-----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, Rgey9veJ+NLCI2WeQGOCpJxKXCnZ7G6KXU13Uab+y8ViNrPlD1pee+EekFySLP9J z9pq5SdAZpsLovG68Y/ifg== /in/edgar/work/20000628/0000072741-00-000175/0000072741-00-000175.txt : 20000920 0000072741-00-000175.hdr.sgml : 20000920 ACCESSION NUMBER: 0000072741-00-000175 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19991231 FILED AS OF DATE: 20000628 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NORTHEAST UTILITIES SYSTEM CENTRAL INDEX KEY: 0000072741 STANDARD INDUSTRIAL CLASSIFICATION: [4911 ] IRS NUMBER: 042147929 STATE OF INCORPORATION: MA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: SEC FILE NUMBER: 001-05324 FILM NUMBER: 663798 BUSINESS ADDRESS: STREET 1: 174 BRUSH HILL AVE CITY: WEST SPRINGFIELD STATE: MA ZIP: 01090-0010 BUSINESS PHONE: 4137855871 MAIL ADDRESS: STREET 1: 107 SELDON ST CITY: BERLIN STATE: CT ZIP: 06037-1616 11-K 1 0001.txt 11-K FOR YES SUPP. RETIRE. & SAVINGS PLAN SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 11-K (Mark One) X ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 [NO FEE REQUIRED] For the fiscal year ended December 31, 1999 OR __ TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] For the transition period from __________ to _________ Commission file number 0-17605 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: YANKEE ENERGY SYSTEM, INC. 401k EMPLOYEE STOCK OWNERSHIP PLAN B. Name of issuer of the securities held pursuant to the plan and address of its principal executive office: YANKEE ENERGY SYSTEM, INC. 599 Research Parkway Meriden, Connecticut 06450 FINANCIAL STATEMENTS The following financial statements are filed as a part of this annual report: Financial statements of Yankee Energy System, Inc. 401k Plan as of December 31, 1999 and 1998 and for the fiscal years ended December 31, 1999 and 1998, including the report of Arthur Andersen LLC with respect thereto. SIGNATURE The Plan. Pursuant to the requirements of the Securities and Exchange Act of 1934, the trustees (or other persons who administer the employee benefit plan) have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized. YANKEE ENERGY SYSTEM, INC. 401k EMPLOYEE STOCK OWNERSHIP PLAN Date: June 28, 2000 By:/s/ Jean M. LaVecchia Jean M. LaVecchia Vice President-Human Resources and Organizational Development Northeast Utilities Service Company EXHIBIT INDEX 1. Consent of Independent Accountant Page 3 EX-23 2 0002.txt CONSENT OF INDEPENDENT ACCOUNTANT CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation of our report dated May 19, 2000 in this Form 11-K into Yankee Energy System, Inc. 401(k) Employee Stock Ownership Plan's previously filed Registration Statement File No. 33-52077. Arthur Andersen LLP Hartford, Connecticut June 26, 2000 EX-99 3 0003.txt YANKEE ENERGY 401(K) ESOP FINANCIAL STATEMENTS AND SCHEDULES YANKEE ENERGY SYSTEM, INC. 401(k) EMPLOYEE STOCK OWNERSHIP PLAN Financial Statements and Schedules As of December 31, 1999 and 1998 Together with Report of Independent Public Accountants YANKEE ENERGY SYSTEM, INC. 401(k) EMPLOYEE STOCK OWNERSHIP PLAN Financial Statements and Schedules December 31, 1999 and 1998 Index - ----- Page ---- REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS............................ 1 FINANCIAL STATEMENTS: Statements of Net Assets Available for Benefits as of December 31, 1999 and 1998....................... 2 Statements of Changes in Net Assets Available for Benefits for the Year Ended December 31, 1999 and 1998...... 3 NOTES TO FINANCIAL STATEMENTS AND SCHEDULES......................... 4-9 SUPPLEMENTAL SCHEDULES: Schedule H - Item 4(i) - Schedule of Assets Held for Investment Purposes as of December 31, 1999.................... 10 Schedule H - Item 4(j) - Schedule of Reportable Transactions for the Year Ended December 31, 1999........................... 11 Report of Independent Public Accountants To the Plan Administrator of the Yankee Energy System, Inc. 401(k) Employee Stock Ownership Plan: We have audited the accompanying statements of net assets available for benefits of Yankee Energy System, Inc. 401(k) Employee Stock Ownership Plan (the Plan) as of December 31, 1999 and 1998, and the related statements of changes in net assets available for benefits for the years then ended. These financial statements and schedules referred to below are the responsibility of the Plan administrator. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by 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 net assets available for benefits of the Plan as of December 31, 1999 and 1998, and the changes in its net assets available for benefits for the years then ended in conformity with accounting principles generally accepted in the United States. Our audits were made for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules of assets held for investment purposes 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 Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The supplemental schedules have been subjected to the auditing procedures applied in 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. /s/ Arthur Andersen LLP Arthur Andersen LLP Hartford, Connecticut May 19, 2000 YANKEE ENERGY SYSTEM, INC. 401(k) EMPLOYEE STOCK OWNERSHIP PLAN Statements of Net Assets Available for Benefits As of December 31, 1999 and 1998 1999 1998 ASSETS: Cash................................... $ 124,758 $ - Short term investments................. 9,806,692 9,614,085 Mutual funds........................... 20,307,099 16,841,819 Common stock........................... 13,951,348 9,467,819 Employer contributions receivable...... 788,730 794,181 Employee contributions receivable...... 211,104 198,166 Accrued interest receivable............ 13,458 10,043 ----------- ----------- Total assets........................ 45,203,189 36,926,113 ----------- ----------- LIABILITIES: Overdraft.............................. - 240,257 Note payable - current................. - 200,000 ----------- ----------- Total liabilities................... - 440,257 ----------- ----------- NET ASSETS AVAILABLE FOR BENEFITS........ $45,203,189 $36,485,856 =========== =========== YANKEE ENERGY SYSTEM, INC. 401(k) EMPLOYEE STOCK OWNERSHIP PLAN Statements of Changes in Net Assets Available for Benefits For the Year Ended December 31, 1999 and 1998 1999 1998 ADDITIONS: Employee contributions and rollovers..... $ 2,401,378 $ 4,716,661 Employer contributions................... 969,250 832,431 Earnings - Interest/other (expense) income........ (643,336) 397,705 Dividends.............................. 1,754,831 1,522,234 Net appreciation (depreciation) in fair value of investments............ 6,875,044 (648,836) ----------- ----------- Total additions....................... 11,357,167 6,820,195 ----------- ----------- DEDUCTIONS: Benefit distributions.................... 2,639,834 2,905,692 Total deductions....................... 2,639,834 2,905,692 Net increase........................... 8,717,333 3,914,503 ----------- ----------- NET ASSETS AVAILABLE FOR BENEFITS, beginning of year........................... 36,485,856 32,571,353 ----------- ----------- NET ASSETS AVAILABLE FOR BENEFITS, end of year................................. $45,203,189 $36,485,856 =========== =========== YANKEE ENERGY SYSTEM, INC. 401(k) EMPLOYEE STOCK OWNERSHIP PLAN Notes to Financial Statements and Schedules December 31, 1999 and 1998 (1) ESTABLISHMENT OF THE PLAN The Yankee Energy System, Inc. 401(k) Employee Stock Ownership Plan (the Plan) was established and effective on July 1, 1989 (the effective date) following the divestiture of the gas business of the Connecticut Light and Power Company (CL&P), a wholly-owned subsidiary of Northeast Utilities (NU), and the related creation of Yankee Energy System, Inc. (YES). Each transferred gas employee participating in the Northeast Utilities Tax Reduction Act Employee Stock Ownership Plan (TRAESOP), Payroll Based Employee Stock Ownership Plan (PAYSOP) or Supplemental Retirement Savings Plan became a participant in the Plan effective July 1, 1989. Participant account balances and $7,203,056 in assets were transferred to the Plan on the effective date. The assets were comprised of NU common stock and cash. (2) PLAN DESCRIPTION The following description of the Plan provides only general information. Participants should refer to the Plan agreement for a more complete description