-----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, IjAPYjZvSrQI0VkGt0PHdDIEyQ93bRjnAHPYdk2lBTE8wbpi+XK7QNAIg+b3r2qx p/0UhXSu7UrQCLy49ySVmw== 0000950116-03-003087.txt : 20030627 0000950116-03-003087.hdr.sgml : 20030627 20030627154506 ACCESSION NUMBER: 0000950116-03-003087 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 20021231 FILED AS OF DATE: 20030627 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PHILADELPHIA SUBURBAN CORP CENTRAL INDEX KEY: 0000078128 STANDARD INDUSTRIAL CLASSIFICATION: WATER SUPPLY [4941] IRS NUMBER: 231702594 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-06659 FILM NUMBER: 03761283 BUSINESS ADDRESS: STREET 1: 762 LANCASTER AVE CITY: BRYN MAWR STATE: PA ZIP: 19010 BUSINESS PHONE: 2155278000 MAIL ADDRESS: STREET 1: 762 LANCASTER AVE CITY: BRYN MAWR STATE: PA ZIP: 19010 11-K 1 elevenk.txt 11-K As Filed with the United States Securities and Exchange Commission on June 27, 2003 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 11-K [X] ANNUAL REPORT PURSUANT TO SECTION 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] For the fiscal year ended December 31, 2002 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 1-6659 A. Full title of the Plan: CONSUMERS WATER COMPANY EMPLOYEES' 401(k) SAVINGS PLAN AND TRUST B. Name of issuer of the securities held pursuant to the Plan and the address of its principal executive office: PHILADELPHIA SUBURBAN CORPORATION 762 W. LANCASTER AVENUE BRYN MAWR, PA 19010 CONSUMERS WATER COMPANY EMPLOYEES' 401(k) SAVINGS PLAN AND TRUST The following audited financial statements are included with this report: Financial Statements and Supplemental Schedules as of December 31, 2002 and 2001 Exhibit Page 23.1 Consent of PricewaterhouseCoopers LLP 4 99.1 Financial Statements and Supplemental Schedules as of December 31, 2002 and 2001 5 99.2 Certification pursuant to 18 U.S.C. Section 1350, 17 as adopted pursuant to Section 906 of the Sarbanes- Oxley Act of 2002. 99.3 Certification pursuant to 18 U.S.C. Section 1350, 18 as adopted pursuant to Section 906 of the Sarbanes- Oxley Act of 2002. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, Consumers Water Company has duly caused this annual report to be signed by the undersigned thereunto duly authorized. Consumers Water Company Employees' 401(K) Savings Plan and Trust Plan Sponsor: Date Roy H. Stahl 06/27/03 - ---------------------------- ------------ Roy H. Stahl Vice President Consumers Water Company EX-23 3 ex23-1.txt EXHIBIT 23.1 Exhibit 23.1 Consent of Independent Accountants We hereby consent to the incorporation by reference in the Registration Statement on Form S-8 (No. 333-81085) of Philadelphia Suburban Corporation of our report dated June 6, 2003, relating to the financial statements of Consumers Water Company Employees' 401(k) Savings Plan and Trust, which appears in this Form 11-K. PricewaterhouseCoopers LLP Philadelphia, Pennsylvania June 27, 2003 EX-99 4 ex99-1.txt EXHIBIT99.1 Exhibit 99.1 CONSUMERS WATER COMPANY EMPLOYEES' 401(k) SAVINGS PLAN AND TRUST Financial Statements and Supplemental Schedules December 31, 2002 and 2001 (With Independent Accountants' Reports Thereon) CONSUMERS WATER COMPANY EMPLOYEES' 401(k) SAVINGS PLAN AND TRUST Page Independent Accountants' Report of PricewaterhouseCoopers LLP 1 Financial Statements: Statements of Net Assets Available for Benefits 2 Statements of Changes in Net Assets Available for Benefits 3 Notes to Financial Statements 4 Supplemental Schedules 1 - Schedule of Assets (Held at End of Year) 9 2 - Schedule of Reportable Transactions 10 CONSUMERS WATER COMPANY EMPLOYEES' 401(k) SAVINGS PLAN AND TRUST Report of Independent Accountants To the Participants and Administrator of Consumers Water Company Employees' 401(k) Savings Plan and Trust In our opinion, the accompanying statements of net assets available for benefits and the related statements of changes in net assets available for benefits present fairly, in all material respects, the net assets available for benefits of Consumers Water Company Employees' 401(k) Savings Plan and Trust (the "Plan") at December 31, 2002 and 2001, and the changes in net assets available for benefits for the years then ended in conformity with accounting principles generally accepted in the United States of America. These financial statements are the responsibility of the Plan's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with auditing standards generally accepted in the United States of America, which 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, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. Our audits were conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules of Assets (Held at End of Year) 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. These supplemental schedules are the responsibility of the Plan's management. 