-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, BCnVL5UM8DwPOq+dW43KhYIcUV5H8xJJ+u8ksSfpeTV1N7QeUIrAuLorzex925oV HXZGovdfJ6ZjiB9FG603uQ== 0001036050-99-000893.txt : 19990430 0001036050-99-000893.hdr.sgml : 19990430 ACCESSION NUMBER: 0001036050-99-000893 CONFORMED SUBMISSION TYPE: U-13-60 PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19981231 FILED AS OF DATE: 19990429 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CONECTIV INC CENTRAL INDEX KEY: 0001029590 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC & OTHER SERVICES COMBINED [4931] IRS NUMBER: 510377417 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: U-13-60 SEC ACT: SEC FILE NUMBER: 049-00135 FILM NUMBER: 99604220 BUSINESS ADDRESS: STREET 1: 800 KING STREET P O BOX 231 CITY: WILMINGTON STATE: DE ZIP: 19899 BUSINESS PHONE: 3024293114 MAIL ADDRESS: STREET 1: 800 KING ST STREET 2: P O BOX 231 CITY: WILMINGTON STATE: DE ZIP: 19899 U-13-60 1 FORM U-13-60 Form U-13-60 Mutual and Subsidiary Service Companies ANNUAL REPORT For the Period Beginning January 1, 1998 and Ending December 31, 1998 TO THE U.S. SECURITIES AND EXCHANGE COMMISSION OF CONECTIV RESOURCE PARTNERS, INC. A Subsidiary Service Company Date of Incorporation: January 16, 1998 State or Sovereign Power under which Incorporated or Organized: Delaware Location of Principal Executive Offices of Reporting Company: 800 King Street Wilmington, DE 19899 Name, title, and address of officer to whom correspondence concerning the report should be addressed: James P. Lavin, Controller Accounting and Finance 800 King Street Wilmington, DE 19899 Name of Principal Holding Company Whose Subsidiaries are served by Reporting Company: Conectiv INSTRUCTIONS FOR USE OF FORM U-13-60 1. TIME OF FILING. Rule 94 provides that on or before the first day of May in each calendar year, each mutual service company and each subsidiary service company as to which the Commission shall have made a favorable finding pursuant to Rule 88, and every service company whose application for approval or declaration pursuant to Rule 88 is pending shall file with the Commission an annual report on Form U-13-60 and in accordance with the Instructions for that form. 2. NUMBER OF COPIES. Each annual report shall be filed in duplicate. The company should prepare and retain at least one extra copy for itself in case correspondence with reference to the report become necessary. 3. PERIOD COVERED BY REPORT. The first report filed by any company shall cover the period from the date the Uniform System of Accounts was required to be made effective as to that company under Rules 82 and 93 to the end of that calendar year. Subsequent reports should cover a calendar year. 4. REPORT FORMAT. Reports shall be submitted on the forms prepared by the Commission. If the space provided on any sheet of such form is inadequate, additional sheets may be inserted of the same size as a sheet of the form or folded to such size. 5. MONEY AMOUNTS DISPLAYED. All money amounts required to be shown in financial statements may be expressed in whole dollars, in thousands of dollars or in hundred thousands of dollars, as appropriate and subject to provisions of Regulation S-X (Section 210.3-01(c)). 6. DEFICITS DISPLAYED. Deficits and other like entries shall be indicated by the use of either brackets or a parenthesis with corresponding reference in footnotes. (Regulation S-X, Section 210.3-01 (c) ). 7. MAJOR AMENDMENTS OR CORRECTIONS. Any company desiring to amend or correct a major omission or error in a report after it has been filed with the Commission shall submit an amended report including only those pages, schedules, and entries that are to be amended or corrected. A cover letter shall be submitted requesting the Commission to incorporate the amended report changes and shall be signed by a duly authorized officer of the company. 8. DEFINITIONS. Definitions contained in Instruction 01-8 to the Uniform System of Accounts for Mutual Service Companies and Subsidiary Service Companies, Public Utility Holding Company Act of 1935, as amended February 2, 1979 shall be applicable to words or terms used specifically within this Form U-13-60. 9. ORGANIZATION CHART. The service company shall submit with each annual report a copy of its current organization chart. -1- 10. METHODS OF ALLOCATION. The service company shall submit with each annual report a listing of the currently effective methods of allocation being used by the service company and on file with the Securities and Exchange Commission pursuant to the Public Utility Holding Company Act of 1935. 11. ANNUAL STATEMENT OF COMPENSATION FOR USE OF CAPITAL BILLED. The service company shall submit with each annual report a copy of the annual statement supplied to each associate company in support of the amount of compensation for use of capital billed during the calendar year. 12. ELECTRONIC FILERS. Electronic filers are subject to Regulation S-T and the EDGAR Filer Manual. Any rule or instruction therein shall be controlling unless otherwise specifically provided in rules or instructions pertaining to the submission format documents. Data that appears in tabular or columnar format shall be marked as prescribed in the EDGAR Filer Manual. Signatures shall be in typed form rather than manual format. See rule 13 of Regulation S-T. -2- LISTING OF SCHEDULES AND ANALYSIS OF ACCOUNT
Schedule or Page Description of Schedules and Accounts Account Number Number COMPARATIVE BALANCE SHEET Schedule I 4-5 Service Company Property Schedule II 6-7 Accumulated Provision for Depreciation and Amortization of Service Company Property Schedule III 8 Investments Schedule IV 9 Accounts Receivable from Associate Companies Schedule V 10 Fuel Stock Expenses Undistributed Schedule VI 11 Stores Expense Undistributed Schedule VII 12 Miscellaneous Current and Accrued Assets Schedule VIII 13 Miscellaneous Deferred Debits Schedule IX 14 Research, Development, or Demonstration Expenditures Schedule X 15 Proprietary Capital Schedule XI 16 Long-Term Debt Schedule XII 17 Current and Accrued Liabilities Schedule XIII 18 Notes to Financial Statements Schedule XIV 19-20 COMPARATIVE STATEMENT OF INCOME Schedule XV 21 Analysis of Billing - Associate Companies Account 457 22 Analysis of Billing - Non associate Companies Account 458 23 Analysis of Charges for Service - Associate and Non associate Companies Schedule XVI 24 Schedule of Expense by Department or Service Function Schedule XVII 25-27 Departmental Analysis of Salaries Account 920 28-29 Outside Services Employed Account 923 30-32 Employee Pensions and Benefits Account 926 33 General Advertising Expenses Account 930.1 34 Miscellaneous General Expenses Account 930.2 35-36 Rents Account 931 37 Taxes Other Than Income Taxes Account 408 38 Donations Account 426.1 39 Other Deductions Account 426.5 40 Notes to Statement of Income Schedule XVIII 41 LISTING OF INSTRUCTIONAL FILING REQUIREMENTS Description of Reports or Statements ORGANIZATION CHART 42 METHODS OF ALLOCATION 43-49 ANNUAL STATEMENT OF COMPENSATION FOR USE OF CAPITAL BILLED 50 SIGNATURE 51
-3- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. SCHEDULE I - COMPARATIVE BALANCE SHEET Give balance sheet of the Company as of December 31 of the current and prior year
As of Account Assets and Other Debits December 31 Current Prior 1998 1997 (In Thousands) SERVICE COMPANY PROPERTY 101 Service Company Property (Schedule II) $ 11,774 $ - 107 Construction work in progress (Schedule II) 379 - --------------------------- Total Property $ 12,153 $ - --------------------------- 108 Less accumulated provision for depreciation and amortization of service company property (Schedule III) $ 611 $ - --------------------------- Net Service Company Property $ 11,542 $ - --------------------------- INVESTMENTS 121 Nonutility Property $ 5,796 $ - 123 Investments in associate companies (Schedule IV) - - 124 Other investments (Schedule IV) - - --------------------------- Total Investments $ 5,796 $ - --------------------------- CURRENT AND ACCRUED ASSETS 131 Cash $ 1 $ - 134 Special deposits - - 135 Working funds 87 - 136 Temporary cash investments (Schedule IV) - - 141 Notes receivable - - 143 Accounts receivable - - 144 Accumulated provision for uncollectible accounts - - 146 Accounts receivable from associate companies (Schedule V and XIV) 34,486 - 152 Fuel stock expenses undistributed (Schedule VIII) - - 154 Materials and supplies - - 163 Stores expense undistributed (Schedule VII) - - 165 Prepayments 930 - 174 Miscellaneous current and accrued assets - - --------------------------- Total Current and Accrued Assets $ 35,504 $ - --------------------------- DEFERRED DEBITS 181 Unamortized debt expense $ - $ - 183 Preliminary Survey and Investigation 22 - 184 Clearing accounts 127 - 186 Miscellaneous deferred debits (Schedule IX) 7 - 188 Research, development, or demonstration - expenditures (Schedule X) - - 190 Accumulated deferred income taxes - - --------------------------- Total Deferred Debits $ 156 $ - --------------------------- TOTAL ASSETS AND OTHER DEBITS $ 52,998 $ - ===========================
