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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934.
For the fiscal year ended December 31, 2000
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Commission file number 1-7850
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A. Full title of the plan and the address of the plan, if different from that
of the issuer named below:
SOUTHWEST GAS CORPORATION EMPLOYEES' INVESTMENT PLAN
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B. Name of issuer of the securities held pursuant to the plan and the address
of its principle executive office:
SOUTHWEST GAS CORPORATION
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5241 Spring Mountain Road, Post Office Box 98510
Las Vegas, Nevada 89193-8510
(702) 876-7237
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FINANCIAL STATEMENTS AND EXHIBITS.
Listed below are all financial statements and exhibits filed as part of this
annual report:
(a) Financial statements, including statements of net assets
available for Plan benefits as of December 31, 2000 and 1999,
and the related statement of changes in net assets available
for Plan benefits for the year ended December 31, 2000 and
notes to financial statements, together with the report
thereon of Arthur Andersen LLP, independent public
accountants.
(b) Consent of Arthur Andersen LLP, independent public accountants.
Pursuant to the requirements of the Securities Exchange Act of 1934, the members
of the Southwest Gas Corporation Benefit Committee have duly caused this annual
report to be signed by the undersigned thereunto duly authorized.
SOUTHWEST GAS CORPORATION
EMPLOYEES' INVESTMENT PLAN
By /s/ George C. Biehl
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George C. Biehl
Executive Vice President,
Chief Financial Officer and
Corporate Secretary
Southwest Gas Corporation
Dated: June 22, 2001
2
SOUTHWEST GAS CORPORATION
EMPLOYEES' INVESTMENT PLAN
FINANCIAL STATEMENTS
AS OF DECEMBER 31, 2000 AND 1999 AND
FOR THE YEAR ENDED DECEMBER 31, 2000
TOGETHER WITH REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
3
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Benefit Committee,
Southwest Gas Corporation:
We have audited the accompanying statements of net assets available for plan
benefits of the SOUTHWEST GAS CORPORATION EMPLOYEES' INVESTMENT PLAN (the
"Plan") as of December 31, 2000 and 1999, and the related statement of changes
in net assets available for plan benefits for the year ended December 31, 2000.
These financial statements and the schedules referred to below are the
responsibility of the Plan Committee. Our responsibility is to express an
opinion on these financial statements and schedules based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by the Plan Committee, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for plan benefits as of December
31, 2000 and 1999, and the changes in net assets available for Plan benefits for
the year ended December 31, 2000, in conformity with accounting principles
generally accepted in the United States.
Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of assets held
for investment purposes at December 31, 2000 and reportable transactions for the
year ended December 31, 2000 are presented for purposes of additional analysis
and are not a required part of the basic financial statements but are
supplementary information required by the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. The supplemental schedules have been subjected to the
auditing procedures applied in our audits of the basic financial statements and,
in our opinion, are fairly stated in all material respects in relation to the
basic financial statements taken as a whole.
ARTHUR ANDERSEN LLP
Las Vegas, Nevada
June 15, 2001
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SOUTHWEST GAS CORPORATION
EMPLOYEES' INVESTMENT PLAN
Statements of Net Assets Available for Plan Benefits
December 31,
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2000 1999
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Assets:
Investments (see Note 2) $ 162,392,888 $ 162,964,101
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Total assets 162,392,888 162,964,101
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Net assets available for plan benefits $ 162,392,888 $ 162,964,101
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The accompanying notes are an integral part of these statements.
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SOUTHWEST GAS CORPORATION
EMPLOYEES' INVESTMENT PLAN
Statement of Changes in Net Assets Available for Plan Benefits
December 31,
2000
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Additions:
Additions to net assets attributed to
Investment income
Net depreciation in fair value
of investments (see Note 2) $ (16,532,087)
Interest and dividends 13,045,686
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(3,486,401)
Less investment expenses 19,020
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(3,505,421)
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Contributions
Participant 9,043,192
Employer 2,774,231
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11,817,423
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Total additions 8,312,002
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Deductions:
Deductions from net assets attributed to
Benefits paid to participants 8,883,215
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Net decrease (571,213)
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Net assets available for plan benefits:
Beginning of year 162,964,101
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End of year $ 162,392,888
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The accompanying notes are an integral part of this statement.
