,784 670,477 109,307 Non-Operating Income, Net 63,654 72,397 (8,743) ---------- ---------- --------- Net Income $ 692,841 $ 486,311 $ 206,530 ========== ========== ========= NATURAL GAS DISTRIBUTION The natural gas distribution segment reported EBIT of $998,202 for the second quarter of 1997 as compared to EBIT of $1,126,234 for the corresponding period last year -- a decrease of $128,032. The decrease in EBIT is due to an increase in operating expenses mostly offset by an increase in gross margin. FOR THE QUARTER ENDED JUNE 30, 1997 1996 Change ---- ---- ------ Revenue $15,811,302 $15,602,300 $ 209,002 Cost of Gas 10,669,854 10,727,790 (57,936) ----------- ----------- --------- Gross Margin 5,141,448 4,874,510 266,938 Operations & Maintenance 2,736,605 2,426,999 309,606 Depreciation & Amortization 789,003 744,453 44,550 Other Taxes 617,638 576,824 40,814 ----------- ----------- --------- EBIT $ 998,202 $ 1,126,234 $(128,032) =========== =========== ========= The increase in gross margin is primarily due to 8% colder than normal temperatures in our northern service territory which resulted in a 4% increase in deliveries to residential and commercial customers. Operations expenses increased in the areas of distribution, legal, data processing, uncollectibles, benefits and regulatory related expenses. Maintenance expenses primarily increased in mains, meters and regulators. Depreciation and amortization expense increased due to plant placed in service during the past twelve months. Other taxes were higher due to revenue related taxes and property taxes. NATURAL GAS TRANSMISSION The natural gas transmission segment reported EBIT of $696,878 for the second quarter of 1997 as compared to EBIT of $641,989 for the corresponding period last year -- an increase of $54,889. The increase in EBIT is primarily due to an increase in gross margin somewhat offset by higher expenses. FOR THE QUARTER ENDED JUNE 30, 1997 1996 Change ---- ---- ------ Revenue $6,673,540 $7,660,939 $(987,399) Cost of Gas 4,877,330 6,016,536 (1,139,206) ---------- ---------- --------- Gross Margin 1,796,210 1,644,403 151,807 Operations & Maintenance 774,055 707,824 66,231 Depreciation & Amortization 222,688 191,332 31,356 Other Taxes 102,589 103,258 (669) ---------- ---------- --------- EBIT $ 696,878 $ 641,989 $ 54,889 ========== ========== ========= The gross margin increase was primarily the result of a rate increase that went into effect mid-April. The higher rates are subject to refund pending the final outcome of Eastern Shore Natural Gas Company's ("Eastern Shore") rate increase filing with the Federal Energy Regulatory Commission ("FERC"). Operations and maintenance expenses increased in the areas of legal fees and maintenance of communication equipment. Depreciation and amortization increased due to the capital additions placed in service during the past twelve months. As previously reported, Eastern Shore filed with FERC an abbreviated application for a blanket certificate of public convenience to provide open access transportation service. It is expected that open access transportation service would be implemented in the second half of 1997. PROPANE DISTRIBUTION For the second quarter of 1997, the propane distribution segment experienced a LBIT of $311,326. These results were more favorable than those achieved for the corresponding quarter of 1996, with the segment recognizing a decrease in LBIT of $322,597, or 51%, over the second quarter 1996 LBIT of $633,923. The decrease in LBIT was attributable to lower operating expenses partially offset by a decrease in gross margin. The 1997 and 1996 financial results of the propane distribution segment include the operating results of Tri-County. FOR THE QUARTER ENDED JUNE 30, 1997 1996 Change ---- ---- ------ Revenue $4,370,878 $4,350,153 $ 20,725 Cost of Gas 2,361,212 2,107,997 253,215 ---------- ---------- --------- Gross Margin 2,009,666 2,242,156 (232,490) Operations & Maintenance 1,901,541 2,347,390 (445,849) Depreciation & Amortization 298,622 427,482 (128,860) Other Taxes 120,829 101,207 19,622 ---------- ---------- --------- EBIT $ (311,326) $ (633,923) $ 322,597 ========== ========== ========= The decrease in gross margin is due primarily to a reduction in sales prices partially offset by an increase in deliveries. Operations and maintenance expenses declined primarily in the areas of legal fees, outside services, compensation and insurance. Depreciation and amortization expense decreased $128,860 which is primarily the result of a non-compete agreement which became fully amortized in November of 1996. Other taxes increased due to property taxes on capital additions in 1996. ADVANCED INFORMATION SERVICES The advanced information services segment recognized an EBIT of $310,217 and $256,162 for the quarters ended June 30, 1997 and 1996, respectively. This increase in EBIT of $54,055 is attributable to higher revenue slightly offset by increased operating expenses. FOR THE QUARTER ENDED JUNE 30, 1997 1996 Change ---- ---- ------ Revenue $1,911,836 $1,798,823 $ 113,013 Operations & Maintenance 1,502,886 1,441,970 60,916 Depreciation & Amortization 24,480 36,234 (11,754) Other Taxes 74,253 64,457 9,796 ---------- ---------- --------- EBIT $ 310,217 $ 256,162 $ 54,055 ========== ========== ========= The increase in revenue is due primarily to an increase in consulting and resource services revenue. Operation expenses were higher, primarily compensation expense. INTEREST The increase in interest expense is associated with higher short-term borrowing balances, as compared to the same period last year. OPERATING INCOME TAXES Operating income taxes decreased by $89,844 because the 1996 LBIT for the propane distribution segment does not include income tax benefits, since Tri-County was a subchapter S corporation prior to the acquisition in the first quarter of 1997. RESULTS OF OPERATIONS FOR THE SIX MONTHS ENDED JUNE 30, 1997 The Company recognized net income of $4,058,953 for the six months ended June 30, 1997, representing a decrease in net income of $2,427,515 as compared to the corresponding period in 1996. The financial results for 1997 and 1996 include the operating results of Tri-County. As indicated in the table below, the decrease in EBIT is due to lower earnings in the distribution and propane segments, offset by increased earnings in transmission, advanced information services and other. FOR THE SIX MONTHS ENDED JUNE 30, 1997 1996 Change ---- ---- ------ Earnings Before Interest and Taxes Natural Gas Distribution $4,419,765 $5,882,954 $(1,463,189) Natural Gas Transmission 1,314,290 1,197,085 117,205 Propane Distribution 1,390,847 3,077,269 (1,686,422) Advanced Information Services 721,300 565,955 155,345 Eliminations & Other 324,467 286,574 37,893 ---------- ---------- ----------- Total EBIT 8,170,669 11,009,837 (2,839,168) Operating Income Taxes 2,661,602 3,257,947 (596,345) Interest 1,578,931 1,412,968 165,963 Non-Operating Income, Net 128,817 147,546 (18,729) ---------- ---------- ----------- Net Income $4,058,953 $6,486,468 $(2,427,515) ========== ========== =========== NATURAL GAS DISTRIBUTION The natural gas distribution segment reported EBIT of $4,419,765 for the first six months of 1997 as compared to EBIT of $5,882,954 for the corresponding period last year. The decrease in EBIT is due to a reduction in gross margin, coupled with increased expenses. FOR THE SIX MONTHS ENDED JUNE 30, 1997 1996 Change ---- ---- ------ Revenue $42,290,107 $43,318,721 $(1,028,614) Cost of Gas 29,639,265 29,791,577 (152,312) ---------- ----------- ----------- Gross Margin 12,650,842 13,527,144 (876,302) Operations & Maintenance 5,308,144 4,852,157 455,987 Depreciation & Amortization 1,576,489 1,486,506 89,983 Other Taxes 1,346,444 1,305,527 40,917 ---------- ----------- ----------- EBIT $4,419,765 $5,882,954 $(1,463,189) ========== =========== =========== The decrease in gross margin is primarily due to first quarter temperatures which were 14% warmer than the first quarter in 1996, resulting in an 11% reduction in deliveries during that period. Operations expenses increased in the areas of distribution, legal, data processing, benefits and regulatory related expenses. Maintenance expenses primarily increased in mains, meters and regulators. Depreciation and amortization expense increased due to plant placed in service during the last twelve months. NATURAL GAS TRANSMISSION The natural gas transmission segment reported EBIT of $1,314,290 for the first six months of 1997 as compared to EBIT of $1,197,085 for the corresponding period last year -- an increase of $117,205. The increase in EBIT is due to an increase in gross margin slightly offset by an increase in operating expenses. FOR THE SIX MONTHS ENDED JUNE 30, 1997 1996 Change ---- ---- ------ Revenue $18,733,593 $19,370,231 $(636,638) Cost of Gas 15,254,182 16,020,684 (766,502) ---------- ---------- --------- Gross Margin 3,479,411 3,349,547 129,864 Operations & Maintenance 1,510,372 1,558,369 (47,997) Depreciation & Amortization 445,376 382,663 62,713 Other Taxes 209,373 211,430 (2,057) ---------- ---------- --------- EBIT $1,314,290 $1,197,085 $ 117,205 ========== ========== ========= The gross margin increase was primarily the result of a rate increase that went into effect mid-April. The higher rates are subject to refund pending the final outcome of the Eastern Shore rate increase filing with the FERC. Operations and maintenance expenses decreased in the areas of compensation and data processing. These reductions were somewhat offset by an increase in legal fees. Depreciation and amortization increased due to the capital additions placed in service during the past twelve months. PROPANE DISTRIBUTION The propane distribution segment recognized EBIT of $1,390,847 for the first six months of 1997, as compared to $3,077,269 EBIT for the six months ended June 30, 1996. The financial results for 1997 and 1996 include the operating results of Tri-County. The decrease in EBIT of $1,686,422 was primarily due to a reduction in gross margin, somewhat offset by lower expenses. FOR THE SIX MONTHS ENDED JUNE 30, 1997 1996 Change ---- ---- ------ Revenue $15,548,906 $19,104,053 $(3,555,147) Cost of Gas 9,033,868 10,165,446 (1,131,578) ---------- ---------- ---------- Gross Margin 6,515,038 8,938,607 (2,423,569) Operations & Maintenance 4,259,712 4,742,956 (483,244) Depreciation & Amortization 587,877 854,040 (266,163) Other Taxes 276,602 264,342 12,260 ---------- ---------- --------- EBIT $1,390,847 $3,077,269 $(1,686,422) ========== ========== ========= The decrease in gross margin occurred primarily during the first quarter when sales volumes and margin earned per gallon sold declined 21% and 20%, respectively. The declines resulted from warm temperatures experienced during the first quarter of 1997. Operations and maintenance expenses declined in the areas of legal fees, outside services, compensation and insurance. Depreciation and amortization expense decreased $128,860 which is primarily the result of a non-compete agreement which became fully amortized in November 1996. ADVANCED INFORMATION SERVICES For the six months ended June 30, the advanced information services segment recognized an EBIT of $721,300 and $565,955 for 1997 and 1996, respectively. This increase in EBIT of $155,345 is the outcome of higher revenue and lower operating expenses. FOR THE SIX MONTHS ENDED JUNE 30, 1997 1996 Change ---- ---- ------ Revenue $3,903,552 $3,818,823 $ 84,729 Operations & Maintenance 2,955,967 3,022,919 (66,952) Depreciation & Amortization 50,763 72,348 (21,585) Other Taxes 175,522 157,601 17,921 ---------- ---------- --------- EBIT $ 721,300 $ 565,955 $ 155,345 ========== ========== ========= The increase in revenue primarily occurred in consulting and resource services revenues due to a rise in demand for progress training and programmers. INTEREST The increase in interest expense is associated with higher short-term borrowing balances, as compared to the same period last year. OPERATING INCOME TAXES Operating income taxes decreased $596,345 due to a reduction in EBIT and the lack of income tax expense recorded by Tri-County in 1996, offset by a one-time expense of $318,000 recorded during the first quarter. The one-time expense was required to establish deferred income taxes for Tri-County Gas Company, Inc., acquired during the first quarter of 1997. Prior to the acquisition, Tri-County Gas Company, Inc. was a Subchapter S Corporation for income tax reporting; therefore, no deferred income taxes were recorded on their balance sheet. In addition, the Company's 1996 restated financial statements do not include any income tax expense on EBIT reported for Tri-County due to their 1996 Subchapter S status. ENVIRONMENTAL MATTERS The Company continues to work with federal and state environmental agencies to assess the environmental impacts and explore corrective action at several former gas manufacturing plant sites (see Note 4 to the Consolidated Financial Statements). The Company believes that any future costs associated with these sites will be recoverable in future rates. FINANCIAL POSITION, LIQUIDITY AND CAPITAL RESOURCES The Company's capital requirements reflect the capital intensive nature of its business and are attributable principally to its construction program and the retirement of its outstanding debt. The Company relies on funds provided by operations and short-term borrowings to meet normal working capital requirements and temporarily finance capital expenditures. During the first six months of 1997, the Company's net cash flow provided by operating activities, net cash used by investing activities and net