-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, Xwn3QACKs98eATN6fSf4XU/n1/orXSIdnbrjVmZeDcZk75dcPvh7Me9i+IEKij9h F0TRoWwu77q5N8LdDAwuqw== 0000774197-95-000013.txt : 199506290000774197-95-000013.hdr.sgml : 19950629 ACCESSION NUMBER: 0000774197-95-000013 CONFORMED SUBMISSION TYPE: 10-K/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19941231 FILED AS OF DATE: 19950628 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: CENTERIOR ENERGY CORP CENTRAL INDEX KEY: 0000774197 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC SERVICES [4911] IRS NUMBER: 341479083 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 001-09130 FILM NUMBER: 95550043 BUSINESS ADDRESS: STREET 1: 6200 OAK TREE BLVD CITY: INDEPENDENCE STATE: OH ZIP: 44131 BUSINESS PHONE: 2164473100 MAIL ADDRESS: STREET 1: PO BOX 94661 CITY: CLEVELAND STATE: OH ZIP: 44101-4661 FORMER COMPANY: FORMER CONFORMED NAME: NORTH HOLDING CO /OH/ DATE OF NAME CHANGE: 19851002 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CLEVELAND ELECTRIC ILLUMINATING CO CENTRAL INDEX KEY: 0000020947 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC SERVICES [4911] IRS NUMBER: 340150020 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 001-02323 FILM NUMBER: 95550044 BUSINESS ADDRESS: STREET 1: 55 PUBLIC SQ STREET 2: PO BOX 5000 CITY: CLEVELAND STATE: OH ZIP: 44101 BUSINESS PHONE: 2166229800 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TOLEDO EDISON CO CENTRAL INDEX KEY: 0000352049 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC SERVICES [4911] IRS NUMBER: 344375005 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K/A SEC ACT: 1934 Act SEC FILE NUMBER: 001-03583 FILM NUMBER: 95550045 BUSINESS ADDRESS: STREET 1: 300 MADISON AVE CITY: TOLEDO STATE: OH ZIP: 43652 BUSINESS PHONE: 4192495000 10-K/A 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K/A Amendment No. 1 (Mark One) [ X ] Annual report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the fiscal year ended December 31, 1994 OR [ ] Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from ____ to ____ Commission Registrant; State of Incorporation; I.R.S. Employer File Number Address; and Telephone Number Identification No. 1-9130 CENTERIOR ENERGY CORPORATION 34-1479083 (An Ohio Corporation) 6200 Oak Tree Boulevard Independence, Ohio 44131 Telephone (216) 447-3100 1-2323 THE CLEVELAND ELECTRIC 34-0150020 ILLUMINATING COMPANY (An Ohio Corporation) 55 Public Square Cleveland, Ohio 44113 Telephone (216) 622-9800 1-3583 THE TOLEDO EDISON COMPANY 34-4375005 (An Ohio Corporation) 300 Madison Avenue Toledo, Ohio 43652 Telephone (419) 249-5000 The Annual Reports on Form 10-K of Centerior Energy Corporation (File No. 1- 9130), The Cleveland Electric Illuminating Company (File No. 1-2323) and The Toledo Edison Company (File No. 1-3583) for the fiscal year ended December 31, 1994 are each amended to file as Exhibit 99a under "Part IV. Item 14. Exhibits, Financial Statement Schedules and Reports on Form 8-K -- (a) Documents Filed as a Part of the Report -- 4. Exhibits" in each Form 10-K, pursuant to Rule 15d-21 under the Securities Exchange Act of 1934, the attached Financial Statements of the Centerior Energy Corporation Employee Savings Plan for the fiscal year ended December 31, 1994, which Exhibit 99a is an exhibit common to all three Annual Reports on Form 10-K. -1- Signatures Pursuant to the requirements of the Securities Exchange Act of 1934, each registrant identified below has duly caused this amendment to be signed on its behalf by the undersigned, thereunto duly authorized. CENTERIOR ENERGY CORPORATION (Registrant) THE CLEVELAND ELECTRIC ILLUMINATING COMPANY (Registrant) THE TOLEDO EDISON COMPANY (Registrant) By: JANIS T. PERCIO Janis T. Percio Secretary of each Registrant Date: June 27, 1995 -2- EXHIBIT 99a FINANCIAL STATEMENTS OF THE CENTERIOR ENERGY CORPORATION EMPLOYEE SAVINGS PLAN FOR THE FISCAL YEAR ENDED DECEMBER 31, 1994 CENTERIOR ENERGY CORPORATION EMPLOYEE SAVINGS PLAN STATEMENT OF FINANCIAL CONDITION December 31, 1994