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. PricewaterhouseCoopers LLP Philadelphia, Pennsylvania June 6, 2003 1 CONSUMERS WATER COMPANY EMPLOYEES' 401(k) SAVINGS PLAN AND TRUST Statements of Net Assets Available for Benefits December 31, 2002 and 2001 2002 2001 Investments at fair value $28,163,913 $30,231,000 Cash and cash equivalents 6,253 6,138 Receivables: Employer contributions - 487 Participants' contributions - 8,793 ----------- ----------- Net assets available for benefits $28,170,166 $30,246,418 =========== =========== See accompanying notes to financial statements. 2 CONSUMERS WATER COMPANY EMPLOYEES' 401(k) SAVINGS PLAN AND TRUST Statements of Changes in Net Assets Available for Benefits December 31, 2002 and 2001 2002 2001 Additions: Investment income: Interest & Dividends $ 664,854 $ 635,324 Net depreciation in fair value of investments (3,704,814) (390,353) ------------ ------------ Total investment (loss) income (3,039,960) 244,971 Contributions: Employer 315,695 304,858 Participants 1,563,528 1,350,521 ------------ ------------ Total contributions 1,879,223 1,655,379 Total additions (1,160,737) 1,900,350 Deductions: Benefits paid to participants 912,474 1,361,356 Administrative expenses 3,041 2,230 ------------ ------------ Net (decrease) increase (2,076,252) 536,764 Net assets available for benefits: Beginning of year 30,246,418 29,709,654 ------------ ------------ End of year $ 28,170,166 $ 30,246,418 ============ ============ See accompanying notes to financial statements. 3 CONSUMERS WATER COMPANY EMPLOYEES' 401(k) SAVINGS PLAN AND TRUST Notes to Financial Statements December 31, 2002 and 2001 (1) DESCRIPTION OF PLAN The following description of the Consumers Water Company Employee's 401(k) Savings Plan and Trust ("the Plan") is provided for general information purposes only. Participants should refer to the Plan document for more complete information. General The Plan is a defined contribution plan covering substantially all employees of the Consumers Water Company (the "Company"), employees of certain divisions of Pennsylvania Suburban Water Company and all employees of Hydraulics, LTD, wholly owned subsidiaries of Philadelphia Suburban Corporation ("PSC"). An employee becomes eligible to participate on January 1 of the year following the date on which his or her employment commenced. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974, as amended (ERISA). An employee may not participate in the Plan if the employee is a member of a union with which the Company has a collective bargaining agreement directly or through an employee association, unless the collective bargaining agreement between the Company and the union involved specifically makes the Plan applicable to employees covered under such collective bargaining agreements, provided that benefits have been a subject of good faith bargaining between the Company and its employees. Contributions Participants may elect to contribute from 1% to 25% of their pretax compensation pursuant to a salary deferral election, up to a maximum of $11,000 in 2002 and $10,500 in 2001 as determined by Internal Revenue Code ss.402(g)(1). Participants may change the rate of their contribution or their investment elections. They may also make transfers or suspend their contributions at any time. Under the Plan, participants may contribute 1% to 10% of their compensation on an after-tax basis to their voluntary accounts. In any Plan year, a participant's aggregate contributions to the Plan (salary deferral amounts plus after-tax voluntary contributions) may not exceed 35% of such participant's compensation for the applicable Plan year. The Plan provides for the Company to contribute an amount equal to 40% of the pretax employee contribution up to $1,040 for