Atmos Energy 1998 Annual Report Download - page 40

30,1998.These uncommitted lines expire at various dates from
May through August 1999, and are renewed or renegotiated at
least annually. The uncommitted lines have varying terms and the
Company pays no fee for the availability of the lines. Borrowings
under these lines are made on a when and as-available basis at the
discretion of the banks. The weighted average interest rate on
short-term borrowings outstanding was 6.2% and 6.1% at
September 30,1998 and 1997, respectively.
Commercial Paper Program The Company implemented a $250
million commercial paper program in October 1998. It is support-
ed by the $250 million committed line of credit described above.
The Company’s commercial paper was rated A-2by Standard and
Poor’s and P-2by Moody’s.
8STATEMENT OF CASH FLOWS SUPPLEMENTAL DISCLOSURES
Supplemental disclosures of cash flow information for 1998,1997
and 1996 are presented below.
1998 1997 1996
(In thousands)
Cash paid for
Interest $29,980 $25,216 $32,778
Income taxes $25,598 $ 9,736 $14,562
9COMMON STOCK AND STOCK OPTIONS
Shareholders’ Rights Plan On November 12,1997, the Board of
Directors approved a new Rights Agreement to become effective
upon the expiration of the then existing Rights Agreement on
May 10,1998. Under the Rights Agreement, each right (“Right”)
will entitle the holder thereof, until May 10,2008 or the date of
redemption the Rights, to buy two additional shares of Common
Stock of the Company at the exercise price of $80.00, subject to
adjustment. At no time will the Rights have any voting rights.
The exercise price payable and the number of shares of Common
Stock or other securities or property issuable upon exercise of the
Rights are subject to adjustment from time to time to prevent
dilution. At the date upon which the rights become separate from
the Company’s Common Stock (the “Distribution Date”), the
Company will issue one right with each share of Common Stock
that becomes outstanding so that all shares of Common Stock
will have attached Rights. After the Distribution Date, the
Company may issue Rights when it issues Common Stock if the
Board deems such issuance to be necessary or appropriate.
The Rights will separate from the Common Stock and a
Distribution Date will occur upon the occurrence of certain
events specified in the Agreement, including but not limited to,
the acquisition by certain persons of at least 10% of the beneficial
ownership of the Company’s Common Stock. The Rights have
provide for certain cash flow requirements and restrictions on
additional indebtedness, sale of assets and payment of dividends.
Under the most restrictive of such covenants, cumulative cash
dividends paid after December 31,1988 may not exceed the sum
of accumulated net income for periods after December 31,1988
plus $15.0million. At September 30,1998, approximately $60.9
million of retained earnings was unrestricted.
As of September 30,1998, all of the Greeley Division utility
plant assets with a net book value of approximately $88.3million
are subject to a lien under the 9.4% Series J First Mortgage Bonds
assumed by the Company in the acquisition of Greeley Gas
Company. Also, substantially all of the United Cities Division
utility plant assets, totaling approximately $324.7million, are sub-
ject to a lien under the Indenture of Mortgage of the Series N
through V First Mortgage Bonds.
Based on the borrowing rates currently available to the
Company for debt with similar terms and remaining average
maturities, the fair value of long-term debt at September 30,
1998 and 1997 is estimated, using discounted cash flow analysis,
to be $489.0million and $348.3million, respectively. It is not
currently advantageous for the Company to refinance its long-
term debt because of costs of prepayment required in the
various debt agreements.
Maturities of long-term debt at September 30, 1998 are as
follows (in thousands):
1999 $ 57,783
2000 16,389
2001 17,934
2002 15,823
2003 22,745
Thereafter 325,657
$ 456,331
Short-term debt
Committed Credit Facilities The Company has two short-term
committed credit facilities. The committed lines are renewed or
renegotiated at least annually. One short-term, unsecured credit
facility from a group of eight banks is for $250 million. This facili-
ty expires in August 1999. No balance was outstanding under it at
September 30,1998. This facility requires a commitment fee of
.06% on the unused portion. A second facility is for $12 million
with a single bank. This facility expires March 31,1999. It
requires a commitment fee of .075% on the unused portion.
Uncommitted Credit Facilities The Company also has unsecured
short-term uncommitted credit lines from three banks totaling
$80 million, of which $25.6million was unused as of September
36 ATMOS ENERGY CORPORATION