------------------------------------------------------------------------------------------------- Centerior Fixed Global Stock Equity Income Balanced Equity ASSETS Fund Fund Fund Fund Fund Loans Total - ------ ------------- ------------- ------------- ------------- ------------- ------------- ------------- Centerior - common stock, at market value $36,992,490 $0 $0 $0 $0 $0 $36,992,490 Equity Fund - diversified common stock fund, at market value 0 44,446,774 0 0 0 0 44,446,774 Funds on deposit with insurance companies and banks, at market value 0 0 76,950,126 0 0 0 76,950,126 Investments in mutual funds, at market value 0 483,478 0 7,136,248 12,878,221 0 20,497,947 Loans receivable from participants 0 0 0 0 0 4,782,757 4,782,757 Cash and temporary cash investments 443,062 1,068,184 801,669 15,126 24,828 0 2,352,869 Transfers receivable 8,763 0 235,868 0 0 0 244,631 Investment income receivable 1,628 107,961 126,663 64,504 425 0 301,181 Contributions and other receivables from: Participants 37,213 90,531 91,757 25,102 69,672 0 314,275 Employer 11,185 27,210 27,578 7,545 20,941 0 94,459 ------------- ------------- ------------- ------------- ------------- ------------- ------------- Total assets $37,494,341 $46,224,138 $78,233,661 $7,248,525 $12,994,087 $4,782,757 $186,977,509 ============= ============= ============= ============= ============= ============= ============= LIABILITIES AND PLAN EQUITY - --------------------------- Transfers payable $0 $168,024 $0 $55,889 $13,032 $7,686 $244,631 Liabilities for investment purchases and other 969,993 0 122,817 64,384 0 0 1,157,194 Plan equity 36,524,348 46,056,114 78,110,844 7,128,252 12,981,055 4,775,071 185,575,684 ------------- ------------- ------------- ------------- ------------- ------------- ------------- Total liabilities and plan equity $37,494,341 $46,224,138 $78,233,661 $7,248,525 $12,994,087 $4,782,757 $186,977,509 ============= ============= ============= ============= ============= ========== The accompanying notes are an integral part of this statement.
CENTERIOR ENERGY CORPORATION EMPLOYEE SAVINGS PLAN STATEMENT OF FINANCIAL CONDITION December 31, 1993
---------------------------------------------------------------------------- Centerior Fixed Stock Equity Income ASSETS Fund Fund Fund Loans Total - ------ ------------- ------------- ------------- ------------- ------------- Centerior - common stock, at market value $48,995,691 $0 $0 $0 $48,995,691 Equity Fund - diversified common stock fund, at market value 0 62,356,938 0 0 62,356,938 Funds on deposit with insurance companies and banks, at market value 0 0 66,813,277 0 66,813,277 United States government securities, at market value 0 0 52,530,284 0 52,530,284 Loans receivable from participants 0 0 0 4,456,963 4,456,963 Cash and temporary cash investments 4,261,912 0 1,439,888 0 5,701,800 Transfers receivable 0 0 1,111,915 0 1,111,915 Investment income receivable 15,397 109,877 423,078 0 548,352 Contributions and other receivables from: Participants 148,986 225,270 158,860 0 533,116 Employer 59,541 81,698 57,934 0 199,173 Pension trustee and others 0 771,986 77,919 0 849,905 ------------- ------------- ------------- ------------- ------------- Total assets $53,481,527 $63,545,769 $122,613,155 $4,456,963 $244,097,414 ============= ============= ============= ============= ============= LIABILITIES AND PLAN EQUITY - --------------------------- Transfers payable $654,730 $440,369 $0 $16,816 $1,111,915 Liabilities for investment purchases and other 643,009 853,510 84,190 0 1,580,709 Plan equity 52,183,788 62,251,890 122,528,965 4,440,147 241,404,790 ------------- ------------- ------------- ------------- ------------- Total liabilities and plan equity $53,481,527 $63,545,769 $122,613,155 $4,456,963 $244,097,414 ============= ============= ============= ============= ============= The accompanying notes are an integral part of this statement.