-4- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. SCHEDULE I - COMPARATIVE BALANCE SHEET
As of Account Liabilities and Proprietary Capital December 31 Current Prior 1998 1997 (In Thousands) PROPRIETARY CAPITAL 201 Common stock issued (Schedule XI) $ 1 $ - 211 Miscellaneous paid-in-capital (Schedule XI) - - 215 Appropriated retained earnings (Schedule XI) - - 216 Unappropriated retained earnings (Schedule XI) (26) - ------------------------------------ Total Proprietary Capital $ (25) $ - ------------------------------------ LONG - TERM DEBT 223 Advances from associate companies $ - $ - 224 Other long-term debt (Schedule XII) - - 225 Unamortized premium on long-term debt - - 226 Unamortized discount on long-term debt - - ------------------------------------ Total Long - Term Debt $ - $ - ------------------------------------ CURRENT AND ACCRUED LIABILITIES 184 Clearing accounts $ 7 $ - 231 Notes payable - - 232 Accounts payable 7,487 - 233 Notes payable to associate companies (Schedule XIII and XIV) 37,327 - 234 Accounts payable to associate companies (Schedule XIII and XIV) - - 236 Taxes accrued (1,123) - 237 Interest accrued 94 - 238 Dividends declared - - 241 Tax collections payable 1,323 - 242 Miscellaneous current and accrued liabilities - (Schedule XIII) 6,560 - ------------------------------------ Total Current and Accrued Liabilities $ 51,675 $ - ------------------------------------ DEFERRED CREDITS 253 Other deferred credits $ 3 $ - 255 Accumulated deferred investment tax credits - - ------------------------------------ Total Deferred Credits $ 3 $ - ------------------------------------ ACCUMULATED DEFERRED INCOME TAXES 282 Accumulated deferred income taxes-Other Property $ - $ - 283 Accumulated deferred income taxes-Other 1,345 - ------------------------------------ Total Accumulated Deferred Income Taxes $ 1,345 $ - ------------------------------------ TOTAL LIABILITIES AND PROPRIETARY CAPITAL $ 52,998 $ - ====================================
-5- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (In Thousands) SCHEDULE II - SERVICE COMPANY PROPERTY
Balance At Retirements Balance At Beginning or Other Close Description of Year Additions Sales Changes (1) of Year SERVICE COMPANY PROPERTY Account 301 Organization $ - $ - $ - $ - $ - 303 Miscellaneous Intangible Plant - 8,250 8,250 304 Land and Land Rights - - - - - 305 Structures and Improvements - - - - - 306 Leasehold Improvements - - - - - 307 Equipment(2) - 3,524 3,524 308 Office Furniture and Equipment - - - - - 309 Automobiles, Other Vehicles and Related Garage Equipment - - - - - 310 Aircraft and Airport Equipment - - - - - 311 Other Service Company Property(3) - - - - - ----------------------------------------------------------------------------------- SUBTOTAL $ - $ 11,774 $ - $ - $ 11,774 107 Construction Work in Progress (4) - 379 - - 379 ----------------------------------------------------------------------------------- TOTAL $ - $ 12,153 $ - $ - $ 12,153 ===================================================================================
(1) Provide an explanation of those changes considered material: Not Applicable -6- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (In Thousands) SCHEDULE II - CONTINUED (2) Sub accounts are required for each class of equipment owned. The service company shall provide a listing by sub account of equipment additions during the year and the balance at the close of the year:
Balance At Close of Subaccount Description Additions Year Computer Hardware $ 3,524 $ 3,524 Computer Software - - Typewriters, Calculators, Copiers, & Duplicating - - Office Services Printing and Stationary Equipment - - --------------------------- TOTAL $ 3,524 $ 3,524 ===========================
(3) Describe Other Service Company Property: Not Applicable (4) Describe Construction Work in Progress:
Asset Under Construction Capitalized Date Value Description ------------------------ ---------------- ----- ----------- Telephony 9/30/98 $352 IS costs - Customer Service Technical Revenue Management 12/31/98 15 IS costs - Customer information system conversion Technical Measurement Field 9/30/98 12 IS costs - Billing/Meter reading
-7- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (In Thousands) SCHEDULE III ACCUMULATED PROVISION FOR DEPRECIATION AND AMORTIZATION OF SERVICE COMPANY PROPERTY
Balance At Additions Other Balance At Beginning Charged to Changes Add Close Description of Year Account 403 Retirements (Deduct) (1) of Year Account 301 Organization $ - $ - $ - $ - $ - 303 Miscellaneous Intangible Plant - 441 - - 441 304 Land and Land Rights - - - - - 305 Structures and Improvements - - - - - 306 Leasehold Improvements - - - - - 307 Equipment - 170 - - 170 308 Office Furniture and Equipment - - - - - 309 Automobiles, Other Vehicles and Related Garage Equipment - - - - - 310 Aircraft and Airport Equipment - - - - - 311 Other Service Company Property - - - - - ------------------------------------------------------------------------------------- TOTAL $ - $ 611 $ - $ - $ 611 =====================================================================================
(1) Provide an explanation of those changes considered material: NOT APPLICABLE -8- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (In Thousands) SCHEDULE IV - INVESTMENTS INSTRUCTIONS: Complete the following schedule concerning investments. Under Account 124, "Other Investments", state each investment separately, with description, including the name of the issuing company, number of shares or principal amount, etc. Under Account 136, "Temporary Cash Investments", list each investment separately.
Balance At Balance At Beginning Close Description of Year of Year Account 123 - Investment in Associate Companies $ - $ - Account 124 - Other Investments - - Account 136 - Temporary Cash Investments - - ----------------------------- TOTAL $ - $ - =============================
-9- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (In Thousands) SCHEDULE V - ACCOUNTS RECEIVABLE FROM ASSOCIATE COMPANIES INSTRUCTIONS: Complete the following schedule listing accounts receivable from each associate company. Where the service company has provided accommodation or convenience payments for associate companies, a separate listing of total payments for each associate company by subaccount should be provided.
Balance At Balance At Beginning Close Description of Year of Year Account 146 - Accounts Receivable from Associate Companies Christiana Capital Management $ - $ 122 DCI I, Inc. - 34 Conectiv Operating Services Company - 29 DCTC-Burney, Inc. - 0 Delmarva Power & Light Co. - 12,001 Atlantic City Electric Co. - 8,771 Delmarva Capital Investments - 40 Conectiv Supply, Inc. - 198 Atlantic Energy Enterprises, Inc. - 451 Enertech Capital Partners, LP - 18 Delmarva Services Company - 8 Power Consulting Group, Inc. - 182 Conectiv Solutions LLC - 7,200 Conectiv Communications, Inc. - 3,835 Conectiv Services, Inc. - 1,643 Petron Oil Corporation - 26 Conectiv Plumbing, LLC - 48 Conectiv Holding Company - (120) --------------------------------- TOTAL RECEIVABLES $ - $ 34,486 ================================= Total Payments Analysis of Convenience or Accommodation Payments: $ - ----------- TOTAL PAYMENTS $ - ============
-10- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (In Thousands) SCHEDULE VI - FUEL STOCK EXPENSE UNDISTRIBUTED INSTRUCTIONS: Report the amount of labor and expenses incurred with respect to fuel stock expenses during the year and indicate amount attributable to each associate company. Under the section headed "summary" listed below give an overall report of the fuel functions performed by the service company. Description Labor Expenses Total ----------- ----- -------- ------ Account 152 - Fuel Stock Expenses Undistributed $ - $ - $ - ----------------------------- TOTAL $ - $ - $ - ============================= Summary: Not Applicable -11- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (In Thousands) SCHEDULE VII - STORES EXPENSE UNDISTRIBUTED INSTRUCTIONS: Report the amount of labor and expenses incurred with respect to stores expense during the year and indicate amount attributable to each associate company.