6
SOUTHWEST GAS CORPORATION
EMPLOYEES' INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(1) DESCRIPTION OF PLAN
The following description of the Southwest Gas Corporation Employees' Investment
Plan (the Plan), as amended, provides general information. Participants should
refer to the Plan document for a more complete description of the Plan's
provisions.
GENERAL
The Plan is a voluntary defined contribution plan covering all employees of
Southwest Gas Corporation (the Company). It is subject to the provisions of
the Employee Retirement Income Security Act of 1974 (ERISA).
BASIS OF ACCOUNTING
The financial statements of the Plan are prepared under the accrual method
of accounting.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally
accepted accounting principles in the United States requires management to
make estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.
CONTRIBUTIONS
Participants may contribute up to 16 percent of their annual wages before
bonuses and overtime. However, contributions may not exceed amounts
promulgated by the Internal Revenue Code. The Company contributes to the
Plan an amount equal to 50 percent of a participant's contribution. The
Company's maximum contribution is three percent of a participant's annual
compensation before bonuses and overtime.
PARTICIPANTS ACCOUNTS
Each participant account is credited with the participant's contribution and
the portion contributed by the Company. The portion contributed by the
participant is invested in the various funds according to the direction of
the participant. The Company contributions are invested in the Southwest Gas
Stock Fund. Upon attaining age 50, participants may elect the investment
funds in which the present balance of Company contributions, as well as
future Company matching contributions, will be invested.
VESTING
Participants are immediately vested in their voluntary contributions plus
actual earnings thereon. Vesting in the contributions made by the Company
and in the earnings thereon is based on years of continuous service as
follows:
VESTED
YEARS OF SERVICE PERCENTAGE
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One but less than two...............................20
Two but less than three.............................40
Three but less than four............................60
Four but less than five.............................80
Five and over......................................100
In the event of death, retirement or total disability of a participant,
Company contributions become fully vested irrespective of the years of
service at the date of termination.
7
SOUTHWEST GAS CORPORATION
EMPLOYEES' INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
PAYMENT OF BENEFITS
If a participant terminates employment with the Company as a result of
retirement, death or permanent and total disability, such participant or
designated beneficiary in the case of death, will be entitled to receive an
amount equal to the value of his account at the end of the month immediately
following termination of employment. Distributions from the Southwest Gas
Stock Fund will be made in the Company's common stock plus cash in lieu of
fractional shares. A participant may apply to the Plan Committee to request
a single lump sum payment in cash of the value of the Company's common stock
otherwise distributable to the participant. Distributions from other funds
will be made in a single lump sum cash payment.
Distributions under the Plan will begin as soon as practicable, but not
later than April 1 following the end of the Plan year in which the
participant attains age 70-1/2 or terminates employment, if later. No
distribution in excess of $5,000 will be made to employees at the time of
termination of employment without the participant's consent. A participant
who is terminated and does not elect to take a distribution will continue to
receive his share of investment income on all vested portions of his
accounts until electing to receive distributions from the Plan. All
distributions to beneficiaries of a participant must be made within five
years after the participant's death.
PLAN EXPENSES
Plan-related expenses and any other costs of administering the Plan will be
paid with funds from the Plan unless paid by the Company at its discretion.
All Plan expenses, except loan origination and maintenance fees for loans
initiated after July 1, 1996, were paid by the Company for the year ended
December 31, 2000. Loan origination and maintenance fees paid by Plan
participants for the year ended December 31, 2000 were $19,020.
PLAN ADMINISTRATION
Fidelity Management Trust Company acts as the trustee and Fidelity
Institutional Retirement Services Company performs all recordkeeping of the
Plan.
(2) INVESTMENTS
All investments of the Plan are stated at quoted market value as of the date of
the statement. The Plan provides for investments in various investments.
Investment securities, in general, are exposed to various risks, such as
interest rate, credit and overall market volatility risks. Due to the level of
risk associated with certain investment securities, it is reasonably possible
that changes in the values of investment securities will occur in the near term
and such changes could materially affect the amounts reported in the statements
of net assets available for plan benefits. Loans to participants are valued at
their outstanding principal amount. Realized gains/losses on investments sold
and the unrealized gains/losses on investments held during the year are
determined on a revalued cost basis.