cash used by financing activities were approximately $12.0 million, $5.7 million and $7.1 million, respectively. Due to the seasonal nature of the Company's business, there are substantial variations in the results of operations reported on a quarterly basis. The Board of Directors has authorized the Company to borrow up to $20 million from banks and trust companies. As of June 30, 1997, the Company had four $8 million unsecured bank lines of credit. Funds provided from these lines of credit are used for short-term cash needs to meet seasonal working capital requirements and to fund portions of its capital expenditures. The outstanding balances of short-term borrowings at June 30, 1997 and 1996 were $9.9 million and $175,000, respectively. During the six months ended June 30, 1997 and 1996, net property, plant and equipment expenditures were approximately $5.7 million and $5.4 million, respectively. For 1997, the Company has budgeted $18.9 million for capital expenditures. The components of this amount include $8.5 million for natural gas distribution, $4.5 million for natural gas transmission, $3.8 million for environmental related expenditures, $1.8 million for propane distribution, $150,000 for advanced information services, with the remaining $150,000 for computer, office equipment and general plant. The natural gas and propane expenditures are for expansion and improvement. Natural gas transmission expenditures are to improve the pipeline system and completion of the Delaware City compressor station. Financing of the 1997 construction will be provided primarily by short-term borrowings and cash from operations and the issuance of the long-term debt. In the fourth quarter of 1997, the Company expects to finalize the issuance of $10.0 million of senior notes due in December 2007. The construction program is subject to continuous review and modification by management. Actual construction expenditures may vary from the above estimates due to a number of factors including inflation, changing economic conditions, regulation, load growth and the cost and availability of capital. The Company expects to incur environmental related expenditures in the future (see Note 4 to the Consolidated Financial Statements), a portion of which may need to be financed through external sources. Management does not expect such financing to have a material adverse effect on the financial position or capital resources of the Company. The Company is continually evaluating new business opportunities and acquisitions such as Tri-County. The Company may need to obtain financing in conjunction with any future opportunities or acquisitions. Management will consider the impact of such financing on the financial position of the Company in its evaluation of the business opportunity or acquisition. Such financings are not expected to have a material adverse effect on the financial position or capital resources of the Company. As of June 30, 1997, common equity represented 63.5% of permanent capitalization, compared to 60.7% as of December 31, 1996. The Company remains committed to maintaining a sound capital structure and strong credit ratings in order to provide the financial flexibility needed to access the capital markets when required. This commitment, along with adequate and timely rate relief for the Company's regulated operations, helps to ensure that the Company will be able to attract capital from outside sources at a reasonable cost. The achievement of these objectives will provide benefits to customers and creditors, as well as the Company's investors. PART II OTHER INFORMATION CHESAPEAKE UTILITIES CORPORATION AND SUBSIDIARIES Item 1: Legal Proceedings See Note 2 to the Consolidated Financial Statements Item 2: Changes in Securities None Item 3: Defaults Upon Senior Securities None Item 4: Submission of Matters to a Vote of Security Holders The Annual Meeting of Stockholders was held on May 20, 1997. Proposals as submitted in the proxy statement were voted on as follows: 1. All Board of Director nominees were elected to the classes indicated in the proxy statement. 2. Ratification of the selection of the Company's independent auditors through the fiscal year ending December 31, 1997 was approved. Item 5: Other Information None Item 6(a): Exhibits Exhibit 3 - Amendments to the Bylaws of Chesapeake Utilities Corporation, effective July 11, 1997, are filed herewith. Exhibit 10 - Form of the Executive Employment Agreement dated March 26, 1997, by and between Chesapeake Utilities Corporation and each of Ralph J. Adkins and John R. Schimkaitis, is submitted herewith. Exhibit 11 - Computation of Primary and Fully Diluted Earnings Per Share is submitted herewith. Item 6 (b): Reports on Form 8-K None 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. CHESAPEAKE UTILITIES CORPORATION /s/ Michael P. McMasters - ---------------------------- Michael P. McMasters Vice President, Chief Financial Officer and Treasurer Date: August 13, 1997 EX-3 2 AMENDMENTS TO BYLAWS 3.2 COMPOSITION OF THE BOARD. The number of Directors which shall constitute the Board shall be nine, divided into three classes, as specified in the Certificate of Incorporation. Directors shall be elected at the annual meeting of the stockholders, and each Director shall be elected to serve until such Director's successor shall be elected and shall qualify; provided, however, no person who shall have attained the age of 75 years by the date of election shall be eligible for election as a Director of the Corporation. If not already a stockholder at the time of assuming office, each Director shall purchase at least one share of the Corporation's common stock within a reasonable time thereafter. The Board of Directors at its first meeting after each annual meeting of stockholders shall elect the Chair of the Board who shall perform such duties as are specified in these Bylaws or are properly required of the Chair by the Board of Directors. The Board may designate the Chair as the Chief Executive Officer of the Corporation. 5.1 OFFICERS. The Officers of the Corporation shall be chosen by the Board of Directors and shall be a President, a Vice President, a Secretary, and a Treasurer , and, if the Board has designated the Chair as the Chief Executive Officer of the Corporation pursuant to Section 3.2 of these Bylaws, the Chair. The Board of Directors may also choose additional Vice Presidents, and one or more Assistant Secretaries and Assistant Treasurers, and may appoint such other Officers and agents as it shall deem necessary. Two or more offices may be held by the same person, except that where the officer designated as the Chief Executive Officer and the Secretary are the same person, such person shall not hold any other office. 