Description Labor Expenses Total ------------ ----- -------- ----- Account 163 - Stores Expense Undistributed $ - $ - $ - ------------------------------------ TOTAL $ - $ - $ - ====================================
-12- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (In Thousands) SCHEDULE VIII - MISCELLANEOUS CURRENT AND ACCRUED ASSETS INSTRUCTIONS: Provide detail of items in this account. Items less than $10,000 may be grouped, showing the number of items in each group. Balance At Balance At Beginning Close Description of Year of Year ----------- Account 174 - Miscellaneous Current and $ - $ - Accrued Assets ------------------------------- TOTAL $ - $ - =============================== -13- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (In Thousands) SCHEDULE IX - MISCELLANEOUS DEFERRED DEBITS INSTRUCTIONS: Provide detail of items in this account. Items less than $10,000 may be grouped by class, showing the number of items in each class.
Balance At Balance At Beginning Close Description of Year of Year ----------- Account 186 - Miscellaneous Deferred Debits Suspense-Procurement $ - $ 9 Exp in connection with Mgmt Life Insurance Program $ - $ (2) ----------------------- TOTAL $ $ 7 =======================
-14- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS,INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (In Thousands) SCHEDULE X RESEARCH, DEVELOPMENT OR DEMONSTRATION EXPENDITURES INSTRUCTIONS: Provide a description of each material research, development, or demonstration project which incurred costs by the service corporation during the year. Description Amount ----------- ------ Account 188 - RESEARCH, DEVELOPMENT, OR DEMONSTRATION EXPENDITURES $ - TOTAL $ - ======== -15- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 SCHEDULE XI - PROPRIETARY CAPITAL
Outstanding Number of Par or Stated Close of Period Account Shares Value No. of Total Number Class of Stock Authorized Per Share Shares Amount 201 Common Stock Issued 1,000 $ 1.00 1,000 $ 1,000
INSTRUCTIONS: Classify amounts in each account with brief explanation, disclosing the general nature of transactions which gave rise to the reported amounts.
Description Amount Account 211 - Miscellaneous Paid-In Capital $ - Account 215 - Appropriated Retained Earnings - ------------- TOTAL $ - =============
INSTRUCTIONS: Give particulars concerning net income or (loss) during the year, distinguishing between compensation for the use of capital owed or net loss remaining from servicing nonassociates per the General Instructions of the Uniform System of Accounts. For dividends paid during the year in cash or otherwise, provide rate percentage, amount of dividend, date declared and date paid.
Balance At Net Income Balance At Beginning or Dividends Close Description of Year (Loss) Paid of Year Account 216 - Unappropriated Retained Earnings $ - $ (26) $ - $ (26) ---------------------------------------------------------------------------- TOTAL $ - $ (26) $ - $ (26) =============================================================================
-16- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (IN THOUSANDS) SCHEDULE XII - LONG-TERM DEBT INSTRUCTIONS: Advances from associate companies should be reported separately for advances on notes, and advances on open account. Names of associate companies from which advances were received shall be shown under the class and series of obligation column. For Account 224 - Other Long-Term Debt provide the name of the creditor company or organization, terms of the obligation, date of maturity, interest rate, and the amount authorized and outstanding.
Terms of Oblig Date Balance At Balance At Class & Series of Interest Amount Beginning Deductions Close of Obligation Maturity Rate Amortized of Year Additions (1) of Year Account 223 - Advances from $ - $ - Associate Companies: Account 224 - Other Long-Term Debt - - TOTAL $ - $ -
(1) Give an explanation of deductions: Not Applicable -17- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (In Thousands) SCHEDULE XIII - CURRENT AND ACCRUED LIABILITIES INSTRUCTIONS: Provide balance of notes and accounts payable to each associate company. Give description and amount of miscellaneous current and accrued liabilities. Items less than $10,000 may be grouped, showing the number of items in each group.
Balance At Balance At Beginning Close Description of Year of Year ---------- Account 233 - Notes Payable to Associate Companies Conectiv Money Pool $ - $ 12,327 Conectiv Holding Company - 25,000 ----------------------------- TOTAL $ - $ 37,327 ============================= Account 234 - Accounts Payable to Associate Companies $ - $ - ----------------------------- TOTAL $ - $ - ============================= Account 242 - Miscellaneous Current and Accrued Liabilities General Liability Insurance $ - $ 314 Life Insurance - 120 Deferred Compensation - 5,834 Deferred Savings and Thrift - 292 ----------------------------- TOTAL $ - $ 6,560 =============================
-18- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 SCHEDULE XIV - NOTES TO FINANCIAL STATEMENTS INSTRUCTIONS: The space below is provided for important notes regarding the financial statements or any account thereof. Furnish particulars as to any significant contingent assets or liabilities existing at the end of the year. Notes relating to financial statements shown elsewhere in this report may be indicated here by reference. 1. Service Company Property and Non-Utility Property Service Company property and non-utility property are stated at original cost, including property additions. Capitalized interest is included in the original cost and represents the cost of borrowed and equity funds used to finance construction of new facilities. The annual provision for depreciation on service company and non-utility property is computed on the straight-line basis using composite rates by classes of depreciable property. Accumulated depreciation is charged with the cost of depreciable property retired, including removal costs less salvage and other recoveries. 2. Income Taxes CRP, as a subsidiary of Conectiv, is included in the consolidated federal income tax return of Conectiv. Income taxes are allocated to CRP based upon its taxable income or loss, determined on a separate return basis. The financial statements include two categories of income taxes-current and deferred. Current income taxes represent CRP's share of amounts of tax expected to be reported on Conectiv's federal and state income tax returns. Deferred income tax assets and liabilities represent the tax effects of temporary differences between the financial statements and tax bases of existing assets and liabilities and are measured using presently enacted tax rates. Deferred income tax expense represents the net change during the reporting period in the net deferred tax liability. 3. Pension and Other Postretirement Benefits CRP employees are covered by the Conectiv pension plan which as of December 31, 1998 had a projected benefit obligation of $748.7 million and trust fund assets with a fair value of $951.5 million, resulting in an over-funded status of $202.8 million of which $16.1 million was reflected on Conectiv's Consolidated December 31, 1998 Balance Sheet. During 1998, CRP was billed by associated Conectiv subsidiaries for $6.1 million for pension service and interest costs, net of expected return on assets. CRP employees are covered by Conectiv's other postretirement benefit plans which as of December 31, 1998 had a projected benefit obligation of $232.4 million and trust fund assets with a fair value of $95.1 million, resulting in an under-funded status of $137.2 million of which $102.3 million was reflected on Conectiv's Consolidated December 31, 1998 Balance Sheet. During 1998, CRP was billed by associated Conectiv subsidiaries for $3.0 million for other postretirement service and interest costs; net of expected return on assets. -19- Effective January 1, 1999, Conectiv adopted a "cash balance" pension plan. Conectiv will make contributions, which vary based on a covered employee's age and years of service, to individual employee accounts provided for under the plan. The "cash balance" of each employee's account increases based on Conectiv's contributions and interest income credited to the accounts. Conectiv also maintains 401(k) savings plans for covered employees, including employees of CRP. Conectiv contributes to the plan, in the form of Conectiv stock, at varying levels up to $0.50 for each dollar contributed by employees, for up to 6% of employee base pay. The amount expensed by CRP for Conectiv's matching contributions was $0.2 million in 1998. 4. Rents CRP leases office buildings and business equipment from associate companies. These leases are accounted for as operating leases. 5. Money Pool The Money Pool exists to permit affiliate companies to borrow excess cash from other affiliate companies. Conectiv Resource Partners, Inc. serves as the Administrator for the System Money Pool. -20- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEARS ENDED DECEMBER 31, 1998 AND 1997 (IN THOUSANDS) SCHEDULE XV - COMPARATIVE STATEMENT OF INCOME