of the Plan's provisions. General The Plan is a defined contribution 401(k) Employee Stock Ownership Plan established to provide benefits to eligible employees. Participation in the Plan is voluntary. Union employees become eligible to participate on the first day of the month following the completion of one year of service. Non-union employees become eligible to participate on the first day of the month following the completion of six months of service. Contributions Participants contribute between 1% and 15% of compensation subject to limitations set forth by the Plan. Investment of employee contributions in the various funds is at the employees' discretion. YES matches 100% of non-union employee pre-tax contributions annually up to 3% of compensation and 50% of union employee pre-tax contributions each month up to 5% of compensation. Effective January 1, 1998, YES began matching 100% of non-union Yankee Energy Services Company employee pre-tax contributions annually up to 5% of compensation. Benefit payments Unless a participant elects otherwise, benefit distributions are made in a lump sum not later than sixty days following the end of the Plan year following the later of the participant's 65th birthday, the 10th anniversary of the date on which participation commenced or the termination of employment. In the event of the death of a participant prior to distribution, benefits will be paid to a designated beneficiary in a lump sum. Vesting Non-union employees become 100% vested upon commencing participation in the Plan. Union employees shall at all times be fully vested in employee contributions and will vest in the employer contributions in accordance with the following schedule: Years of Service Vesting % ---------------- --------- 1 20% 2 40% 3 60% 4 80% 5 or more 100% The account balances of union employees, as of June 3, 1989, formerly participating in the NU Supplemental Retirement Savings Plan and NU TRAESOP and PAYSOP became fully vested on July 1, 1989. Notwithstanding the foregoing, union participants shall be fully vested in employer contributions upon reaching age 65 or in the event of death or total disability. Any union employee forfeitures will be used to reduce future employer contributions. Loans Participants may borrow up to the lesser of 50% of the participant's vested interest in his or her total account or $50,000, reduced by the highest outstanding balance of loans from the Plan during the one-year period preceding the date of the loan. Investment options The Plan consists of fifteen funds as follows: Cash Fund Represents a cash fund which is used as a temporary account for overnight transactions and features an investment sweep option to earn interest daily. Merrill Lynch Retirement Preservation Trust Provides preservation of participants' investments, liquidity and current income that is typically higher than money market funds. Merrill Lynch Growth Fund Investment and Retirement Class A Invests in securities, primarily equities. Northeast Utilities Stock Fund Maintains Northeast Utilities stock belonging to transferred CL&P and Northeast Utilities Service Company (NUSCO) employees formerly participating in the NU Supplemental Retirement Savings Plan. Merrill Lynch Basic Value Fund Class A Invests in securities, primarily equities. Merrill Lynch Capital Fund Class A Invests in equity securities, corporate bonds and money market securities. YES, Inc. Loan Fund Represents a clearing account for participant loans. Merrill Lynch Global Allocation Fund Class A Invests in U.S. and foreign equity, debt and money market securities. YES, Inc. Allocation Fund Represents the employer matching fund, which invests in Yankee Energy System, Inc. common stock. YES, Inc. Voluntary Stock Fund Invests in Yankee Energy System, Inc. common stock. MFS Strategic Income Fund Invests in foreign and domestic fixed-income securities. Alliance Premier Growth Fund Invests in a limited number of primarily large U.S. company common stocks and other equity securities. Lord Abbett Developing Growth Fund Invests in small company stocks. AIM International Equity Fund Invests in primarily foreign equity securities. Merrill Lynch S&P 500 Index Fund