CENTERIOR ENERGY CORPORATION EMPLOYEE SAVINGS PLAN STATEMENT OF INCOME AND CHANGES IN PLAN EQUITY Year Ended December 31, 1994
------------------------------------------------------------------------------------------------- Centerior Fixed Global Stock Equity Income Balanced Equity Fund Fund Fund Fund Fund Loans Total ------------- ------------- ------------- ------------- ------------- ------------- ------------- Contributions: Participants $3,717,016 $4,883,354 $4,102,498 $739,110 $1,301,241 $0 $14,743,219 Employer 929,229 1,773,097 1,469,423 254,278 433,104 0 4,859,131 Rollover 640 489,050 1,785,022 0 0 0 2,274,712 Investment income: Dividends 3,016,975 1,259,178 0 149,123 169,752 0 4,595,028 Interest 86,921 35,932 2,449,757 5,623 11,307 338,406 2,927,946 Net realized gain (loss) and unrealized appreciation (depreciation) in market value of investments (16,037,612) (389,854) 926,904 (198,274) 220,095 0 (15,478,741) Transfers (to)/from other funds (net) (669,137) (12,203,037) (6,092,924) 6,974,542 12,000,012 (9,456) 0 Loan activity: Borrowings (631,859) (693,886) (803,077) (74,400) (125,883) 2,329,105 0 Repayment of borrowings 0 0 1,741,936 0 0 (1,741,936) 0 Interest payments 0 0 338,406 0 0 (338,406) 0 ------------- ------------- ------------- ------------- ------------- ------------- ------------- (9,587,827) (4,846,166) 5,917,945 7,850,002 14,009,628 577,713 13,921,295 Less - Amounts withdrawn by participants 6,071,613 11,349,610 50,336,066 721,750 1,028,573 242,789 69,750,401 ------------- ------------- ------------- ------------- ------------- ------------- ------------- Increase (Decrease) in plan equity for the year (15,659,440) (16,195,776) (44,418,121) 7,128,252 12,981,055 334,924 (55,829,106) Plan equity at beginning of year 52,183,788 62,251,890 122,528,965 0 0 4,440,147 241,404,790 ------------- ------------- ------------- ------------- ------------- ------------- ------------- Plan equity at end of year $36,524,348 $46,056,114 $78,110,844 $7,128,252 $12,981,055 $4,775,071 $185,575,684 ============= ============= ============= ============= ============= ============= ============= The accompanying notes are an integral part of this statement.
CENTERIOR ENERGY CORPORATION EMPLOYEE SAVINGS PLAN STATEMENT OF INCOME AND CHANGES IN PLAN EQUITY Year Ended December 31, 1993
---------------------------------------------------------------------------- Centerior Fixed Stock Equity Income Fund Fund Fund Loans Total ------------- ------------- ------------- ------------- ------------- Contributions: Participants $4,741,769 $6,641,924 $4,355,469 $0 $15,739,162 Employer 1,888,334 2,365,855 1,571,313 0 5,825,502 Rollover 856,817 6,134,494 59,349,308 0 66,340,619 Investment income: Dividends 7,186,492 1,338,494 0 0 8,524,986 Interest 82,347 73,312 2,183,602 263,349 2,602,610 Net realized gain (loss) and unrealized appreciation (depreciation) in market value of investments (26,723,610) (387,797) 1,989,261 0 (25,122,146) Transfers (to)/from other funds (net) (20,754,474) 1,572,316 19,163,105 19,053 0 Loan activity: Borrowings (1,065,856) (688,688) (786,843) 2,541,387 0 Repayment of borrowings 0 0 1,608,012 (1,608,012) 0 Interest payments 0 0 263,349 (263,349) 0 ------------- ------------- ------------- ------------- ------------- (33,788,181) 17,049,910 89,696,576 952,428 73,910,733 Less - Amounts withdrawn by participants 13,683,788 9,029,068 15,502,324 76,654 38,291,834 ------------- ------------- ------------- ------------- ------------- Increase (Decrease) in plan equity for the year (47,471,969) 8,020,842 74,194,252 875,774 35,618,899 Plan equity at beginning of year 99,655,757 54,231,048 48,334,713 3,564,373 205,785,891 ------------- ------------- ------------- ------------- ------------- Plan equity at end of year $52,183,788 $62,251,890 $122,528,965 $4,440,147 $241,404,790 ============= ============= ============= ============= ============= The accompanying notes are an integral part of this statement.