Investments representing five percent or more of Plan net assets are:
December 31,
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2000 1999
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Southwest Gas Corporation Common Stock
(2,527,438 and 2,384,382 shares, respectively) $55,287,706 $54,840,786
Fidelity Contrafund
(993,093 and 837,748 shares, respectively) 48,830,402 50,281,659
Fidelity Growth & Income Fund
(253,060 and 240,960 shares, respectively) 10,653,812 11,363,694
Fidelity Retirement Money Market Fund
(11,406,120 and 11,721,487 shares, respectively) 11,406,120 11,721,487
Fidelity Asset Manager: Growth Fund
(668,975 and 569,104 shares, respectively) 10,643,394 11,194,272
Vanguard 500 Index Fund
(81,233 and 63,940 shares, respectively) 9,899,080 8,653,059
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SOUTHWEST GAS CORPORATION
EMPLOYEES' INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
During 2000, Plan investments (including gains and losses on investments bought
and sold as well as held during the year) depreciated in value by $(16,532,087)
as follows:
Common stock $ (2,404,174)
Mutual funds (14,127,913)
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$ (16,532,087)
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Purchases and sales of securities are recorded on a trade-date basis. Dividends
are recorded on the ex-dividend date.
(3) NONPARTICIPANT-DIRECTED INVESTMENTS
Information about the net assets and the significant components of the changes
in net assets relating to the nonparticipant-directed investments is as follows:
December 31,
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2000 1999
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Net Assets:
Common stock $ 35,683,018 $ 29,776,393
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$ 35,683,018 $ 29,776,393
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December 31,
2000
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Changes in Net Assets:
Contributions $ 2,560,185
Dividends 1,072,180
Net appreciation 4,827,247
Benefits paid to participants (1,836,910)
Transfers to participant-directed investments (716,077)
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$ 5,906,625
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(4) FUND DESCRIPTIONS
Employees can invest their contributions in any combination of the available
investment options in ten percent increments. Participants can change the
allocation of their ongoing contributions on a monthly basis in increments of
ten percent and can transfer amounts they previously contributed to other funds.
Descriptions of the Plan funds are as follows:
SOUTHWEST GAS STOCK FUND
Contributions are invested in Southwest Gas Corporation common stock.
VANGUARD 500 INDEX FUND
Contributions are invested in the Vanguard Index Trust-500 Portfolio which
invests in all or substantially all 500 stocks in the Standard & Poor's 500
Stock Composite Index (S&P 500) in approximately the same proportion as they
are represented in the S&P 500.
VANGUARD INTERNATIONAL GROWTH FUND
Contributions are invested in the Vanguard International Growth Portfolio
which invests in a broadly diversified array of non-U.S. equity securities,
primarily common stocks of seasoned companies.
FIDELITY CONTRAFUND
Contributions are invested in the Fidelity Contrafund which seeks capital
growth by investing primarily in securities which the management of the fund
considers to have better than average prospects for appreciation in value
due to the undervalued or out-of-favor position of the securities.
FIDELITY INVESTMENT-GRADE BOND FUND
Contributions are invested in the Fidelity Investment-Grade Bond Fund which
invests in U.S. dollar-denominated investment-grade bonds (those of medium
and high quality). The fund is managed to have similar overall interest rate
risk to the Lehman Brothers Aggregate Bond Index.
9
SOUTHWEST GAS CORPORATION
EMPLOYEES' INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
FIDELITY GROWTH & INCOME FUND
Contributions are invested in the Fidelity Growth & Income Fund which seeks
a high total return through a combination of current income and capital
appreciation by investing mainly in equity securities of companies that pay
current dividends and offer potential growth of earnings.
FIDELITY ASSET MANAGER: GROWTH FUND
Contributions are invested in the Fidelity Asset Manager: Growth Fund which
seeks to maximize total return over the long term by allocating its assets
among stocks, bonds, and short-term investments with an emphasis on stocks.
FIDELITY LOW-PRICED STOCK FUND
Contributions are invested in the Fidelity Low-Priced Stock Fund which seeks
long-term capital appreciation by investing primarily in low-priced stocks
in small and medium-sized, less well known, or overlooked companies which
may be undervalued and offer the potential for growth.
FIDELITY RETIREMENT MONEY MARKET FUND
Contributions are invested in the Fidelity Retirement Money Market Portfolio
Fund which seeks as high a level of current income as is consistent with the
preservation of capital and liquidity by investing in high-quality, U.S.
dollar-denominated money market investments of U.S. and foreign issuers and
repurchase agreements.
