-----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, GjD/5H7hMBgDEzS4/oS6FhHJaumOBzPSdrPHrOAg38TlsdSIVRpTcjkQXB9Ylzpf H1DFpwSFPcAbaPW26CXLPg== 0000788784-01-500030.txt : 20010702 0000788784-01-500030.hdr.sgml : 20010702 ACCESSION NUMBER: 0000788784-01-500030 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20001231 FILED AS OF DATE: 20010629 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PUBLIC SERVICE ENTERPRISE GROUP INC CENTRAL INDEX KEY: 0000788784 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC & OTHER SERVICES COMBINED [4931] IRS NUMBER: 222625848 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: SEC FILE NUMBER: 001-09120 FILM NUMBER: 1672438 BUSINESS ADDRESS: STREET 1: 80 PARK PLAZA STREET 2: P.O. BOX 1171 CITY: NEWARK STATE: NJ ZIP: 07101-1171 BUSINESS PHONE: 973-430-7000 MAIL ADDRESS: STREET 1: 80 PARK PLAZA STREET 2: P.O. BOX 1171 CITY: NEWARK STATE: NJ ZIP: 07101-1171 11-K 1 final2-savpln.txt PSEG EMPLOYEE SAVINGS PLAN UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 11-K ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2000 Commission File Number 001-09120 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED EMPLOYEE SAVINGS PLAN 80 PARK PLAZA NEWARK, NEW JERSEY 07102 MAILING ADDRESS: P.O. Box 1171 NEWARK, NEW JERSEY 07101-1171 B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: See page 2. Stable Value Fund UBS AG PRIMCO CAPITAL MANAGEMENT 677 WASHINGTON BOULEVARD, 6TH FLOOR 400 WEST MARKET STREET, SUITE 3300 STAMFORD, CT 06901 LOUISVILLE, KENTUCKY 40202 STATE STREET BANK AND TRUST COMPANY THE CHASE MANHATTAN BANK 225 FRANKLIN STREET, M9 270 PARK AVENUE, 6TH FLOOR BOSTON, MASSACHUSSETTS 02110-2804 NEW YORK, NEW YORK 10017 PRUDENTIAL SECURITIES, INC. J.P. MORGAN GUARANTEED PRODUCTS 60 WALL STREET 71 HANOVER ROAD NEW YORK, NEW YORK 10260-0060 FLORHAM PARK, NJ 07932-1597 METROPOLITAN LIFE INSURANCE Enterprise Common Stock Fund and ESOP Fund COMPANY PUBLIC SERVICE ENTERPRISE GROUP ONE MADISON AVENUE INCORPORATED NEW YORK, NEW YORK 10010-3690 80 PARK PLAZA NEWARK, NEW JERSEY 07101-1171 ALLSTATE LIFE INSURANCE COMPANY ALLSTATE PLAZA WEST Large Company Stock Index Fund 3100 SANDERS ROAD, SUITE M2 THE VANGUARD GROUP NORTHBROOK, ILLINOIS 60062-7154 INSTITUTIONAL DIVISION P.O. BOX 2900 NEW YORK LIFE INSURANCE COMPANY VALLEY FORGE, PENNSYLVANIA 19482 260 CHERRY HILL ROAD PARSIPPANY, NEW JERSEY 07054-0422 Diversified Bond Fund BLACKROCK FINANCIAL MANAGEMENT, INC. BANK OF AMERICA 345 PARK AVENUE P.O. BOX 37003 NEW YORK, NEW YORK 10154 MAIL CODE: CA5-701-05-31 SAN FRANCISCO, CA 94137 International Stock Fund T. ROWE PRICE INC. CAISSE des DEPOTS 100 EAST PRATT STREET 9 WEST 57th STREET, 36TH FLOOR BALTIMORE, MARYLAND 02120 NEW YORK, NEW YORK 10019 Mid Size Company Stock Fund DFP, INC. PUTNAM INVESTMENTS 400 WEST MARKET STREET P.O. BOX 41203 P.O. BOX 32830 PROVIDENCE, RHODE ISLAND 02940 LOUISVILLE, KY 40232 Small Company Stock Fund JOHN HANCOCK MUTUAL LIFE MILLER ANDERSON & SHERRERD, LLP INSURANCE COMPANY ONE TOWER BRIDGE JOHN HANCOCK PLACE, 27th FLOOR WEST CONSHOHOCKEN, PENNSLYVANIA 19428 P.O. BOX 111 BOSTON, MASSACHUSSETTS 02117 Schwab Personal Choice Retirement Account Fund CHARLES SCHWAB & CO., INC. 4722 NORTH 24TH STREET, SUITE 300 PHOENIX, ARIZONA 85016 INDEX PAGE ---- INDEPENDENT AUDITORS' REPORT 4 STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS AS OF DECEMBER 31, 2000 AND 1999 5 STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS FOR THE YEARS ENDED DECEMBER 31, 2000 and 1999 6 NOTES TO FINANCIAL STATEMENTS 7 SIGNATURES 21 EXHIBIT INDEX 22 INDEPENDENT AUDITORS' REPORT Employee Benefits Committee of Public Service Enterprise Group Incorporated: We have audited the accompanying statements of net assets available for benefits of the Public Service Enterprise Group Incorporated Employee Savings Plan (the "Plan") as of December 31, 2000 and 1999, and the related statements of changes in net assets available for benefits for the years then ended. 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 in accordance with auditing standards generally accepted in the United States of America. 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, such financial statements present fairly, in all material respects, the net assets available for benefits of the Plan at December 31, 2000 and 1999, 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. DELOITTE & TOUCHE LLP Parsippany, New Jersey June 15, 2001
PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED EMPLOYEE SAVINGS PLAN STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS As of December 31, ---------------------------------------------- 2000 1999 -------------------- --------------------- ASSETS Investments, at Fair Value Plan Interest in Master Employee Benefit Plan Trust $433,023,908 $406,357,275 Receivables-Interest and Dividends 7,228 144,275 -------------------- -------------------- Total Assets 433,031,136 406,501,550 -------------------- -------------------- LIABILITIES Accunts Payable 246,827 248,186 -------------------- -------------------- Total Liabilities 246,827 248,186 -------------------- -------------------- Net Assets Available for Benefits $432,784,309 $406,253,364 ==================== ==================== See Notes to Financial Statements.
PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED EMPLOYEE SAVINGS PLAN STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS For the Year Ended December 31, ------------------------------------------- 2000 1999 ----------------- ----------------- ADDITIONS Participant Deposits $35,560,535 $33,094,213 Employer Contributions 8,263,885 7,944,321 ----------------- ----------------- Total Deposits and Contributions 43,824,420 41,038,534 Conversions 7,278 -- Plan Interest in Master Employee Benefit Trust Investment Income 10,680,946 10,471,676 Net appreciation (depreciation) in Market Value of Investment (2,944,260) 36,812,492 ----------------- ------------------ Total Additions 51,568,384 88,322,702 ----------------- ------------------- DEDUCTIONS Withdrawals 19,976,451 18,119,054 Administrative Expenses 529,565 565,279 Transfers to Thrift and Tax-Deferred Savings Plan--net 4,531,423 3,615,054 ----------------- ------------------- Total Deductions 25,037,439 22,299,387 ----------------- ------------------- INCREASE IN NET ASSETS AVAILABLE FOR BENEFITS 26,530,945 66,023,315 NET ASSETS AVAILABLE FOR BENEFITS-BEGINNING OF YEAR 406,253,364 340,230,049 ----------------- ----------------- NET ASSETS AVAILABLE FOR BENEFITS-END OF YEAR $432,784,309 $406,253,364 ================= ================= See Notes to Financial Statements.
=============================================================================== PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED =============================================================================== EMPLOYEE SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS 1. SUMMARY OF THE PLAN The Public Service Enterprise Group Incorporated Employee Savings Plan (the "Plan"), was adopted as a tax qualified profit sharing plan under section 401(a) of the Internal Revenue Code of 1986, as amended, (the "IRC") and a qualified cash or deferred arrangement under IRC section 401(k) to encourage thrift and savings by eligible bargaining unit employees (Eligible Employees). Deutsche Bank is the Trustee of the Master Trust established pursuant to the Plan. Hewitt Associates is the Record Keeper for the Plan. The Plan was last amended effective December 13, 1999, at which time primary sponsorship of the Plan was changed from Public Service Electric & Gas Company (PSE&G) to its parent corporation, Public Service Enterprise Group Incorporated (the "Company"). As a result, the Plan was renamed the Public Service Enterprise Group Incorporated Employee Savings Plan and the Master Trust was amended to become the Public Service Enterprise Group Incorporated Master Employee Benefits Plan Trust. In addition, Plan amendments were made for various administrative and wording changes, including changes in the definitions of Compensation, Employee, Eligible Employee and Hours of Service and to add additional investment options under the plan, including the Schwab Personal Choice Retirement Account (PCRA) Fund. The following description of the Plan provides only general information. For a complete description of the Plan, see the Plan Agreement. The Plan permits, among other things, participation in the Plan by Affiliates of the Company and their bargaining unit employees (each such participating Affiliate with the Company is an "Employer"). Participation in the Plan is entirely