Current Prior Year Year Account Description 1998 1997 INCOME 457 Services rendered to associate companies $ 136,562 $ - 458 Services rendered to nonassociate companies - 421 Miscellaneous income or loss - --------------------------------- TOTAL INCOME $ 136,562 $ - ================================= EXPENSE 912-13 Marketing & Advertising $ 273 $ - 920 Salaries and wages 46,578 - 921 Office Supplies and expenses 8,157 - 922 Administrative expenses transferred-credit - - 923 Outside services employed 28,803 - 924 Property insurance - - 925 Injuries and damages 574 - 926 Employee pensions and benefits 18,608 - 928 Regulatory commission expense - - 929 Duplicate charges-credit (246) - 930.1 General advertising expense 755 - 930.2 Miscellaneous general expenses 18,114 - 931 Rents 13,517 - 932 Maintenance of structures and equipment - - 403 Depreciation and amortization expense 611 - 408 Taxes other than income taxes 14 - 409 Income taxes (1,319) - 410 Provision for deferred income taxes 1,345 - 411 Provision for deferred income taxes-credit - - 411.5 Investment tax credit - - 426.1 Donations 49 - 426.5 Other deductions - - 427 Interest on long-term debt - - 430 Interest on debt to associate companies 755 - 431 Other interest expense - - --------------------------------- TOTAL EXPENSES 136,588 $ - --------------------------------- NET INCOME OR (LOSS) (26) $ - ==================================
-21- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (In Thousands) ANALYSIS OF BILLING ASSOCIATE COMPANIES - ACCOUNT 457
Direct Indirect Compensation Total Costs Costs For Use Amount Name of Associate Company Charged Charged of Capital Billed 457-1 457-2 457-3 Delmarva Power & Light Company $ 7,751 $ 56,681 $ 405 $ 64,837 Atlantic City Electric Company 3,689 31,578 264 35,531 Delmarva Capital Investments 94 173 1 268 Conectiv Supply, Inc. 13 - - 13 Petron Oil 67 - - 67 Atlantic Energy Enterprises, Inc. 1 1,314 10 1,325 Delmarva Services Company 2 34 1 37 Conectiv Services, Inc. 1,715 7,678 26 9,419 Power Consulting Group, Inc. 918 - - 918 Conectiv Plumbing LLC 274 - - 274 Conectiv Solutions LLC 2,580 4,354 12 6,946 Conectiv Communications, Inc. 8,800 7,267 36 16,103 Conectiv Holding Company, Inc. - 824 - 824 ------- -------- ------- -------- TOTAL $25,904 $109,903 $ 755 $136,562 ======= ======== ======= ========
-22- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (In Thousands) ANALYSIS OF BILLING NONASSOCIATE COMPANIES - ACCOUNT 458
Direct Indirect Compensation Excess Total Costs Costs For Use Total or Amount Name of Nonassociate Company Charged Charged of Capital Cost Deficiency Billed 458-1 458-2 458-3 458-4 TOTAL $ - $ - $ - $ - $ - $ - ======= ======== ========== ===== ========= =======
INSTRUCTION: Provide a brief description of the services rendered to each nonassociate company. NOT APPLICABLE -23- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (In Thousands) SCHEDULE XVI - ANALYSIS OF CHARGES FOR SERVICES ASSOCIATE AND NONASSOCIATE COMPANIES
Associate Nonassociate Total Charges Company Charges Company Charges for Service Direct Indirect Direct Indirect Direct Indirect Description of Items Costs Costs Total Costs Costs Total Costs Costs Total 912-13 Marketing & Advertising $ - $ 273 $ 273 $ - $ - $ - $ - $ 273 $ 273 920 Salaries and wages 16,320 30,258 46,578 - - - 16,320 30,258 46,578 921 Office Supplies and expenses 5,699 2,458 8,157 - - - 5,699 2,458 8,157 922 Administrative expenses transferred-credit - - - - - - - - - 923 Outside services employed - 28,803 28,803 - - - - 28,803 28,803 924 Property insurance - - - - - - - - - 925 Injuries and damages - 574 574 - - - - 574 574 926 Employee pensions and benefits 3,627 14,981 18,608 - - - 3,627 14,981 18,608 928 Regulatory commission expense - - - - - - - - - 929 Duplicate charges-credit - (246) (246) - - - - (246) (246) 930.1 General advertising expense - 755 755 - - - - 755 755 930.2 Miscellaneous general expenses 259 17,855 18,114 - - - 259 17,855 18,114 931 Rents - 13,517 13,517 - - - - 13,517 13,517 932 Maintenance of structures and equipment - - - - - - - - - 403 Depreciation and amortization expense - 611 611 - - - - 611 611 408 Taxes other than income taxes - 14 14 - - - - 14 14 409 Income taxes - (1,345) 1,345 - - - - (1,345) (1,345) 410 Provision for deferred income taxes - 1,345 1,345 - - - - 1,345 1,345 411 Provision for deferred income taxes-credit - - - - - - - - - 411.5 Investment tax credit - - - - - - - - - 426.1 Donations - 49 49 - - - - 49 49 426.5 Other deductions - - - - - - - - - 427 Interest on long-term debt - - - - - - - - - 431 Other interest expense - - - - - - - - - ------------------------------------------------------------------------------------------------- TOTAL EXPENSES $25,904 $109,903 $135,807 $ - $ - $ - $25,904 $109,903 $135,807 ================================================================================================= Compensation for Use of Equity Capital 430 Interest on debt to associate companies $ 755 $ - $ - $ - $ - $ 755 $ 755 -------------------------------------------------------------------------- TOTAL COST OF SERVICES $136,562 $ - $ - $ - $25,904 $110,658 $136,562 ==========================================================================
INSTRUCTION: Total cost of service will equal for associate and nonassociate companies the total amount billed under their separate analysis of billing schedules. -24- ANNUAL REPORT OF: Conectiv Resource Partners, Inc. For the Year Ended December 31, 1998 (In Thousands) SCHEDULE XVII - SCHEDULE OF EXPENSE DISTRIBUTION BY DEPARTMENT OR SERVICE FUNCTION
Total Executive Environmental Corporate Description of Items Amount Overhead Management & Safety Communications 912-13 Marketing & Advertising $ 273 $ - $ - $ - $ 6 920 Salaries and wages 46,578 1,566 763 791 320 921 Office Supplies and expenses 8,157 - 44 67 134 922 Administrative expenses transferred-credit - - - - - 923 Outside services employed 28,803 80 249 236 1,032 924 Property insurance - - - - - 925 Injuries and damages 574 - - - - 926 Employee pensions and benefits 18,608 18,571 - - - 928 Regulatory commission expense - - - - - 929 Duplicate Charges-credit (246) - - - - 930.1 General advertising expense 755 - - - 635 930.2 Miscellaneous general expenses 18,114 378 804 346 1,742 931 Rents 13,517 - - 1 4 932 Maintenance of structures and equipment - - - - - 403 Depreciation and amortization expense 611 - - - - 408 Taxes other than income taxes 14 2 - - - 409 Income taxes (1,319) (1,319) - - - 410 Provision for deferred income taxes 1,345 1,345 - - - 411 Provision for deferred income taxes-credit - - - - - 411.5 Investment tax credit - - - - - 426.1 Donations 49 - - 3 17 426.5 Other deductions - - - - - 427 Interest on long-term debt - - - - - 430 Interest on debt to associate companies 755 743 - - - 431 Other interest expense - - - - - -------------------------------------------------------------------------- TOTAL EXPENSES $ 136,588 $ 21,366 $1,860 $ 1,444 $ 3,890 ========================================================================== SAP Information Customer Corporate Description of Items Services Services Marketing Service Secretary 912-13 Marketing & Advertising $ - $ - $ 180 $ 1 $ - 920 Salaries and wages 707 3,916 639 2,170 89 921 Office Supplies and expenses 341 3,004 75 174 45 922 Administrative expenses transferred-credit 923 Outside services employed 1,600 8,359 3,688 999 132 924 Property insurance - - - - - 925 Injuries and damages - - - - - 926 Employee pensions and benefits - - - - - 928 Regulatory commission expense - - - - - 929 Duplicate Charges-credit - (39) - (87) - 930.1 General advertising expense - 10 26 - - 930.2 Miscellaneous general expenses 195 2,157 (55) 500 160 931 Rents 1,853 6,603 51 - - 932 Maintenance of structures and equipment - - - - - 403 Depreciation and amortization expense - 136 - 102 - 408 Taxes other than income taxes - - - - - 409 Income taxes - - - - - 410 Provision for deferred income taxes - - - - - 411 Provision for deferred income taxes-credit - - - - - 411.5 Investment tax credit - - - - - 426.1 Donations - - - - - 426.5 Other deductions - - - - - 427 Interest on long-term debt - - - - - 430 Interest on debt to associate companies - - - - - 431 Other interest expense - - - - - -------------------------------------------------------------------------- TOTAL EXPENSES $ 4,696 $ 24,146 $ 4,604 $ 3,859 $ 426 ==========================================================================