CENTERIOR ENERGY CORPORATION EMPLOYEE SAVINGS PLAN NOTES TO THE FINANCIAL STATEMENTS NOTE 1 - GENERAL DESCRIPTION OF THE PLAN The Centerior Energy Corporation (Centerior) Employee Savings Plan (Plan) was approved by the Centerior Board of Directors in 1986 and went into effect as of January 1, 1987. The purpose of the Plan is to afford eligible employees an opportunity to make systematic savings through payroll deductions, to invest such savings in a manner which will assist them in meeting their savings and investment needs, and to facilitate their becoming share owners of Centerior. Participation in the Plan is voluntary. An eligible employee is any part-time, temporary, full-time probationary or full-time regular employee of Centerior, Centerior Service Company (CSC), The Cleveland Electric Illuminating Company (CEI), The Toledo Edison Company (TE) or any other Centerior affiliate that adopts the Plan according to its terms, and is at least age 18. CSC, CEI and TE are wholly owned subsidiaries of Centerior. The Employee Savings Plan Trust (Trust) has been established by agreement between Centerior, CSC and Society National Bank (Society), Cleveland, Ohio. Society has been selected by Centerior to serve as trustee (Trustee) of the Trust. The Trust is divided into three subtrusts - the After Tax Subtrust, the Before Tax Subtrust and the Rollover Subtrust. There are five funds in each Subtrust, as follows: (1) Centerior Stock Fund, (2) Equity Fund, (3) Fixed Income Fund, (4) Balanced Fund and (5) Global Equity Fund. The Balanced and Global Equity Funds were new investment fund options effective April 1, 1994. Centerior may close contributions into the Plan at any time. A discontinuance of employer matching contributions into the Plan would constitute a closing of both participant contributions and employer matching contributions into the Plan. In such event, each participant's interest in the employer's matching contributions will become fully vested and nonforfeitable. Centerior may either continue the operation of the Plan with respect to the interests of participants then in the Plan or terminate the Plan. If the Plan is terminated, all assets in the Trust will be distributed among the participants in proportion to their respective interests without any forfeitures. The Plan is subject to the reporting, disclosure, participation, vesting and fiduciary responsibility provisions of Title I of the Employee Retirement Income Security Act of 1974 (ERISA), but is not subject to the funding provisions of Title I and the plan termination insurance provisions of Title IV of ERISA. The number of participants in each fund and in the Plan at the end of the last two years was as follows: December 31, 1994 1993 Centerior Stock Fund 4,637 5,261 Equity Fund 4,010 4,327 Fixed Income Fund 4,299 4,391 Balanced Fund 926 - Global Equity Fund 1,198 - Plan 6,492 6,096 The total number of participants in the Plan was less than the sum of the number of participants in each fund shown above because many were participating in more than one fund. NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Accounting The financial statements of the Plan are prepared on the accrual basis of accounting. Valuation of Investments Centerior common stock in the Centerior Stock Fund is valued at the average of the high and low sales prices of Centerior common stock as reported on Network A of the Consolidated Transactions Reporting System and as listed by The Wall Street Journal on the last business day of the year. Equity Fund investment securities in a diversified common stock fund managed by National City Bank, Cleveland, Ohio, and in a mutual fund are valued at market prices on the last business day of the year. Fixed Income Fund investments are interest-bearing contracts with insurance companies, investments in Society's MaGIC Fund and United States government securities. Fixed Income Fund investments are valued on the last business day of the year at the current amount of dollars invested therein for the contracts and the market values of the MaGIC Fund's assets and the government securities. Investments for the Balanced and Global Equity Funds in diversified mutual funds, the Phoenix Balanced Fund and the American Funds' New Perspective Fund, respectively, are valued at market prices on the last business day of the year. Investment Gains (Losses), Appreciation (Depreciation) and Income The net realized gain (loss) and unrealized appreciation (depreciation) amounts shown in the Statements of Income and Changes in Plan Equity for 1994 and 1993 were calculated using the current value methodology for costing investments. Current value represents the market value of investments held at the beginning of the year plus the purchase price for investments acquired during the current year. The realized gains and losses on the distribution or sale of shares in the Centerior Stock, Equity, Balanced and Global Equity Funds represent the difference between the market value of the shares on the date of distribution or sale and the cost of the shares using the current value methodology described above. The realized gain or loss on the sale of securities in the Centerior Stock Fund is included in the amounts withdrawn or transferred by participants which caused the sale. The net realized gain or loss on the sale of investment securities in the Equity, Balanced and Global Equity Funds will contribute to the annual increase (decrease) in the respective Fund's equity. Dividend income within the Centerior Stock Fund and the Equity Fund is recorded on the ex-dividend dates. Income from all other investments is recorded as earned. The Plan provides that