voluntary. An employee may participate in the Plan from the date of hire. The Company begins matching contributions when an employee has completed one Year of Service as defined by the Plan. The Company also maintains a Thrift and Tax Deferred Savings Plan to provide for its non-represented employees. At the time any employee who is a Participant in the Thrift Plan becomes an Eligible Employee for the Plan, that employee will automatically be enrolled in the Plan, all balances in the Thrift Plan will be transferred to the Plan and all contributions and investment elections in effect for the Thrift Plan will remain in effect. Certain Eligible Employees may also elect to have a distribution from another qualified corporate plan contributed as a rollover contribution with the approval of the Company's Employee Benefits Committee (Committee), the Plan Administrator. Deposits and Contributions Under the Plan, each participating employee (Participant), except as otherwise noted, may elect to make basic deposits to Investment Funds of such Participant's choosing within the Savings Account Fund of 1% - 7% of his/her Compensation (Basic Deposits), and his/her Employer will contribute an amount equal to 50% thereof, subject to certain exceptions and limitations (Employer Contributions). Employer Contributions for Participants with respect to Basic Deposits in excess of 5% and up to 7% of Compensation are made in shares of the Company's Common Stock and are not available for transfer to any other Investment Fund or withdrawal from the Plan prior to the Participant's termination of employment. In addition, a Participant may elect to make supplemental deposits to his/her Savings Account Fund in increments of 1% of Compensation up to an additional 18% of Compensation (Supplemental Deposits), subject to certain limitations, without any corresponding matching Employer Contribution. Participants may designate such Basic and/or Supplemental Deposits as Nondeferred (post-income tax contributions) or Deferred (pre-income tax contributions). Each Participant may also, within any Plan Year, make one or more Additional Lump Sum Deposits on a Nondeferred basis in minimum amounts of $250 and in such total amounts which, when aggregated with such Participant's Basic Deposits and Supplemental Deposits, do not exceed 25% of his or her Compensation for that Plan Year and subject to the limitations of the IRC. The maximum amount of Deferred Deposits to a Participant's Savings Account may have to be limited to less than or equal to 25% of Compensation to meet requirements of the IRC. The extent of any such limitation will be determined from time to time by the Committee based on the actual pattern of Deferred Deposits by all Participants. All Deferred Deposits in excess of such percentage will automatically be treated as Nondeferred Deposits and will result in taxable income to the affected Participants. The Committee will attempt to assure that any such limitation will apply only to future contributions, but it is possible that, in order to meet requirements of the IRC, the limitation will, in some circumstances, have to be applied retroactively. Deferred Deposits may not generally be withdrawn until age 59-1/2. Nondeferred Deposits, on the other hand, may be withdrawn at any time subject to certain penalties and restrictions. Savings Account Deposits are made through payroll deductions by the Employer, rollover contributions from other qualified plans and Additional Lump Sum Deposits. Deposits by Participants and Employer Contributions are transferred to a Trustee and separately held in the Plan's Savings Account Fund of the Master Trust Fund for Investment and other transactions, as directed by Participants. Each Participant is entitled to choose the Investment Funds in which his/her Deposits and Employer Contributions will be invested from among the Investment Funds offered under the Plan, except for Employer Contributions with respect to Basic Deposits in excess of 5% for all others, which are invested in the Enterprise Common Stock Fund. Dividends, interest and other income attributable to each Investment Fund of the Plan are reinvested in that Investment Fund to the extent they are not used to pay direct expenses of that Investment Fund. All Deposits and Employer