-25- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, FOR THE YEAR ENDED DECEMBER 31, 1998 (IN THOUSANDS) SCHEDULE XVII - SCHEDULE OF EXPENSE DISTIBUTION BY DEPARTMENT OR SERVICE FUNCTION
Internal Human CFO & Description of Items Audit Legal Resources Controller Planning Finance Tax 912-13 Marketing & Advertising $ - 0 $ 15 $ - $ - $ - $ - 920 Salaries and wages 194 524 2,159 1,626 356 459 262 921 Office Supplies and expenses 13 80 247 65 18 32 37 922 Administrative expenses transferred- credit 923 Outside services employed 43 66 3,985 439 999 219 426 924 Property insurance 925 Injuries and damages 926 Employee pensions and benefits 30 928 Regulatory commission expense 929 Duplicate Charges-credit (10) 930.1 General advertising expense 90 930.2 Miscellaneous general expenses 13 (382) 2,786 914 161 (110) 38 931 Rents 237 215 932 Maintenance of structures and equipment 403 Depreciation and amortization expense 408 Taxes other than income taxes 7 1 409 Income taxes 410 Provision for deferred income taxes 411 Provision for deferred income taxes-credit 411.5 Investment tax credit 426.1 Donations 1 426.5 Other deductions 427 Interest on long-term debt 430 Interest on debt to associate companies 431 Other interest expense -------------------------------------------------------------------------------------- TOTAL EXPENSES $263 $ 288 $9,546 $3,259 $1,534 $601 $764 ====================================================================================== Risk & Description of Items Insurance Treasury Regulatory 912-13 Marketing & Advertising $ - $ 3 $ - 920 Salaries and wages 239 622 801 921 Office Supplies and expenses 10 91 28 922 Administrative expenses transferred- credit 923 Outside services employed 10 652 4 924 Property insurance 925 Injuries and damages 574 926 Employee pensions and benefits 928 Regulatory commission expense 929 Duplicate Charges-credit 930.1 General advertising expense 2 930.2 Miscellaneous general expenses 1 1,184 3 931 Rents 932 Maintenance of structures and equipment 403 Depreciation and amortization expense 408 Taxes other than income taxes 2 409 Income taxes 410 Provision for deferred income taxes 411 Provision for deferred income taxes-credit 411.5 Investment tax credit 426.1 Donations 426.5 Other deductions 427 Interest on long-term debt 430 Interest on debt to associate companies 12 431 Other interest expense ---------------------------------------------------------- TOTAL EXPENSES $836 $2,566 $836 ==========================================================
26 ANNUAL REPORT OF: Conectiv Resource Partners, Inc. For the Year Ended December 31, 1998 (In Thousands) SCHEDULE XVII - SCHEDULE OF EXPENSE DISTIBUTION BY DEPARTMENT OR SERVICE FUNCTION
Procurement Facility Real Vehicle Description of Items & Supply Chain Services Estate Management Security 912-13 Marketing & Advertising $ - $ - $ - $ - $ - 920 Salaries and wages 829 185 196 148 69 921 Office Supplies and expenses 47 11 5 2 3 922 Administrative expenses transferred-credit - - - - - 923 Outside services employed 129 6 1 (14) 105 924 Property insurance - - - - - 925 Injuries and damages - - - - - 926 Employee pensions and benefits - - - - - 928 Regulatory commission expense - - - - - 929 Duplicate Charges-credit (3) - - - - 930.1 General advertising expense - - - - - 930.2 Miscellaneous general expenses 220 27 221 8 270 931 Rents - 4,161 - - - 932 Maintenance of structures and equipment - - - - - 403 Depreciation and amortization expense - - - - - 408 Taxes other than income taxes - - - - - 409 Income taxes - - - - - 410 Provision for deferred income taxes - - - - - 411 Provision for deferred income taxes-credit - - - - - 411.5 Investment tax credit - - - - - 426.1 Donations - - - - - 426.5 Other deductions - - - - - 427 Interest on long-term debt - - - - - 430 Interest on debt to associate companies - - - - - 431 Other interest expense - - - - - -------------------------------------------------------------------------------- TOTAL EXPENSES $1,222 $4,390 $423 $144 $447 ================================================================================ Document Delivery Supply Enterprises Description of Items Services Services Services Service 912-13 Marketing & Advertising $ - $ - $ 43 $ 25 920 Salaries and wages 336 6,842 6,865 12,905 921 Office Supplies and expenses 1,827 319 459 979 922 Administrative expenses transferred-credit - - - - 923 Outside services employed 689 2,027 1,113 1,529 924 Property insurance - - - - 925 Injuries and damages - - - - 926 Employee pensions and benefits - 7 - - 928 Regulatory commission expense - - - - 929 Duplicate Charges-credit - - (107) - 930.1 General advertising expense - - 3 (11) 930.2 Miscellaneous general expenses 938 3,466 1,247 882 931 Rents 141 233 18 - 932 Maintenance of structures and equipment - - - - 403 Depreciation and amortization expense - 373 - - 408 Taxes other than income taxes - 2 - - 409 Income taxes - - - - 410 Provision for deferred income taxes - - - - 411 Provision for deferred income taxes-credit - - - - 411.5 Investment tax credit - - - - 426.1 Donations - - - 28 426.5 Other deductions - - - - 427 Interest on long-term debt - - - - 430 Interest on debt to associate companies - - - - 431 Other interest expense - - - - ------------------------------------------------------------ TOTAL EXPENSES $3,931 $13,269 $9,641 $16,337 ============================================================
-27- DELMARVA POWER ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (IN THOUSANDS) DEPARTMENTAL ANALYSIS OF SALARIES - ACCOUNT 920
Departmental Salary Expense Number of Name of Department Included in Amounts Billed to Personnel Indicate each department Total Parent Other Non End of or service function. Amount Company Associates Associates Year Executive Management $ 763 $ 56 $ 707 $ - 4 Environmental & Safety 791 - 791 - 24 Corporate Communications 320 - 320 - 13 SAP Applications 707 - 707 - 23 Information Systems 3,916 - 3,916 - 117 Marketing 639 - 639 - 24 Customer Services 2,170 - 2,170 - 295 Corporate Secretary 89 - 89 - 2 Internal Audit 194 - 194 - 6 Legal 524 52 472 - 17 Human Resources 2,159 - 2,159 - 68 Controller 1,626 12 1,614 - 67 Planning 356 - 356 - 14 Finance 459 9 450 - 5 Tax 262 - 262 - 9 Risk & Insurance 239 - 239 - 11 Treasury 622 33 589 - 19 Regulatory 801 - 801 - 24 Procurement & Supply Chain 829 - 829 - 27 Facility Services 185 - 185 - 7
-28- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (IN THOUSANDS) DEPARTMENTAL ANALYSIS OF SALARIES - ACCOUNT 920 (CONTINUED)
Departmental Salary Expense Number of Name of Department Included in Amounts Billed to Personnel Indicate each department Total Parent Other Non End of or service function. Amount Company Associates Associates Year Real Estate $ 196 $ - $ 196 $ - 6 Vehicle Management 148 - 148 - 5 Security 69 - 69 - 2 Document Services 336 - 336 - 16 Delivery Shared Services 6,842 - 6,842 - 204 Supply Shared Services 6,865 - 6,865 - 156 Enterprises Shared Services 12,905 - 12,905 - 233 Corporate 1,566 - 1,566 - - --------- ------ --------- ------- --------- $ 46,578 $ 162 $ 46,416 $ - 1,398 ========= ====== ========= ======= =========
-29- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (IN THOUSANDS) OUTSIDE SERVICES EMPLOYED - ACCOUNT 923 INSTRUCTIONS: Provide a breakdown by subaccount of outside services employed. If the aggregate amounts paid to any one payee and included within one subaccount is less than $100,000, only the aggregate number and amount of all such payments included within the subaccount need be shown. Provide a subaccount for each type of service.