each participant. The Company's contributions consist of common stock in PSC. Participant Accounts Each participant's account is credited with the participant's contribution and allocations of (a) the Company's contribution, (b) Plan earnings and (c) administrative expenses. Allocations are based on participant contributions or account balances, as defined by the Plan document. Vesting Each participant will always be 100% vested in all employee and Company contributions. Payment of Benefits In the event a participant's employment is terminated by reason of death, disability or termination of service, a participant's interest will be distributed in a lump-sum payment. Withdrawals will be made in cash or shares of PSC stock, to the extent permitted by law. Under certain circumstances, a participant may withdraw all or a portion of the employee contributions while employed. 4 CONSUMERS WATER COMPANY EMPLOYEES' 401(k) SAVINGS PLAN AND TRUST Notes to Financial Statements December 31, 2002 and 2001 (Continued) Loans Due from Participants Participants may borrow funds from their account balance equal to the lesser of $50,000 or half of their vested account balance for a period not to exceed five years. Repayment is made by payroll deduction. During the period covered by the report, all new loans issued after January 1, 2000 were issued at the prime rate of interest and prior to this loans were issued at 5.5%. The interest rate on loans outstanding as of December 31, 2002 ranged from 4.25% to 9.5%. Investment Options Participants can direct, at the time they enroll in the Plan, that their salary deferral and voluntary contributions be invested entirely in one of the funds offered by the Plan or divided among the funds. The Plan currently offers nine (9) mutual funds and one (1) common/collective trust fund. Subject to compliance with applicable state and federal securities laws, the Plan also permits participants to acquire an interest in PSC common stock. Participants may change their investment instructions and reinvest their contributions in a different fund or funds. Termination of the Plan Although the Company does not intend to terminate the Plan, it may do so at its discretion, subject to the provisions of ERISA. All interests of the participants would be distributed to them as determined by the Committee (as hereinafter defined) and in accordance with applicable provisions of the Internal Revenue Code. (2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Accounting The accompanying financial statements have been prepared using the accrual basis. Use of Estimates The preparation of the financial statements in conformity with accounting principles generally accepted in the United States of America requires the Plan's management to use estimates and assumptions that affect the accompanying financial statements and disclosures. Actual results could differ from these estimates. Administration The Plan is administered by a committee ("the Committee") consisting of three or more individuals selected by, and who may be removed at any time by, the Board of Directors of PSC. The Committee members may be employees of PSC and may be participants in the Plan. The Committee members receive no compensation from the Plan for their services in such capacity. The Committee has extensive administrative powers in connection with the Plan, including authority to interpret the provisions of the Plan, to adopt rules for its administration and to make other decisions with respect to the Plan. The trustee for the Plan's funds invests the funds as directed by the participants. The principal duties of the trustees are to receive all contributions paid to the Plan and to make investments and pay benefits as directed by the Committee. The assets of the Plan are held in the name of the trustees. Substantially all of the administrative expenses of the Plan are paid by the Company. 