Delaware
|
|
51-0002090
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification Number)
|
Securities registered pursuant to Section 12(b) of the Act:
|
||
Title of each class
|
Trading Symbol (s)
|
Name of each exchange on which registered
|
Common Stock
|
ARTNA
|
The Nasdaq Stock Market
|
□
|
Yes
|
☑
|
No
|
|
□
|
Yes
|
☑
|
No
|
|
☑
|
Yes
|
□
|
No
|
|
☑
|
Yes
|
□
|
No
|
|
Large Accelerated Filer □
|
Accelerated Filer □
|
Non-Accelerated Filer ☑
|
Smaller Reporting Company ☑
|
Emerging Growth Company ☐
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
-
|
general economic, employment and business conditions;
|
-
|
material costs and availability;
|
-
|
consumer and producer price inflation;
|
-
|
the impact of recent acquisitions on our ability to expand and foster relationships;
|
-
|
strategic plans for goals, priorities, growth and expansion;
|
-
|
expectations for our water and wastewater subsidiaries and non-utility subsidiaries;
|
-
|
customer base growth opportunities in Delaware and Cecil County, Maryland;
|
-
|
our belief regarding our capacity to provide water services for the foreseeable future to our customers;
|
-
|
our belief relating to our compliance and the cost to achieve compliance with relevant governmental regulations;
|
-
|
our expectation of the timing of decisions by regulatory authorities;
|
-
|
the impact of weather and climate change on our operations;
|
-
|
the execution of our strategic initiatives;
|
-
|
our expectation regarding the timing for construction on new projects;
|
-
|
the adoption of recent accounting pronouncements from time to time;
|
-
|
contract operations opportunities;
|
-
|
legal proceedings;
|
-
|
our properties;
|
-
|
deferred tax assets;
|
-
|
the adequacy of our available sources of financing;
|
-
|
the expected recovery of expenses related to our long-term debt;
|
-
|
our expectation to be in compliance with financial covenants in our debt instruments;
|
-
|
our ability to refinance our debt as it comes due;
|
-
|
our ability to adjust our debt level, interest rate, maturity schedule and structure;
|
-
|
the timing and terms of renewals of our lines of credit;
|
-
|
changes in interest rates;
|
-
|
plans to increase our wastewater treatment operations, engineering services and other revenue streams less affected by weather;
|
-
|
expected future contributions to our postretirement benefit plan;
|
-
|
anticipated growth in our non-utility subsidiaries;
|
-
|
anticipated investments in certain of our facilities and systems and the sources of funding for such investments;
|
-
|
sufficiency of internally generated funds and credit facilities to provide working capital and our liquidity needs; and
|
-
|
the specific and overall impacts of global pandemics on our financial condition and results of operations.
|
-
|
changes in weather and climate;
|
-
|
changes in our contractual obligations;
|
-
|
ability to sufficiently control certain operating expenses which are necessary to provide public utility services;
|
-
|
changes in government policies;
|
-
|
timely availability of materials and supplies for essential infrastructure projects and operations;
|
-
|
the timing and results of our rate requests;
|
-
|
failure to receive regulatory approvals;
|
-
|
cyber-attacks;
|
-
|
changes in economic and market conditions generally;
|
-
|
effectiveness of internal control over financial reporting;
|
-
|
unexpected events, restrictions and policies related to a public health crisis; and
|
-
|
other matters discussed elsewhere in this Annual Report on Form 10-K.
|
-
|
a signed service agreement with the developer of a proposed subdivision or development, which subdivision or development has been duly approved by
the respective county government;
|
-
|
a petition requesting such service signed by a majority of the landowners of the proposed territory to be served; or
|
-
|
a duly certified copy of a resolution from the governing body of a county or municipality requesting the applicant to provide service to the
proposed territory to be served.
|
-
|
Dilutive issuance of our equity securities;
|
-
|
Incurrence of debt and contingent liabilities;
|
-
|
Difficulties in integrating the operations and personnel of the acquired organization;
|
-
|
Diversion of our management’s attention from ongoing business concerns;
|
-
|
Failure to have effective internal control over financial reporting;
|
-
|
Overload of human capital resources; and
|
-
|
Other acquisition-related expense.
|
ITEM 1B. |
UNRESOLVED STAFF COMMENTS
|
ITEM 2. |
PROPERTIES
|
Utility plant
comprises:
|
||||||||
In thousands
|
||||||||
|
Estimated Useful Life
(In Years)
|
December 31, 2023
|
||||||
Utility plant at original cost
|
||||||||
Utility plant in service-Water
|
||||||||
Intangible plant
|
---
|
$
|
140
|
|||||
Source of supply plant
|
45-85
|
29,960
|
||||||
Pumping and water treatment plant
|
8-62
|
130,337
|
||||||
Transmission and distribution plant
|
||||||||
Mains
|
81
|
370,977
|
||||||
Services
|
39
|
60,818
|
||||||
Storage tanks
|
76
|
40,933
|
||||||
Meters
|
26
|
30,318
|
||||||
Hydrants
|
60
|
18,980
|
||||||
General plant
|
5-31
|
67,317
|
||||||
|
||||||||
Utility plant in service-Wastewater
|
||||||||
Intangible plant
|
---
|
116
|
||||||
Treatment and disposal plant
|
21-81
|
67,789
|
||||||
Collection mains and lift stations
|
81
|
51,539
|
||||||
General plant
|
5-31
|
2,478
|
||||||
|
||||||||
Property held for future use
|
---
|
4,028
|
||||||
Construction work in progress
|
---
|
23,724
|
||||||
|
899,454
|
|||||||
Less – accumulated depreciation
|
185,170
|
|||||||
|
$
|
714,284
|
ITEM 4. |
MINE SAFETY DISCLOSURES
|
ITEM 5. |
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY
SECURITIES
|
Stock Price
|
|||||||
High
|
Low
|
||||||
2023
|
|||||||
First Quarter
|
$
|
63.00
|
$
|
51.30
|
|||
Second Quarter
|
$
|
58.41
|
$
|
46.37
|
|||
Third Quarter
|
$
|
49.73
|
$
|
41.26
|
|||
Fourth Quarter
|
$
|
44.78
|
$
|
38.76
|
|||
2022
|
|||||||
First Quarter
|
$
|
50.88
|
$
|
43.02
|
|||
Second Quarter
|
$
|
50.00
|
$
|
44.08
|
|||
Third Quarter
|
$
|
60.36
|
$
|
47.96
|
|||
Fourth Quarter
|
$
|
59.98
|
$
|
45.44
|
|
|
INDEXED RETURNS
|
||||||||||
|
Base Period
|
Years Ending December 31
|
||||||||||
Company Name / Index
|
2018
|
2019
|
2020
|
2021
|
2022
|
2023
|
||||||
Artesian Resources Corporation
|
|
100
|
|
109.66
|
112.37
|
144.07
|
186.27
|
134.81
|
||||
S&P 500 Index
|
|
100
|
|
131.49
|
155.68
|
200.37
|
164.08
|
207.21
|
||||
Peer Group
|
|
100
|
|
134.89
|
155.56
|
192.86
|
165.11
|
141.97
|
ITEM 6. |
RESERVED
|
ITEM 7. |
MANAGEMENT'S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
Percentage of Operating Revenues
|
||||||||||||
|
2023
|
2022
|
2021
|
|||||||||
Water Sales
|
||||||||||||
Residential
|
50.1
|
%
|
48.7
|
%
|
53.0
|
%
|
||||||
Commercial
|
17.9
|
17.6
|
19.4
|
|||||||||
Industrial
|
0.1
|
0.1
|
0.1
|
|||||||||
Government and Other
|
12.9
|
12.8
|
13.2
|
|||||||||
Other utility operating revenues
|
12.3
|
11.6
|
7.9
|
|||||||||
Non-utility operating revenues
|
6.7
|
9.2
|
6.4
|
|||||||||
Total
|
100.0
|
%
|
100.0
|
%
|
100.0
|
%
|
— |
Payroll and employee benefit costs increased $1.0 million, primarily related to an increase in medical premium costs, employee merit increases, and
a decrease in capitalized payroll related to a 2022 software upgrade, partially offset by a decrease in bonuses compared to 2022.
|
— |
Administrative costs increased $0.7 million, primarily due to
increases in computer system maintenance costs, and customer billing costs.
|
— |
Supply and treatment costs
increased $0.7 million, primarily due to an increase in the cost and volume of chemicals used, an increase in wastewater treatment costs, a one-time acquisition adjustment related to TESI in 2022 and a reimbursement from the Delaware
Sand and Gravel Remedial Trust, or DS&G Trust, in 2022 for Artesian Water’s operating costs related to certain 2021 treatment costs pursuant to a settlement agreement. These increases are partially offset by a decrease in filter media
replacement costs related to varying replacement schedules.
|
— |
Transmission, distribution and collection costs increased $0.3 million, primarily associated with tank
painting costs and maintenance and repair of transmission mains.
|
— |
Purchased power costs increased $0.2 million due to an increase in usage in wastewater and water
operations.
|
— |
Purchased water costs decreased $0.5 million, primarily related to a decrease of water purchased under
contract, in which the minimum amount of water required to be purchased was reduced in July 2022.
|
Percentage of Operating and Maintenance Expenses
|
||||||||||||
|
2023
|
2022
|
2021
|
|||||||||
Payroll and Associated Expenses
|
49.5
|
%
|
47.5
|
%
|
49.2
|
%
|
||||||
Administrative
|
16.9
|
15.3
|
15.7
|
|||||||||
Supply and Treatment
|
11.9
|
10.8
|
9.4
|
|||||||||
Purchased Power
|
5.7
|
5.2
|
4.8
|
|||||||||
Transmission, Distribution and Collection
|
4.6
|
4.1
|
2.7
|
|||||||||
Purchased Water
|
2.7
|
3.6
|
9.5
|
|||||||||
Non-utility Operating
|
8.7
|
13.5
|
8.7
|
|||||||||
Total
|
100.0
|
%
|
100.0
|
%
|
100.0
|
%
|
In thousands
|
2023
|
2022
|
2021
|
|||||||||
Source of supply, treatment and pumping
|
$
|
20,327
|
$
|
14,158
|
$
|
9,681
|
||||||
Transmission and distribution
|
26,886
|
17,712
|
20,951
|
|||||||||
General plant
|
4,553
|
3,856
|
1,739
|
|||||||||
Developer financed utility plant
|
8,301
|
8,038
|
6,866
|
|||||||||
Wastewater facilities
|
3,353
|
5,613
|
2,133
|
|||||||||
Allowance for Funds Used During Construction, AFUDC, equity portion
|
(1,243
|
)
|
(894
|
)
|
(556
|
)
|
||||||
Total
|
$
|
62,177
|
$
|
48,483
|
$
|
40,814
|
Material Cash Requirements
|
Payments Due by Period
|
|||||||||||||||||||
In thousands
|
Less than
1 Year
|
1-3
Years
|
4-5
Years
|
After 5
Years
|
Total
|
|||||||||||||||
First mortgage bonds (principal and interest)
|
$
|
7,902
|
$
|
15,714
|
$
|
40,610
|
$
|
204,564
|
$
|
268,790
|
||||||||||
State revolving fund loans (principal and interest)
|
979
|
2,147
|
2,068
|
10,287
|
15,481
|
|||||||||||||||
Promissory note (principal and interest)
|
1,200
|
1,923
|
1,924
|
9,652
|
14,699
|
|||||||||||||||
Asset purchase contractual obligation (principal and interest)
|
339
|
659
|
320
|
---
|
1,318
|
|||||||||||||||
Lines of credit
|
---
|
---
|
---
|
---
|
---
|
|||||||||||||||
Operating leases
|
35
|
70
|
64
|
1,429
|
1,598
|
|||||||||||||||
Operating agreements
|
76
|
112
|
109
|
749
|
1,046
|
|||||||||||||||
Unconditional purchase obligations
|
870
|
1,762
|
114
|
312
|
3,058
|
|||||||||||||||
Tank painting contractual obligation
|
626
|
313
|
---
|
---
|
939
|
|||||||||||||||
Total contractual cash obligations
|
$
|
12,027
|
$
|
22,700
|
$
|
45,209
|
$
|
226,993
|
$
|
306,929
|
ITEM 7A. |
QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
|
ITEM 8. |
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
|
For the Year Ended
|
||||||||
ASSETS
|
December 31, 2023
|
December 31, 2022
|
||||||
Utility plant, at original cost less accumulated depreciation
|
$
|
714,284
|
$
|
668,031
|
||||
Current assets
|
||||||||
Cash and cash equivalents
|
2,505
|
1,309
|
||||||
Accounts and other receivables (less provision for expected credit loss 2023 - $328; 2022 - $416)
|
12,830
|
13,511
|
||||||
Income tax receivable
|
1,799
|
1,632
|
||||||
Unbilled operating revenues
|
1,934
|
1,586
|
||||||
Materials and supplies
|
5,983
|
4,702
|
||||||
Prepaid property taxes
|
2,269
|
2,186
|
||||||
Prepaid expenses and other
|
3,297
|
2,878
|
||||||
Total current assets