Relationship "A"=Associate From Whom Purchased Description "NA" =Nonassociate Amount Temporary Services: MAXIM GROUP Information Technology Temp Consulting NA $102 RHI CONSULTING Temporary Employment Services NA 147 MANPOWER TEMPORARY SERVICES Temporary Employment Services NA 424 THE CALDWELL GROUP Temporary Employment Services NA 444 MISCELLANEOUS Temporary Employment Services 306 (37 ITEMS LESS THAN $100,000) -------- TOTAL $1,423 -------- Market Research Services: EXECUTIVE SOLUTIONS INC Market Research Consultants NA $161 MARKET STRATEGIES INC Market Research Consultants NA 184 MISCELLANEOUS Market Research Consultants NA 13 (3 ITEMS LESS THAN $100,000) -------- TOTAL $358 -------- Maintenance Services: FORTE SYSTEMS, INC. Computer Consultants/Services NA $1,685 DECISIONONE Computer Consultants/Services NA 1,192 SUN MICROSYSTEMS INC Computer Consultants/Services NA 377 XEROX BUSINESS SERVICES Copier Services NA 243 IBM CORPORATION Computer Consultants/Services NA 166 WILTEL Telecommunications Services NA 164 DORSET PROFESSIONAL SERVICES INC Computer Consultants/Services NA 134 CABLETRON SYSTEMS, INC. Computer Consultants/Services NA 116 MISCELLANEOUS Computer Consultants/Services NA 404 (36 ITEMS LESS THAN $100,000) -------- TOTAL $4,481 -------- Legal Services: THE WALLACE LAW REGISTRY Legal Temporary Services NA $125 MISCELLANEOUS Legal Services NA 116 (9 ITEMS LESS THAN $100,000) -------- TOTAL $241 -------- Internet Services: TM GROUP Internet Services NA $148 VIRTU INC Internet Services NA 143 -------- TOTAL $291 --------
-30- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (IN THOUSANDS) OUTSIDE SERVICES EMPLOYED - ACCOUNT 923 (CONTINUED)
Relationship "A"=Associate From Whom Purchased Description "NA"=Nonassociate Amount Audit Services: PRICEWATERHOUSECOOPERS LLP Audit Services NA $ 421 ------- TOTAL $ 421 ------- Advertising Services: GILLESPIE INC Advertising Services NA $ 2,367 MISCELLANEOUS Advertising Services NA 186 (6 ITEMS LESS THAN $100,000) ------- TOTAL $ 2,553 ------- Competitive Intelligence Services: MISCELLANEOUS Competitive Intelligence Services NA $ 48 (10 ITEMS LESS THAN $100,000) ------- TOTAL $ 48 ------- Training Services: MISCELLANEOUS Training Services NA $ 161 (10 ITEMS LESS THAN $100,000) ------- TOTAL $ 161 ------- Other Services: EDIS COMPANY Consulting Services NA $ 3,482 DELOITTE & TOUCHE LLP Computer Consulting Services NA 1,216 STRATEGIC DECISIONS GROUP Consulting Services NA 1,029 WATSON WYATT & COMPANY Human Resources, Comp & Benefits NA 933 DMR CONSULTING Consulting Services NA 899 LOCHRIDGE & COMPANY Market Research Services NA 750 TECHNOLOGY SOLUTIONS COMPANY Computer Consulting Services NA 689 FLK CONSULTING SERVICES Consulting Services NA 609 TOWERS PERRIN Actuarial Services NA 551 INFO SYSTEMS INC Computer Consulting Services NA 408 TRICOMM SERVICES CORPORATION Consulting Services NA 356 CAREER CONCEPTS, INC. Employment Placement Services NA 308 SCOTT, MADDEN & ASSOC INC Consulting Services NA 304 THE CENTRELL GROUP Consulting Services NA 284 GROUP I SOFTWARE Computer Consulting Services NA 277 RENAISSANCE WORLDWIDE CONSULTING Consulting Services NA 274 ERNST & YOUNG LLP Management Consulting Services NA 274 RHM ASSOCIATES Consulting Services NA 252 INTERACTIVE INTELLIGENCE INC Computer Consulting Services NA 229
-31- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (IN THOUSANDS) OUTSIDE SERVICES EMPLOYED - ACCOUNT 923 (CONTINUED)
Relationship "A"=Associate From Whom Purchased Description "NA"=Nonassociate Amount COMDISCO DISASTER RECOVERY Disaster Recovery Services NA 227 DORSET PROFESSIONAL SERVICES INC Consulting Services NA 224 THE BANK OF NEW YORK Treasury Services NA 210 EPRI NDE CENTER Consulting Services NA 209 HITACHI DATA SYSTEMS Computer Consulting Services NA 207 CAREWISE INC Human Resources Wellness Services NA 198 NEW ENERGY ASSOCIATES LLC Consulting Services NA 192 MAR-KAL PRODUCTS CORPORATION Operations Consulting Services NA 189 COMPUTER AID, INC. Computer Consulting Services NA 185 BROOKS COURIER SERVICE INC Courier Services NA 185 JASON ROBERTS ASSOCIATES LTD Professional Staffing Services NA 185 UTILITY SYSTEMS SOLUTIONS Operations Consulting Services NA 174 BEECHTREE ASSOCIATES, INC. Consulting Services NA 169 DAVIES CONSULTING, INC. Management Consulting Services NA 165 AMHERST CONSULTING GROUP Management Consulting Services NA 163 FUTURTECH CONSULTING INC Computer Consulting Services NA 155 TRANSACTION INFORMATION SYSTEMS INC Computer Consulting Services NA 153 SAP AMERICA INC Computer Consulting Services NA 142 EXECUTIVE REGISTER INC Professional Staffing Services NA 138 OPEN TEXT INC Computer Consulting Services NA 134 KEANE INC Computer Consulting Services NA 129 OSI SOFTWARE, INC. Computer Consulting Services NA 122 PROTECTION TECHNOLOGY, INC. Computer Consulting Services NA 117 HILLMAN & KERSEY Consulting Services NA 116 NUCLEUS CORPORATION Consulting Services NA 106 KORN/FERRY INTERNATIONAL Human Resources Services NA 106 BERENSON MINELLA Consulting Services NA 102 ACSYS-PHILADELPHIA Consulting Services NA 102 JOSEPH A DAVIS CONSULTANTS INC Management Consulting Services NA 100 MISCELLANEOUS NA 1,098 (541 ITEMS LESS THAN $100,000) ------- TOTAL $18,826 ------- GRAND TOTAL $28,803 =======
-32- ANNUAL REPORT OF: CONECTIV RESOURCES PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (In Thousands) EMPLOYEE PENSIONS AND BENEFITS - ACCOUNT 926 INSTRUCTIONS: Provide a listing of each pension plan and benefit program provided by the service company. Such listing should be limited to $25,000. Description Amount Pension $ 6,750 Medical 5,492 OPEB expenses 2,991 Life insurance 546 Dental 469 Vision 232 Savings & Thrift 220 Payroll tax expenses 2,488 Child care 45 Employee Association 34 Employee deductions (369) Other (290) -------- TOTAL $18,608 ======== -33- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (In Thousands) GENERAL ADVERTISING EXPENSES - ACCOUNT 930.1 INSTRUCTIONS: Provide a listing of the amount included in Account 930.1, "General Advertising Expenses", classifying the items according to the nature of the advertising and as defined in the account definition. If a particular class includes an amount in excess of $3,000 applicable to a single payee, show separately the name of the payee and the aggregate amount applicable thereto.