Contributions in the Stable Value Fund are invested in either traditional Guaranteed Investment Contracts issued by insurance companies or other financial intermediaries (Traditional GICs) or Benefit Responsive Agreements (Synthetic GICs) which are similar to Traditional GICs in terms of their ability to preserve principal and provide a stable rate of return. Synthetic GICs are different in that they are backed or secured by a separate portfolio of high-quality fixed income securities that are directly owned by the Plan. The portfolio is wrapped by a "book value wrapper", usually a financial institution other than the investment manager of the Synthetic GIC, which provides a crediting rate and which guarantees that benefit repayments will be made at book value. Deposits and Employer Contributions earn interest at the composite rate of all GICs in which the assets of the Stable Value Fund are then invested. Such rate varies as such Traditional and Synthetic GICs mature or are entered into, and as Deposits and Employer Contributions are made to and withdrawn from such contracts. Under the contracts in effect during 2000, the composite rate of interest earned by such assets so invested was not less than 6.02%. ESOP Fund Participants receive quarterly payments directly from the Trustee equal to the dividends paid to the Trustee on the shares of the Company's Common Stock held for their ESOP Fund. Loan Provisions The Trustee may, subject to the approval of the Director of Performance and Rewards of PSEG Services Corporation, lend a Participant an amount up to: the lesser of 50% of the value of the vested portion of such Participant's Savings Account and ESOP Fund but no more than the aggregate value of such Participant's Thrift Account or $50,000, whichever is less. However, no amounts may be loaned directly from any ESOP Account, from any portion of the Enterprise Common Stock Fund attributable to Employer Contributions made in shares of stock, from any portion of a Participant's Savings Account attributable to transfers from the Cash Balance Plan or from assets held in the Schwab Personal Choice Retirement Account Fund. Any Participant loan must be for a principal amount of $1,000 or more and no Participant may have more than two loans outstanding at any time. All loans, including interest thereon, must be repaid by payroll deductions in equal monthly installments of 12 to 60 months as selected by the Participant. However, a Participant may prepay any such loan in full or in part in a lump sum in accordance with such rules as are prescribed by the Committee. A Participant may not apply for more than one loan in any calendar year. A loan to a Participant is considered an investment of such Participant's Savings Account and repayments of principal of any loan, together with interest thereon, are invested in the Savings Account Investment Funds of the Plan in accordance with the Participant's then-current investment direction for Deposits and Employer Contributions. Each loan bears interest at a rate fixed from time to time by the Committee taking into consideration the then-current interest rates being charged by other lenders. The rate of interest applicable to any loan at its inception remains in effect for the duration of such loan. During 2000 and 1999, the ratio of interest on loans granted to Participants fluctuated between 8.5% to 9.5% and 7.75% to 8.25%, respectively. Repayments of the principal amount of the loan are credited to each such sub-account and repayments of principal along with any accrued interest thereon are invested in the Savings Account Investment Funds in the same manner as the Participant's then current-investment direction for Deposits and Employer Contributions. Loan amounts are taken from sub-accounts of a Participant's Savings Account in the following order: (a) Deferred Deposits (b) Unmatured vested Employer Contributions (c) Matured vested Employer Contributions (d) Rollover Contributions (e) Unmatured post-1986 Nondeferred Deposits (f) Matured post-1986 Nondeferred Deposits (g) Pre-1987 Nondeferred Deposits Each loan is secured by an assignment of the Participant's entire right, title and interest in and to the Master Trust Fund to the extent of the loan and accrued interest thereon. Vesting Employer Contributions