5.2 ELECTION; TERM OF OFFICE; REMOVAL. The Board of Directors at its first meeting after each annual meeting of stockholders shall elect the President, one or more Vice Presidents, the Secretary, the Treasurer, and such other Officers as it shall deem necessary, who shall hold their offices for such terms and shall exercise such powers and perform such duties as shall be determined from time to time by the Board. The Officers of the Corporation shall hold office until their successors are chosen and qualify in their stead, or until such time as they may resign or be removed from office. Any Officer elected or appointed by the Board of Directors may be removed at any time by the affirmative vote of a majority of the whole Board of Directors. If the office of any Officer becomes vacant for any reason, the vacancy shall be filled by the Board of Directors. In the case of any office other than that of the Chair, President, Secretary or Treasurer, the officer designated as the Chief Executive Officer may appoint a person to serve in such office, on a temporary basis, until the vacancy is filled by the Board. 5.4 THE CHAIR, THE PRESIDENT AND THE CHIEF EXECUTIVE OFFICER. The Chair shall be the Chief Executive Officer of the Corporation if, and only if, the Chair has been so designated pursuant to Section 3.2 of these Bylaws. If the Chair has not been so designated, the President shall hereby be designated as the Chief Executive Officer. The Chief Executive Officer shall report directly to the Board of Directors , and shall perform such duties as are incident to the office of the Chief Executive Officer or are properly specified and authorized by the Board of Directors. If the Chair has been designated as the Chief Executive Officer, the President shall be the Chief Operating Officer. In such case, the President shall report to the Chief Executive Officer and shall perform such duties as are incident to the office of the Chief Operating Officer or are properly specified and authorized by the Board of Directors; in the absence or disability of the Chair, the President shall perform the duties and exercise the powers of the Chief Executive Officer. 6.1 CERTIFICATES OF STOCK. The certificates of stock of the Corporation shall be numbered and shall be entered in the books of the Corporation as they are issued. They shall exhibit the holder's name and number of shares and shall be signed by the officer designated as the Chief Executive Officer, the President or a Vice President and the Treasurer or an Assistant Treasurer or the Secretary or an Assistant Secretary. Any or all of the signatures on the certificate may be a facsimile. In the event that any officer, transfer agent, or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent, or registrar before such certificate is issued, it may be used by the Corporation with the same effect as if such person were such officer, transfer agent, or registrar at the date of issue. 8.3 VOTING SECURITIES OF OTHER CORPORATIONS. Subject to any specific direction from the Board of Directors, the officer designated as the Chief Executive Officer of the Corporation, or any other person or persons who may from time to time be designated by the Board of Directors, shall have the authority to vote on behalf of the Corporation the securities of any other corporation which are owned or held by the Corporation and may attend meetings of stockholders or execute and deliver proxies or written consents for such purpose. EX-10 3 EXECUTIVE EMPLOYMENT AGREEMENT FORM EXECUTIVE EMPLOYMENT AGREEMENT ------------------------------ AN EXECUTIVE EMPLOYMENT AGREEMENT ("Agreement") dated this 26th day of March, 1997, by and between Chesapeake Utilities Corporation, a Delaware corporation (the "Company"), and XXXXXXXXXX ("Executive"). WITNESSETH: WHEREAS, the Company is currently obtaining the benefit of Executive's services as a full-time executive employee in the capacity of XXXXXXXXXX; WHEREAS, the Company's Board of Directors (the "Board") has authorized the Company to agree to provide for Executive's con- tinued employment pursuant to the terms of this Agreement; and WHEREAS, Executive is willing, in consideration of the covenants hereinafter provided, to continue to be employed by the Company in the capacity of XXXXXXXXXX and to render services incident to such position during the term of this Agreement. NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein, the Company and Executive hereby agree as follows: 1. EMPLOYMENT. The Company agrees to employ Executive, and Executive agrees to accept employment, as an executive officer of the Company in the capacity of XXXXXXXXXX, with such reasonable duties and responsibilities as are consistent with the By-laws of the Company as of the date hereof, including, but not limited to being in compliance with goals, policies, and objectives established by the Chief Executive Officer and the Board of Directors. Directs, coordinates, and administers all aspects of Company operations or subsidiary operations. Recommends short and long-term plans to achieve organization growth and diversification. Responsible for recommending to or advising management on potential mergers, acquisitions, divestitures, new ventures and research in both energy and non-energy related fields. 2. TERM. (a) TERM OF AGREEMENT. The term of this Agreement ("Term") shall be the Initial Term (as defined in Paragraph 2(b) hereof), and, if applicable, the Extended Term (as defined in Paragraph 2(c) hereof). (b) INITIAL TERM. Subject to Paragraph 2(c) hereof, the Initial Term of this Agreement shall extend for five (5) years commencing on the date of this Agreement. (c) EXTENDED TERM. Upon the occurrence of a Change in Control (as defined in Paragraph 2(d) hereof), the Initial Term shall end and the Term of this Agreement shall thereupon automatically be extended, commencing on the date of such Change in Control, for the shorter of five (5) years or the period until Executive attains the earliest age, if any, at which his compulsory retirement is permitted under section 12(c) of the Age Discrimination in Employment Act of 1967, as amended, 29 U.S.C. section 631(c), or its successor (such extended five-year or shorter term constituting the "Extended Term"). (d) CHANGE IN CONTROL. For the purposes of this Agreement, Change in Control shall mean a change in the control of the Company during the Term of this Agreement, which shall be deemed to have occurred if: (i) The registration of the Company's voting securities under the Securities Exchange Act of 1934, as amended (the "1934 Act"), terminates or the Company shall have fewer than 300 stockholders of record; or (ii) any person or group (within the meaning of Sections 13(d) and 14(d) of the 1934 Act), other than the Company or any of its majority-controlled subsidiaries, becomes the beneficial owner (within the meaning of Rule 13d-3 under the 1934 