5 CONSUMERS WATER COMPANY EMPLOYEES' 401(k) SAVINGS PLAN AND TRUST Notes to Financial Statements December 31, 2002 and 2001 (Continued) Investment Valuation The Plan's investments are stated at fair value. Mutual funds are valued at quoted market prices which represents the net asset value of shares held by the Plan at year-end. Common/collective trust funds are valued at unit value, which represents the fair value of the underlying assets as reported by the applicable custodian. PSC stock is valued at its quoted market price at year-end. Loans to participants, short-term investments and cash are valued at cost, which approximates fair value. Dividend income is recorded on the ex-dividend date and interest income is recorded when earned. Realized gains and losses on the sale of the PSC stock are based on average cost of the securities sold. Purchases and sales are recorded on a trade date basis. (3) INVESTMENTS The fair market values of individual assets that represent 5% or more of the Plan's net assets as of December 31, 2002 and 2001 are as follows: 2002 Mutual Funds Select Fund, 192,117 shares $ 5,475,339 Balanced Fund, 177,099 shares $ 2,309,370 Common/Collective Funds Stable Assets, 3,069,650 shares $ 3,069,650 Stock PSC Common Stock, 633,067 shares* $13,041,184 * Nonparticipant-directed balance 465,682 shares and $9,654,425. 2001 Mutual Funds Select Fund, 191,606 shares $ 7,089,438 Balanced Fund, 166,185 shares $ 2,452,885 Common/Collective Funds Stable Assets, 2,622,951 shares $ 2,622,951 Stock PSC Common Stock, 627,146 shares** $14,142,142 ** Nonparticipant-directed balance 456,051 shares and $10,287,197. 6 CONSUMERS WATER COMPANY EMPLOYEES' 401(k) SAVINGS PLAN AND TRUST Notes to Financial Statements December 31, 2002 and 2001 (Continued) The Plan's investments (including gains and losses on investments brought and sold, as well as held during the year) appreciated (depreciated) in value as follows: 2002 2001 Common Stock $ (1,175,078) $ 1,816,743 Mutual Funds (2,529,736) (2,207,096) ------------ ------------ Total $ (3,704,814) $ (390,353) ============ ============ (4) 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: 2002 2001 Net Assets: PSC Common Stock $ 9,654,425 $ 10,287,197 ------------ ------------ Total $ 9,654,425 $ 10,287,197 ============ ============ 2002 2001 Changes in Net Assets: Contributions 315,695 304,858 Interest & Dividends 246,917 228,996 Net (Depreciation) Appreciation (874,676) 1,336,943 Benefits paid to participants (320,708) (465,574) ------------ ------------ Total $ (632,772) $ 1,405,223 ============ ============ (5) RELATED-PARTY TRANSACTIONS Certain Plan investments are shares of mutual funds managed by J.P. Morgan/American Century Retirement Plan Services. J.P. Morgan/American Century Retirement Plan Services is the trustee as defined by the Plan and, therefore, these transactions qualify as party-in interest transactions. 7 CONSUMERS WATER COMPANY EMPLOYEES' 401(k) SAVINGS PLAN AND TRUST Notes to Financial Statements December 31, 2002 and 2001 (Continued) (6) TAX STATUS The Internal Revenue Service issued its latest determination letter dated December 16, 2002, which stated that the Plan and related trust, as amended, qualified under applicable provisions of the Internal Revenue Code (IRC) and, therefore are exempt from federal income taxes. The Plan has been amended since receiving the determination letter. The Plan administrator and the Plan's counsel believe that the Plan is designed and is currently being operated in compliance with applicable requirements of the IRC. Therefore, no provision for income taxes has been included in the Plan's financial statements. (7) SUBSEQUENT EVENT All non-union employees hired after April 1, 2003 are not eligible to participate in this Plan. Union employees hired after April 1, 2003 are eligible to participate in this Plan unless the collective bargaining agreement between the Company and the union involved specifically makes the Plan not applicable to employees covered under such collective bargaining agreements. 8 SCHEDULE 1 CONSUMERS WATER COMPANY EMPLOYEES' 401(k) SAVINGS PLAN AND TRUST Schedule of Assets (Held at End of Year) December 31, 2002