to a Participant's Savings Account are immediately vested upon a Participant's completion of five years of service with an Employer, or when a Participant reaches the age of 65, is disabled, laid off or dies. All amounts credited to a Participant's ESOP Fund are fully vested. Any nonvested Employer Contributions in a Participant's Account are forfeited upon the Participant's date of termination from the Employer, and shall be used to reduce subsequent employer contributions. Holding Account The Holding Account is a vehicle to record the transactions either from one Investment Fund to another Investment Fund or from an Investment Fund to an outside source. Daily balances which remain in the Holding Account are temporarily invested in short-term, liquid investments by the Trustee until disbursement. Activity within the Holding Account includes inflows and outflows of cash related to Investment Fund transfers, Deposits, Employer Contributions, withdrawals, receipts of dividends and interest, expenses incurred in connection with the administration of the Plan, benefit payments and loan transactions. Penalties Upon Withdrawal If a Participant withdraws vested Employer Contributions and/or Deposits before they have been in the Plan for twenty-four months, such Participant will lose the matching Employer Contributions on Deposits made during the subsequent three months. Distributions to Participants electing to withdraw Nondeferred Deposits and Employer Contributions are made as soon as practicable after such elections are received by the Plan's Record Keeper. Nondeferred Deposits may be withdrawn at any time, but certain penalties may apply. Deferred Deposits may not be withdrawn during employment prior to age 59-1/2 except for reasons of extraordinary financial hardship and to the extent permitted by the IRC (hardship withdrawals). Distributions to Participants of approved hardship withdrawals are made as soon as practicable after such approval. Rights Upon Termination The Company expects and intends to continue the Plan indefinitely, but has reserved the right to amend, suspend or terminate the Plan at any time. In the event of termination of the Plan, the net assets of the Plan would be distributed to the Participants based on the balances in their individual accounts at the date of termination. 2. SIGNIFICANT ACCOUNTING POLICIES Basis of Accounting The financial statements of the Plan have been prepared on a accrual basis in accordance with generally accepted accounting principles. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Recent Accounting Pronouncements In June 1998, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards (SFAS) No. 133, "Accounting for Derivative Instruments and Hedging Activities" (SFAS 133), which was later amended by SFAS No. 138. Among other provisions, it requires that entities, including employee benefit plans, recognize all derivatives as either assets or liabilities in the balance sheet and measure those instruments at fair value. Gains and losses resulting from changes in the fair values of those derivatives would be accounted for depending on the use of the derivative and whether it qualifies for hedge accounting treatment. Effective January 1, 2001, the Plan adopted this statement. Upon adoption, SFAS No. 133 had no impact on the Plan's financial position or results of operations. Valuation of Investments The value of all of the Plan's Investments in the various Funds are based upon quoted market values, except for the Stable Value Fund, which is based on the contract value of all GICs in which the assets of the Stable Value Fund are invested, which approximates fair value. Temporary investments are valued at cost, which approximates fair market value. Securities transactions are accounted for on the trade date. The Plan's financial statements have been prepared in accordance with financial reporting requirements of the Employee Retirement Income Security Act of 1974, as amended, (ERISA) as permitted by applicable rules. Under such requirements, realized gains and losses from securities transactions are computed using an adjusted cost basis as prescribed by the Department of Labor's (DOL) Rules and Regulations for Reporting and Disclosure. The adjusted cost is the fair value of the security