Invests in securities listed on Standard & Poor's 500 Index. (3) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of accounting The accompanying financial statements and schedules of the Plan have been prepared on the accrual basis of accounting. Use of estimates in the preparation of financial statements The preparation of financial statements in conformity with accounting principles generally accepted in the United States and the Department of Labor Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974 requires management of the plan to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of income and expense during the reporting period. Actual results could differ from those estimates. Reclassifications Certain prior year amounts have been reclassified to conform with current year classifications. Administrative expenses Administrative expenses of the Plan are paid from the Plan assets unless paid by YES. Administrative expenses of approximately $81,000 and $70,500 were paid by YES in 1999 and 1998, respectively and are included in other (expense) income. Valuation of investments The Plan's investments are stated at fair value. Securities traded on the national securities exchange are valued at the last reported sales price on the last business day of the plan year. Investments traded in the over-the-counter market and listed securities for which no sale was reported on that date are valued at the last reported bid price. (4) INVESTMENTS The fair market value of individual investments that represent 5% or more of the Plan's total net assets as of December 31, 1999 and 1998 are as follows: 1999 1998 ---- ---- Yankee Energy System, Inc. common stock $12,584,879 $8,225,105 Merrill Lynch Retirement Preservation Trust 8,764,392 8,563,481 Merrill Lynch Basic Value Fund Class A 5,638,242 5,543,301 Merrill Lynch Growth Fund Investment and Retirement Class A 5,333,466 5,300,316 Alliance Premiere Growth Fund 2,944,643 * Merrill Lynch Capital Fund Class A * 2,610,466 *Denotes amount has been omitted as it does not represent 5% or more of the Plan's total net assets. During 1999, the Plan's investments increased in fair value by $6,875,044 as follows: Increase in Fair Value During Year ------------- Fair value as determined by quoted market value: Mutual funds $ 2,025,484 YES common stock 4,529,061 NU common stock 320,499 ----------- $ 6,875,044 =========== During 1998, the Plan's investments decreased in fair value by $(648,836) as follows: Net (Decrease) Increase in Fair Value During Year ------------- Fair value as determined by quoted market value: Mutual funds $(1,706,391) YES common stock 676,909 NU common stock 380,646 ----------- $ (648,836) =========== (5) NEW ACCOUNTING LITERATURE Statement of Position 99-3 The Accounting Standards Executive Committee issued Statement of Position (SOP) 99-3, "Accounting For and Reporting of Certain Defined Contribution Plan Investments and Other Disclosure Matters," which eliminates the requirement for a defined contribution plan to disclose participant directed investment programs. The statement was adopted for the 1999 financial statements and as such, the 1998 financial statements have been reclassified to eliminate the participant directed fund investment program disclosures. (6) NONPARTICIPANT-DIRECTED INVESTMENTS Information about the net assets and the significant components of the changes in net assets relating to the nonparticipant-directed investments is as follows: December 31, 1999 1998 ---- ---- Assets: Cash $ 124,758 $ - Short Term Investments 1,042,300 1,050,604 Common Stock 8,670,418 6,304,760 Employer Contributions Receivable 770,058 775,986 Accrued Interest Receivable 13,458 10,043 ----------- ---------- Liabilities: Overdrafts - 240,257 Notes Payable - Current - 200,000 ----------- ---------- $10,620,992 $7,701,136 =========== ========== Year Ended December 31, 1998 ----------------- Changes in Net Assets: Contributions $ 677,421 Net Appreciation 2,984,212 Reimbursement Income/Other (655,283) Benefit Distributions (86,494) ---------- $2,919,856 ========== (7) TAX STATUS The Plan obtained its latest determination letter on March 20, 1996 in which the Internal Revenue Service stated