-----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, CGK6I90BhglrpCEdAqC66xQX0FbO6kx6jiHBp1OwGW+bp3MLft1v9l0cQBmgylch SNH276Zyli/TPTSlFy/Ipw== 0000074778-97-000015.txt : 19970520 0000074778-97-000015.hdr.sgml : 19970520 ACCESSION NUMBER: 0000074778-97-000015 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19961231 FILED AS OF DATE: 19970515 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: ORANGE & ROCKLAND UTILITIES INC CENTRAL INDEX KEY: 0000074778 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC & OTHER SERVICES COMBINED [4931] IRS NUMBER: 131727729 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-04315 FILM NUMBER: 97608929 BUSINESS ADDRESS: STREET 1: ONE BLUE HILL PLZ CITY: PEARL RIVER STATE: NY ZIP: 10965 BUSINESS PHONE: 9143526000 MAIL ADDRESS: STREET 1: ONE BLUE HILL PLAZA CITY: PEARL RIVER STATE: NY ZIP: 10965 FORMER COMPANY: FORMER CONFORMED NAME: ROCKLAND LIGHT & POWER CO DATE OF NAME CHANGE: 19681202 11-K 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 11-K FOR ANNUAL REPORTS OF EMPLOYEE STOCK PURCHASE, SAVINGS AND SIMILAR PLANS PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (Mark One) X ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (Fee Required) For the Fiscal Year ended December 31, 1996 OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934 (No Fee Required) For the transition period from to Commission file number 1-4315 ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN (Full title of the plan) ORANGE AND ROCKLAND UTILITIES, INC. (Name of issuer of the securities held pursuant to the plan) ONE BLUE HILL PLAZA PEARL RIVER, NEW YORK 10965 (Address of principal executive office) TABLE OF CONTENTS Page Signature of Plan Administrator 3 Report of Independent Public Accountants 5 Financial Statements and Notes: Statements of Net Assets Available for Benefits as of December 31, 1996 and 1995 7 Statements of Changes in Net Assets Available for Benefits for the years ended December 31, 1996 and 1995 10 Notes to Financial Statements 13 Supplementary Schedules: I. Line 27a - Schedules of Assets Held for Investment Purposes as of December 31, 1996 and 1995 24 II. Line 27d - Schedule of Reportable Transactions for the year ended December 31, 1996 26 Exhibit 23 Consent of Independent Public Accountants SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the plan) have duly caused this annual report to be signed by the undersigned hereunto duly authorized. ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN By ROBERT J. MCBENNETT Robert J. McBennett Member, Retirement Committee Date: MAY 14, 1997 ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN FINANCIAL STATEMENTS AND REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS DECEMBER 31, 1996 AND 1995 REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS To the Orange and Rockland Utilities, Inc. Retirement Committee We have audited the accompanying statements of net assets available for benefits of the Orange and Rockland Utilities, Inc. Management Employees' Savings Plan (the "Plan") as of December 31, 1996 and 1995, and the related statements of changes in net assets available for benefits 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 net assets available for benefits of the Orange and Rockland Utilities, Inc. Management Employees' Savings Plan as of December 31, 1996 and 1995, and the changes in net assets available for benefits for the years then ended, in conformity with generally accepted accounting principles. Our audits were performed 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 the purpose 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 statement of net assets available for benefits and the statement of changes in net assets available for benefits is presented for purposes of additional analysis rather than to present the net assets available for plan benefits and changes in net assets available for plan benefits 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 New York, New York March 28, 1997 ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS DECEMBER 31, 1996
Fidelity Managed Growth & Stock Income Loan Income Fund Fund Account Portfolio Assets: Value of interest in master trusts $3,889,659 $16,789,906 $ - $ - Value of interest in registered investment companies - - - 13,853,461 Loans to participants - - 1,364,152 - Total assets 3,889,659 16,789,906 1,364,152 13,853,461 Net assets available for benefits $3,889,659 $16,789,906 $1,364,152 $13,853,461 The accompanying notes are an integral part of these statements.
ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS DECEMBER 31, 1996
Fidelity Fidelity Fidelity Asset Fidelity Magellan OTC Manager Worldwide Combined Fund Portfolio Fund Fund Funds Assets: Value of interest in master trusts $ - $ - $ - $ - $20,679,565 Value of interest in registered investment companies 5,504,833 3,677,412 1,798,730 1,391,841 26,226,277 Loans to participants - - - - 1,364,152 Total assets 5,504,833 3,677,412 1,798,730 1,391,841 48,269,994 Net assets available for benefits $5,504,833 $3,677,412 $1,798,730 $1,391,841 $48,269,994 The accompanying notes are an integral part of these statements.
ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS DECEMBER 31, 1995
Vanguard/ Vanguard/ Stock Guaranteed Loan Windsor Morgan Ariel Combined Fund Fund Account Fund Growth Fund Growth Fund Funds Assets: Cash equivalents $ 77,401 $ - $ - $ 82,838 $ 37,225 $ 13,014$ 210,478 Common Stock - Orange and Rockland Utilities, Inc. 4,361,536 - - - - - 4,361,536 Loans to participants - - 1,156,509 - - - 1,156,509 Value of interest in master trust - 20,652,927 - - - - 20,652,927 Sales pending settlement - - - 11,317,012 2,858,123 1,248,640 15,423,775 Other assets 7 - - 16 4 1 28 Total assets 4,438,944 20,652,927 1,156,509 11,399,866 2,895,352 1,261,655 41,805,253 Liabilities: Other liabilities (59,664) - - - - - (59,664) Total liabilities (59,664) - - - - - (59,664) Net assets available for benefits $4,379,280 $20,652,927 $1,156,509 $11,399,866 $2,895,352 $1,261,655$41,745,589 The accompanying notes are an integral part of these statements.
ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS FOR THE YEAR ENDED DECEMBER 31, 1996
Cumulative Fidelity 1995 Managed Growth & Mellon Stock Income Loan Income Funds Fund Fund Account Portfolio Additions: Contributions: Employee before-tax $ - $ 128,169 $ 587,334 $ - $ 911,758 Employee after-tax - 1,087 5,026 - 22,426 Rollovers - 25,029 12,888 - 71,120 Employer match - 66,116 13,405 - 139,581 Total contributions - 220,401 618,653 - 1,144,885 Earnings on investments: Interest on loans to participants - - - 93,934 - Gain from registered investment companies - - - - 2,230,995 Gain on master trusts - 315,794 1,046,538 - - Total earnings on investments - 315,794 1,046,538 93,934 2,230,995 - 536,195 1,665,191 93,934 3,375,880 Deductions: Benefit payments to participants - (124,787) (1,886,568) (42,080) (509,960) - (124,787) (1,886,568) (42,080) (509,960) Increase (decrease) in net assets - 411,408 (221,377) 51,854 2,865,920 Net transfers from other Company plan - 22,249 105,520 10,000 38,095 Fund transfers (41,745,589) 3,456,002 16,905,763 1,302,298 10,949,446 Changes in net assets (41,745,589) 3,889,659 16,789,906 1,364,152 13,853,461 Net assets available for benefits at beginning of year 41,745,589 - - - - Net assets available for benefits at end of year $ - $3,889,659 $16,789,906 $1,364,152 $13,853,461 The accompanying notes are an integral part of these statements.
ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS FOR THE YEAR ENDED DECEMBER 31, 1996
Fidelity Fidelity Fidelity Asset Fidelity Magellan OTC Manager Worldwide Combined Fund Portfolio Fund Fund Funds Additions: Contributions: Employee before-tax $ 720,775 $ 331,997 $ 165,279 $ 116,312 $ 2,961,624 Employee after-tax 13,518 9,364 1,496 8,563 61,480 Rollovers 50,391 3,827 273,115 4,745 441,115 Employer match 136,260 56,764 27,832 18,772 458,730 Total contributions 920,944 401,952 467,722 148,392 3,922,949 Earnings on investments: Interest on loans to participants - - - - 93,934 Gain from registered investment companies 534,247 527,267 155,460 112,572 3,560,541 Gain on master trusts - - - - 1,362,332 Total earnings on investments 534,247 527,267 155,460 112,572 5,016,807 1,455,191 929,219 623,182 260,964 8,939,756 Deductions: Benefit payments to participants (32,962) (26,918) (1,400) - (2,624,675) (32,962) (26,918) (1,400) - (2,624,675) Increase (decrease) in net assets 1,422,229 902,301 621,782 260,964 6,315,081 Net transfers from other Company plan 15,347 2,157 - 15,956 209,324 Fund transfers 4,067,257 2,772,954 1,176,948 1,114,921 - Changes in net assets 5,504,833 3,677,412 1,798,730 1,391,841 6,524,405 Net assets available for benefits at beginning of year - - - - 41,745,589 Net assets available for benefits at end of year $5,504,833 $3,677,412 $1,798,730 $1,391,841 $48,269,994 The accompanying notes are an integral part of these statements.
ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS FOR THE YEAR ENDED DECEMBER 31, 1995
Vanguard/ Vanguard/ Stock Guaranteed Loan Windsor Morgan Ariel Combined Fund Fund Account Fund Growth Fund Growth Fund Funds Assets: Contributions: Before-tax $ 164,730 $ 1,306,344 $ - $ 935,576 $ 148,274 $ 120,052$ 2,674,976 After-tax 3,930 34,159 - 32,900 5,262 1,334 77,585 Rollovers - 67,769 - - - - 67,769 Total contributions 168,660 1,408,272 - 968,476 153,536 121,386 2,820,330 Earnings on investments: Interest on cash equivalents 2,575 - - 5,646 731 686 9,638 Dividend income 343,774 - - - - - 343,774 Gain on sale of assets 35,980 - - - - - 35,980 Unrealized appreciation of assets 382,498 - - - - - 382,498 Interest on loans to participants - - 83,505 - - - 83,505 Gain from registered investment companies - - - 2,180,854 390,348 170,046 2,741,248 Gain on master trust - 1,830,726 - - - - 1,830,726 Total earnings on investments 764,827 1,830,726 83,505 2,186,500 391,079 170,732 5,427,369 933,487 3,238,998 83,505 3,154,976 544,615 292,118 8,247,699 Deductions: Benefit payments to participants (836,794) (2,712,306) - (854,565) (30,151) (64,964)(4,498,780) (836,794) (2,712,306) - (854,565) (30,151) (64,964)(4,498,780) Increase in net assets 96,693 526,692 83,505 2,300,411 514,464 227,154 3,748,919 Net transfers from other Company plan 3,240 9,510 5,604 2,606 - - 20,960 Fund transfers (171,014) (2,676,240) (137,141) 1,551,325 1,369,786 63,284 - Changes in net assets (71,081) (2,140,038) (48,032) 3,854,342 1,884,250 290,438 3,769,879 Net assets available for benefits at beginning of year 4,450,361 22,792,965 1,204,541 7,545,524 1,011,102 971,217 37,975,710 Net assets available for benefits at end of year $4,379,280 $20,652,927 $1,156,509 $11,399,866 $2,895,352 $1,261,655$41,745,589 The accompanying notes are an integral part of these statements.
ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1996 AND 1995 NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The financial statements of the Orange and Rockland Utilities, Inc. Management Employees' Savings Plan (the "Plan") have been prepared on the accrual basis of accounting in accordance with generally accepted accounting principles as applied to employee benefit plans and in accordance with the requirements of the Employee Retirement Income Security Act of 1974 ("ERISA"). The investments in the Stock Fund Master Trust investment account ("Stock Fund Master Trust"), including cash equivalents and Orange and Rockland Utilities, Inc. (the "Company") common stock, and the registered investment companies are stated at fair market value. The investments in the Managed Income Fund Master Trust investment account (The "MIF Master Trust"), other than cash equivalents, are valued at contract value. Contract value is determined by the contributions made plus interest at the rate specified on the various investment contracts. NOTE B - DESCRIPTION OF PLAN The following is a brief description of the Plan and is provided for general information purposes only. PARTICIPANTS SHOULD REFER TO THE PLAN AND THE PLAN PROSPECTUS FOR MORE COMPLETE INFORMATION. General The Plan is a qualified defined contribution employee profit- sharing plan, effective January 1, 1985, for eligible management employees of the Company (the "Participants"). ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1996 AND 1995 NOTE B (Continued) Participating Employees At December 31, 1996 and 1995, there were approximately 676 and 687 Participants in the Plan, respectively. The number of Participants in each of the Plan's funds were as follows: December 31, 1996December 31, 1995 Stock Fund 262 321 Equity Funds: Vanguard/Windsor Fund - 493 Vanguard/Morgan Growth Fund - 292 Ariel Growth Fund - 183 Managed Income Fund/Guaranteed Fund 396 509 Fidelity Asset Manager Fund 131 - Fidelity Growth & Income Portfolio 521 - Fidelity Magellan Fund 412 - Fidelity OTC Portfolio 321 - Fidelity Worldwide Fund 150 - The total number of Participants in the Plan is less than the sum of the number of Participants shown above because Participants may participate in more than one fund. Contributions Prior to January 2, 1996, no contributions to the Plan were made by the Company. Effective for payroll periods after December 31, 1995, the Company provides matching contributions of 50% of Participants' before-tax contributions to the Plan up to 3% of compensation. The maximum Company matching contribution per Participant, therefore, is 1.5% of compensation. Participants may elect to make before-tax or after-tax contributions in accordance with the terms of the Plan. Company matching contributions are invested in accordance with Participants' before-tax investment elections. ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1996 AND 1995 NOTE B (Continued) Transferred Hourly Plan Contributions Any amounts held on behalf of Orange and Rockland Utilities, Inc., Hourly Group Savings Plan (the "Hourly Plan") participants who become management employees will be transferred to the Plan in accordance with the terms of the Plan. The transferred Hourly Plan contributions will be treated in the same manner as before- tax contributions except where otherwise specifically provided in the Plan. Rollover Contributions Employees may elect to roll over into the Plan any cash received in any distribution from a pension, profit sharing or stock bonus plan meeting the requirements of Section 401(a) of the Internal Revenue Code of 1986, or from any qualifying individual retirement account or annuity. Rollover contributions are invested and otherwise treated in the same manner as other contributions except where otherwise specifically provided in the Plan. Participant Accounts and Vesting Separate accounts are maintained for each Participant's interest in the Plan. Participant accounts, including Company match, are at all times fully vested and nonforfeitable. Withdrawals and Distributions Upon Termination of Employment A Participant may elect to withdraw, according to the Plan's rules governing withdrawals, all or a portion of the Participant's after-tax contributions and earnings, in accordance with the terms of the Plan. The earnings portion of the withdrawal may be subject to an excise tax. A Participant, in general, may withdraw before-tax contributions and earnings only in the case of hardship and in accordance with the terms of the Plan. The Participant may be subject to an excise tax on the taxable portion of such withdrawal. ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1996 AND 1995 NOTE B (Continued) Upon termination of employment for any reason, a Participant's account balance, if less than or equal to $3,500, will be distributed to the Participant or designated beneficiary as soon as practicable, unless the Participant elects to defer such distribution in accordance with the terms of the Plan. However, if the value of a Participant's account is greater than $3,500, the Participant's account will not be distributed until the Participant elects in writing to receive such distribution, subject to certain limitations, and in accordance with the terms of the Plan. In addition, the taxable portion of the distribution may be subject to an excise tax. Administration of Plan The Plan is administered by the Company's Retirement Committee, whose members are appointed by the Company's Board of Directors. Prior to January 2, 1996, the Plan's investments were held by Mellon Bank, N.A. (the "Previous Trustee") in accordance with the terms of a master trust agreement (the "Previous Trust Agreement") between the Previous Trustee and the Company. Effective January 2, 1996, the Plan's investments were transferred to Fidelity Management Trust Company ("Current Trustee") in accordance with the terms of a new master trust agreement between the Current Trustee and the Company. Amendment or Discontinuance of Plan While the Company expects to continue the Plan indefinitely, it reserves the right to amend or terminate the Plan at any time, in whole or in part, provided that no amendment may retroactively reduce the rights of Participants. NOTE C - INVESTMENT OF FUNDS Participant contributions and Company matching contributions are invested, at the election of the Participant, in one or a combination of funds. The following is a brief description of the funds available: ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1996 AND 1995 NOTE C (Continued) Stock Fund Prior to January 2, 1996, the assets of the Stock Fund were invested exclusively in common stock of the Company purchased by the Previous Trustee on the open market, through the method of purchase and sales used by the Previous Trustee in the normal course of its security transactions, or through enrollment in the Company's Dividend Reinvestment and Stock Purchase Plan. Participant interests were stated in shares. Effective January 2, 1996, the assets of the Stock Fund are commingled for investment purposes in the Stock Fund Master Trust with the assets of the Hourly Plan's Stock Fund and are invested by the Current Trustee primarily in common stock of the Company along with a small portion of money market instruments for liquidity. Participant interests are stated in units to allow for daily valuation. During the year, month end Net Asset Values ranged between $9.44 per unit and $10.79 per unit. For the year ended December 31, 1996, there are 616,508 units in the Stock Fund with a Net Asset Value of $10.79 per unit. The purchase price of such stock includes brokerage commissions and any transfer taxes, if applicable. The Stock Fund is stated at fair market value. The percentage interest in the Stock Fund Master Trust for the Plan's Stock Fund at December 31, 1996 was 58.47%. The Stock Fund Master Trust's assets at December 31, 1996 are presented in the following table: Investments: At Fair Market Value- Cash Equivalents $ 23,865 Common Stock - Orange and Rockland Utilities, Inc. 6,579,152 6,603,017 Receivables 49,114 Net Assets $6,652,131 ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1996 AND 1995 NOTE C (Continued) The earnings on investments of the Stock Fund Master Trust for the year ended December 31, 1996 are presented in the following table: Interest on cash equivalents $ 6,553 Dividend income 497,612 Gain on sale of assets 268,951 Unrealized depreciation of assets (243,792) Earnings on investments $529,324 Managed Income Fund/Guaranteed Fund The assets of the Managed Income Fund are commingled for investment purposes in the MIF Master Trust with the assets of the Hourly Plan's Managed Income Fund. Prior to January 2, 1996, the Managed Income Fund was known as the Guaranteed Fund and the Master Trust was administered by the Previous Trustee. The assets are invested primarily in fixed-income investments issued by high-quality insurance companies and banks in accordance with the Guaranteed Fund's investment guidelines. Effective January 2, 1996, the fund was renamed the Managed Income Fund. The MIF Master Trust is being administered by the Current Trustee and new contributions are invested in the Current Trustee's Managed Income Portfolio ("MIP") in addition to the fixed-income investments previously purchased for the fund. As the previous fixed-income investments mature, all proceeds will be invested in the MIP. All of the investments of the Master Trust are stated at contract value except for the cash equivalents, which are stated at fair market value. The investment experience of the Master Trust is allocated monthly based on the Master Trust's assets as calculated by the Current Trustee. The amount is derived from the prior month-end contract value of each Plan's Managed Income Fund, plus contributions and transfers in and less benefit payments and transfers out for the current month. The percentage interest in the Master Trust for the Plan's Managed Income Fund at December 31, 1996 and the Plan's Guaranteed Fund at December 31, 1995 was 53.36% and 53.53%, respectively. ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1996 AND 1995 NOTE C (Continued) The Master Trust's assets, at December 31, 1996 and 1995, are presented in the following table: 1996 1995 Investments: At Fair Market Value - Cash Equivalents $ 2,010,376 $ 3,216,594 At Contract Value - Fixed-Rate Insurance Company Contracts 13,630,661 16,871,629 Pooled Fund Investment 15,824,772 18,494,278 29,455,433 35,365,907 Net Assets $31,465,809 $38,582,501 The earnings on the Master Trust's investments consist of interest income on the various fixed-income securities. For the years ended December 31, 1996 and 1995 such earnings were $1,883,328 and $3,208,934, respectively. Equity Funds Contributions may be invested in one or more registered investment company mutual funds ("Equity Funds") selected by the Company's Retirement Committee. Prior to January 2, 1996, the following three Equity Funds were available: Vanguard/Windsor Fund ("Windsor"), Vanguard/Morgan Growth Fund ("Morgan") and Ariel Growth Fund ("Ariel"). Windsor and Morgan are members of the Vanguard Group of Investment Companies. Windsor is managed by Wellington Management Company while Morgan is managed by Wellington Management Company, Franklin Portfolio Associates, Inc., and Husic Capital Management. Ariel is managed by Ariel Capital Management. Effective January 2, 1996, the Retirement Committee replaced the previous three Equity Funds with a new menu of five Equity Funds, all of which are managed by Fidelity Management and Research Company ("Fidelity Equity Funds"). The Fidelity Equity Funds are as follows: Fidelity Asset Manager Fund, Fidelity Growth & Income Portfolio, Fidelity Magellan Fund, Fidelity OTC Portfolio and Fidelity Worldwide Fund. ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1996 AND 1995 NOTE C (Continued) On December 29, 1995, the Prior Trustee sold the Plan's entire holdings in Windsor, Morgan and Ariel in preparation for the conversion to the Fidelity Equity Funds. On January 2, 1996, the Prior Trustee received the proceeds of these sales and transferred such proceeds to the Current Trustee. Accordingly, these sales are classified on the Plan's December 31, 1995 statement of net assets available for benefits as sales pending settlement. The Equity Funds are stated at fair market value. NOTE D - LOANS TO PARTICIPANTS A Participant may obtain a loan under the Plan in a minimum amount of $500 and subject to a maximum amount as provided in the Plan. No more than one loan request may be made by a Participant in any 12 month period and only one loan per Participant may be outstanding at a time. The interest rate on loans is determined by the Retirement Committee on a quarterly basis. The interest rate established for a loan will not be changed during the term of the loan. Each loan will be evidenced by a promissory note payable to the Current Trustee for the loan amount, including interest, and secured by a lien on the Participant's account. The terms of the loan generally require repayment within five years. NOTE E - FEDERAL INCOME TAX STATUS The Company has received a favorable determination letter from the Internal Revenue Service ("IRS") dated July 11, 1995, that the Plan meets the requirements of the Tax Reform Act of 1986. The Company has previously received a favorable determination letter from the IRS, dated March 19, 1986, that the Plan meets the requirements of Section 401(a) and 401(k) of the Internal Revenue Code of 1954, as amended (the "Code"), and that the Trust is exempt from federal income tax under Code Section 501(a). The Plan has been amended since receiving the latest determination letter. However, the Retirement Committee and the Plan's tax counsel believe that the Plan is designed and is currently being operated in compliance with the applicable provisions of the Code. ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1996 AND 1995 NOTE E (Continued) The following is intended only as a brief, general description of the federal income tax consequences to Participants participating in the Plan. Participants should refer to the prospectus for the Plan and consult a tax advisor to determine the specific federal, state and local tax consequences of participation in the Plan. 1.A Participant's after-tax contributions are fully taxable to the Participant in the year contributed to the Plan; and, therefore, they are not taxed again when distributed or withdrawn from the Plan. 2.A Participant's before-tax contributions are not taxable to the Participant in the year contributed to the Plan; and, therefore, they are taxable to the Participant when distributed or withdrawn from the Plan. 3.Dividends, interest, profits from the