|
30,617
|
27,804
|
||||||
Other assets
|
||||||||
Non-utility property (less accumulated depreciation 2023 - $1,052; 2022 - $990)
|
3,693
|
3,740
|
||||||
Other deferred assets
|
8,504
|
10,536
|
||||||
Goodwill
|
1,939
|
1,939
|
||||||
Operating lease right of use assets
|
506
|
467
|
||||||
Total other assets
|
14,642
|
16,682
|
||||||
Regulatory assets, net
|
7,289
|
7,274
|
||||||
Total Assets
|
$
|
766,832
|
$
|
719,791
|
||||
|
||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
||||||||
Stockholders’ equity
|
||||||||
Common stock
|
$
|
10,285
|
$
|
9,502
|
||||
Preferred stock
|
—
|
—
|
||||||
Additional paid-in capital
|
143,369
|
107,142
|
||||||
Retained earnings
|
76,743
|
71,286
|
||||||
Total stockholders’ equity
|
230,397
|
187,930
|
||||||
Long-term debt, net of current portion
|
178,307
|
175,619
|
||||||
|
408,704
|
363,549
|
||||||
Current liabilities
|
||||||||
Lines of credit
|
—
|
20,174
|
||||||
Current portion of long-term debt
|
2,235
|
2,003
|
||||||
Accounts payable
|
9,697
|
10,929
|
||||||
Accrued expenses
|
3,519
|
4,246
|
||||||
Overdraft payable
|
9
|
43
|
||||||
Accrued interest
|
2,275
|
989
|
||||||
Income taxes payable
|
2
|
6
|
||||||
Customer and other deposits
|
2,983
|
2,489
|
||||||
Other
|
1,694
|
3,191
|
||||||
Total current liabilities
|
$
|
22,414
|
$
|
44,070
|
||||
|
||||||||
Commitments and contingencies (Note 11)
|
—
|
—
|
||||||
|
||||||||
Deferred credits and other liabilities
|
||||||||
Net advances for construction
|
$
|
2,797
|
$
|
3,686
|
||||
Operating lease liabilities
|
503
|
466
|
||||||
Regulatory liabilities
|
25,676
|
28,721
|
||||||
Deferred investment tax credits
|
423
|
439
|
||||||
Deferred income taxes
|
58,381
|
54,552
|
||||||
Total deferred credits and other liabilities
|
$
|
87,780
|
$
|
87,864
|
||||
|
||||||||
Net contributions in aid of construction
|
247,934
|
224,308
|
||||||
Total Liabilities and Stockholders’ Equity
|
$
|
766,832
|
$
|
719,791
|
|
For the Year Ended December 31,
|
|||||||||||
|
2023
|
2022
|
2021
|
|||||||||
|
||||||||||||
Operating revenues
|
||||||||||||
Water sales
|
$
|
80,033
|
$
|
78,318
|
$
|
77,821
|
||||||
Other utility operating revenue
|
12,195
|
11,506
|
7,195
|
|||||||||
Non-utility operating revenue
|
6,633
|
9,073
|
5,843
|
|||||||||
Total Operating Revenues
|
98,861
|
98,897
|
90,859
|
|||||||||
Operating expenses
|
||||||||||||
Utility operating expenses
|
46,205
|
43,772
|
41,414
|
|||||||||
Non-utility operating expenses
|
4,428
|
6,850
|
3,942
|
|||||||||
Depreciation and amortization
|
13,335
|
12,620
|
11,885
|
|||||||||
Taxes
|
||||||||||||
State and federal income tax expense (benefit)
|
||||||||||||
Current
|
2,962
|
4,285
|
3,360
|
|||||||||
Deferred
|
3,386
|
1,593
|
2,377
|
|||||||||
Property and other taxes
|
6,099
|
5,871
|
5,587
|
|||||||||
Total Operating Expenses
|
76,415
|
74,991
|
68,565
|
|||||||||
|
||||||||||||
Operating income
|
22,446
|
23,906
|
22,294
|
|||||||||
|
||||||||||||
Other income, net
|
||||||||||||
Allowance for funds used during construction (AFUDC)
|
2,002
|
1,329
|
823
|
|||||||||
Miscellaneous
|
1,407
|
1,265
|
1,302
|
|||||||||
|
3,409
|
2,594
|
2,125
|
|||||||||
|
||||||||||||
Income before interest charges
|
25,855
|
26,500
|
24,419
|
|||||||||
|
||||||||||||
Interest charges
|
9,156
|
8,502
|
7,592
|
|||||||||
|
||||||||||||
Net income applicable to common stock
|
$
|
16,699
|
$
|
17,998
|
$
|
16,827
|
||||||
|
||||||||||||
Net income per common share:
|
||||||||||||
Basic
|
$
|
1.67
|
$
|
1.90
|
$
|
1.79
|
||||||
Diluted
|
$
|
1.67
|
$
|
1.90
|
$
|
1.79
|
||||||
|
||||||||||||
Weighted average common shares outstanding:
|
||||||||||||
Basic
|
10,018
|
9,462
|
9,394
|
|||||||||
Diluted
|
10,022
|
9,481
|
9,426
|
|||||||||
|
||||||||||||
Cash dividends per share of common stock
|
$
|
1.14
|
$
|
1.09
|
$
|
1.05
|
For the Year Ended December 31,
|
||||||||||||
|
2023
|
2022
|
2021
|
|||||||||
CASH FLOWS FROM OPERATING ACTIVITIES
|
||||||||||||
Net income
|
$
|
16,699
|
$
|
17,998
|
$
|
16,827
|
||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
|
||||||||||||
Depreciation and amortization
|
13,335
|
12,620
|
11,885
|
|||||||||
Amortization of debt expense
|
355
|
354
|
351
|
|||||||||
Provision for bad debt expense
|
92
|
68
|
(224
|
)
|
||||||||
Deferred income taxes, net
|
3,813
|
2,282
|
2,803
|
|||||||||
Stock compensation
|
254
|
152
|
193
|
|||||||||
AFUDC, equity portion
|
(1,243
|
)
|
(894
|
)
|
(556
|
)
|
||||||
|
||||||||||||
Changes in assets and liabilities, net of acquisitions:
|
||||||||||||
Accounts and other receivables
|
807
|
(3,847
|
)
|
318
|
||||||||
Income tax receivable
|
(167
|
)
|
602
|
(1,605
|
)
|
|||||||
Unbilled operating revenues
|
(348
|
)
|
(141
|
)
|
86
|
|||||||
Materials and supplies
|
(1,281
|
)
|
(2,769
|
)
|
(398
|
)
|
||||||
Income taxes payable
|
(4
|
)
|
6
|
(28
|
)
|
|||||||
Prepaid property taxes
|
(83
|
)
|
697
|
(415
|
)
|
|||||||
Prepaid expenses and other
|
(419
|
)
|
(216
|
)
|
(444
|
)
|
||||||
Other deferred assets
|
1,998
|
(5,473
|
)
|
(445
|
)
|
|||||||
Regulatory assets
|
(497
|
)
|
(37
|
)
|
(236
|
)
|
||||||
Regulatory liabilities
|
(3,168
|
)
|
6,799
|
(535
|
)
|
|||||||
Accounts payable
|
284
|
(3,989
|
)
|
3,547
|
||||||||
Accrued expenses
|
614
|
(564
|
)
|
(71
|
)
|
|||||||
Accrued interest
|
1,286
|
72
|
(13
|
)
|
||||||||
Revenue reserved for refund
|
—
|
—
|
—
|
|||||||||
Customer deposits and other
|
(476
|
)
|
545
|
270
|
||||||||
NET CASH PROVIDED BY OPERATING ACTIVITIES
|
31,851
|
24,265
|
31,310
|
|||||||||
|
||||||||||||
CASH FLOWS USED IN INVESTING ACTIVITIES
|
||||||||||||
Capital expenditures (net of AFUDC, equity portion)
|
(62,177
|
)
|
(48,483
|
)
|
(40,814
|
)
|
||||||
Investment in acquisitions, net of cash acquired
|
—
|
(6,341
|
)
|
—
|
||||||||
Proceeds from sale of assets
|
99
|
65
|
90
|
|||||||||
NET CASH USED IN INVESTING ACTIVITIES
|
(62,078
|
)
|
(54,759
|
)
|
(40,724
|
)
|
||||||
|
||||||||||||
CASH FLOWS FROM FINANCING ACTIVITIES
|
||||||||||||
Repayments under lines of credit agreements
|
(23,477
|
)
|
(41,038
|
)
|
(10,797
|
)
|
||||||
Borrowings under lines of credit agreements
|
3,303
|
34,509
|
10,687
|
|||||||||
(Decrease) increase in overdraft payable
|
(34
|
)
|
13
|
(75
|
)
|
|||||||
Proceeds from contributions in aid of construction and advances
|
24,747
|
17,494
|
17,059
|
|||||||||
Payouts for contributions in aid of construction and advances
|
(2,228
|
)
|
(1,063
|
)
|
(1,242
|
)
|
||||||
Net proceeds from issuance of common stock
|
37,073
|
2,090
|
1,390
|
|||||||||
Equity issuance cost
|
(317
|
)
|
—
|
—
|
||||||||
Issuance of long-term debt
|
5,608
|
31,803
|
4,126
|
|||||||||
Dividends paid
|
(11,242
|
)
|
(10,319
|
)
|
(9,826
|
)
|
||||||
Debt issuance costs
|
—
|
(135
|
)
|
(19
|
)
|
|||||||
Principal repayments of long-term debt
|
(2,010
|
)
|
(1,643
|
)
|
(1,825
|
)
|
||||||
NET CASH PROVIDED BY FINANCING ACTIVITIES
|
31,423
|
31,711
|
9,478
|
|||||||||
|
||||||||||||
NET INCREASE IN CASH AND CASH EQUIVALENTS
|
1,196
|
1,217
|
64
|
|||||||||
|
||||||||||||
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR
|
1,309
|
92
|
28
|
|||||||||
|
||||||||||||
CASH AND CASH EQUIVALENTS AT END OF YEAR
|
$
|
2,505
|
$
|
1,309
|
$
|
92
|
||||||
|
||||||||||||
Non-cash Investing and Financing Activity:
|
||||||||||||
Utility plant received as construction advances and contributions in aid of construction
|
$
|
3,492
|
$
|
8,416
|
$
|
3,538
|
||||||
Contractual amounts of contributions in aid of construction due from developers included in accounts receivable
|
$
|
1,695
|
$
|
726
|
$
|
545
|
||||||
Contractual amounts of contributions in aid of construction received from developers previously included in
accounts receivable
|
$
|
799
|
$
|
356
|
$
|
1,749
|
||||||
Change in amounts included in accounts payable and accrued
payables related to capital
expenditures
|
$
|
(3,384
|
)
|
$
|
3,182
|
$
|
641
|
|||||
Supplemental Cash Flow Information:
|
||||||||||||
Interest paid
|
$
|
7,515
|
$
|
8,430
|
$
|
7,605
|
||||||
Income taxes paid
|
$
|
3,590
|
$
|
3,482
|
$
|
5,181
|
||||||
Purchase price allocation of investment in acquisitions:
|
||||||||||||
Utility plant
|
$
|
—
|
$
|
33,345
|
$
|
—
|
||||||
Cash
|
—
|
280
|
—
|
|||||||||
Goodwill
|
—
|
1,939
|
—
|
|||||||||
Other assets
|
—
|
1,033
|
—
|
|||||||||
Total assets
|
—
|
36,597
|
—
|
|||||||||
Less:
|
||||||||||||
Liabilities
|
—
|
2,828
|
—
|
|||||||||
Future contractual obligation payable to seller
|
—
|
1,569
|
—
|
|||||||||
Contributions in aid of construction
|
—
|
25,597
|
—
|
|||||||||
Cash paid for acquisitions
|
—
|
6,621
|
—
|
|||||||||
Cash received from acquisitions
|
—
|
280
|
—
|
|||||||||
Investment in acquisitions, net of cash acquired
|
$
|
—
|
$
|
6,341
|
$
|
—
|
|
Common Shares Outstanding Class A Non-Voting (1) (3) (4)
|
Common Shares Outstanding Class B Voting (2)
|
$1 Par Value Class A Non-Voting
|
$1 Par Value Class B Voting
|
Additional Paid-in Capital
|
Retained Earnings
|
Total
|
|||||||||||||||||||||
|
||||||||||||||||||||||||||||
Balance as of December 31, 2020
|
8,475
|
881
|
$
|
8,475
|
$
|
881
|
$
|
103,463
|
$
|
56,606
|
$
|
169,425
|
||||||||||||||||
|
||||||||||||||||||||||||||||
Net income
|
—
|
—
|
—
|
—
|
—
|
16,827
|
16,827
|
|||||||||||||||||||||
Cash dividends declared
|
||||||||||||||||||||||||||||
Common stock
|
—
|
—
|
—
|
—
|
—
|
(9,826
|
)
|
(9,826
|
)
|
|||||||||||||||||||
Issuance of common stock
|
||||||||||||||||||||||||||||
Dividend reinvestment plan
|
10
|
—
|
10
|
—
|
382
|
—
|
392
|
|||||||||||||||||||||
Employee stock options and awards(4)
|
38
|
—
|
38
|
—
|
790
|
—
|
828
|
|||||||||||||||||||||
Employee Retirement Plan(3)
|
9
|
—
|
9
|
—
|
354
|
—
|
363
|
|||||||||||||||||||||
Balance as of December 31, 2021
|
8,532
|
881
|
$
|
8,532
|
$
|
881
|
$
|
104,989
|
$
|
63,607
|
$
|
178,009
|
||||||||||||||||
|
||||||||||||||||||||||||||||
Net income
|
—
|
—
|
—
|
—
|
—
|
17,998
|
17,998
|
|||||||||||||||||||||
Cash dividends declared
|
||||||||||||||||||||||||||||
Common stock
|
—
|
—
|
—
|
—
|
—
|
(10,319
|
)
|
(10,319
|
)
|
|||||||||||||||||||
Issuance of common stock
|
||||||||||||||||||||||||||||
Dividend reinvestment plan
|
7
|
—
|
7
|
—
|
366
|
—
|
373
|
|||||||||||||||||||||
Employee stock options and awards(4)
|
82
|
—
|
82
|
—
|
1,787
|
—
|
1,869
|
|||||||||||||||||||||
Employee Retirement Plan(3)
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
|||||||||||||||||||||
Balance as of December 31, 2022
|
8,621
|
881
|
$
|
8,621
|
$
|
881
|
$
|
107,142
|
$
|
71,286
|
$
|
187,930
|
||||||||||||||||
|
||||||||||||||||||||||||||||
Net income
|
—
|
—
|
—
|
—
|
—
|
16,699
|
16,699
|
|||||||||||||||||||||
Cash dividends declared
|
||||||||||||||||||||||||||||
Common stock
|
—
|
—
|
—
|
—
|
—
|
(11,242
|
)
|
(11,242
|
)
|
|||||||||||||||||||
Issuance of common stock
|
||||||||||||||||||||||||||||
Public offering, net of costs
|
763
|
—
|
763
|
—
|
35,464
|
—
|
36,227
|
|||||||||||||||||||||
Dividend reinvestment plan
|
8
|
—
|
8
|
—
|
373
|
—
|
381
|
|||||||||||||||||||||
Employee stock options and awards(4)
|
12
|
—
|
12
|
—
|
390
|
—
|
402
|
|||||||||||||||||||||
Employee Retirement Plan(3)
|
—
|
—
|
—
|
—
|
—
|
—
|
—
|
|||||||||||||||||||||
Balance as of December 31, 2023
|
9,404
|
881
|
$
|
9,404
|
$
|
881
|
$
|
143,369
|
$
|
76,743
|
$
|
230,397
|
(1) |
At December 31, 2023, 2022, and 2021, Class A Stock had 15,000,000 shares authorized. For
the same periods, shares issued, inclusive of treasury shares, were 9,433,288, 8,650,392 and 8,561,772, respectively.