PARTICIPANT LOANS
These funds are the result of loans to participants in the Plan (see
Note 5).
(5) PARTICIPANT LOANS
The Plan provides that participants may borrow against the balances in their
accounts, subject to certain limitations specified in the Plan. Funds for loans
are obtained through the liquidation of participants' investment accounts.
Payments on the loans include interest at a rate that approximates the prime
rate, plus two percent. At December 31, 2000, outstanding loans had annual
interest rates ranging from 9.75 percent to 11.50 percent. Principal and
interest payments on a participant's loan will be credited to the participant's
investment accounts in the same ratio as ongoing contributions. The maximum
repayment period for participant loans is five years.
(6) RELATED-PARTY TRANSACTIONS
Investments in the Southwest Gas Stock Fund consist of Company common stock and
are considered party-in-interest. Investments in Fidelity funds (e.g.;
Contrafund, Growth & Income, Low-Priced Stock, etc.) are managed by Fidelity,
the Plan trustee, and are also considered party-in-interest.
(7) PLAN TERMINATION
Although the Company expects to continue the Plan indefinitely, it reserves the
right to amend or terminate the Plan at any time. Upon termination, partial
termination or complete discontinuance of contributions to the Plan, Company
contributions will become fully vested.
(8) FEDERAL INCOME TAXES
In March 1996, the Company received a favorable determination letter from the
Internal Revenue Service stating that the Plan, amended and restated effective
December 1, 1994, qualifies for deferred tax treatment of contributions under
Section 401(k) of the Internal Revenue Code. The Plan has been amended since
receiving the determination letter. However, the Plan administrator and the
Plan's tax counsel believe that the Plan is currently designed and is being
operated in compliance with the applicable requirements of the Internal Revenue
Code. Therefore, the Plan administrator and the Plan's tax counsel believe that
the Plan was qualified and the related trust was tax-exempt for the years ended
December 31, 2000 and 1999.
10
SCHEDULE I
SOUTHWEST GAS CORPORATION
EMPLOYEES' INVESTMENT PLAN
E.I.N. 88-0085720
ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
AT DECEMBER 31, 2000
Number of Fair Market
Shares Cost Value
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Southwest Gas Corporation Common Stock* 2,527,438 $ 46,915,830 $ 55,290,645
Vanguard 500 Index Fund 81,233 9,804,575 9,899,080
Vanguard International Growth Fund 104,399 2,165,599 1,970,014
Fidelity Contrafund* 993,093 47,723,398 48,830,402
Fidelity Investment-Grade Bond Fund* 478,398 3,400,914 3,425,327
Fidelity Growth & Income Fund* 253,060 10,436,716 10,653,812
Fidelity Asset Manager: Growth Fund* 668,975 11,661,827 10,643,394
Fidelity Low-Priced Stock Fund* 165,691 3,828,455 3,830,780
Fidelity Retirement Money Market Fund* 11,406,120 11,406,120 11,406,120
Temporary Cash Investments* 767,244 767,244 767,244
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148,110,678 156,716,818
Participant Loans (with interest ranging from 9.75% to 11.50%) 5,676,070 5,676,070
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$ 153,786,748 $ 162,392,888
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* Party-in-interest
11
SCHEDULE II
SOUTHWEST GAS CORPORATION
EMPLOYEES' INVESTMENT PLAN
E.I.N. 88-0085720
ITEM 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 2000
Purchases Sales
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Number of Number of Original
Description Transactions Cost Transactions Proceeds Cost Gain (Loss)
- ---------------------------------- ---------------- --------- ------------ ---------------- ---------- -------------
NO REPORTABLE TRANSACTIONS
* The Southwest Gas Corporation Common Stock shares which are distributed to
terminated or withdrawing participants are not included in this schedule;
however, a realized gain (loss) is recognized on the statement of changes in net
assets available for plan benefits.
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EXHIBIT 23
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation of our
report dated June 15, 2001 included in this Form 11-K, into Southwest Gas
Corporation's previously filed Form S-8 Registration Statement
File No. 333-35556.
ARTHUR ANDERSEN LLP
Las Vegas, Nevada
June 15, 2001
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