the market value of all investments shall be determined on the last business day of each month. Unrealized appreciation or depreciation, equal to the difference between the cost and the market value of the investments at the applicable valuation date, is recognized in determining the value of each fund. Expenses of the Plan Expenses of the Plan incurred by the Trustee to buy and sell securities are included as a cost of those securities. Fund earnings for the new Balanced and Global Equity Funds in 1994 are net of the charges assessed for mutual fund investment management fees. All expenses for administration of the Plan are paid by CSC, CEI and TE and, accordingly, are not included in the financial statements of the Plan. NOTE 3 - CONTRIBUTIONS The Plan consists of three parts (Parts) - the After Tax Part, the Before Tax Part and the Rollover Part. The maximum participant contribution into both the After Tax Part and the Before Tax Part is 16% of pay: up to 6% as a Basic Contribution and up to 10% as a Supplemental Contribution. The minimum contribution is 1% of pay. Pay includes only straight-time hourly wages or salary paid for regularly scheduled straight-time hours. A participant may allocate contributions in increments of 1% into the Centerior Stock, Equity, Fixed Income, Balanced and Global Equity Funds which total 100% or may allocate all contributions into any one Fund. The waiting time between changes in participant contributions (increase, decrease, or resumption following a stoppage) is three months. The After Tax Part receives participant contributions after they are taxed as pay. The Before Tax Part receives contributions before they are taxed as pay, as participants may instruct their employer to deposit their contributions into the Trust in exchange for the election to have their pay reduced by the same amount. Participant contributions of pay under the Plan as Before Tax contributions reduce a participant's taxable income for federal and Ohio income tax purposes in the year of contribution. Participant contributions into both the After Tax Part and the Before Tax Part are subject to certain Internal Revenue Service (IRS) limitations. The employer of each participant contributes an amount equal to 50% of the participant's eligible Basic Contributions, which is allocated on the same percentage basis and to the same Funds as the participant's Basic Contributions. Employer matching contributions, which match Basic After Tax Contributions, vest after 36 months of contributions under the Plan. These months need not be consecutive. Once contributions have been made for 36 months, all subsequent employer matching contributions vest immediately. Employer matching contributions which match Basic Before Tax Contributions vest immediately. Employer matching contributions to the After Tax Part and the earnings thereon, which are forfeited by participants, are applied to reduce future employer contributions. Effective June 30, 1993, employees retiring on or after July 1, 1993 are allowed to directly transfer or rollover all or any part of their qualified lump sum pension benefit from their respective Centerior pension plan into the Rollover Part of the Plan. The rollover can be invested in the same five investment Funds of the Plan, but the accounts are segregated from existing After Tax Part and Before Tax Part accounts. The minimum rollover required is $3,500. Participants, including those who have terminated employment but maintained account balances, may transfer any or all of their contributions and the earnings thereon and employer matching contributions and the earnings thereon among the five Funds in the same Part. Any integral increment of 1% may be transferred. Transfers may be made once in any three-month period. NOTE 4 - INVESTMENTS Contributions into the Centerior Stock Fund and the earnings thereon are invested by the Trustee in Centerior common stock. At the direction of Centerior, Centerior common stock is either purchased in the open market at prevailing prices, purchased from Centerior at the market value on the date of the purchase or deemed purchased pursuant to a netting method described herein. The Trustee is authorized to match or net to the extent possible within the Centerior Stock Fund all Centerior common stock sales and purchases (exclusive of purchases related to the quarterly reinvestment of cash dividends). The netting is at a price that is the average of the most recent five daily closing prices of Centerior's common stock prior to the effective date of the transactions. Any required sales or purchases in excess of the netted amounts are transacted in the open market or by transactions with Centerior. Contributions into the Equity Fund and the earnings thereon are deposited by the Trustee in a diversified common stock fund. These deposits are then invested by National City Bank primarily in the common stocks of a large number of publicly owned companies, excluding Centerior. At December 31, 1994, contributions into the Fixed Income Fund and the earnings thereon were invested by the Trustee in interest-bearing contracts with insurance companies and in Society's MaGIC Fund. For 1994 and 1993, group fixed-term contracts with insurance companies earned interest at an annual rate which ranged from 7% to 9.26% and 8.05% to 9.26%, respectively. The MaGIC Fund's earned interest rate varies as the fund's various investment contracts with insurance companies expire and new ones are added. The MaGIC Fund's average annual earned interest rate at December 31, 1994 and 1993 was 6.85% and 6.46%, respectively. Contributions into the Balanced Fund and the earnings thereon are deposited