|
(2) |
At December 31, 2023, 2022, and 2021, Class B Stock had 1,040,000 shares authorized and 881,452 shares issued.
|
(3) |
Artesian Resources Corporation registered 200,000 shares of Class A Stock, subsequently adjusted for stock splits, available for purchase through the Company’s 401(k) retirement plan.
|
(4) |
Under the Equity Compensation Plan, effective
December 9, 2015, Artesian Resources Corporation authorized up to 331,500 shares of Class A Stock for issuance of grants in forms of
stock options, stock units, dividend equivalents and other stock-based awards, subject to adjustment in certain circumstances as discussed in the Plan. Includes stock compensation expense for the years ended December 31, 2023, 2022, and 2021, See Notes to Consolidated Financial Statements - Note 9-Stock Compensation Plans.
|
In thousands
|
||||||||
2023
|
2022
|
2021
|
||||||
AFUDC - Debt
|
$
|
759
|
$
|
435
|
$
|
267
|
||
AFUDC - Equity
|
$
|
1,243
|
$
|
894
|
$
|
556
|
Utility plant comprises:
|
||||||||||||
In thousands
|
||||||||||||
|
December 31,
|
|||||||||||
|
Estimated Useful Life
(In Years)
|
2023
|
2022
|
|||||||||
Utility plant at original cost
|
||||||||||||
Utility plant in service-Water
|
||||||||||||
Intangible plant
|
—
|
$
|
140
|
$
|
140
|
|||||||
Source of supply plant
|
45-85
|
29,960
|
25,223
|
|||||||||
Pumping and water treatment plant
|
8-62
|
130,337
|
116,915
|
|||||||||
Transmission and distribution plant
|
||||||||||||
Mains
|
81
|
370,977
|
338,368
|
|||||||||
Services
|
39
|
60,818
|
56,396
|
|||||||||
Storage tanks
|
76
|
40,933
|
34,567
|
|||||||||
Meters
|
26
|
30,318
|
29,720
|
|||||||||
Hydrants
|
60
|
18,980
|
17,751
|
|||||||||
General plant
|
5-31
|
67,317
|
65,632
|
|||||||||
|
||||||||||||
Utility plant in service-Wastewater
|
||||||||||||
Intangible plant
|
—
|
116
|
117
|
|||||||||
Treatment and disposal plant
|
21-81
|
67,789
|
66,178
|
|||||||||
Collection mains & lift stations
|
81
|
51,539
|
49,431
|
|||||||||
General plant
|
5-31
|
2,478
|
1,845
|
|||||||||
|
||||||||||||
Property held for future use
|
—
|
4,028
|
4,489
|
|||||||||
Construction work in progress
|
—
|
23,724
|
34,213
|
|||||||||
|
899,454
|
840,985
|
||||||||||
Less – accumulated depreciation
|
185,170
|
172,954
|
||||||||||
|
$
|
714,284
|
$
|
668,031
|
Expense
|
Years Amortized
|
Deferred contract costs and other
|
5
|
Rate case studies
|
5
|
Delaware rate proceedings
|
3
|
Maryland rate proceedings
|
5
|
Debt related costs
|
15 to 30
(based on term of related debt)
|
Deferred costs affiliated interest agreement
|
20
|
Goodwill (resulting from acquisition of Mountain Hill Water Company in 2008)
|
50
|
Deferred acquisition costs (resulting from purchase of water assets in Cecil County, Maryland in 2011 and Port Deposit, Maryland in
2010)
|
20
|
Franchise Costs (resulting from purchase of water assets in Cecil County, Maryland in 2011)
|
80
|
(in thousands)
|
December 31, 2023
|
|
December 31, 2022
|
||
|
|
|
|
||
Deferred contract costs and other
|
$
|
209
|
|
$
|
227
|
Rate case studies
|
136
|
57
|
|||
Rate proceedings
|
385
|
—
|
|||
Deferred income taxes
|
444
|
465
|
|||
Debt related costs
|
4,322
|
4,682
|
|||
Deferred costs affiliated interest agreement
|
|
1,110
|
|
|
1,114
|
Goodwill
|
258
|
266
|
|||
Deferred acquisition and franchise costs
|
|
425
|
|
|
463
|
|
$
|
7,289
|
|
$
|
7,274
|
In thousands
|
2023
|
2022
|
||||||
|
||||||||
Investment in CoBank
|
$
|
5,882
|
$
|
5,351
|
||||
Settlement agreement receivable-long term
|
2,496
|
4,991
|
||||||
Other deferred assets
|
126
|
194
|
||||||
$
|
8,504
|
$
|
10,536
|
|
December 31,
|
|||||||||||
In thousands
|
2023
|
2022
|
2021
|
|||||||||
|
||||||||||||
Customer accounts receivable – water
|
$
|
6,573
|
$
|
5,981
|
$
|
5,986
|
||||||
Customer accounts receivable – wastewater
|
513
|
482
|
1,326
|
|||||||||
Settlement agreement receivable – short term
|
2,747
|
2,532
|
—
|
|||||||||
Miscellaneous accounts receivable
|
1,236
|
3,781
|
786
|
|||||||||
Developer receivable
|
2,089
|
1,151
|
698
|
|||||||||
|
13,158
|
13,927
|
8,796
|
|||||||||
Less provision for expected credit loss
|
328
|
416
|
429
|
|||||||||
Net accounts receivable
|
$
|
12,830
|
$
|
13,511
|
$
|
8,367
|
|
December 31,
|
|||||||
In thousands
|
2023
|
2022
|
||||||
|
||||||||
Beginning balance
|
$
|
416
|
$
|
429
|
||||
Provision adjustments
|
92
|
146
|
||||||
Recoveries
|
48
|
28
|
||||||
Write off of uncollectible accounts
|
(228
|
)
|
(187
|
)
|
||||
Ending balance
|
$
|
328
|
$
|
416
|
For the Year Ended December 31,
|
||||||||||||
(in thousands)
|
2023
|
2022
|
2021
|
|||||||||
Tariff Revenue
|
||||||||||||
Consumption charges
|
$
|
49,051
|
$
|
47,809
|
$
|
47,924
|
||||||
Fixed fees
|
33,074
|
31,431
|
27,977
|
|||||||||
Service charges
|
682
|
597
|
579
|
|||||||||
DSIC
|
4,727
|
5,085
|
5,093
|
|||||||||
Metered wastewater services
|
602
|
649
|
—
|
|||||||||
Industrial wastewater services
|
1,851
|
1,853
|
675
|
|||||||||
Total Tariff Revenue
|
$
|
89,987
|
$
|
87,424
|
$
|
82,248
|
Non-Tariff Revenue
|
||||||||||||
Service line protection plans
|
$
|
5,632
|
$
|
5,020
|
$
|
4,594
|
||||||
Contract operations
|
1,046
|
931
|
884
|
|||||||||
Design and installation
|
181
|
3,315
|
562
|
|||||||||
Inspection fees
|
424
|
326
|
341
|
|||||||||
Total Non-Tariff Revenue
|
$
|
7,283
|
$
|
9,592
|
$
|
6,381
|
||||||
Other Operating Revenue
|
$
|
1,591
|
$
|
1,881
|
$
|
2,230
|
||||||
Total Operating Revenue
|
$
|
98,861
|
$
|
98,897
|
$
|
90,859
|
(in thousands)
|
December 31, 2023
|
December 31, 2022
|
December 31, 2021
|
|||||||||
Contract Assets
– Tariff
|
$
|
3,043
|
$
|
2,618
|
$
|
2,144
|
||||||
Deferred Revenue
|
||||||||||||
Deferred Revenue – Tariff
|
$
|
1,300
|
$
|
1,231
|
$
|
1,227
|
||||||
Deferred Revenue – Non-Tariff
|
539
|
438
|
287
|
|||||||||
Total Deferred Revenue
|
$
|
1,839
|
$
|
1,669
|
$
|
1,514
|
|
For the Twelve Months
Ended December 31,
|
|||||||
(in thousands)
|
||||||||
2023
|
2022
|
|||||||
Minimum rentals
|
$
|
34
|
$
|
32
|
||||
Contingent rentals
|
—
|
—
|
||||||
$
|
34
|
$
|
32
|
Twelve Months Ended
|
Twelve Months Ended
|
|||||
December 31,
|
December 31,
|
|||||
2023
|
2022
|
|||||
Cash paid for amounts included in the measurement of lease liabilities:
|
||||||
Operating cash flows from operating leases
|
$
|
34
|
$
|
32
|
||
Right-of-use assets obtained in exchange for lease obligations:
|
||||||
Operating leases
|
$
|
506
|
$
|
467
|
(in thousands, except lease term and discount rate)
|
||||||||
December 31, 2023
|
December 31, 2022
|
|||||||
Operating Leases:
|
||||||||
Operating lease right-of-use assets
|
$
|
506
|
$
|
467
|
||||
Other current liabilities
|
$
|
9
|
$
|
2
|
||||
Operating lease liabilities
|
503
|
466
|
||||||
Total operating lease liabilities
|
$
|
512
|
$
|
468
|
||||
Weighted Average Remaining Lease Term
|
||||||||
Operating leases
|
58 years
|
61 years
|
||||||
Weighted Average Discount Rate
|
||||||||
Operating leases
|
5.0
|
%
|
5.0
|
%
|
|
(in thousands)
|
|||
|
Operating Leases
|
|||
Year
|
||||
2024
|
$
|
35
|
||
2025
|
35
|
|||
2026
|
35
|
|||
2027
|
35
|
|||
2028
|
29
|
|||
Thereafter
|
1,429
|
|||
Total undiscounted lease payments
|
$
|
1,598
|
||
Less effects of discounting
|
(1,086
|
)
|
||
Total lease liabilities recognized
|
512
|
In thousands
|
December 31,
|
|||||||
|
2023
|
2022
|
||||||
Carrying amount
|
$
|
180,542
|
$
|
177,622
|
||||
Estimated fair value
|
162,720
|
155,425
|
Components of Income Tax Expense
|
||||||||||||
In thousands
|
For the Year Ended December 31,
|
|||||||||||
Federal income taxes
|
2023
|
2022
|
2021
|
|||||||||
Current
|
$
|
1,946
|
$
|
2,912
|
$
|
2,144
|
||||||
Deferred
|
1,968
|
930
|
1,601
|
|||||||||
Total federal income tax expense
|
$
|
3,914
|
$
|
3,842
|
$
|
3,745
|
|
For the Year Ended December 31,
|
|||||||||||
State income taxes
|
2023
|
2022
|
2021
|
|||||||||
Current
|
$
|
1,016
|
$
|
1,373
|
$
|
1,216
|
||||||
Deferred
|
1,418
|
663
|
776
|
|||||||||
Total state income tax expense
|
$
|
2,434
|
$
|
2,036
|
$
|
1,992
|
Reconciliation of effective tax rate:
|
||||||||||||||||||||||||
|
For the Year Ended December 31,
|
|||||||||||||||||||||||
In thousands
|
2023
|
2023
|
2022
|
2022
|
2021
|
2021
|
||||||||||||||||||
|
Amount
|
Percent
|
Amount
|
Percent
|
Amount
|
Percent
|
||||||||||||||||||
Reconciliation of effective tax rate
|
||||||||||||||||||||||||
Income before federal and state income taxes
|
$
|
23,047
|
100.0
|
%
|
$
|
23,876
|
100.0
|
%
|
$
|
22,564
|
100.0
|
%
|
||||||||||||
|
||||||||||||||||||||||||
Amount computed at statutory rate
|
4,840
|
21.0
|
%
|
5,014
|
21.0
|
%
|
4,738
|
21.0
|
%
|
|||||||||||||||
Reconciling items
|
||||||||||||||||||||||||
State income tax-net of federal tax benefit
|
1,918
|
8.3
|
%
|
1,696
|
7.1
|
%
|
1,600
|
7.1
|
%
|
|||||||||||||||
Regulatory liability adjustment
|
(449
|
)
|
(1.9
|
)%
|
(450
|
)
|
(1.9
|
)%
|
(451
|
)
|
(2.0
|
)%
|
||||||||||||
Other
|
39
|
0.2
|
%
|
(382
|
)
|
(1.6
|
)%
|
(150
|
)
|
(0.7
|
)%
|
|||||||||||||
Total income tax expense and effective rate
|
$
|
6,348
|
27.6
|
%
|
$
|
5,878
|
24.6
|
%
|
$
|
5,737
|
25.4
|
%
|
For the Year Ended
December 31,
|
||||||||
In thousands
|
2023
|
2022
|
||||||
|
||||||||
Deferred tax assets related to:
|
||||||||
State operating loss carry-forwards
|
$
|
1,037
|
$
|
922
|
||||
Less: valuation allowance
|
(906
|
)
|
(600
|
)
|
||||
Bad debt allowance
|
92
|
116
|
||||||
Stock options
|
47
|
47
|
||||||
Other
|
48
|
28
|
||||||
Total deferred tax assets
|
$
|
318
|
$
|
513
|
||||
|