Act) of 30 percent or more of the combined voting power of the Company's then outstanding voting securities; or (iii) a tender offer or exchange offer (other than an offer by the Company or a majority-controlled subsidiary), pursuant to which 30 percent or more of the combined voting power of the company's then outstanding voting securities was purchased, expires; or (iv) the stockholders of the Company approve an agreement to merge or consolidate with another corporation (other than a majority-controlled subsidiary of the Company) unless the stockholders of the Company immediately before the merger or consolidation are to own more than 70 percent of the combined voting power of the resulting entity's voting securities; or (v) the Company's stockholders approve an agreement (including, without limitation, a plan of liquidation) to sell or otherwise dispose of all or substantially all of the business or assets of the Company; or (vi) during any period of two consecutive years, individuals who, at the beginning of such period, constituted the Board cease for any reason to constitute at least a majority thereof, unless the election or the nomination for election by the Company's stockholders of each new director was approved by a vote of at least two-thirds of the directors then still in office who were directors at the beginning of the period; or (vii) the acquisition of direct or indirect beneficial ownership of more than 15 percent of the Company's then outstanding voting securities by any person or group is approved over the formal objection of the Company by the Securities and Exchange Commission pursuant to Section 9 of the Public Utility Holding Company Act of 1935, as amended. However, no Change in Control shall be deemed to have occurred by reason of any event involving a transaction in which Executive, or a group of persons or entities with which Executive acts in concert, acquires, directly or indirectly, more than 30 percent of the common stock or the business or assets of the Company; any event involving or arising out of a proceeding under Title 11 of the United States Code (or the provisions of any future United States bankruptcy law), an assignment for the benefit of creditors or an insolvency proceeding under state or local law; or any event constituting approval by the Company's stockholders of a merger or consolidation if a majority of the group consisting of the President and Vice Presidents of the Company who are parties to agreements conferring rights upon a Change in Control shall have agreed in writing prior to such approval that approval shall be deemed not to constitute a Change in Control. 3. TIME. Executive agrees to devote all reasonable full time and best efforts for the benefit of the Company and any subsidiary of the Company, and not to serve any other business enterprise or organization in any capacity during the Term hereof without the prior written consent of the Company, which consent shall not be unreasonably withheld. 4. OFFICE. (a) INITIAL TERM. During the Initial Term, the Company shall elect Executive XXXXXXXXXX. (b) EXTENDED TERM. During the Extended Term of this Agreement: (i) Executive shall hold and perform an office with the responsibility, importance and scope within the Company at least equal to that of the office described and contemplated in Paragraph 1 hereof; and (ii) Executive's office shall be located in Dover, Delaware, and Executive shall not be required, without his written consent, to change his office location or to be absent therefrom on business for more than 60 working days in any year. 5. COMPENSATION. (a) INITIAL TERM. The Company shall compensate Executive for his services hereunder during the Initial Term at a rate of $XXXXX per annum, payable in equal semi-monthly installments, or such greater or lesser amount as the Board may determine ("Base Compensation"). The Base Compensation rate shall be reviewed annually and may be increased or decreased from time to time. (b) EXTENDED TERM. During the Extended Term, the Company shall compensate Executive for his services hereunder at a rate per annum, payable in equal semi-monthly installments, equal to his Base Compensation at the time the Extended Term commences, increased: (i) effective on each anniversary of the date of this Agreement during the Extended Term by an amount equal to the product of such Base Compensation times the increase in the preceding calendar year of the Consumer Price Index for Urban Wage Earners and Clerical Workers for the Philadelphia metropolitan region as reported by the U.S. Department of Labor (or, if such index is no longer reported, the corresponding increase in a comparable index); and (ii) by such additional amounts as the Board may determine from time to time based, in part, on an annual review of Executive's compensation. 6. EXPENSES. During the Term of this Agreement, the Company shall pay all necessary and reasonable business expenses incurred by Executive on behalf of the Company in the course of his employment hereunder, including, without limitation, expenses incurred in the conduct of the Company's business while away from his domicile and expenses for travel, meals, lodging, entertainment and related expenses that are for the benefit of the Company. 7. OTHER BENEFITS. (a) Executive shall be entitled to participate in all profit-sharing, insurance, medical and retirement benefit plans, together with vacation and other employee benefits of the Company, now in effect or as hereafter amended or established, in which the Company executive employees are permitted to participate. The Executive's participation shall be in accordance with the terms and provisions of such plans. (b) The Company shall furnish Executive with a suitable office, necessary administrative support and customary furniture and furnishings for such office. The Company further agrees that Executive shall have the use of a Company-owned or Company-leased and Company-maintained automobile, new every three years, of a kind and model appropriate to his position with the Company. (c) Nothing in this Agreement shall preclude the Company from amending or terminating any employee benefit plan or practice, but, it being the intent of the parties that the Executive shall continue to be entitled during the Extended Term to benefits and perquisites as set forth in Paragraphs 7(a) and 7(b) hereof at least equal to those attached to his position on the date of this Agreement, nothing in this Agreement shall operate as, or be construed to authorize, a reduction during the Extended Term without Executive's written consent in the level of such benefits or perquisites as in effect on the date of a Change in Control. If and to the extent that such benefits or perquisites are not payable or provided to Executive under any such plan or practice by reason of an amendment thereto or termination thereof during the Extended Term, the Company shall pay or provide such benefits or perquisites to Executive. 