at the beginning of the Plan Year, or cost if acquired since that date. Unrealized gains and losses on securities held for investment are computed on the basis of the change in fair value between the beginning and end of the Plan Year. Expenses of Plan All expenses incurred for the administration of the Plan, including taxes and brokerage costs, are deducted from the Master Trust Fund. The assets of the Enterprise Common Stock Fund and the ESOP Fund are invested in shares of the Company's Common Stock. Shares of the Company's Common Stock required for the Enterprise Common Stock Fund are purchased by the Trustee either directly from the Company at its sole discretion, on the open market through a broker or from the ESOP Fund. In situations where the ESOP Fund is in a "sell" position and the Enterprise Common Stock Fund is in a "buy" position, the Enterprise Common Stock Fund will buy from the ESOP Fund at the closing price on the New York Stock Exchange for that day. In such case, no brokerage commissions will be charged on the transaction. Otherwise, all shares sold for the Enterprise Common Stock Fund and the ESOP Fund are sold by the Trustee on the open market through a broker. The proceeds, net of brokerage commissions and transfer taxes, are distributed to the Participant. Interfund Transfers -- ESOP Fund to Savings Account Participants are permitted to transfer all, but not less than all, of the shares of the Company's Common Stock from their ESOP Funds to their Savings Accounts. To effect such transfers, the Trustee will sell the shares of Enterprise Common Stock held in the ESOP Fund and invest the proceeds in the Savings Account Investment Funds designated by the Participant. The cash value of each share of the Company's Common Stock transferred will be equal to the price per share of the Company's Common Stock actually received by the Trustee. Any such transfer is treated as a rollover contribution. Conversions During the year 2000, the Employee Savings Plan converted net assets from an acquired company's employees savings plan, Fluidics Inc, in the amount of $7,278. 3. INVESTMENTS The following presents investments that represent five percent or more of the Plan's net assets as of December 31, 2000 and 1999:
2000 1999 ------------ -------------- Primco Stable Value Fund $134,610,863 $112,308,552 Common Stock of Public Service Enterprise Group Incorporated 60,070,890 43,560,456 Vanguard Institutional Index Fund 102,317,326 117,068,658 Putnam Vista Mutual Fund 51,300,453 40,067,203 T. Rowe Price International Mutual Fund 25,399,072 26,813,577
The financial statements of the Plan include the following: A. Savings Account Investment Funds (1) On March 31, 1998, the assets of the Stable Value Fund were merged, for investment purposes, with the Stable Value Fund assets of the Thrift Plan. The assets of the Stable Value Fund are invested in Traditional GICs or Synthetic GICs. All contract values approximate fair values. As of December 31, 2000, the Plan's interest in the following GICs was approximately 38%. (a) At December 31, 2000, the following Traditional GICs were continuing in effect: (i) A two-year contract with Metropolitan Life Insurance Company, expiring December 10, 2001, with an effective interest rate of 6.95% and a contract value of $10,696,969; (ii) A three-year contract with New York Life Insurance Company, expiring April 30, 2001, with an effective interest rate of 7.07% and a contract value of $6,897,844; and (iii)A five-year contract with Prudential Life Insurance, expiring November 11, 2001, with an effective interest rate of 6.99% and a contract value of $5,023,192. (b) Also at December 31, 2000, the following Synthetic GICs were continuing in effect: (i) An open-ended contract with J.P. Morgan as the book value wrapper and Pacific Investment Management Company managing the underlying portfolio providing an effective crediting rate as of December 31, 2000 of 7.13% and a contract value of $54,144,548; (ii) An open-ended contract with Bank of America as the book value wrapper and Pacific Investment Management Company managing the underlying portfolio providing an effective crediting rate as of December 31, 2000 of 7.15% and a contract value of $18,057,990; (iii)An open-ended contract with The Chase Manhattan Bank as