by the Trustee in a diversified mutual fund with the objectives of long-term growth of capital, reasonable income and conservation of capital. The initial Balanced Fund investment is in the Phoenix Balanced Fund. Contributions into the Global Equity Fund and the earnings thereon are deposited by the Trustee in a diversified mutual fund with the investment objective of long-term growth of capital through world-wide investments. The initial Global Equity Fund investment is in the American Funds' New Perspective Fund. The market values of investments that represent 5% or more of the Plan's net assets at the end of the last two years were as follows: December 31, 1994 1993 Centerior common stock, 4,168,168 and 3,697,788 shares, respectively $ 36,992,490 $ 48,995,691 Life Insurance Company of Georgia, 7%, due June 1999 10,048,312 - MaGIC Fund 57,770,695 54,985,013 Federal National Mortgage Association Notes (PC 229363), 6.5%, due August 2023 - 13,087,954 American Funds' New Perspective Fund, 896,188 shares 12,878,221 - Total $117,689,718 $117,068,658 See Schedule I for a complete list of investments held at December 31, 1994 for each of the five Funds. The Trustee can temporarily keep money in any of the Funds in short-term investments or in cash to have cash available to meet participants' distribution requests or until the Trustee invests it. See Schedule II for a summary of reportable (significant) transactions for 1994. NOTE 5 - WITHDRAWALS PAYABLE TO PARTICIPANTS Subject to certain limitations under the Plan, participants may elect to withdraw their contributions and employer matching contributions and any related gains and earnings on these contributions. Withdrawals payable to participants at the end of the last two years were as follows: December 31, 1994 1993 Centerior Stock Fund $ 219,922 $ 1,949,057 Equity Fund 9,331 6,031,070 Fixed Income Fund 1,086,561 23,370,706 Balanced Fund 19,472 - Global Equity Fund 18,829 - Total $1,354,115 $31,350,833 NOTE 6 - LOANS TO PARTICIPANTS Participants are eligible to apply for a loan to borrow from their vested available investment accounts having a balance of at least $2,000. To be eligible, participants must receive a regular paycheck from which repayments can be withheld to repay the borrowing and pay interest to their own accounts. Eligible participants may borrow up to the lesser of 50% of their vested account balances (excluding vested employer matching contributions made during the current year and the prior two calendar years) or $50,000. Loans from the Rollover Part are not permitted. All loan repayments are made to the Fixed Income Fund. NOTE 7 - TAX STATUS OF THE PLAN Centerior received a determination letter from the IRS dated March 28, 1995 to the effect that the Plan is a qualified defined contribution plan under Section 401 of the Internal Revenue Code and that the Trust is exempt from income taxes under Section 501 thereof. The effect of such qualification and exemption is that the participating employees are not subject to federal income taxes on employer contributions or any income accruing to their accounts until distributions are made from the accounts. When a distribution is made, the excess of the amount distributed over the participating employee's own After Tax contributions is taxable income to the employee. Distributions from both the Before Tax Part and the Rollover Part are subject to federal income tax. NOTE 8 - PLAN AMENDMENTS IN 1995 Effective April 1, 1995, all employer matching contributions are deposited solely into the Before Tax Part of the Plan. Effective June 1, 1995, the Plan switched to daily valuation of the investment funds. All Plan activity, including fund account balances, transfers and withdrawals, is updated daily by the Trustee. Participants can get up-to-date reports on their accounts via the telephone information access system of the Trustee. As part of the change to daily valuation, all participants are sharing in the investment management costs and certain administrative costs of the Plan. Other changes, which provide participants more control over contribution levels, investment mix and the frequency of withdrawals, are summarized as follows: (1) All employer matching contributions vest immediately. Previously, employer matching contributions which matched Basic Before Tax Contributions vested immediately, while employer matching contributions which matched Basic After Tax Contributions vested only after 36 months of employee participation in the Plan. (2) Participants can change their contributions as often as once a month and can change their investment mix, transfer between funds or withdraw as often as once every 30 calendar days, rather than once every three months for these various transactions previously. (3) Participants make a single election for investment mix for their contributions into both the After Tax and Before Tax Parts. Previously, participants made separate selections for investment mix for their contributions into those two Parts of the Plan. (4) A participant's interests from a corporate qualified plan of a previous employer can be transferred into the Plan. (5) A participant's withdrawal of post-December 31, 1986 After Tax contributions is penalized by requiring a six-month waiting period for future participant contributions to the After Tax Part of the Plan. CENTERIOR ENERGY CORPORATION SCHEDULE I EMPLOYEE SAVINGS PLAN INVESTMENTS - DECEMBER 31, 1994