||||||||
Deferred tax liabilities related to:
|
||||||||
Property plant and equipment basis differences
|
$
|
(56,012
|
)
|
$
|
(52,565
|
)
|
||
Bond retirement costs
|
(982
|
)
|
(1,058
|
)
|
||||
Property taxes
|
(624
|
)
|
(609
|
)
|
||||
Other
|
(1,081
|
)
|
(833
|
)
|
||||
Total deferred tax liabilities
|
$
|
(58,699
|
)
|
$
|
(55,065
|
)
|
||
|
||||||||
Net deferred tax liability
|
$
|
(58,381
|
)
|
$
|
(54,552
|
)
|
Schedule of Valuation Allowance
|
||||||||||||||||
|
Balance at
Beginning of
Period
|
Additions
Charged to
Costs and
Expenses
|
Deductions
|
Balance at
End of Period
|
||||||||||||
In thousands
|
||||||||||||||||
|
||||||||||||||||
Classification
|
||||||||||||||||
For the Year Ended December 31, 2023 Valuation allowance for deferred tax assets
|
$
|
600
|
$
|
312
|
$
|
6
|
$
|
906
|
||||||||
For the Year Ended December 31, 2022 Valuation allowance for deferred tax assets
|
$
|
546
|
$
|
54
|
$
|
—
|
$
|
600
|
||||||||
For the Year Ended December 31, 2021 Valuation allowance for deferred tax assets
|
$
|
493
|
$
|
53
|
$
|
—
|
$
|
546
|
For the years ended December 31,
|
||||||||
In thousands
|
2023
|
2022
|
||||||
Balance at beginning of year
|
$
|
146
|
$
|
202
|
||||
Additions based on tax positions related to the current year
|
—
|
146
|
||||||
Additions based on tax positions related to prior years
|
12
|
10
|
||||||
Reductions for tax positions of prior years
|
—
|
—
|
||||||
Lapses in statutes of limitations
|
—
|
(212
|
)
|
|||||
Balance at end of year
|
$
|
158
|
$
|
146
|
|
December 31,
|
|||||||
In thousands
|
2023
|
2022
|
||||||
First mortgage bonds
|
||||||||
|
||||||||
Series R, 5.96%,
due December 31, 2028
|
$
|
25,000
|
$
|
25,000
|
||||
Series S, 4.45%,
due December 31, 2033
|
6,000
|
6,600
|
||||||
Series T, 4.24%,
due December 20, 2036
|
40,000
|
40,000
|
||||||
Series U, 4.71%,
due January 31, 2038
|
25,000
|
25,000
|
||||||
Series V, 4.42%,
due October 31, 2049
|
30,000
|
30,000
|
||||||
Series W, 4.43%, due April 30, 2047
|
30,000
|
30,000
|
||||||
|
156,000
|
156,600
|
||||||
|
||||||||
State revolving fund loans
|
||||||||
|
||||||||
3.57%,
due September 1, 2023
|
—
|
102
|
||||||
3.64%,
due May 1, 2025
|
228
|
373
|
||||||
3.41%,
due February 1, 2031
|
1,415
|
1,577
|
||||||
3.40%,
due July 1, 2032
|
1,445
|
1,590
|
||||||
1.187%,
due November 1, 2041
|
588
|
617
|
||||||
1.187%,
due November 1, 2041
|
690
|
724
|
||||||
1.187%,
due November 1, 2041
|
1,075
|
1,128
|
||||||
2.00%, due February 1, 2043
|
828
|
846
|
||||||
2.00%, due February 1, 2043
|
1,143
|
974
|
||||||
2.00%, due June 1, 2043
|
1,002
|
1,044
|
||||||
2.00%, due June 1, 2043
|
1,022
|
—
|
||||||
2.00%, due February 1, 2044
|
2,696
|
—
|
||||||
2.00%, due January 1, 2043
|
1,000
|
—
|
||||||
|
13,132
|
8,975
|
||||||
Notes Payable
|
||||||||
Promissory Note, 5.12%,
due December 30, 2028
|
$
|
10,155
|
$
|
10,478
|
||||
Asset Purchase, 2.00%, due May 26, 2027
|
1,255
|
1,569
|
||||||
11,410
|
12,047
|
|||||||
Sub-total
|
180,542
|
177,622
|
||||||
|
||||||||
Less: current maturities (principal amount)
|
2,235
|
2,003
|
||||||
|
||||||||
Total long-term debt
|
$
|
178,307
|
$
|
175,619
|
In thousands
|
2024
|
2025
|
2026
|
2027
|
2028
|
Thereafter
|
||||||||||||||||||
First Mortgage bonds
|
$
|
600
|
$
|
600
|
$
|
600
|
$
|
600
|
$
|
25,600
|
$
|
128,000
|
||||||||||||
State revolving fund loans
|
756
|
852
|
794
|
813
|
834
|
9,083
|
||||||||||||||||||
Asset Purchase-Contractual Obligation
|
314
|
314
|
314
|
313
|
—
|
—
|
||||||||||||||||||
Promissory note
|
565
|
480
|
505
|
532
|
559
|
7,514
|
||||||||||||||||||
Total payments
|
$
|
2,235
|
$
|
2,246
|
$
|
2,213
|
$
|
2,258
|
$
|
26,993
|
$
|
144,597
|
|
|
2023
Shares
|
|
2023
Weighted
Average
Exercise
Price
|
|
2022
Shares
|
|
2022
Weighted
Average
Exercise
Price
|
|
2021
Shares
|
|
2021
Weighted
Average
Exercise
Price
|
|||||
Plan options
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Outstanding at beginning of year
|
|
6,750
|
|
$
|
21.86
|
|
|
83,000
|
|
$
|
21.65
|
|
|
116,347
|
|
$
|
20.90
|
Granted
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
Exercised
|
|
(6,750)
|
|
|
21.86
|
|
|
(76,250)
|
|
|
21.63
|
|
|
(33,347)
|
|
|
19.04
|
Expired
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
Outstanding at end of year
|
|
—
|
|
$
|
—
|
|
|
6,750
|
|
$
|
21.86
|
|
|
83,000
|
|
$
|
21.65
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Options exercisable at year end
|
|
—
|
|
$
|
—
|
|
|
6,750
|
|
$
|
21.86
|
|
|
83,000
|
|
$
|
21.65
|
Options Outstanding and Exercisable
|
|
|
|
|
|
|
|||||
Range of Exercise
Price
|
|
Shares Outstanding at
December 31, 2023
|
|
Weighted Average
Remaining Life
|
|
Weighted Average
Exercise Price
|
|
Aggregate Intrinsic
Value
|
|||
$
|
00.00
|
|
0
|
|
0 Years
|
|
$
|
00.00
|
|
$
|
0
|
2023
Shares
|
2023
Weighted
Average
Grant Date
Fair Value
|
2022
Shares
|
2022
Weighted
Average
Grant Date
Fair Value
|
2021
Shares
|
2021
Weighted
Average
Exercise
Price
|
|||||||||||||||||||
Plan RSA’s
|
||||||||||||||||||||||||
Outstanding at beginning of year
|
5,000
|
$
|
45.58
|
5,000
|
$
|
40.11
|
5,000
|
$
|
35.01
|
|||||||||||||||
Granted
|
5,000
|
54.88
|
5,000
|
45.58
|
5,000
|
40.11
|
||||||||||||||||||
Vested/Released
|
(5,000
|
)
|
45.58
|
(5,000
|
)
|
40.11
|
(5,000
|
)
|
35.01
|
|||||||||||||||
Cancelled
|
—
|
—
|
—
|
—
|
—
|
—
|
||||||||||||||||||
Unvested Outstanding at end of year
|
5,000
|
$
|
54.88
|
5,000
|
$
|
45.58
|
5,000
|
$
|
40.11
|
In thousands
|
||||
2024
|
$
|
67
|
||
2025
|
47
|
|||
2026
|
49
|
|||
2027
|
50
|
|||
2028
|
52
|
|||
2029 through 2043
|
868
|
|||
|
$
|
1,133
|
In thousands
|
||||
2024
|
$
|
870
|
||
2025
|
881
|
|||
2026
|
881
|
|||
2027
|
57
|
|||
2028
|
57
|
|||
$
|
2,746
|
In thousands
|
||||
2024
|
$
|
8,200
|
||
2025
|
8,500
|
|||
2026
|
8,550
|
|||
$
|
25,250
|
Application Date
|
11/20/2020
|
DEPSC Approval Date
|
12/14/2020
|
Effective Date
|
01/01/2021
|
Cumulative DSIC Rate
|
7.50%
|
Net Eligible Plant Improvements – Cumulative Dollars (in millions)
|
$43.1
|
Eligible Plant Improvements – Installed Beginning Date
|
10/01/2014
|
Eligible Plant Improvements – Installed Ending Date
|
04/30/2019
|
|
For the Year
|
|||||||||||
|
Ended December 31,
|
|||||||||||
|
2023
|
2022
|
2021
|
|||||||||
|
(in thousands)
|
|||||||||||
|
||||||||||||
Weighted average common shares outstanding during the period for basic computation
|
$
|
10,018
|
$
|
9,462
|
$
|
9,394
|
||||||
Dilutive effect of employee stock options
|
4
|
19
|
32
|
|||||||||
Weighted average common shares outstanding during the period for diluted computation
|
$
|
10,022
|
$
|
9,481
|
$
|
9,426
|
(in thousands)
|
||||
TESI
|
||||
Utility plant
|
$
|
25,354
|
||
Cash
|
280
|
|||
Goodwill
|
1,939
|
|||
Other assets
|
1,033
|
|||
Total assets
|
28,606
|
|||
Less: Liabilities and contributions in aid of construction (CIAC)
|
||||
Liabilities
|
2,808
|
|||
CIAC
|
22,676
|
|||
Net cash purchase price
|
$
|
3,122
|
In thousands
|
||||||||||||
Years Ended December 31,
|
||||||||||||
2023
|
2022
|
2021
|
||||||||||
Revenues:
|
||||||||||||
Regulated Utility
|
$
|
92,228
|
$
|
89,818
|
$
|
85,016
|
||||||
Other (non-utility)
|
6,877
|
9,248
|
5,996
|
|||||||||
Inter-segment elimination
|
(244
|
)
|
(169
|
)
|
(153
|
)
|
||||||
Consolidated Revenues
|
$
|
98,861
|
$
|
98,897
|
$
|
90,859
|
||||||
Operating Income:
|
||||||||||||
Regulated Utility
|
$
|
21,246
|
$
|
22,411
|
$
|
20,950
|
||||||
Other (non-utility)
|
1,200
|
1,495
|
1,344
|
|||||||||
Consolidated Operating Income
|
$
|
22,446
|
$
|
23,906
|
$
|
22,294
|
||||||
Income Taxes:
|
||||||||||||
Regulated Utility
|
$
|
5,216
|
$
|
5,091
|
$
|
5,146
|
||||||
Other (non-utility)
|
1,132
|
787
|
591
|
|||||||||
Consolidated Income Taxes
|
$
|
6,348
|
$
|
5,878
|
$
|
5,737
|
||||||
Assets:
|
||||||||||||
Regulated Utility
|
$
|
760,339
|
$
|
713,113
|
||||||||
Other (non-utility)
|
6,493
|
6,678
|
||||||||||
Consolidated Assets
|
$
|
766,832
|
$
|
719,791
|
•
|
Testing a sample of revenue transactions by obtaining and inspecting source documents such as invoices, cash receipts, approved tariff rates and
recalculating the revenue recognized.
|
•
|
Testing a sample of revenue transactions to verify that the customer’s property is located within the Company’s approved service territory.
|
•
|
Performing analytical procedures to reconcile cash received from customers to revenue recognized.
|
CHIEF EXECUTIVE OFFICER:
|
|
CHIEF FINANCIAL OFFICER:
|
|
|
|
|
|
/s/ DIAN C. TAYLOR
|
|
/s/ DAVID B. SPACHT
|
|
Dian C. Taylor
|
|
David B. Spacht
|
|
Name
|
Age
|
Position
|
|
|
|
Dian C. Taylor
|
78
|
Biography: Director since 1991 - Chair of the
Board of Directors of the Company, or the Board, since July 1993, and Chief Executive Officer of Artesian Resources Corporation and its subsidiaries since September 1992. Ms. Taylor has been employed by the Company since August 1991. Prior to
joining the Company, Ms. Taylor had extensive marketing and small business ownership experience. She was formerly a consultant to the Small Business Development Center at the University of Delaware from February 1991 to August 1991 and Owner
and President of Achievement Resources Inc. from 1977 to 1991. Achievement Resources, Inc. specialized in strategic planning, marketing, entrepreneurial and human resources development consulting. Ms. Taylor was a marketing director for SMI,
Inc. from 1982 to 1985. Ms. Taylor is the aunt of John R. Eisenbrey, Jr. and Nicholle R. Taylor. She serves on the Budget and Finance Committee.