8. TERMINATION. (a) TERMINATION FOR CAUSE. This Agreement and Executive's employment hereunder may be terminated by the Company at any time for Cause. In the event of termination for Cause, the Executive shall not be entitled to any severance benefits under this agreement. During the Initial Term, Cause shall be as the Board may reasonably determine. During the Extended Term, termination of this Agreement and the Executive's employment shall be deemed to have been for Cause only if it shall have been the result of: (i) conduct by Executive that constitutes a felony under the laws of the United States or a state in which Executive works or resides; (ii) an act or acts of dishonesty by Executive resulting or intended to result directly or indirectly in material gain to or personal enrichment of Executive at the Company's expense; (iii) a deliberate and intentional refusal by Executive during the Extended Term (except by reason of incapacity due to illness or accident) to comply with the provisions of Paragraph 1 hereof, provided that such breach shall have resulted in demonstrably material injury to the Company and the Executive shall have failed to remedy such breach within thirty days after notice from the Secretary of the Company demanding that the Executive remedy such breach; or (iv) the engagement in conduct by Executive that is materially injurious to the Company if such conduct was undertaken without good faith and the reasonable belief that such conduct was in the best interest of the Company. (b) TERMINATION DURING EXTENDED TERM. During the Extended Term of this Agreement, the term "Termination" shall mean: (i) Termination by the Company of Executive's employment; or (ii) Termination by Executive of his employment following the occurrence of any of the following events: (A) Failure to elect or re-elect Executive to, or removal of Executive from, the office or offices set forth in Paragraph 1 hereof, or the Board if Executive shall have been a member of the Board immediately prior to a Change in Control of the Company; (B) Executive's good-faith determination that there has been a significant change in the nature or scope of his authorities, powers, functions, duties or responsibilities attached to the positions contemplated in Paragraph 1 hereof or a reduction in his compensation as provided in Paragraph 5 hereof or his benefits as provided in Paragraph 7, which change or reduction is not remedied within thirty days after notice to the Company by Executive; (C) Any other breach by the Company of any provision of this Agreement (including, without limitation, relocation of Executive in violation of Paragraph 4(b) hereof), which breach is not remedied within thirty days after notice to the Company by Executive; or (D) The liquidation, dissolution, consolidation or merger of the Company or transfer of all or a significant portion of its assets unless a successor or successors (by merger, consolidation or otherwise) to which all or a significant portion of its assets has been transferred shall have assumed all duties and obligations of the Company under this Agreement; provided that in any event set forth in this Paragraph 8(b)(ii), Executive shall have elected to terminate his employment under this Agreement upon not less than forty (40) and not more than ninety (90) days' notice to the Board, attention of the Secretary, given, except in the case of a continuing breach, within three calendar months after (1) failure to be so elected or reelected, or such removal, (2) expiration of the 30-day cure period with respect to such event, or (3) the closing date of such liquidation, dissolution, consolidation, merger or transfer of assets. An election by Executive to terminate his employment under the provisions of this Paragraph shall not be deemed a voluntary termination of employment by Executive for the purpose of this Agreement or any plan or practice of the Company. (c) PAYMENT UPON TERMINATION DURING EXTENDED TERM. In the event of a Termination of this Agreement during the Extended Term hereof for any reason other than Cause or Executive's death, the Company shall, subject to Paragraph 9 hereof, pay to Executive (or, in the event of his death following the Termination, his legal representative) in cash within thirty (30) days after the date of such Termination (the "Termination Date"): (i) An amount equal to the product of multiplying the monthly rate of Base Compensation to which Executive was entitled under Paragraph 5(b) hereof on the day immediately prior to the Termination Date by the lesser of (A) twenty-four (24) months or (B) the number of months remaining in the Term of this Agreement (the shorter of such periods constituting the "Covered Period"); (ii) An amount equal to the present value of the additional benefits that would have been paid Executive under the Company's retirement plans if he had continued to be employed pursuant to this Agreement during the Covered Period and the retirement plans had continued during such period without change from the date of the Change in Control; (iii) For each share of Company stock subject to a stock option that was awarded to Executive under a Company stock option plan, was held by Executive on the day immediately prior to his Termination Date, was not exercisable on that date but would have become exercisable during the Covered Period if Executive's employment with the Company had continued during that period, an amount equal to the excess of (A) the daily average closing price for a share of the Company's stock on the New York Stock Exchange, or such other national securities exchange on which such stock may be listed, during the 30-day period ending upon the date of the Change in Control, or, if higher, during the 30-day period ending upon the Termination Date (adjusted as appropriate for any changes in the capital structure of the Company) over (B) the option price for a share of the Company's stock subject to the option; and (iv) An amount equal to the aggregate of the Company's contributions to the Company's savings plan in respect of Executive that were not vested on the day immediately prior to the Termination Date but that would have been vested at the end of the Covered Period if Executive had remained employed by the Company for the duration of that period. For purposes of calculating the present value specified in Paragraph 8(c)(ii), the discount rate shall equal the PBGC interest rate for immediate annuities, as provided in 29 C.F.R. Part 4044, Appendix B, Table II or its successor, in effect for a valuation date coinciding with the Termination Date. If that rate should no longer be published, the discount rate shall