Number of Historical Market Common Stock Shares Cost Value - --------------------------------------------- ---------- ------------ ------------ CENTERIOR STOCK FUND - -------------------- Centerior ................................... 4,168,168 $66,307,575 $36,992,490 ============ ============ EQUITY FUND - ----------- Abbott Laboratories ......................... 9,700 $225,446 $316,462 Airtouch Communications Inc ................. 15,500 219,899 451,437 American Home Products Corp ................. 10,500 719,410 658,875 American International Group Inc ............ 17,950 969,462 1,759,100 Archer Daniels Midland Co ................... 25,032 354,382 516,285 AT&T Corp ................................... 18,300 874,393 919,575 Automatic Data Processing Inc ............... 16,000 333,562 936,000 C R Bard Inc ................................ 3,500 84,847 94,500 H&R Block Inc ............................... 12,000 440,175 445,500 Bristol-Myers Squibb Co ..................... 19,700 1,010,233 1,140,138 Browning Ferris Inds Inc .................... 36,200 913,887 1,027,175 Chevron Corp ................................ 23,800 690,443 1,062,075 Chubb Corp .................................. 13,100 794,377 1,013,613 Cifra SA .................................... 107,100 256,397 219,662 Cintas Corp ................................. 25,000 664,525 887,500 Cisco Systems ............................... 14,300 426,292 502,287 Walt Disney Co .............................. 22,938 773,106 1,055,148 Dun & Bradstreet Corp ....................... 2,800 155,544 154,000 Emerson Electric Co ......................... 7,900 418,255 492,762 Exxon Corp .................................. 15,800 777,157 959,850 Fleet Financial Group ....................... 36,100 1,027,425 1,168,738 FPL Group Inc ............................... 13,000 469,946 456,625 General Electric Co ......................... 18,400 706,636 938,400 General Mills Inc ........................... 2,400 130,845 137,100 General Motors Corp ......................... 22,200 704,825 851,925 General Re Corp ............................. 8,500 761,309 1,049,750 Home Depot Inc .............................. 23,866 797,352 1,097,836 Hubbell Inc ................................. 7,300 400,738 388,725 Interpublic Group Cos Inc ................... 39,300 1,123,029 1,262,513 K Mart Corp ................................. 27,300 501,141 354,900 Lotus Development Corp ...................... 9,100 288,470 373,100 Marsh & McLennan Co Inc ..................... 6,600 528,284 523,050 McCormick & Co Inc .......................... 26,300 602,444 479,975 Microsoft Corp .............................. 5,700 218,288 348,412 Minnesota Mining & Mfg Co ................... 18,900 742,650 1,008,788 Morton International Inc .................... 9,600 189,386 273,600 Nestle SA ................................... 23,800 731,651 1,133,927 Nordstrom Inc ............................... 14,000 500,915 588,000 Northern Trust Corp ......................... 20,675 927,301 723,625 Pacific Telesis Group ....................... 18,700 400,778 532,950 Pepsico Inc ................................. 36,800 960,581 1,334,000 Perrigo Co .................................. 25,300 500,638 316,250 Pfizer Inc .................................. 19,700 1,399,476 1,521,825 Pitney Bowes Inc ............................ 36,800 1,046,675 1,168,400 Reuters Holdings PLC ........................ 22,500 451,732 987,188 Royal Dutch Petroleum Co .................... 10,800 748,964 1,163,700 Sara Lee Corp ............................... 13,800 249,277 348,450 Schering Plough Corp ........................ 23,300 1,098,407 1,724,200 Schlumberger Ltd ............................ 16,600 1,085,669 836,225 Singer Co ................................... 15,500 496,795 459,187 Sysco Corp .................................. 39,000 980,475 1,004,250 Telefonos De Mexico ......................... 9,900 490,989 405,900 U S West Inc ................................ 21,435 675,767 763,622 Wachovia Corp ............................... 21,200 665,182 683,700 Wells Fargo & Co ............................ 1,350 102,661 195,750 Wisconsin Energy Corp ....................... 33,850 702,231 875,869 WMX Technologies Inc ........................ 41,000 1,371,998 1,071,125 York International Corp ..................... 34,800 1,220,811 1,283,250 ------------ ------------ $37,103,533 $44,446,774 ============ ============
CENTERIOR ENERGY CORPORATION SCHEDULE I EMPLOYEE SAVINGS PLAN (Continued) INVESTMENTS - DECEMBER 31, 1994
Historical Market Funds on Deposit with Insurance Companies and Banks Cost Value - --------------------------------------------------- ------------ ------------ FIXED INCOME FUND - ----------------- Life Insurance Company of Georgia, 7%, due June 1999 ............................... $10,048,312 $10,048,312 Massachusetts Mutual Life Insurance Company, 9.26%, due February 1995 ........................ 1,713,852 1,713,852 Massachusetts Mutual Life Insurance Company, 8.65%, due February 1996 ........................ 7,417,267 7,417,267 MaGIC Fund ........................................ 57,087,924 57,770,695 ------------ ------------ $76,267,355 $76,950,126 ============ ============ Mutual Funds - --------------------------------------------------- EQUITY FUND - ----------- Fidelity Select Portfolio - Biotechnology Fund (20,653 shares) ............................ $500,000 $483,478 BALANCED FUND - ------------- Phoenix Balanced Fund (481,204 shares) ............ 7,330,331 7,136,248 GLOBAL EQUITY FUND - ------------------ American Funds' New Perspective Fund (896,188 shares) ................................ 13,401,914 12,878,221 ------------ ------------ $21,232,245 $20,497,947 ============ ============ LOANS - ----- Loans Receivable from Participants ................ $4,782,757 $4,782,757 ============ ============ The accompanying notes are an integral part of this schedule.