Qualifications: Ms. Dian Taylor has over 30 years of experience as Chief Executive Officer and President of the
Company, during which the Company has continuously grown. Ms. Taylor has extensive knowledge of the complex issues facing smaller companies and prior strategic planning expertise. Ms. Taylor has served as President of the National Association
of Water Companies, a trade organization of the investor-owned water utility industry. Ms. Taylor also has served as a Commissioner for the Delaware River and Bay Authority, on the Delaware Economic and Financial Advisory Council, as a Regional
Advisory Board Member for Citizens Bank, on the Board of Governors of the Delaware State Chamber of Commerce, on the Executive Committee of the Delaware Business Round Table, American Heart Association, Committee of 100 and the Delaware Council
on Economic Education, and as a Trustee of the Delaware Grand Opera and the Christiana Care Hospital. . The Board views Ms. Taylor’s experience with various aspects of the utility industry and her demonstrated leadership roles in business and
community activities as important qualifications, skills, and experiences for the Board’s conclusion that Ms. Taylor should serve as a director of the Company.
|
Kenneth R. Biederman Ph. D.
|
80
|
Biography: Director since 1991 - Currently
retired and former Professor of Finance at the Lerner College of Business and Economics of the University of Delaware, from May 1996 to May 2011. Interim Dean of the College of Business and Economics of the University of Delaware from February
1999 to June 2000. Dean of the College of Business and Economics of the University of Delaware from 1990 to 1996. Former Director of the Mid-Atlantic Farm Credit Association from 2006 to 2010. Director of Chase Manhattan Bank USA from 1993
to 1996. Formerly a financial and banking consultant from 1989 to 1990 and President of Gibraltar Bank from 1987 to 1989. Previously Chief Executive Officer and Chairman of the Board of West Chester Savings Bank; Economist and former
Treasurer of the State of New Jersey and Staff Economist for the United States Senate Budget Committee. He serves on the Executive; Audit; Budget and Finance; Governance and Nominating; and Compensation Committees.
Qualifications: Dr. Biederman’s experience as a former State Treasurer of New Jersey and the former Dean of the Lerner College of Business and
Economics at the University of Delaware gives him a substantial amount of business, economic and financial reporting knowledge.
|
|
|
|
John R. Eisenbrey, Jr.
|
68
|
Biography: Director since 1993 – Small
Business Executive. For more than 40 years, Owner and President of Bear Industries, Inc., a contracting firm providing building fire sprinkler protection installations for businesses throughout the Delmarva Peninsula. In 2021, Mr. Eisenbrey
was appointed to the Board of Trustees of St. Andrews School. Mr. Eisenbrey is the nephew of Dian C. Taylor and the cousin of Nicholle R. Taylor. He serves on the Audit; Budget and Finance; Governance and Nominating; and Compensation
Committees.
Qualifications: The Board has determined that Mr. Eisenbrey’s hands-on experience as a business owner in one of our primary geographic regions
qualifies him to be a member of the Board. For more than 40 years, Mr. Eisenbrey has been the Owner and President of a privately held contracting firm providing fire sprinkler protection installations for businesses throughout the Delmarva
Peninsula. Mr. Eisenbrey is a past President of the Delaware Contractors Association. Mr. Eisenbrey’s operating business background provides experience with operational, technical, and regulatory matters also applicable to our water
business.
|
Michael Houghton, Esq.
|
67
|
Biography: Director appointed September 2018
– Mr. Houghton retired as of January 1, 2022 as Partner from the law firm of Morris Nichols Arsht & Tunnell in Wilmington, Delaware and continued as special counsel to the firm until September 30, 2023. He was admitted to practice law in
Delaware in 1982, before the U.S. District Court for the District of Delaware in 1983 and before the U.S. Court of Appeals for the Third Circuit in 1985. He served a clerkship with the Delaware Court of Chancery in 1982-1983. Mr. Houghton’s
legal expertise involves the representation of governmental entities, such as the Delaware River & Bay Authority. He has also represented banks, trust companies, insurance companies and public utilities in commercial transactions and
before regulatory authorities and state, county, and local governments and in legislative and public policy matters before Delaware government. Mr. Houghton has also advised numerous entities, including Fortune 500 companies, on unclaimed
property issues and has represented numerous companies in connection with unclaimed property audits and voluntary disclosure matters. He has been selected for inclusion in The Best Lawyers in America from 2009-2023. Mr. Houghton is a member
of the Board of Governors of the Delaware State Chamber of Commerce and the Boards of the Delaware Public Policy Institute and the Rockefeller Trust Company of Delaware. Mr. Houghton is also a member of the Delaware Heritage Commission. He is
a past member of the Pete du Pont Freedom Foundation, the Board of the Delaware Bar Foundation, a Trustee of the Uniform Law Foundation, a Past President of the Delaware State Bar Association and a Past President the National Conference of
Commissioners on Uniform State Laws. He was appointed in 2017 by Delaware Governor John Carney to serve as Chair of the Delaware Economic and Financial Advisory Council and in 2023 to the Delaware Marijuana Appeals Commission and the Delaware
Environmental Appeals Board. He serves on the Audit and Compensation Committees.
Qualifications: Mr. Houghton’s legal and regulatory experience and extensive involvement in Delaware legislative and public policy matters are
attributes that provide valuable insight and benefit as the Company continues its growth in Delaware. The Board has determined that Mr. Houghton’s more than 40 years of experience makes him well qualified to serve on the Board.
|
Nicholle R. Taylor
|
56
|
Biography: Director since 2007 – Senior Vice
President of Artesian Resources Corporation and its subsidiaries since May 9, 2012 and President of Artesian Water Company since August 16, 2021. Previously served as Chief Operating Officer of Artesian Water Company from August 2019 to August
2021. She was Vice President of Artesian Resources Corporation and its subsidiaries from May 2004 to May 2012. Ms. Taylor has been employed by the Company since 1991 and has held various management level and operational positions within the
Company. She serves on the Budget and Finance Committee. Ms. Taylor is the niece of Dian C. Taylor and the cousin of John R. Eisenbrey, Jr.
Qualifications: Ms. Nicholle Taylor has over thirty years of experience with the Company in a variety of field, office, and managerial positions.
The Board has determined that the range of her experience across various company functions gives her a clear perception of how the Company operates, thus enhancing the Board’s ability to know the Company’s current capabilities and limitations,
and qualifies her to serve as a director. Ms. Taylor serves on the Board of Directors of the National Association of Water Companies, a trade organization of the investor-owned water utility industry. Ms. Taylor also currently serves on the
Board of Directors of the Committee of 100, which is a business organization that promotes responsible economic development in the state of Delaware. In 2019, Ms. Taylor was appointed to the Board of Directors of the Delaware Nature Society, a
non- profit organization dedicated to connecting people with the natural world to improve the environment through education, advocacy, and conservation.
|
|
|
|
Pierre A. Anderson
|
45
|
Chief Information Officer and Senior Vice President of Artesian Resources Corporation and its subsidiaries since May 19, 2021. Mr. Anderson
previously served as Vice President of Information Technologies of Artesian Resources Corporation and its subsidiaries from May 2012 to May 2021, Director of Information Technologies from April 2008 to May 2012, and Manager of Information
Technologies from December 2006 to April 2008. Prior to joining the Company, Mr. Anderson was employed by the Christina School District as Manager, Project & Support Services. From 2000 to 2005, while with MBNA (now Bank of America), he
served in several information technology roles. He received his Bachelors of Science degree in Computer Science from Delaware State University and both an Masters of Business Administration and Masters of Science in Information Systems &
Technology Management from the University of Delaware’s Lerner College of Business & Economics.
Mr. Anderson serves on the Boards of Easterseals of Delaware & Maryland’s Eastern Shore (Vice Chair), Delaware State Chamber of Commerce,
University of Delaware’s Lerner College Alumni, Bancroft Construction Company, and the Delaware Economic & Forecasting Advisory Council (DEFAC).
|
Joseph A. DiNunzio, CPA, CGMA
|
61
|
Executive Vice President and Secretary of Artesian Resources Corporation and Subsidiaries since May 2007 and President of Artesian Water Maryland,
Inc. since May 2017. Mr. DiNunzio previously served as Senior Vice President and Secretary since March 2000 and as Vice President and Secretary since January 1995. He served as Secretary of Artesian Resources Corporation and Subsidiaries from
July 1992 to January 1995. Prior to joining Artesian in 1989, Mr. DiNunzio was employed by PriceWaterhouseCoopers LLP. He earned a Bachelor of Science in Commerce, with concentration in accounting, from the McIntire School of Commerce at the
University of Virginia.
Mr. DiNunzio is Past Chairman of the Board of the Cecil County Chamber of Commerce and served on the Board of the Cecil Business Leaders from June
2013 to January 2023. He is Past Chairman of the Delaware Chapter of the National Association of Water Companies. Mr. DiNunzio is a member of the Cecil County Maryland Economic Development Commission, the Delaware Source Water Assessment and
Protection Program’s Citizens and Technical Advisory Committee, the American Institute of Certified Public Accountants, the Pennsylvania Institute of Certified Public Accountants, and was a member of the 2003 Delaware Legislative Drinking Water
Task Force.
|
|
|
|
Courtney A. Emerson, Esq.
|
40
|
General Counsel of Artesian Resources Corporation and its subsidiaries since August 2021 and Assistant Secretary of Artesian Resources Corporation
and its subsidiaries since November 2022. Prior to joining Artesian in 2021, Ms. Emerson practiced law at Fox Rothschild LLP. She previously served as an emergency manager for the State of Delaware for nearly a decade and was an educator at a
multinational bank. She earned her J.D. from the Delaware Law School of Widener University and her B.S. in Political Science from the University of Delaware.
Ms. Emerson has served as Vice Chair of the Environmental Section of the Delaware State Bar Association, as Vice Chair of the American Bar
Association’s Disaster Legal Services Team, and as Vice President of the University of Delaware Alumni Lawyers Society. She is a member of the General Counsel Section of the National Association of Water Companies, the American Bar
Association, the Delaware State Bar Association, and the Committee of 100.
|
Jennifer L. Finch, CPA
|
55
|
Senior Vice President of Finance & Corporate Treasurer of Artesian Resources Corporation & Subsidiaries since November 2020. Prior to that,
Ms. Finch was the Assistant Treasurer and Vice President of Finance. Ms. Finch is responsible for the oversight of all aspects of accounting and tax‐related matters, corporate financing, and serves as the principal accounting officer.
Prior to joining Artesian in 2008, Ms. Finch held various accounting positions for Handler Corporation, a homebuilder and developer located in
Wilmington, Delaware, where she worked for 14 years. She also worked four years for a local certified public accounting firm and has more than 30 years of accounting, auditing, and tax experience. Ms. Finch is a member of the American
Institute of Certified Public Accountants and the Delaware Society of Certified Public Accountants.
|
|
|
|
Raymond T. Kelly, CPA, CISA
|
39
|
Vice President of Information Technology for Artesian Resources Corporation and Subsidiaries since November 4, 2022. Mr. Kelly joined Artesian in
2013 as Manager of Business Applications and was promoted to the Director of Information Technology in 2016. Prior to joining Artesian he served as a Manager for PricewaterhouseCoopers, where he progressively advanced from an Associate; leading
information technology audits, financial audits of publicly traded institutions, and utility meter to cash system engagements. During his time at Artesian, Mr. Kelly, who is responsible for all Information Technology functions, has directly led
and overseen all enhancements to the technology portfolio including; enterprise applications, infrastructure, business process automation, analytics, and cybersecurity.
Mr. Kelly earned both a Bachelor of Science in Computer Science and Business and a Bachelor of Science in Business and Economics from Lehigh
University. He is a Certified Public Accountant, a Certified Information Systems Auditor, and a Chartered Global Management Accountant. He serves on the Program Committee of the Boys & Girls Club of Delaware and is a member of the American
Institute of Certified Public Accountants.
|
Daniel W. Konstanski
|
39
|
Mr. Konstanski is a Board Certified, Professional Engineer with 19 years of experience in the water and wastewater industry. He joined Artesian
Resources Corporation in March of 2014 as a Senior Engineer, was appointed Manager of Engineering in 2019 and was named Vice President of Engineering in October of 2022. Mr. Konstanski is responsible for managing and overseeing the Engineering
Department’s operation and staff as well as directly managing capital projects. His team includes engineers, project managers and subject matter experts who shepherd, analyze, and manage Artesian’s extensive water and wastewater assets
including treatment, pipeline hydraulics, system modeling, pumped networks, and regulatory matters. During his time at Artesian, Mr. Konstanski has managed the permitting, design and construction of multiple new water and wastewater treatment
plants as well as renovations of numerous existing facilities, overseen the development of state-of-the-art digital models for both the water and wastewater systems, led efforts to increase self-sufficiency by hundreds of millions of gallons
per year and provided input on Artesian’s purchase of multiple additional water and wastewater systems.
|
David B. Spacht
|
64
|
Chief Financial Officer of Artesian Resources Corporation and its subsidiaries since January 1995 and President of Artesian Wastewater Management,
Inc. since August 2019. Mr. Spacht joined the Company in 1980 and has held various executive and management level positions. Mr. Spacht has worked closely with the Public Service Commission for over 40 years on developing rates and
regulations in Delaware. He has also worked closely with the Maryland Public Service Commission developing rates and regulations as a result of filing for acquisitions. He was selected by the National Association of Regulatory Utility
Commissioners Subcommittee on Education as an instructor for their semi-annual course on rate making.