Description Identity of Issuer of Investment Cost Current Value - ------------------ ------------- ---- ------------- American Century International Growth* Registered Investment Company $ 92,300 American Century Select Fund* Registered Investment Company $ 5,475,339 American Century Balanced Fund* Registered Investment Company $ 2,309,370 American Century Vista Fund* Registered Investment Company $ 707,324 American Century Value Fund* Registered Investment Company $ 1,139,668 American Century Strategic Allocation Moderate* Registered Investment Company $ 69,642 JP Morgan U.S. Small Company* Registered Investment Company $ 140,889 American Century Diversified Bond* Registered Investment Company $ 244,557 American Century Equity Index* Registered Investment Company $ 842,109 SEI Trust Stable Assets Common/Collective Fund $ 3,069,650 Philadelphia Suburban Corporation* Common Stock, 633,067 shares $ 7,003,451 $ 13,041,184 Loans* Loans due from participants (interest rate 4.25% to 9.5% & maturity date January 1, 2003 to December 18, 2007) $ 1,031,881 $ 1,031,881 ------------ Total Assets (Held at End of Year) $ 28,163,913 ------------
* Represents a party-in-interest to the Plan. 9 SCHEDULE 2 CONSUMERS WATER COMPANY EMPLOYEES' 401(k) SAVINGS PLAN AND TRUST Schedule of Reportable Transactions Year Ended December 31, 2002
Description of Purchase Selling Identity of Issuer Investment Price Price Cost Net Gain - ------------------ ---------- ----- ----- ---- -------- Philadelphia Suburban Corporation Common Stock* Purchases $950,039 $ - $ 950,039 $ - Sales $ - $736,292 $ 509,315 $ 226,977
*Represents a party-in-interest to the Plan 10 EX-99 5 ex99-2.txt EXHIBIT 99.2 Exhibit 99.2 CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 In connection with the Annual Report on Form 11-K for the year ended December 31, 2002 (the "Report") of the Consumers Water Company Employees' 401(k) Savings Plan and Trust (the "Plan") as filed with the Securities and Exchange Commission on the date hereof, the undersigned officer of Philadelphia Suburban Corporation hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that: (1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. Section 78m(a) or Section 78o(d)); and (2) The information contained in the Report fairly presents, in all material respects, the net assets available for benefits and changes in net assets available for benefits of the Plan. Nicholas DeBenedictis - ----------------------------------------------- Nicholas DeBenedictis Chairman, President and Chief Executive Officer June 27, 2003 The foregoing certification shall not be deemed to be filed for purposes of Section 18 of the Securities and Exchange Act of 1934 or otherwise subject to liability under that section. This certification shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Exchange Act except to the extent this Exhibit 99.2 is expressly and specifically incorporated by reference in any such filing. A signed original of this written statement required by Section 906 has been provided to Philadelphia Suburban Corporation and will be retained by Philadelphia Suburban Corporation and furnished to the Securities and Exchange Commission or its staff upon request. EX-99 6 ex99-3.txt EXHIBIT 99.3 Exhibit 99.3 CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002 In connection with the Annual Report on Form 11-K for the year ended December 31, 2002 (the "Report") of the Consumers Water Company Employees' 401(k) Savings Plan and Trust (the "Plan") as filed with the Securities and Exchange Commission on the date hereof, the undersigned officer of Philadelphia Suburban Corporation hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that: (1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. Section 78m(a) or Section 78o(d)); and (2) The information contained in the Report fairly presents, in all material respects, the net assets available for benefits and changes in net assets available for benefits of the Plan. David P. Smeltzer - ----------------------------------------------------------- David P. Smeltzer Senior Vice President - Finance and Chief Financial Officer June 27, 2003 The foregoing certification shall not be deemed to be filed for purposes of Section 18 of the Securities and Exchange Act of 1934 or otherwise subject to liability under that section. This certification shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Exchange Act except to the extent this Exhibit 99.3 is expressly and specifically incorporated by reference in any such filing. A signed original of this written statement required by Section 906 has been provided to Philadelphia Suburban Corporation and will be retained by Philadelphia Suburban Corporation and furnished to the Securities and Exchange Commission or its staff upon request. -----END PRIVACY-ENHANCED MESSAGE-----