CENTERIOR ENERGY CORPORATION SCHEDULE II EMPLOYEE SAVINGS PLAN SCHEDULE OF REPORTABLE TRANSACTIONS YEAR ENDED DECEMBER 31, 1994
Number of Historical Net Gain Transaction Description Transactions Cost Proceeds (Loss) - ------------------------------- ------------ ----------- ------------ ------------ Purchases: MaGIC Fund .................... 3 $73,580,446 N/A N/A American Funds' New Perspective Fund ............ 17 13,738,127 N/A N/A Employee Benefits Money Market Fund ................. 380 119,964,285 N/A N/A Sales: MaGIC Fund .................... 6 $68,182,914 $74,239,942 $6,057,028 American Funds' New Perspective Fund ............ 2 1,031,738 1,080,000 48,262 United States Government Securities: Federal National Mortgage Association Notes (PC 229363), 6.5%, due August 2023 ........... 6 13,459,605 12,144,625 (1,314,980) Federal National Mortgage Association Notes (PC 229263), 6.5%, due September 2023 ........ 7 12,259,568 11,059,656 (1,199,912) Employee Benefits Money Market Fund ................. 232 123,313,217 123,313,217 0 Reportable transactions are a series of purchases or sales of the same securities issue which aggregate to an amount in excess of 5% of the market value of the Plan assets at the beginning of the year. The accompanying notes are an integral part of this schedule.
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS To: Centerior Energy Corporation We have audited the accompanying statements of financial condition of the Centerior Energy Corporation Employee Savings Plan (the Plan) as of December 31, 1994 and 1993, and the related statements of income and changes in Plan equity for the years then ended. These financial statements and the schedules referred to below are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements and schedules based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial condition of the Plan as of December 31, 1994 and 1993, and the income and changes in Plan equity for the years then ended, in conformity with generally accepted accounting principles. Our audits were made for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules of investments and reportable transactions are presented for purposes of additional analysis and are not a required part of the basic financial statements but are supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The fund information in the statements of financial condition and the statements of income and changes in plan equity is presented for the purpose of additional analysis rather than to present the financial condition and income and changes in plan equity of each fund. The supplemental schedules and fund information have been subjected to the auditing procedures applied in the audits of the basic financial statements and, in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole. ARTHUR ANDERSEN LLP Cleveland, Ohio June 23, 1995 CENTERIOR ENERGY CORPORATION CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation of our report on the financial statements of the Centerior Energy Corporation Employee Savings Plan dated June 23, 1995, included in this Form 10-K/A, into Centerior Energy Corporation's previously filed Registration Statements, File Nos. 33-4788, 33-9736, 33-58935, 33-49957 and 33-59635. ARTHUR ANDERSEN LLP Cleveland, Ohio June 27, 1995 THE CLEVELAND ELECTRIC ILLUMINATING COMPANY CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation of our report on the financial statements of the Centerior Energy Corporation Employee Savings Plan dated June 23, 1995, included in this Form 10-K/A, into The Cleveland Electric Illuminating Company's previously filed Registration Statement, File No. 33-55513. ARTHUR ANDERSEN LLP Cleveland, Ohio June 27, 1995 -----END PRIVACY-ENHANCED MESSAGE-----