Mr. Spacht is a member of several national and local organizations, including the National Association of Water Companies, having served on their
Finance Committee for 32 years and most recently in 2015 joining the Rate and Regulatory Committee; the American Water Works Association; the National Association of Regulatory Utility Commissioners; the International Organization of Management
Accountants; and Special Olympics Delaware.
|
|
|
|
John M. Thaeder
|
65
|
Senior Vice President of Operations. Mr. Thaeder has served as an officer since February 1998. He currently serves as an officer of Artesian
Resources Corporation and Subsidiaries. Prior to joining the company, Mr. Thaeder was with Hydro Group, Inc. from 1996 to 1998 as Southeastern District Manager of Sales and Operations from Maryland to Florida. During 1995 and 1996, he was
Sales Manager of the Northeast Division with sales responsibilities from Maine to Florida. Previously, he served as District Manager of the Layne Well and Pump Division of Hydro Group.
|
Name
|
Fees Earned or
Paid in
Cash
($)
|
Stock
Awards
($)(1)
|
All other Compensation
($)
|
Total
($)
|
||||||||||||
Kenneth R. Biederman
|
95,000
|
54,880
|
---
|
149,880
|
||||||||||||
John R. Eisenbrey, Jr.
|
95,000
|
54,880
|
---
|
149,880
|
||||||||||||
Michael Houghton
|
95,000
|
54,880
|
---
|
149,880
|
||||||||||||
William C. Wyer (2)
|
7,500
|
N/A
|
---
|
7,500
|
1) |
On May 9, 2023, each director, received a restricted stock award of 1,000 shares of Class A Non-Voting Stock. The fair market value per share was $54.88, the closing
price of the Class A Non-Voting Stock as recorded on the Nasdaq Global Select Market on May 9, 2023. The restricted shares vest one year from the date of grant. There were no outstanding option shares outstanding for Independent Directors at
December 31, 2023. The number of restricted shares outstanding at December 31, 2023 for each director is:.
|
|
Option Shares Outstanding
at December 31, 2023
|
Restricted Shares Outstanding at December 31, 2023
|
Kenneth R. Biederman
|
---
|
1,000
|
John R. Eisenbrey, Jr.
|
---
|
1,000
|
Michael Houghton
|
---
|
1,000
|
2) |
Willam Wyer concluded his last three-term year as Director on May 4, 2022. Upon his retirement from the Board, in light of his substantial contributions to the Company
and the Board's interest in continuing to benefit from Mr Wyer's experience, the Board appointed Mr. Wyer to the honorary role of Director Emeritus. As Director Emeritus, Mr. Wyer is invited to attend meetings of the Board, but is not
considered a Director of the Company and is not entitled to vote on any matter presented to the Board.
|
Board Diversity Matrix (As of March 1, 2024)
|
||||
Total Number of Directors
|
5
|
|||
|
Female
|
Male
|
Non-
Binary
|
Did Not
Disclose
Gender
|
Part I: Gender Identify
|
|
|||
Directors
|
2
|
3
|
||
Part II: Demographic Background
|
|
|||
African American or Black
|
||||
Alaskan Native or Native American
|
||||
Asian
|
||||
Hispanic or Latinx
|
||||
Native Hawaiian or Pacific Islander
|
||||
White
|
2
|
3
|
||
Two or More Races or Ethnicities
|
||||
LGBTQ+
|
||||
Did Not Disclose Demographic Background
|
Board Diversity Matrix (As of March 1, 2023)
|
||||
Total Number of Directors
|
5
|
|||
|
Female
|
Male
|
Non-
Binary
|
Did Not
Disclose
Gender
|
Part I: Gender Identify
|
|
|||
Directors
|
2
|
3
|
||
Part II: Demographic Background
|
|
|||
African American or Black
|
||||
Alaskan Native or Native American
|
||||
Asian
|
||||
Hispanic or Latinx
|
||||
Native Hawaiian or Pacific Islander
|
||||
White
|
2
|
3
|
||
Two or More Races or Ethnicities
|
||||
LGBTQ+
|
||||
Did Not Disclose Demographic Background
|
2023 Total Compensation
|
||||
Median employee total annual compensation
|
$
|
89,289
|
||
Annual total compensation of Dian C. Taylor, CEO
|
$
|
828,593
|
||
Ratio of CEO to median employee compensation
|
9:1
|
Name and Principal Position
|
Year
|
|
Salary ($)
|
|
Bonus ($)
|
|
Stock
Awards
($)(1)
|
|
|
All Other
Compensation
($)(2),(3),(4)
|
|
Total ($)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dian C. Taylor, Chair, Chief Executive
|
2023
|
|
635,787
|
-0-
|
54,520
|
|
138,286
|
828,593
|
||||
Officer & President
|
2022
|
|
611,330
|
175,000
|
46,620
|
172,425
|
1,005,375
|
|||||
2021
|
|
592,712
|
153,000
|
40,980
|
|
|
153,595
|
940,287
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
David B. Spacht, Chief Financial
|
2023
|
|
426,366
|
-0-
|
N/A
|
|
|
37,444
|
463,810
|
|||
Officer
|
2022
|
|
409,973
|
100,000
|
N/A
|
|
39,583
|
549,556
|
||||
2021
|
|
395,272
|
75,000
|
|
N/A
|
|
36,404
|
506,676
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
Joseph A. DiNunzio, Executive Vice
|
2023
|
|
462,371
|
-0-
|
|
N/A
|
|
|
38,594
|
500,965
|
||
President & Secretary
|
2022
|
|
444,589
|
150,000
|
|
N/A
|
|
|
35,725
|
630,314
|
||
2021
|
|
431,046
|
75,000
|
|
N/A
|
|
31,900
|
537,946
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
Nicholle R. Taylor, President
|
2023
|
|
410,397
|
-0-
|
|
54,520
|
106,427
|
571,344
|
||||
2022
|
|
394,608
|
150,000
|
|
46,620
|
|
100,511
|
691,739
|
||||
2021
|
|
350,864
|
78,000
|
|
40,980
|
|
98,953
|
568,797
|
||||
|
|
|
|
|
||||||||
Jennifer L. Finch, Senior Vice
|
2023
|
|
378,382
|
1,500
|
|
N/A
|
18,159
|
398,041
|
||||
President & Treasurer
|
2022
|
|
363,832
|
100,000
|
|
N/A
|
20,819
|
484,651
|
||||
2021
|
352,749
|
75,000
|
N/A
|
16,035
|
443,784
|
|||||||
(1) |
On May 9, 2023, Dian Taylor and Nicholle Taylor each received a restricted stock award of 1,000 shares of Class A Non-Voting Stock in their capacities as directors of the
Company. The award was valued at the fair market value on the date of the award (last reported sale price on the date of award) or $54.88 per share. The restricted shares vest one year from the date of grant. On May 3, 2022, Dian Taylor and
Nicholle Taylor each received a restricted stock award of 1,000 shares of Class A Non-Voting Stock. The award was valued at the fair market value on the date of the award or $45.58 per share. The restricted shares vested one year after the
date of grant. On May 4, 2021, Dian Taylor and Nicholle Taylor each received a restricted stock award of 1,000 shares of Class A Non-Voting Stock. The award was valued at the fair market value on the date of the award or $40.11 per share. The
restricted shares vested one year after the date of grant.
|
(2) |
Under the Company’s defined contribution 401(k) Plan, the Company contributes two percent of an eligible employee's gross earnings. The Company also matches 50 percent of
the first six percent of the employee's gross earnings that the employee contributes to the 401(k) Plan. Employees over the age of 60 at that date receive Company paid medical, dental and life insurance benefits upon retirement. The Company
will not provide the additional 401(k) or medical, dental and life insurance benefits to any other current or future employees. In 2023, Company contributions to the 401(k) Plan under terms available to all other employees based upon their
years of service and plan eligibility were made in the amounts of:
|
Dian C. Taylor
|
$
|
36,300
|
||
David B. Spacht
|
$
|
36,300
|
||
Joseph A. DiNunzio
|
$
|
36,300
|
||
Nicholle R. Taylor
|
$
|
36,300
|
||
Jennifer L. Finch
|
$
|
16,500
|
(3) |
Included in the "All Other Compensation" column in the table above are amounts received by Dian C. Taylor as compensation for attendance at meetings of the Board and its
committees in 2023 totaling $67,000, $15,152 for security provided at her personal residence, $4,576 for personal use of a company-owned vehicle. Also included in the "All Other Compensation" column in the table above are amounts received by
Nicholle R. Taylor as compensation for Board retainer fees, attendance at meetings of the Board and its committees in 2023 totaling $67,000.
|
(4) |
Executive officers are reimbursed for eligible medical expenses not otherwise covered by the Company's medical insurance plan under the Officer's Medical Reimbursement
Plan. Amounts reimbursed are included in the "All Other Compensation" column in the table above. Dian C. Taylor received reimbursements of $15,259 in 2023.
|
Name
|
Grant Date
|
Vest Date
|
All Other
Stock Awards:
Number of
Shares of
Stock or Units
(#)
|
All Other Option
Awards: Number
of Securities
Underlying
Options (#)
|
Exercise or
Base Price
of Option
Awards
($/share)
|
Grant Date Fair
Value of Stock &
Option Awards ($)
|
||||||||||||
|
|
|||||||||||||||||
Dian C. Taylor
|
5/09/2023
|
5/09/2024
|
1,000
|
-
|
-
|
54,880
|
||||||||||||
Nicholle R. Taylor
|
5/09/2023
|
5/09/2024
|
1,000
|
-
|
-
|
54,880
|
|
Option Awards
|
|||||||||||||||
Name
|
Number of Securities Underlying Unexercised Options(#) Exercisable
|
Number of Securities Underlying Unexercised Options (#) Unexercisable
|
Option Exercise Price($)
|
Option
Expiration
Date
|
||||||||||||
|
||||||||||||||||
Nicholle R. Taylor
|
-0-
|
---
|
-0-
|
-0-
|
|
Option Awards
|
Stock Awards
|
||||||||||||||
Name
|
Number of
Shares Acquired
on Exercise (#)
|
Value
Realized on
Exercise ($)
|
Number of
Shares Acquired
on Vesting (#)
|
Value
Realized on
Vesting ($)
|
||||||||||||
Dian C. Taylor
|
-0-
|
-0-
|
1,000
|
54,520
|
||||||||||||
Nicholle R. Taylor
|
6,750
|
137,363
|
1,000
|
54,520
|
|
Class A Non-Voting Common Stock(1)
|
Class B Common Stock(1)
|
||||||||||||||
|
Shares
|
Percent(2)
|
Shares
|
Percent(2)
|
||||||||||||
|
||||||||||||||||
Dian C. Taylor (3)
|
148,500
|
1.6
|
159,509
|
18.1
|
||||||||||||
|
||||||||||||||||
Kenneth R. Biederman (3)
|
24,875
|
*
|
---
|
---
|
||||||||||||
|
||||||||||||||||
John R. Eisenbrey, Jr. (3)(4)(5)
|
54,751
|
*
|
45,707
|
5.2
|
||||||||||||
|
||||||||||||||||
Nicholle R. Taylor (3)(6)
|
27,308
|
*
|
281,719
|
32.0
|
||||||||||||
|
||||||||||||||||
Michael Houghton
|
2,000
|
*
|
---
|
---
|
||||||||||||
Joseph A. DiNunzio
|
19,240
|
*
|
203
|
*
|
||||||||||||
|
||||||||||||||||
David B. Spacht
|
4,210
|
*
|
189
|
*
|
||||||||||||
|
||||||||||||||||
Jennifer L. Finch
|
1,861
|
*
|
---
|
---
|
||||||||||||
|
||||||||||||||||
Louisa Taylor Welcher
219 Laurel Avenue
Newark, DE 19711
|
89,690
|
1.0
|
135,862
|
15.4
|
||||||||||||
|
||||||||||||||||
Directors and Executive Officers as a Group (13 Individuals)(3)
|
310,447
|
3.3
|
488,677
|
55.4
|
||||||||||||
|
||||||||||||||||
* less than 1%
|
(1) |
The nature of ownership consists of sole voting and investment power unless otherwise indicated. The amount also includes all shares issuable to such person or group
upon the exercise of options or vesting of restricted shares held by such person or group to the extent such options are exercisable or restricted shares vest within 60 days after March 12, 2024.
|
(2) |
The percentage of the total number of shares of the class outstanding is shown where that percentage is one percent or greater. Percentages for each person are based on
the aggregate number of shares of the applicable class outstanding as of March 12, 2024, and all shares issuable to such person upon the exercise of options or vesting of restricted shares held by such person to the extent such options are
exercisable or restricted shares vest within 60 days of that date.
|
(3) |
Includes vesting of restricted shares and options to purchase shares of the Company’s Class A Non-Voting Stock, as follows: Ms. D. Taylor (1,000 shares); Mr. Biederman
(1,000 shares); Mr. Eisenbrey, Jr. (1,000 shares); Ms. N. Taylor (1,000 shares); Mr. Houghton (1,000 shares).
|
(4) |
89,123 shares were pledged by Mr. Eisenbrey, Jr. as collateral for a loan.
|
(5) |
Includes 780 shares of the Class B Stock owned by a trust, of which Mr. Eisenbrey, Jr. is a trustee and has a beneficial ownership interest, and 1,555 shares of the Class
B Stock held in custodial accounts for Mr. Eisenbrey, Jr.’s daughters.
|
(6) |
Includes 744 shares of the Class A Non-Voting Stock and 45 shares of the Class B Stock held in custodial accounts for Ms. N. Taylor’s daughter and 290 shares of Class A
Non-Voting Stock held by her spouse.
|
|
|
Class A Non-Voting Common Stock
|
|
||
|
|
Shares
|
|
Percent
|
|
|
|
|
|
|
|
BlackRock, Inc. (1)
50 Hudson Yards
New York, NY 10001
|
1,026,106
|
10.9
|
|||
The Vanguard Group (2)
100 Vanguard Blvd.
|
530,947
|
5.7
|
|||
Malvern, PA 19355
|
|||||
T. Rowe Price Investment Management, Inc. (3)
101 E. Pratt Street
Baltimore, MD 21201
|
773,384
|
8.2
|
|||
(1) |
Pursuant to a Schedule 13G/A filed by BlackRock, Inc., or BlackRock, with the SEC on January
24, 2024, BlackRock is the beneficial owner of 1,026,106 shares of Class A Non-Voting Stock, and, to the extent it has voting rights under Delaware law, BlackRock has reported having sole voting power with respect to 1,006,293 shares and
shared voting power with respect to 0 shares, as well as sole dispositive power with respect to 1,026,106 shares and shared dispositive power with respect to 0 shares.
|
(2) |
Pursuant to a Schedule 13G filed by The Vanguard Group, or Vanguard, with the SEC on
February 13, 2024, Vanguard is the beneficial owner of 530,947 shares of Class A Non-Voting Stock, and, to the extent it has voting rights under Delaware law, Vanguard has reported having sole voting power with respect to 0 shares and shared
voting power with respect to 13,696 shares, as well as sole dispositive power with respect to 508,599 shares and shared dispositive power with respect to 22,438 shares.