Description Name of Payee Amount Ad Agency Fees Gillespie, Inc. $ 450 Yellow Pages Advertising Bell Atlantic 121 TV Advertising W.B. Donner & Co. 26 Newspaper Advertising Alstin Advertising 86 TV Advertising Executive Solutions 27 Internet Advertising Virtu Inc 23 Newspaper Advertising Thomas Rose Advertising 18 Miscellaneous 4 ------ TOTAL $ 755 ======
-34- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (In Thousands) MISCELLANEOUS GENERAL EXPENSES - ACCOUNT 930.2 INSTRUCTIONS: Provide a listing of the amount included in Account 930.2, "Miscellaneous General Expenses", classifying such expenses according to their nature. Payments and expenses permitted by Section 321(b) (2) of the Federal Election Campaign Act, as amended by Public Law 94-283 in 1976 (2 U.S.C. Section 441 (b) (2)) shall be separately classified. Description Amount Material expenses $ 993 Sponsorships/Associations 45 Utilities expense 193 Training expenses 68 Rebates expense 6 Relocation costs 79 Logo items 19 Employee survey costs 20 Management Consultant fees 59 Database subscriptions 11 Employee physicals 16 Market research 195 Software 59 System maintenance 88 Transition expenses* : System Operations 388 Maintenance 1,190 Engineering 107 Asset Management 880 Delivery Services 739 Treasury 550 Planning 160 SAP Support 542 Investor Relations 587 Executive Management 790 General Services 668 Real Estate 219 Security 269 Financial Services 975 HR Training 111 HR Other 2,127 Legal (394) Internal Audit 14 Corporate Services 137 Enterprise IT Operations 382 Marketing 44 Corporate Communications 949 Branding 740 Environmental 158 -35- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (In Thousands) MISCELLANEOUS GENERAL EXPENSES - ACCOUNT 930.2 (CONTINUED) Description Amount Safety 146 Merchant 950 Supply Executive 258 Enterprise Call Center (97) Production Support 147 Enterprise Finance 187 Document Services 335 Customer Service 666 Information Systems 642 Other Miscellaneous expenses 697 --------- $18,114 ========= * Represent expenses from April-June when Conectiv Resource Partners, Inc. was operating as a service company, with minimal detail in accounting records. These costs are grouped by service area, but make up various types of expenses and cross-charges. -36- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (In Thousands) RENTS - ACCOUNT 931 INSTRUCTIONS: Provide a listing of the amount included in Account 931, "Rents", classifying such expenses by major groupings of property, as defined in the definition of the Uniform System of Accounts. Type of Property Amount Office Rents $ 4,225 Office Equipment - Computer 9,129 Miscellaneous Rents 163 TOTAL $ 13,517 ========= -37- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (In Thousands) TAXES OTHER THAN INCOME TAXES - ACCOUNT 408 INSTRUCTIONS: Provide an analysis of Account 408, "Taxes Other Than Income Taxes". Separate the analysis into two groups: (1) other than U.S. Government taxes, and (2) U.S. Government taxes. Specify each of the various kinds of taxes and show the amounts thereof. Provide a subtotal for each class of tax. Kind of Tax Amount (1) Other Than U.S. Government Taxes City of Wilmington $ 11 State of Delaware 2 Other Miscellaneous Taxes 1 --------- SUBTOTAL $ 14 --------- (2) U.S. Government Taxes $ - --------- SUBTOTAL $ - --------- TOTAL $ 14 ========= -38- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (In Thousands) DONATIONS - ACCOUNT 426.1 INSTRUCTIONS: Provide a listing of the amount included in Account 426.1, "Donations", classifying such expenses by its purpose. The aggregate number and amount of all items of less than $3,000 may be shown in lieu of details.
Name of Recipient Purpose of Donation Amount International Championship Community Welfare $ 29 Coalition to Preserve Nature Community Welfare 15 Other Miscellaneous Donations Community Welfare 5 ---------- TOTAL $ 49 ==========
-39- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (In Thousands) OTHER DEDUCTIONS - ACCOUNT 426.5 INSTRUCTIONS: Provide a listing of the amount included in Account 426.5, "Other Deductions", classifying such expenses according to their nature. Description Name of Payee Amount $ - TOTAL $ - =========== -40- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (In Thousands) SCHEDULE XVIII - NOTES TO STATEMENT OF INCOME INSTRUCTIONS: The space below is provided for important notes regarding the statement of income or any account thereof. Furnish particulars as to any significant increase in services rendered or expenses incurred during the year. Notes relating to financial statements shown elsewhere in this report may be indicated here by reference. See Notes to Financial Statements, Schedule XIV, pages 19-20 -41- CONECTIV RESOURCE PARTNERS, INC. CURRENT ORGANIZATION CHART Howard E. Cosgrove Chairman, President & CEO Barbara S. Graham Senior Vice President & CFO Thomas S. Shaw Executive Vice President Barry R. Elson Executive Vice President Robert L. Aveyard Vice President Donald E. Cain Vice President John W. Land Vice President Lonnie C. Scott Vice President Louis M. Walters Treasurer & Assistant Secretary Moira K. Donoghue Secretary Carol C. Conrad Assistant Secretary James P. Lavin Controller -42- CONECTIV RESOURCE PARTNERS, INC CURRENT METHODS OF ALLOCATION Described below are the methods used to allocate costs of the Service Company to Client Companies which cannot practicably be direct charged. Service Department or Function Basis of Allocation * ----------- --------------------- Executive Management Blended ratio Procurement Material stock expense ratio Vehicle Resource Management Vehicle $ ratio Building Services Square footage ratio for office space and non-office space General Services Employee ratio Real Estate Real estate investment ratio Security Labor $ ratio Insurance Administration Blended ratio Claims Administration Historical claims ratio Regulatory Affairs Utility asset cost ratio Property insurance and miscellaneous insurance coverage Asset cost ratio General liability insurance Labor $ ratio Directors and Officers insurance Asset cost ratio Nuclear insurance Nuclear installed capacity ratio * Definitions of ratios follows Methods of Allocation pages -43- CONECTIV RESOURCE PARTNERS, INC CURRENT METHODS OF ALLOCATION (CONTINUED) Service Department or Function Basis of Allocation ----------- ------------------- Cost of Benefits Employee ratio Compensation and Benefits Services Employee ratio Personnel, Employment and Staffing Employee ratio Employee/Labor Relations Employee ratio Training and Management Development Employee ratio Performance Improvement Employee ratio Organizational Development Employee ratio Legal Services Actual legal direct labor charges of prior year Audit Services O&M ratio Management of Customer Care Number of customers ratio Special Billing Number of special bills ratio Regulated Sales and Marketing Services Number of Utility customers ratio Competitive Sales and Marketing Revenue ratio Voice Service Telephone ratio Solutions Management End user ratio Information and Data Management Data storage ratio Operations Management CPU time ratio Help Desk End user ratio Desktop Support End user ratio Network Support End user ratio Consulting Services Blended ratio General Management and Administration Blended ratio -44- CONECTIV RESOURCE PARTNERS, INC CURRENT METHODS OF ALLOCATION (CONTINUED) Service Department or Function Basis of Allocation ----------- ------------------- Governmental Affairs Employee ratio Communications O&M ratio General Corporate Advertising/Branding O&M ratio Environmental Blended ratio Safety Blended ratio Delivery Services T&D O&M ratio System Operations Services Kwh Output ratio Maintenance Services Kwh Output ratio Other Delivery Services T&D O&M ratio Energy Supply Management and Administration Kwh generated ratio Merchant Functions Merchant cost ratio Supply Engineering and Support Kwh generated ratio Enterprise Business Group Call Center Number of call center representative ratio Accounts Payable Accounting Services Number of checks issued ratio Payroll Accounting Services Number of employees paid ratio Asset and Project Accounting Services Asset system cost ratio Enterprise Business Group Financial Number of financial analysts Analysis Services ratio All Other Financial Services O&M ratio -45- DEFINITION OF SERVICE COMPANY CURRENT ALLOCATION METHODS Ratio Title Ratio Description ----------- ----------------- Employee Ratio A ratio the numerator of which is the number of employees of a Client Company, the denominator of which is the number of employees in all Client Companies using the service. This ratio will be calculated quarterly. Square Footage Ratio office space A ratio the numerator of which is the number of square feet of office space occupied by a Client Company, the denominator of which is the