be such closely comparable interest rate as the Company may reasonably determine. (d) PAYMENT UPON TERMINATION DURING INITIAL TERM. In the event that the Company terminates this Agreement during, or elects pursuant to Paragraph 17 hereof not to renew this Agreement at the end of, the Initial Term hereof for any reason other than Cause or Executive's death, the Company shall continue to pay to Executive (or in the event of his death following such termination, his legal representative) his Base Compensation under Paragraph 5(a) hereof, at the semi-monthly rate in effect immediately prior to the date of such termination ("Termination Date"), for a period of six months following the Termination Date. 9. MAXIMUM PAYMENT UPON TERMINATION. Notwithstanding any other provision of this Agreement, if the Company should determine, in consultation with tax advisors satisfactory to Executive, that any amount payable to Executive pursuant to Paragraph 8 of this Agreement during the extended term, either alone or in conjunction with any payments or benefits to or on behalf of Executive pursuant to this Agreement or otherwise, would not be deductible by the Company, in whole or in part, for federal income tax purposes by reason of section 280G of the Internal Revenue Code or its successor, then the aggregate amount payable to Executive pursuant to Paragraph 8 shall be reduced to the largest amount that, in the opinion of such tax advisors, the Company could pay Executive under Paragraph 8 without any part of that amount being nondeductible by the Company as a result of Section 280G or its successor. 10. MITIGATION. Executive shall not be required to mitigate the amount of any payment provided for in this Agreement either by seeking other employment or otherwise. The amount of any payment provided for herein shall not be reduced by any remuneration that Executive may earn from employment with another employer or otherwise following his Termination Date. 11. NONCOMPETITION COVENANT. For a period of one year following the Termination Date and, if Executive has given a notice pursuant to Paragraph 8(b)(ii) hereof, for a period of 15 months following the giving of such notice, Executive shall assist no individual or entity other than the Company to acquire any entity with respect to which a proposal to acquire was presented to the Board prior to the beginning of the period. 12. INDEMNIFICATION. The Company shall indemnify Executive to the fullest extent permitted by applicable Delaware law (as may be amended from time to time), including the advance of expenses permitted herein. 13. PERFORMANCE. The failure of either party to this Agreement to insist upon strict performance of any provision hereof shall not constitute a waiver of its rights subsequently to insist upon strict performance of such provision or any other provision of this Agreement. 14. NON-ASSIGNABILITY. Neither party shall have the right to assign this Agreement or any rights or obligations hereunder without the consent of the other party. 15. INVALIDITY. If any provisions of this Agreement shall be found to be invalid by any court of competent jurisdiction, such finding shall not affect the remaining provisions of this Agreement, all of the which shall remain in full force and effect. 16. ARBITRATION AND LEGAL FEES. In the event of any dispute regarding a refusal or failure by the Company to make payments or provide benefits hereunder for any reason, Executive shall have the right, in addition to all other rights and remedies provided by law, to arbitration of such dispute under the rules of the American Arbitration Association, which right shall be invoked by serving upon the Company a notice to arbitrate, stating the place of arbitration, within ninety (90) days of receipt of notice in any form (including, without limitation, failure by the Company to respond to a notice from Executive within thirty (30) days) that the Company is withholding or proposes to withhold payments or provisions of benefits. In the event of any such dispute, whether or not Executive exercises his right to arbitration, if it shall ultimately be determined that the Company's refusal or failure to make payments or provide benefits hereunder was wrongful or otherwise inconsistent with the terms of this Agreement, the Company shall indemnify and hold harmless Executive from and against any and all expenses incurred in connection with such determination, including legal and other fees and expenses. Without limitation of or by the foregoing, the Company shall, within ten (10) days after notice from Executive, provide Executive with an irrevocable letter of credit in the amount of $100,000 from a bank satisfactory to Executive against which Executive may draw to pay legal fees and other fees and expenses in connection with any attempt by Executive to enforce any of his rights under this Agreement during the Extended Term. Said letter of credit shall not expire before ten (10) years following the date of this Agreement. 17. RENEWAL. If the Initial Term of this Agreement expires without there having been a Change in Control, this Agreement shall be renewed, as of the day following such expiration, unless, during the period beginning ninety (90) days prior and ending thirty (30) days prior to such day, either the Company or Executive shall have given notice to the other that this Agreement will not be renewed. If this Agreement is renewed as provided under this Paragraph, the new Agreement shall be identical to this Agreement (except insofar as the Company and Executive may otherwise agree in writing) except that the date of the new Agreement shall be as of the day following the expiration of the Initial Term of this Agreement. 18. SUCCESSORS. This Agreement shall be binding upon and inure to the benefit of the Executive (and his personal representative), the Company and any successor organization or organizations that shall succeed to substantially all of the business and property of the Company, whether by means of merger, consolidation, acquisition of substantially all of the assets of the Company or otherwise, including by operation of law. 19. SET-OFF. The Company shall have no right of set-off or counterclaim in respect of any claim, debt or obligation against any payments or benefits provided for in this Agreement. 20. AMENDMENTS. No Amendment to this Agreement shall be effective unless in writing and signed by both the Company and Executive. 21. GOVERNING LAW. This Agreement shall be interpreted and enforced in accordance with the laws of the State of Delaware. 