|
(3) |
Pursuant to a Schedule 13G filed by T. Rowe Price Investment Management, Inc., or T. Rowe
Price, with the SEC on February 14, 2024, T. Rowe Price is the beneficial owner of 773,384 shares of Class A Non-Voting Stock, and, to the extent it has voting rights under Delaware law, T. Rowe Price has reported having sole voting power
with respect to 277,650 shares and shared voting power with respect to 0 shares, as well as sole dispositive power with respect to 773,384 shares and shared dispositive power with respect to 0 shares.
|
Equity Compensation Plan Information
|
||||||||||||
Plan category
|
Number of securities to be issued upon exercise of outstanding options (a)
|
Weighted-average exercise price of outstanding options
|
Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))
|
|||||||||
|
||||||||||||
Equity compensation plans approved by security holders
|
5,000
|
$
|
-0-
|
279,932
|
||||||||
|
||||||||||||
Total
|
5,000
|
$
|
-0-
|
279,932
|
-
|
the nature of the related person’s interest in the transaction;
|
-
|
the material terms of the transaction, including, without limitation, the amount and type of transaction;
|
-
|
the importance of the transaction to the related person;
|
-
|
the importance of the transaction to the Company;
|
-
|
whether the transaction would impair the judgment of a director or executive officer to act in the best interest of the Company; and
|
-
|
any other matters the Audit Committee deems important or appropriate.
|
(In thousands)
|
2023
|
2022
|
||||||
Audit Fees
|
$
|
527
|
$
|
415
|
||||
Audit-Related Fees
|
40
|
21
|
||||||
Tax Fees
|
---
|
---
|
||||||
All Other Fees
|
---
|
---
|
||||||
|
||||||||
Total Fees
|
$
|
567
|
$
|
436
|
|
The following documents are filed as part of this report:
|
Page(s)*
|
(1)
|
|
|
|
Reports
of Independent Registered Public Accountants (BDO USA,P.C.; Wilmington, DE; PCAOB ID# 243)
|
|
|
||
|
||
|
||
|
||
|
||
|
|
|
(2)
|
Exhibits: see the exhibit list below
|
|
|
|
|
|
* Page number shown refers to page number in this Annual Report on Form 10-K
|
|
|
EXHIBIT LIST
|
Exhibit
Number
|
Description
|
|
|
Amended and Restated By-laws of Artesian Resources Corporation incorporated by reference to Exhibit 3.1 filed with the Company’s Form 8-K filed on
November 23, 2020.
|
|
|
|
Restated Certificate of Incorporation of the Company effective April 28, 2004 incorporated by reference to Exhibit 3.1 filed with the Company’s Form
10-Q filed on May 3, 2004 for the quarterly period ended March 31, 2004.
|
|
First Amendment to Second Amended and Restated Revolving Credit Agreement between Artesian Water Company, Inc. and CoBank, ACB dated October 25,
2022. Incorporated by reference to Exhibit 4.1 to the Company’s Quarterly Report on Form 10-Q filed on November 4, 2022 for the quarter ended September 30, 2022.
|
|
Twenty-Fifth Supplemental Indenture dated as of April 29, 2022, between Artesian Water Company, Inc. and Wilmington Trust Company, as trustee.
Incorporated by reference to Exhibit 4.1 to the Company’s Quarterly Report on Form 10-Q filed on May 5, 2022 for the quarter ended March 31, 2022.
|
|
Bond Purchase Agreement, dated April 29, 2022, by and between Artesian Water Company, Inc., and CoBank, ACB.
|
|
Incorporated by reference to Exhibit 4.2 to the Company’s Quarterly Report on Form 10-Q filed on May 5, 2022 for the quarter ended March 31, 2022.
|
|
Twenty-Fourth Supplemental Indenture dated as of December 17, 2019, between Artesian Water Company, Inc., subsidiary of the Company, and Wilmington
Trust Company, as Trustee. Incorporated by reference to Exhibit 4.1 filed with the Company’s Form 8-K filed on December 19, 2019.
|
|
Bond Purchase Agreement, dated December 17, 2019 by and between Artesian Water Company, Inc., subsidiary of the Company, and the Wilmington Trust
Company, as Trustee. Incorporated by reference to Exhibit 4.2 filed with the Company’s Form 8-K filed on December 17, 2019.
|
|
Twenty-Third Supplemental Indenture dated as of January 31, 2018, between Artesian Water Company, Inc., subsidiary of the Company, and Wilmington
Trust Company, as Trustee. Incorporated by reference to Exhibit 4.1 filed with the Company’s Form 8-K filed on February 2, 2018.
|
|
Bond Purchase Agreement, dated January 31, 2018 by and between Artesian Water Company, Inc., subsidiary of the Company, and CoBank,
ACB. Incorporated by reference to Exhibit 4.2 filed with the Company’s Form 8-K filed on February 2, 2018.
|
|
Twenty-Second Supplemental Indenture dated as of January 18, 2017, between Artesian Water Company, Inc., subsidiary of the Company, and Wilmington
Trust Company, as Trustee. Incorporated by reference to Exhibit 4.1 filed with the Company’s Form 8-K filed on January 20, 2017.
|
|
Bond Purchase Agreement, dated January 18, 2017 by and between Artesian Water Company, Inc., subsidiary of the Company, and CoBank,
ACB. Incorporated by reference to Exhibit 4.2 filed with the Company’s Form 8-K filed on January 20, 2017.
|
|
First Amendment to Indenture of Mortgage and to the Sixteenth, Eighteenth and Twentieth Supplemental Indentures dated as of January 18, 2017, between
Artesian Water Company, Inc., subsidiary of the Company, and Wilmington Trust Company, as Trustee. Incorporated by reference to Exhibit 4.3 filed with the Company’s Form 10-K for the year ended December 31, 2017 filed on March 15, 2018.
|
|
Letter Agreement, dated as of September 15, 2015, by and between Artesian Water Company, Inc. and CoBank ACB. Incorporated by reference to Exhibit
4.1 filed with the Company’s Form 8-K filed on September 18, 2015.
|
|
Twenty-First Supplemental Indenture dated as of November 20, 2009, between Artesian Water Company, Inc., subsidiary of the Company, and Wilmington
Trust Company, as Trustee. Incorporated by reference to Exhibit 4.4 filed with the Company’s Form 10-K for the year ended December 31, 2017.
|
|
Twentieth Supplemental Indenture dated as of December 1, 2008, between Artesian Water Company, Inc., subsidiary of the Company, and Wilmington Trust
Company, as Trustee. Incorporated by reference to Exhibit 4.1 filed with the Company’s Form 8-K filed on December 4, 2008.
|
|
First Amendment to Bond Purchase Agreement, dated as of January 18, 2017 by and between Artesian Water Company, Inc., subsidiary of the Company, and
CoBank, ACB. Incorporated by reference to Exhibit 4.13 filed with the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 filed on March 15, 2018.
|
|
Bond Purchase Agreement, dated December 1, 2008 by and between Artesian Water Company, Inc., subsidiary of the Company, and CoBank,
ACB. Incorporated by reference to Exhibit 4.2 filed with the Company’s Form 8-K filed on December 4, 2008.
|
|
Eighteenth Supplemental Indenture dated as of August 1, 2005, between Artesian Water Company, Inc., subsidiary of the Company, and Wilmington Trust
Company, as Trustee. Incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2005 filed on August 9, 2005.
|
|
|
|
Sixteenth Supplemental Indenture dated as of January 31, 2003 between Artesian Water Company, Inc., subsidiary of the Company, and the Wilmington
Trust Company, as Trustee. Incorporated by reference to Exhibit 4.2 filed with the Company’s Annual Report on Form 10-K for the year ended December 31, 2003 filed on March 10, 2004.
|
|
|
|
Indenture of Mortgage dated July 1, 1961, between Artesian Water Company, Inc., subsidiary of the Company, and the Wilmington Trust Company, as Trustee.
Incorporated by reference to Exhibit 4.10 filed with the Company’s Annual
Report on Form 10-K for the year ended December 31, 2017 filed on March 15, 2018..
|
|
Second Amendment to Master Loan Agreement, dated as of November 13, 2019, by and between Artesian Wastewater Management, Inc. and CoBank, ACB.
Incorporated by reference to Exhibit 4.16 filed with the Company’s Annual
Report on Form 10-K for the year ended December 31, 2019 filed on March 13, 2020.
|
|
First Amendment to Master Loan Agreement, dated as of January 10, 2019, by and between Artesian Wastewater Management, Inc. and CoBank, ACB.
Incorporated by reference to Exhibit 4.17 filed with the Company’s Annual
Report on Form 10-K for the year ended December 31, 2019 filed on March 13, 2020.
|
|
Guarantee of Payment, dated as of August 8, 2018, by and between Artesian Resources Corporation and CoBank, ACB. Incorporated by reference to Exhibit
4.3 filed with the Company’s Form 10-Q filed on August 9, 2018.
|
|
Master Loan Agreement, dated as of August 8, 2018, by and between Artesian Wastewater Management, Inc. and CoBank, ACB. Incorporated by reference to
Exhibit 4.2 filed with the Company’s Form 10-Q filed on August 9, 2018.
|
|
Artesian Resources Corporation 2015 Equity Compensation Plan. Incorporated by reference to Exhibit 4.1 filed with the Company’s Registration
Statement on Form S-8 filed December 16, 2015.
|
|
Interest Rate Lock Agreement, dated as of October 8, 2019, by and between Artesian Water Company, Inc. and CoBank, ACB, Incorporated by reference to
Exhibit 4.1 filed with the Company’s Form 8-K filed on October 11, 2019.
|
|
Description of the Company’s Securities. Incorporated by reference to Exhibit 4.22 filed with the Company’s Annual Report on Form 10-K for the year
ended December 31, 2019 filed on March 13, 2020..
|
|
Interest Rate Lock Agreement, dated as of February 7, 2022, by and between Artesian Water Company, Inc. and CoBank, ACB. Incorporated by reference to
Exhibit 4.1 filed with the Company’s Form 8-K filed on February 10, 2022.
|
|
Amended and Restated Demand Line of Credit Agreement between Artesian Resources Corporation, and Citizens Bank, N.A. dated July August 3, 2023.
Incorporated by reference to Exhibit 10.1 filed with the Company’s Form 10-Q filed on November 7, 2023.
|
|
Financing Agreement, Loan No. 22000033, dated as of December 9, 2022, between Artesian Water Company, Inc. and Delaware Drinking Water State
Revolving Fund, acting by and through the Delaware Department of Health & Social Services, Division of Public Health., incorporated by reference to Exhibit 10.1 filed with the Company’s Form 8-K filed on December 12, 2022.
|
|
General Obligation Note (New Castle County Water Main Transmission Replacements Projects), Series 2022D-DWSRF, dated as of December 9, 2022, issued
by Artesian Water Company, Inc. in favor of Delaware Drinking Water State Revolving Fund, acting by and through the Delaware Department of Health & Social Services, Division of Public Health., incorporated by reference to Exhibit 10.2 filed
with the Company’s Form 8-K filed on December 12, 2022.
|
|
Financing Agreement, Loan No. 22000032, dated as of December 9, 2022, between Artesian Water Company, Inc. and Delaware Drinking Water State
Revolving Fund, acting by and through the Delaware Department of Health & Social Services, Division of Public Health., incorporated by reference to Exhibit 10.3 filed with the Company’s Form 8-K filed on December 12, 2022.
|
|
General Obligation Note (New Castle County Water Main Transmission Replacements Projects), Series 2022E-DWSRF, dated as of December 9, 2022, issued
by Artesian Water Company, Inc. in favor of Delaware Drinking Water State Revolving Fund, acting by and through the Delaware Department of Health & Social Services, Division of Public Health., incorporated by reference to Exhibit 10.4 filed
with the Company’s Form 8-K filed on December 12, 2022.
|
|
Financing Agreement, Loan No. 22000031, dated as of December 9, 2022, between Artesian Water Company, Inc. and Delaware Drinking Water State
Revolving Fund, acting by and through the Delaware Department of Health & Social Services, Division of Public Health., incorporated by reference to Exhibit 10.5 filed with the Company’s Form 8-K filed on December 12, 2022.
|
|
General Obligation Note (New Castle County Water Main Transmission Replacements Projects), Series 2022F-DWSRF, dated as of December 9, 2022, issued
by Artesian Water Company, Inc. in favor of Delaware Drinking Water State Revolving Fund, acting by and through the Delaware Department of Health & Social Services, Division of Public Health., incorporated by reference to Exhibit 10.6 filed
with the Company’s Form 8-K filed on December 12, 2022.
|
|
Financing Agreement, Loan No. 22000030, dated as of August 12, 2022, between Artesian Water Company, Inc. and Delaware Drinking Water State Revolving
Fund, acting by and through the Delaware Department of Health & Social Services, Division of Public Health., incorporated by reference to Exhibit 10.1 filed with the Company’s Form 8-K filed on August 15, 2022.
|
|
General Obligation Note (New Castle County Water Main Transmission Replacements Projects), Series 2022A-DWSRF, dated as of August 12, 2022, issued by
Artesian Water Company, Inc. in favor of Delaware Drinking Water State Revolving Fund, acting by and through the Delaware Department of Health & Social Services, Division of Public Health., incorporated by reference to Exhibit 10.2 filed
with the Company’s Form 8-K filed on August 15, 2022.
|
|
Financing Agreement, Loan No. 22000029, dated as of August 12, 2022, between Artesian Water Company, Inc. and Delaware Drinking Water State Revolving
Fund, acting by and through the Delaware Department of Health & Social Services, Division of Public Health., incorporated by reference to Exhibit 10.3 filed with the Company’s Form 8-K filed on August 15, 2022.
|
|
General Obligation Note (New Castle County Water Main Transmission Replacements Projects), Series 2022B-DWSRF, dated as of August 12, 2022, issued by
Artesian Water Company, Inc. in favor of Delaware Drinking Water State Revolving Fund, acting by and through the Delaware Department of Health & Social Services, Division of Public Health., incorporated by reference to Exhibit 10.4 filed
with the Company’s Form 8-K filed on August 15, 2022.