sale of securities by the Trustee, and other investment earnings on after-tax or before-tax contributions are not taxable to the Participant while held in the Plan's Trust; and, therefore, they are taxable to the Participant when distributed or withdrawn from the Plan. 4.Upon withdrawal from the Plan, a Participant will be subject to income taxes on amounts deferred and may be subject to excise taxes on the taxable portion of such withdrawals and distributions. However, the Participant may be eligible for certain favorable tax treatment on such amounts. NOTE F - EXPENSES OF THE PLAN The costs of general administration of the Plan and trustee fees are paid by the Company. The expenses of the investment funds, including management fees of the investment managers of the Equity Funds and the Managed Income Fund, are deducted from the earnings of those funds. ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1996 AND 1995 NOTE G - RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500 The following is a reconciliation of net assets for benefits per the financial statements at December 31, 1996 and 1995 to Form 5500: 1996 1995 Net assets available for benefits per the financial statements $48,269,994 $41,745,589 Amounts allocated to withdrawing Participants - (599,181) Net assets available for benefits per the Form 5500 $48,269,994 $41,146,408 The following is a reconciliation of benefits paid to Participants per the financial statements for the year ended December 31, 1996 and 1995 to form 5500: 1996 1995 Benefit payments to Participants per the financial statements $2,624,675 $4,498,780 Add: Amounts allocated to withdrawing Participants at December 31, 1996 and 1995 - 599,181 Less: Amounts allocated to withdrawing Participants at December 31, 1995 and 1994 (599,181) (566,007) Benefit payments to Participants per Form 5500 $2,025,494 $4,531,954 Amounts allocated to withdrawing Participants are recorded on the Form 5500 for benefit claims that have been processed and approved for payment prior to December 31, 1996 and 1995 but not yet paid as of those dates. ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 1996 AND 1995 NOTE H - PLAN AMENDMENTS The following is a summary of the major changes reflected in the January 1, 1996 amendment and restatement of the Plan, as adopted by the Retirement Committee on December 19, 1995. 1. Company matching contributions were added to the Plan, at a rate of 50% for the first 3% of before-tax Contributions. The Company will provide a true-up of matching contributions at year end to enable Participants contributing at a per pay period rate above 3% to receive the full benefit of the Company match. 2. Effective as of December 1, 1995, the service requirement for participation in the Plan was decreased from 1,000 hours of service in a one-year period to 500 hours of service in a six-month period. 3. The maximum percentage of compensation which can be contributed under the Plan as a combination of before-tax and after-tax contributions was decreased from 20% to 15%. As a result, the maximum percentage of compensation which can be contributed under the Plan as before-tax contributions also decreased from 20% to 15%. 4. The investment elections pertaining to the investment of new Participant contributions may be changed by notifying Fidelity Institutional Retirement Services Company by 4:00 p.m. on a payroll processing date. Previously, 30 days' advance written notice was required. 5. A withdrawal may be made once in any 12-month period, rather than once per calendar year. 6. A number of changes were made to the Plan to reflect changes made recently to the Code by the Small Business Job Protection Act. 7. Model language drafted by the IRS was added to address the rights of reemployed veterans. SCHEDULE I ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN LINE 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES DECEMBER 31, 1996
Description Current Identity of Issue of Investment Cost Value Participant Loans Lowest rate = 7.00% $1,364,152 $ 1,364,152 Highest rate = 8.19% Value of Interest in Registered Investment Companies: *Fidelity Growth & Income Portfolio Equity Mutual Fund - 450,812 shares 12,496,379 13,853,461 *Fidelity Magellan Fund Equity Mutual Fund - 68,256 shares 5,697,653 5,504,833 *Fidelity OTC Portfolio Equity Mutual Fund - 112,425 shares 3,563,108 3,677,412 *Fidelity Asset Manager Fund Equity Mutual Fund - 109,212 shares 1,770,269 1,798,730 *Fidelity Worldwide Fund Equity Mutual Fund - 90,438 shares 1,329,811 1,391,841 24,857,220 26,226,277 Value of Interest in Master Trusts: *Stock Fund Master Orange and Rockland Utilities, Trust Inc. Common Stock - 360,487 units 1,873,725 3,889,659 *Managed Income Fund Various Fixed-Income Master Trust Investments 16,789,906 units 16,789,906 16,789,906 18,663,631 20,679,565 Total - Assets Held for Investment Purposes $44,885,003 $48,269,994 *Party in interest to the Plan.