22. NOTICES. Unless otherwise stated herein, all notices hereunder shall be in writing and shall be deemed to be given when personally delivered or mailed by United States registered or certified mail, postage prepaid, to, if to the Company, 909 Silver Lake Boulevard, Dover, Delaware 19904, and, if to Executive, the last address therefore shown on the records of the Company. Either the Company or Executive may, by notice to the other, designate an address other than the foregoing for the receipt of subsequent notices. 23. WITHHOLDING. The Company may withhold from any amounts payable to Executive hereunder all federal, state, city or other taxes that the Company may reasonably determine are required to be withheld pursuant to any applicable law or regulation. 24. NATURE OF PAYMENTS UPON TERMINATION. All payments to Executive pursuant to Paragraphs 8 and 9 of this Agreement shall be considered as liquidated damages or, in the case of certain payments pursuant to Paragraph 8(d), as severance payments in consideration of Executive's past services to the Company, and no such payment shall be regarded as a penalty to the Company. 25. ACKNOWLEDGMENT. The parties hereto each acknowledge that each has read this Agreement and understands the same and that each enters into this Agreement freely and voluntarily. IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written. CHESAPEAKE UTILITIES CORPORATION [CORPORATE SEAL] By: _______________________________ Title: ATTEST: __________________________ Secretary EXECUTIVE ____________________________________ _____________ EX-11 4 COMPUTATION OF PRIMARY AND FULLY DILUTED EPS CHESAPEAKE UTILITIES CORPORATION AND SUBSIDIARIES EXHIBIT 11 COMPUTATION OF PRIMARY AND FULLY DILUTED EARNINGS PER SHARE
FOR THE QUARTER FOR THE SIX MONTHS ENDED JUNE 30, (1) ENDED JUNE 30, ------------------------ ------------------------ 1997 1996 1997 1996 ---- ---- ---- ---- Primary earnings per share calculation: Weighted average number of shares 4,486,966 4,428,860 4,481,467 4,414,307 ======================== ======================== Consolidated net income $692,841 $486,311 $4,058,953 $6,486,468 ======================== ======================== Primary earnings per share $0.15 $0.11 $0.91 $1.47 ======================== ======================== Fully diluted earings per share calculation: Weighted average number of shares 4,486,966 4,428,860 4,481,467 4,414,307 Contingent shares related to assumed conversion of convertible debt 240,137 242,761 240,339 244,059 ------------------------ ------------------------ Weighted average number of shares assuming full dilution 4,727,103 4,671,621 4,721,806 4,658,366 ======================== ======================== Adjusted net income Consolidated net income $692,841 $486,311 $4,058,953 $6,486,468 Interest on convertible debt 84,030 84,715 167,275 170,338 Less: Applicable federal income taxes (32,772) (33,039) (65,237) (66,432) ------------------------ ------------------------ Adjusted net income $744,099 $537,987 $4,160,991 $6,590,374 ======================== ======================== Fully diluted earnings per share $0.16 $0.12 $0.88 $1.41 ======================== ========================
(1) This calculation is submitted in accordance with Regulation S-K item 601(b)(11), although it is contrary to paragraph 40 of APB Opinion No. 15, because it produces an anti-dilutive result for the quarters ended June 30, 1997 and 1996. EX-27.1 5 FINANCIAL DATA SCHEDULE-JUNE 1997
UT This schedule contains summary financial information extracted from the Balance Sheet, Income Statements and Statement of Cash Flows of Chesapeake Utilities Corporation and is qualified in its entirety by reference to such financial statements. 6-MOS DEC-31-1997 JUN-30-1997 PER-BOOK 76180847 22917474 16226496 11718305 0 127043122 2174064 19198037 28773677 49898912 0 0 28647000 9900000 0 0 717368 0 0 0 37879842 127043122 68371075 2661602 60200406 62862008 5509067 128817 5637884 1578931 4058953 0 4058953 2042668 2357022 11991369 .91 .88
EX-27.2 6 FINANCIAL DATA SCHEDULE-1996 RESTATED
UT This schedule contains summary financial information extracted from the restated Balance Sheets, Income Statements and Statements of Cash Flows of Chesapeake Utilities Corporation for fiscal year 1996 and is qualified in its entirety by reference to such financial statements. 3-MOS 6-MOS 9-MOS 12-MOS DEC-31-1996 DEC-31-1996 DEC-31-1996 DEC-31-1996 MAR-31-1996 JUN-30-1996 SEP-30-1996 DEC-31-1996 PER-BOOK PER-BOOK PER-BOOK PER-BOOK 66317043 67797800 69425920 73217386 21747264 21656697 22224712 22615810 22084813 15628964 17418178 27470042 13304858 13143986 13006492 12742672 0 0 0 0 123453978 118227447 122075302 136045910 2139973 2147199 2154544 2160628 18051687 18301137 18534116 18745718 28387382 27884859 26169270 26957049 47944657 47790657 46445878 47537464 0 0 0 0 0 0 0 0 31377823 31026736 31036043 30776919 2000000 175000 6225000 12700000 0 0 0 0 0 0 0 0 1277938 1277938 1277938 1285938 0 0 0 0 0 0 0 0 0 0 0 0 40853560 37957116 37090443 43745589 123453978 118227447 122075302 136045910 49033492 74248560 93896237 130279277 2779045 3257947 2872281 3947056 39586948 63238723 83432487 116222216 42365993 66496670 86304768 120169272 6667499 7751890 7591469 10110005 75150 147546 261748 458249 6742649 7899436 7853217 10568254 742492 1412968 2114528 2963339 6000157 6486468 5738689 7604915 0 0 0 0 6000157 6486468 5738689 7604915 837333 1633970 2131310 3574694 2397876 2544882 2587391 2574802 6856702 12067679 12044651 11294238 1.36 1.47 1.30 1.72 1.30 1.41 1.26 1.67
EX-27.3 7 FINANCIAL DATA SCHEDULE-1995 RESTATED
UT This schedule contains summary financial information extracted from the restated Balance Sheets, Income Statements and Statement of Cash Flows of Chesapeake Utilities Corporation for fiscal year 1995 and is qualified in its entirety by reference to such financial statements. 3-MOS 6-MOS 9-MOS 12-MOS DEC-31-1995 DEC-31-1995 DEC-31-1995 DEC-31-1995 MAR-31-1995 JUN-30-1995 SEP-30-1995 DEC-31-1995 PER-BOOK PER-BOOK PER-BOOK PER-BOOK 61582716 63528927 63907305 65419372 19647027 19813276 20305020 21127028 14733770 14611747 14977055 22699647 13203962 12944917 13876248 14092681 0 0 0 0 109167475 110898867 113065628 123338728 2107272 2112040 2117966 2122212 17040158 17198828 17366900 17489109 22384332 22316693 22470077 23458776 40637229 40807271 41292978 42582151 0 0 0 0 0 0 0 0 26078657 25733156 27943157 31618657 3600000 4100000 2391000 5400000 0 0 0 0 0 0 0 0 1653470 1666470 5289970 1281970 0 0 0 0 0 0 0 0 0 0 0 0 37198120 38591971 36148524 42455950 109167476 110898868 113065629 123338728 33955208 57188083 78635067 111853705 2030851 2489157 2979229 4025274 26734047 48200772 67974172 97761891 28764898 50689929 70953401 101787165 5190311 6498154 7681666 10066540 52794 148746 251011 391450 5243104 6646900 7932677 10457990 762377 1500638 2144032 2864484 4480727 5146262 5788645 7593506 0 0 0 0 4480727 5146262 5788645 7593506 949863 1924152 2902018 3882966 2480262 2447159 2418288 2464591 8349970 12032665 10949216 12997955 1.04 1.20 1.35 1.75 1.00 1.15 1.31 1.70
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