|
|
Financing Agreement, Loan No. 22000028, dated as of August 12, 2022, between Artesian Water Company, Inc. and Delaware Drinking Water State Revolving
Fund, acting by and through the Delaware Department of Health & Social Services, Division of Public Health., incorporated by reference to Exhibit 10.5 filed with the Company’s Form 8-K filed on August 15, 2022.
|
|
General Obligation Note (New Castle County Water Main Transmission Replacements Projects), Series 2022C-DWSRF, dated as of August 12, 2022, issued by
Artesian Water Company, Inc. in favor of Delaware Drinking Water State Revolving Fund, acting by and through the Delaware Department of Health & Social Services, Division of Public Health., incorporated by reference to Exhibit 10.6 filed
with the Company’s Form 8-K filed on August 15, 2022.
|
|
Settlement Agreement upon which The Chemours Company FC, LLC, Hercules, LLC, Waste Management of Delaware, Inc., SC Holdings, Inc., Cytec Industries,
Inc., Zeneca Inc., and Bayer CropScience Inc., collectively the Percentage Settlors, and the Delaware Sand and Gravel Remedial Trust, on one hand, and Artesian Water Company, Inc., on the other hand, have agreed to resolve certain of Artesian
Water’s claims and issues relating to releases of contaminants from the Delaware Sand & Gravel Landfill Superfund Site, incorporated by reference to Exhibit 10.2 filed with the Company’s Quarterly Report on Form 10-Q filed on August 5, 2022
|
|
Amendment to Asset Purchase Agreement, dated May 11, 2022, by and among Artesian Water Company, Inc., a Delaware corporation, and the Town of
Clayton, a Delaware municipality, incorporated by reference to Exhibit 10.1 filed with the Company’s Form 10-Q filed on August 5, 2022.
|
|
Stock Purchase Agreement, dated August 27, 2021, by and among Artesian Wastewater Management, Inc., a Delaware corporation, and Middlesex Water
Company, a New Jersey corporation. Incorporated by reference to Exhibit 10.1 filed with the Company’s Form 10-Q filed on November 5, 2021.
|
|
Asset Purchase Agreement, dated February 16, 2022, by and among Artesian Water Company, Inc. a Delaware corporation, and the Town of Clayton, a
Delaware municipality. Incorporated by reference to Exhibit 10.2 filed with the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 filed on March 11, 2022.
|
|
Asset Purchase Agreement, dated June 11, 2020 by and among Artesian Water Company, Inc., a Delaware corporation, and the City of Delaware City, a
Delaware municipality. Incorporated by reference to Exhibit 10.1 filed with Company’s Form 8-K filed on June 16, 2020.
|
|
Asset Purchase Agreement, dated February 27, 2020 by and among Artesian Water Company, Inc., a Delaware corporation, and the Town of Frankford, a
Delaware municipality. Incorporated by reference to Exhibit 10.1 filed with Company’s Form 8-K filed on March 4, 2020.
|
|
Financing Agreement, dated as of April 28, 2020, between Artesian Water Company, Inc. and Delaware Drinking Water State Revolving Fund, acting by and
through the Delaware Department of Health & Social Services, Division of Public Health. Incorporated by reference to Exhibit 10.1 filed with the Company’s Form 8-K filed on April 30, 2020.
|
|
General Obligation Note (New Castle County Water Main Transmission Replacements Projects), Series 2020A-SRF, dated as of April 28, 2020, issued by
Artesian Water Company, Inc. in favor of Delaware Drinking Water State Revolving Fund, acting by and through the Delaware Department of Health & Social Services, Division of Public Health. Incorporated by reference to Exhibit 10.2 filed
with the Company’s Form 8-K filed on April 30, 2020.
|
|
Financing Agreement, dated as of April 28, 2020, between Artesian Water Company, Inc. and Delaware Drinking Water State Revolving Fund, acting by and
through the Delaware Department of Health & Social Services, Division of Public Health. Incorporated by reference to Exhibit 10.3 filed with the Company’s Form 8-K filed on April 30, 2020.
|
|
General Obligation Note (New Castle County Water Main Transmission Replacements Projects), Series 2020B-SRF, dated as of April 28, 2020, issued by
Artesian Water Company, Inc. in favor of Delaware Drinking Water State Revolving Fund, acting by and through the Delaware Department of Health & Social Services, Division of Public Health. Incorporated by reference to Exhibit 10.4 filed
with the Company’s Form 8-K filed on April 30, 2020.
|
|
Financing Agreement, dated as of April 28, 2020, between Artesian Water Company, Inc. and Delaware Drinking Water State Revolving Fund, acting by and
through the Delaware Department of Health & Social Services, Division of Public Health. Incorporated by reference to Exhibit 10.5 filed with the Company’s Form 8-K filed on April 30, 2020.
|
|
General Obligation Note (New Castle County Water Main Transmission Replacements Projects), Series 2020C-SRF, dated as of April 28, 2020, issued by
Artesian Water Company, Inc. in favor of Delaware Drinking Water State Revolving Fund, acting by and through the Delaware Department of Health & Social Services, Division of Public Health. Incorporated by reference to Exhibit 10.6 filed
with the Company’s Form 8-K filed on April 30, 2020.
|
|
General Obligation Note (New Castle County Water Main Transmission Replacements Projects), Series 2011-SRF, dated as of July 15, 2011, issued by
Artesian Water Company, Inc. in favor of Delaware Drinking Water State Revolving Fund, acting by and through the Delaware Department of Health & Social Services, Division of Public Health. Incorporated by reference to Exhibit 10.2 filed
with the Company’s Form 8-K filed on July 19, 2011.
|
|
|
|
Financing Agreement, dated as of July 15, 2011, between Artesian Water Company, Inc. and Delaware Drinking Water State Revolving Fund, acting by and
through the Delaware Department of Health & Social Services, Division of Public Health. Incorporated by reference to Exhibit 10.1 filed with the Company’s Form 8-K filed on July 19, 2011.
|
|
|
|
Financing Agreement and General Obligation Note dated February 12, 2010 between Artesian Water Company, Inc. and Delaware Drinking Water State Revolving
Fund Delaware Department of Health and Social Services, Division of Public Health. Incorporated by reference to Exhibit 10.1 filed with the Company’s Form 8-K filed on February 17, 2010.
|
|
Second Amended and Restated Revolving Credit Agreement between Artesian Water Company, Inc. and CoBank, ACB dated September 20, 2019. Incorporated by
reference to Exhibit 4.2 filed with the Company’s Form 10-Q filed on November 8, 2019.
|
|
Demand Line of Credit Agreement dated January 19, 2010 between Artesian Resources Corporation and each of its subsidiaries and Citizens Bank of
Pennsylvania, as amended or modified from time to time. Incorporated by reference to Exhibit 10.2 filed with the Company’s Form 8-K filed on January 25, 2010.
|
|
Amendment to Agreement for Purchase of Water Assets of the Town of Port Deposit and for the provision of Potable Water Services, dated November 1,
2010 by and among Artesian Water Maryland, Inc., a Delaware Corporation, Artesian Resources Corporation, a Delaware Corporation and the Mayor and Town Council of Port Deposit, Maryland, a body corporate and politic organized under the laws of
the State of Maryland. Incorporated by reference to Exhibit 10.2 filed with the Company’s Form 8-K filed on November 4, 2010.
|
|
|
|
Water Asset Purchase Agreement, dated December 1, 2009 by and among Artesian Water Maryland, Inc., a Delaware Corporation, Artesian Resources
Corporation, a Delaware Corporation and the Mayor and Town Council of Port Deposit, Maryland, a body corporate and politic organized under the laws of the State of Maryland. Incorporated by reference to Exhibit 10.1 filed with the Company’s
Form 8-K filed on December 2, 2009.
|
|
|
|
Limited Liability Interest Purchase Agreement, dated May 5, 2008, by and among Artesian Maryland, Inc., a Delaware corporation, Mountain Hill Water
Company, LLC, a Maryland limited liability company, Sunrise Holdings, L.P., a Pennsylvania limited partnership and Artesian Resources Corporation, a Delaware corporation. Incorporated by reference to Exhibit 10.1 filed with the Company’s Form
8-K filed on May 9, 2008.
|
|
|
|
Artesian Resources Corporation 2005 Equity Compensation Plan. Incorporated by reference to Exhibit 4.1 to the Company’s Quarterly Report on Form
10-Q for the quarter ended June 30, 2005 filed on August 9, 2005. ***
|
|
Amended and Restated Artesian Resources Corporation 1992 Non-Qualified Stock Option Plan, as amended. Incorporated by reference to Exhibit 10.4 filed
with the Company’s Form 10-Q for the quarterly period ended June 30, 2003 filed on July 31, 2003.***
|
|
10.36
|
Artesian Resources Corporation Incentive Stock Option Plan. Incorporated by reference to Exhibit 10(e) filed with the Company’s Annual Report on
Form 10-K for the year ended December 31, 1995.***
|
|
|
Officer’s Medical Reimbursement Plan dated May 27, 1992. Incorporated by reference to Exhibit 10.6 filed with the Company’s Annual Report on Form
10-K/A for the year ended December 31, 2001.***
|
|
|
|
Subsidiaries of the Company as of December 31, 2023. *
|
|
|
|
Consent of BDO USA, P.C. *
|
|
|
|
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. *
|
|
|
|
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. *
|
|
|
|
Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. **
|
|
|
|
Artesian Resources Corporation Clawback Policy, effective as of August 7, 2023. *
|
|
101.INS
|
Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline
XBRL document). *
|
101.SCH
|
Inline XBRL Taxonomy Extension Schema Document. *
|
101.CAL
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document. *
|
101.DEF
|
Inline XBRL Taxonomy Extension Definition Linkbase Document. *
|
101.LAB
|
Inline XBRL Taxonomy Extension Label Linkbase Document. *
|
101.PRE
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document. *
|
104
|
Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101). *
|
*
|
Filed herewith.
|
**
|
Furnished herewith.
|
***
|
Compensation plan or arrangement required to be filed or incorporated as an exhibit.
|
Date March 18, 2024
|
By: /s/ DAVID B. SPACHT
|
|
|
David B. Spacht
|
|
|
Chief Financial Officer (Principal Financial Officer)
|
|
Signature
|
Title
|
Date
|
|
|
|
/s/ DIAN C. TAYLOR
|
Chair of the Board of Directors, President
|
|
Dian C. Taylor
|
and Chief Executive Officer (Principal
|
March 18, 2024
|
|
Executive Officer)
|
|
|
||
/s/ DAVID B. SPACHT
|
Chief Financial Officer (Principal Financial
|
|
David B. Spacht
|
Officer) |
March 18, 2024
|
|
|
|
|
|
|
/s/ JENNIFER L. FINCH
|
Corporate Treasurer and Senior Vice
|
|
Jennifer L. Finch
|
President of Finance (Principal Accounting Officer)
|
March 18, 2024
|
|
|
|
/s/ KENNETH R. BIEDERMAN
|
|
|
Kenneth R. Biederman
|
Director
|
March 18, 2024
|
|
|
|
|
|
|
/s/ JOHN R. EISENBREY, JR.
|
|
|
John R. Eisenbrey, Jr.
|
Director
|
March 18, 2024
|
|
|
|
/s/ MICHAEL HOUGHTON
|
||
Michael Houghton
|
Director
|
March 18, 2024
|
/s/ NICHOLLE R. TAYLOR
|
|
|
Nicholle R. Taylor
|
Director
|
March 18, 2024
|
Name of Company
|
|
State of Incorporation
|
|
|
|
|
|
|
|
Artesian Resources Corporation
|
|
Delaware
|
|
|
Artesian Water Company, Inc.
|
|
Delaware
|
|
|
Artesian Water Pennsylvania, Inc.
|
|
Pennsylvania
|
|
|
Artesian Water Maryland, Inc.
|
|
Delaware
|
|
|
Artesian Development Corporation
|
|
Delaware
|
|
|
Artesian Wastewater Management, Inc.
|
|
Delaware
|
|
|
Tidewater Environmental Services, Inc. dba Artesian Wastewater
|
Delaware
|
|||
Artesian Wastewater Maryland, Inc.
|
|
Delaware
|
|
|
Artesian Utility Development, Inc.
|
|
Delaware
|
|
|
Artesian Storm Water Services, Inc.
|
|
Delaware
|
|
1.
|
I have reviewed this Annual Report on Form 10-K for the period ended December 31, 2023 of Artesian Resources Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects
the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most
recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial
reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably
likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control
over financial reporting.
|
Date: March 18, 2024
|
/s/ Dian C. Taylor
|
Dian C. Taylor
|
|
Chief Executive Officer (Principal Executive Officer)
|
1.
|
I have reviewed this Annual Report on Form 10-K for the period ended December 31, 2023 of Artesian Resources Corporation;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the
statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects
the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most
recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial
reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably
likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control
over financial reporting.
|
Date: March 18, 2024
|
/s/ David B. Spacht
|
David B. Spacht
|
|
Chief Financial Officer (Principal Financial Officer)
|
1.
|
The Company's Annual Report on Form 10-K for the period ended December 31, 2023 (the " Report") fully complies with the requirements of Section
13(a) or 15(d) of the Securities Exchange Act of 1934 (15 USC Section 78m(a) or Section 78o(d)), as amended; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition of the Company at the end of the period
covered by the Report and results of operations of the Company for the period covered by the Report.
|
Chief Executive Officer:
|
Chief Financial Officer:
|
|
/s/ Dian C. Taylor
|
/s/ David B. Spacht
|
|
Dian C. Taylor
|
David B. Spacht
|
|
1.
|
Purpose
|
2.
|
Definitions
|
3.
|
Application
|
a)
|
After beginning service as an Executive Officer;
|
b)
|
Who served as an Executive Officer at any time during the performance period for that Incentive-Based Compensation;
|
c)
|
While the Company has a class of securities listed on a national securities exchange or a national securities association;
and
|
d)
|
During the Recovery Period.
|
4.
|
Recovery Amount
|
5.
|
No Additional Payments
|
6.
|
Amendments
|
7.
|
Other
|