total number of square feet of office space occupied by all Client Companies using the service. non-office space A ratio the numerator of which is the number of square feet of non-office space occupied by a Client Company, the denominator of which is the total number of square feet of non-office space occupied by all Client Companies using the service. Telephone Ratio A ratio the numerator of which is the number of telephones used by a Client Company, the denominator of which is the number of telephones used by all Client Companies using the service. CPU Time Ratio A ratio the numerator of which is the number of hours of CPU time used for a particular system application, the demominator of which is the total number of CPU hours used by all companies. Costs are allocated to Orders based on this ratio. That cost is then either included in the cost of other Service Company services or directly routed to the appropriate Client Company. End User Ratio A ratio the numerator of which is the number of users of computer systems within a Client Company, the denominator of which is the total number of users of computer systems within all Client Companies using the service. Labor $ Ratio A ratio the numerator of which is the amount of labor $ of a Client Company, the denominator of which is total labor $ for all Client Companies using the service. This ratio will be calculated monthly. Historical Claims Ratio A ratio the numerator of which is the total claims expense of a Client Company, the denominator of which is the total claims expense for all Client Companies using the service. -46- O&M Ratio A ratio the numerator of which is the total direct (i.e., excludes charges allocated by the Service Company) operations and maintenance expense, excluding depreciation and fuel costs, of a Client Company, the denominator of which is total direct operations and maintenance expense, excluding depreciation and fuel costs, of all Client Companies using the service. Revenue Ratio A ratio the numerator of which is the total revenues of a Client Company, the denominator of which is the total number of customers for all the Client Companies using the service. Number of Customers Ratio A ratio the numerator of which is number of customers served by a Client Company, the denominator of which is the total number of customers for all Client Companies using the service. Number of Utility Customers Ratio A ratio the numerator of which is number of utility customers served by a Client Company, the denominator of which is the total number of utility customers for all Client Companies using the service. Nuclear Installed Capacity Ratio A ratio the numerator of which is the nuclear facility installed capacity of a Client Company, the denominator of which is the total nuclear facility installed capacity of all Client Companies using the service. Materials Stock Expense Ratio A ratio the numerator of which is the materials stock expense of a Client Company, the denominator of which is the total materials stock expense of all Client Companies using the service. Real Estate Investment A ratio the numerator of which is the cost of real estate leases and land and buildings owned by a Client Company, the denominator of which is the total cost of real estate leases and land and buildings for all Client Companies using the service. Number of Special Bills Ratio A ratio the numerator of which is the number of special bills issued for a Client Company, the denominator of which is the total number of special bills issued for all Client Companies. Utility Asset Cost Ratio A ratio the numerator of which is the total cost of utility assets in a Client Company, the denominator of which is the total costs of utility assets for all Client Companies using the service. -47- T&D O&M Ratio A ratio the numerator of which is the total direct (i.e., excludes charges allocated by the Service Company), operations and maintenance expense, excluding depreciation and fuel costs, of a Transmission and Distribution Client Company, the denominator of which is total direct operations and maintenance expense, excluding depreciation and fuel costs, of all Transmission and Distribution Client Companies. Kwh Generated Ratio A ratio the numerator of which is the number of kilowatt hours generated by a Client Company, the denominator of which is the total number of kilowatt hours generated by all Client Companies using the service. Kwh Output Ratio A ratio the numerator of which is the number of kilowatt hours purchased and generated by a Client Company, the denominator of which is the total number of kilowatt hours purchased and generated by all Client Companies using the service. Merchant Cost Ratio A ratio the numerator of which is the dollar amount of direct charges of the merchant function to a specific Client Company, the denominator of which is the total dollar amount of direct charges of the merchant function to all Client Companies using the service. Vehicle $ Ratio A ratio the numerator of which is the dollar amount of vehicle charges in a specific Client Company, the denominator of which is the total amount of vehicle charges in all Client Companies using the services. Blended Ratio A composite ratio which is comprised of an average of the Employee Ratio, the Labor $ Ratio, and the Asset Cost Ratio, for all Client Companies using the service. Asset Cost Ratio A ratio the numerator of which is the total cost of assets in a Client Company, the denominator of which is the total costs of assets for all Client Companies using the service. Assets are limited to plant, property and investments. Number of Checks Issued Ratio A ratio the numerator of which is the number of checks issued for a Client Company, the denominator of which is the total number of checks issued for all Client Companies using the service. Number of Employees Paid Ratio A ratio the numerator of which is the number of employees paid for a Client Company, the denominator of which is the total number of employees paid for all Client Companies using the service. Asset System Cost Ratio A ratio the numerator of which is the total cost of assets for a Client Company on the asset & project system, the denominator of which is the total cost of assets for all Client Companies using the service on the asset & project system. -48- Data Storage Ratio A ratio the numerator of which is the gigabytes of data storage space used for a particular system application, the denominator of which is the total gigabytes of data storage space used for all system applications. Costs are allocated to Orders or Cost Centers based on this ratio. That cost is then either included in the cost of other Service Company services or directly routed to the appropriate Client Company. Number of Call Center Representatives A ratio the numerator of which is Ratio the number of dedicated call center representatives for a Client Company, the denominator of which is the total number of dedicated call center representatives for all Client Companies using the service. Number of Financial Analysts Ratio A ratio the numerator of which is the number of dedicated financial analysts for a Client Company, the denominator of which is the total number of financial analysts for all Client Companies using the service. -49- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC. FOR THE YEAR ENDED DECEMBER 31, 1998 (IN THOUSANDS) ANNUAL STATEMENT OF COMPENSATION FOR USE OF CAPITAL BILLED
Allocation Total of Indirect Allocation Company Percent* Interest of Interest Delmarva Power & Light Company 53.6% 405 405 Atlantic City Electric Company 35.0% 264 264 Delmarva Capital Investments 0.1% 1 1 Conectiv Supply, Inc. - - - Petron Oil - - - Atlantic Energy Enterprises, Inc. 1.3% 10 10 Delmarva Services Company 0.1% 1 1 Conectiv Services, Inc. 3.4% 26 26 Power Consulting Group, Inc. - - - Conectiv Plumbing LLC - - - Conectiv Solutions LLC 1.6% 12 12 Conectiv Communications, Inc. 4.8% 36 36 Conectiv Holding Company, Inc. - - - ---------- ---------- ---------- TOTAL 100.0% $755 $755 ========== ========== ==========
* Reflects average BLENDED rate for the year. -50- ANNUAL REPORT OF: CONECTIV RESOURCE PARTNERS, INC SIGNATURE CLAUSE Pursuant to the requirements of the Public Utility Holding Company Act of 1935 and the rules and regulations of the Securities and Exchange Commission issued thereunder, the undersigned company has duly caused this report to be signed on its behalf by the undersigned officer thereunto duly authorized. Conectiv Resource Partners, Inc. ------------------------------------- (Name of Reporting Company) By: James P. Lavin ------------------------------------- (Signature of Signing Officer) James P. Lavin, Controller ------------------------------------- (Printed Name and Title of Signing Officer) Date: April 23, 1999 -51- -----END PRIVACY-ENHANCED MESSAGE-----