that the form of the Plan, as then designed, was in compliance with the applicable requirements of the Internal Revenue Code. The Plan has been amended since the determination letter was received. However, the Plan administrator believes that the Plan is currently designed and being operated in compliance with the applicable requirements of the Internal Revenue Code. Therefore, the Plan administrator believes that the Plan is qualified. (8) VOTING RIGHTS Each participant is entitled to exercise voting rights attributable to the shares allocated to his account and is notified by Merrill Lynch Trust Company (the Trustee) prior to the time that such rights are to be exercised. The Trustee is not permitted to vote any share for which instructions have not been given by a participant. The Trustee is required, however, to vote any unallocated shares on behalf of the collective best interest of plan participants and beneficiaries. (9) TERMINATION OF THE PLAN YES may suspend, terminate, or completely discontinue contributions under the Plan with respect to its employees subject to the provisions of the Employee Retirement Income Security Act of 1974 relating to plan terminations. Upon termination or partial termination of the Plan, the rights of all affected participants to their accounts to the date of such termination shall be fully vested to the extent funded. (10) SUBSEQUENT EVENT Effective March 1, 2000, YES merged with NU. The Plan was merged into the Northeast Utilities 401(k) Plan on May 1, 2000. Schedule I EIN# 06-1236430 PLAN# 001 YANKEE ENERGY SYSTEM, INC. 401(k) EMPLOYEE STOCK OWNERSHIP PLAN Schedule H - Item 4(i) - Schedule of Assets Held for Investment Purposes As of December 31, 1999
(c) Description of investment, including maturity date, rate of (b) Identity of issue, borrower, interest, collateral, (a) lessor or similar party par or maturity value (d) Current value Common Stock: * Yankee Energy System, Inc. 286,430 shares $12,584,879 * Northeast Utilities 66,456 shares 1,366,469 ----------- Total Common Stock 13,951,348 ----------- Mutual Funds: * Merrill Lynch Growth Fund Investment and Retirement Class A 194,509 shares 5,333,466 * Merrill Lynch Basic Value Fund Class A 147,791 shares 5,638,242 * Merrill Lynch Capital Fund Class A 69,938 shares 2,242,917 * Merrill Lynch Global Allocation Fund Class A 46,244 shares 648,334 * Merrill Lynch S&P 500 Index Fund 88,272 shares 1,590,671 Lord Abbett Developing Growth Fund 46,674 shares 954,949 AIM International Equity Fund 23,150 shares 643,802 Alliance Premier Growth Fund 80,676 shares 2,944,643 MFS Strategic Income Fund 42,827 shares 310,075 ----------- Total Mutual Funds 20,307,099 ----------- Short-Term Investments: * Merrill Lynch Retirement Preservation Trust 8,764,393 shares 8,764,392 * YES, Inc. Loan Fund 1,042,300 shares 1,042,300 ----------- Total Short-Term Investments 9,806,692 ----------- Total Investments $44,065,139 =========== *Indicates a party-in-interest.
Schedule II EIN# 06-1236430 PLAN# 001 YANKEE ENERGY SYSTEM, INC. 401(k) EMPLOYEE STOCK OWNERSHIP PLAN Schedule H - Item 4(j) - Schedule of Reportable Transactions For the Year Ended December 31, 1999
(h) Current (f)Expense value of incurred asset on (i) Net (a) Identity of (b) Description (c) Purchase (d) Selling (e) Lease with (g) Cost of transaction gain party involved of asset price price rental transaction asset date or (loss) Merrill Lynch Retirement $2,196,399 $ - $ - $ - $2,196,399 $2,196,399 $ - Preservation Trust Merrill Lynch Retirement - 2,095,491 - - 2,985,491 2,095,491 - Preservation Trust Merrill Lynch Pending 2,288,915 - - - 2,288,915 2,288,915 - Settlement Fund Merrill Lynch Pending - 2,288,915 - - 2,288,915 2,288,915 - Settlement Fund The accompanying notes are an integral part of this schedule.
Consent of Independent Public Accountants As independent public accountants, we hereby consent to the incorporation of our report dated May 19, 2000 in this Form 11-K into Yankee Energy System, Inc. 401(k) Employee Stock Ownership Plan's previously filed Registration Statement File No. 33-52077. /s/ Arthur Andersen LLP Arthur Andersen LLP Hartford, Connecticut June 26, 2000 -----END PRIVACY-ENHANCED MESSAGE-----