SCHEDULE I ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN LINE 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES DECEMBER 31, 1995
Description Current Identity of Issue of Investment Cost Value Participant Loans Lowest Rate = 7.00%; Highest Rate = 9.25% $1,156,509 $ 1,156,509 Cash Equivalents: *Mellon Bank EB Temporary Investment Fund 210,478 210,478 Common Stock: *Orange and Rockland Orange and Rockland Utilities, Inc. Utilities, Inc. Common Stock - 122,001 shares 3,424,750 4,361,536 Sales Pending Settlement: Ariel Growth Fund Equity Mutual Fund - 45,704 shares 1,248,640 1,248,640 Vanguard/Morgan Equity Mutual Fund Growth Fund - 202,848 shares 2,858,123 2,858,123 Vanguard/Windsor Equity Mutual Fund Fund - 778,872 shares 11,317,012 11,317,012 15,423,775 15,423,775 Value of Interest in Master Trust: Guaranteed Fund Various Fixed-Income Master Trust Investments - 20,652,927 units 20,652,927 20,652,927 Total - Assets Held for Investment purposes $40,868,439 $41,805,225 *Party in interest to the Plan.
SCHEDULE II ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN LINE 27d - SCHEDULE OF REPORTABLE TRANSACTIONS FOR THE YEAR ENDED DECEMBER 31, 1996
Current Value Identity of Description Purchase Selling Expenses Cost of of Asset on Net Gain Party Involved of Transactions Price Price Incurred Asset Transaction Date(Loss) Series of Transactions: *Stock Fund Master Orange and Rockland$ 696,769 $ $ -$ 696,769$ 696,769 $ - Trust Utilities, Inc. 1,560,573 - 734,852 1,560,573 825,721 Common Stock *Managed Income Various Fixed- 5,049,175 - 5,049,175 5,049,175 - Fund Master Trust Income Investments 8,419,255 - 8,419,255 8,419,255 - *Fidelity Growth & Equity Mutual 17,110,980 - 17,110,980 17,110,980 - Income Portfolio Fund 4,820,100 - 4,614,600 4,820,100 205,500 *Fidelity Magellan Equity Mutual 7,418,033 - 7,418,033 7,418,033 - Fund Fund 1,588,190 - 1,720,381 1,588,190 (132,191) *Fidelity OTC Equity Mutual 4,402,803 - 4,402,803 4,402,803 - Portfolio Fund 850,155 - 839,695 850,155 10,460 *Fidelity Asset Equity Mutual 1,968,330 - 1,968,330 1,968,330 - Manager Fund Fund 201,148 - 198,060 201,148 3,088 *Fidelity Worldwide Equity Mutual 1,867,337 - 1,867,337 1,867,337 - Fund Fund 542,978 - 537,525 542,978 5,453 *Party in interest to the Plan
SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 11-K FOR ANNUAL REPORTS OF EMPLOYEE STOCK PURCHASE, SAVINGS AND SIMILAR PLANS PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (Mark One) X ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 (Fee Required) For the Fiscal Year ended December 31, 1996 OR TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934 (No Fee Required) For the transition period from to Commission file number 1-4315 ORANGE AND ROCKLAND UTILITIES, INC. MANAGEMENT EMPLOYEES' SAVINGS PLAN (Full title of the plan) ORANGE AND ROCKLAND UTILITIES, INC. (Name of issuer of the securities held pursuant to the plan) ONE BLUE HILL PLAZA PEARL RIVER, NEW YORK 10965 (Address of principal executive office) EXHIBITS Volume 1 of 1 EXHIBIT INDEX Exhibit Number 23 Consent of Independent Public Accountants EX-23 2 EXHIBIT NO. 23 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation of our report included in this Form 11-K, into the Company's previously filed Registration Statement on Form S-8 (File No. 33-25359). ARTHUR ANDERSEN LLP New York, New York May 12, 1997 -----END PRIVACY-ENHANCED MESSAGE-----