the book value wrapper and Seix Investment Advisors managing the underlying portfolio providing an effective crediting rate as of December 31, 2000 of 7.19% and a contract value of $40,183,483; (iv) An open-ended contract with Allstate Life Insurance Company as the book value wrapper and PRIMCO Capital Management managing the underlying portfolio providing an effective crediting rate as of December 31, 2000 of 5.65% and a contract value of $52,409,601; (v) An open-ended contract with State Street Bank and Trust Company as the book value wrapper and PRIMCO Capital Management managing the underlying portfolio providing an effective crediting rate as of December 31, 2000 of 5.72% and a contract value of $55,627,082; (vi) A pooled separate account expiring May 1, 2007 with John Hancock Mutual Life Insurance Company as the book value wrapper and managing underlying portfolio providing an effective crediting rate as of December 31, 2000 of 5.75% and a contract value of $9,115,021; (vii)An open-ended contract with DFP, Inc. as the book value wrapper and PRIMCO Capital Management managing the underlying portfolio providing an effective crediting rate as of December 31, 2000 of 5.83% and a contract value of $36,011,457; (viii) Two five-year floating-rate contracts with Caisse des Depots, expiring November 26, 2002, effective crediting rate on each contract as of December 31, 2000 of 5.77%, contract values of $4,022,132 and $2,011,065; (ix) Two five-year floating-rate contracts with Caisse des Depots, expiring December 12, 2002, effective crediting rate on each contract as of December 31, 2000 of 5.51%, contract values of $4,011,741 and $2,005,870; (x) A five-year floating-rate contract with Caisse des Depots, expiring February 3, 2003, effective crediting rate as of December 31, 2000 of 5.87%, contract value of $3,027,713; and (xi) An open-ended contract with UBS AG as the book value wrapper and PRIMCO Capital Management managing the underlying portfolio providing an effective crediting rate as of December 31, 2000 of 7.17% and a contract value of $50,993,406. (2) The assets of the Enterprise Common Stock Fund are invested in the Company's Common Stock. (3) The assets of the Large Company Stock Index Fund are invested in the capital stock of Vanguard Institutional Index Fund, a no-load mutual fund managed by The Vanguard Group, Inc. The prospectus for the Vanguard Institutional Index Fund indicates that such fund seeks to replicate the investment performance of the Standard and Poor's 500 Composite Stock Price Index. (4) The assets of the Diversified Bond Fund are invested in a separate account managed by BlackRock Financial Management, Inc. The Diversified Bond Fund invests in a broadly diversified portfolio of bonds that include U.S. Treasury and agency securities, commercial and residential mortgage-backed securities, asset-backed securities, and corporate bonds. (5) The assets of the International Stock Fund are invested in the capital stock of the T. Rowe Price International Stock Fund, a no-load mutual fund managed by Rowe Price-Fleming International, Inc. The prospectus for the T. Rowe Price International Stock Fund indicates that such fund invests primarily in common stocks of established, non-U.S. companies. (6) The assets of the Mid Size Company Stock Fund are invested in the capital stock of the Putnam Vista Fund, a no-load mutual fund managed by Putnam Investment Management, Inc. The prospectus for the Putnam Vista Fund indicates that such fund invests in a diversified portfolio of common stocks, which may include widely-traded common stocks of larger companies as well as common stocks of smaller, less well-known companies. (7) The assets of the Small Company Stock Fund are invested in a separate account managed by Miller Anderson & Sherrerd, LLP. The Small Company Stock Fund invests in a broadly diversified portfolio of U.S. small capitalization companies that are considered to be undervalued on a relative basis by the Fund Manager at the time of purchase. Small capitalization companies are those with equity capitalizations generally below $1.5 billion. (8) The assets of the Conservative Pre-Mix Portfolio are invested in specific percentages within a mix of five existing Plan investment Funds: 40% Stable Value Fund, 20% Diversified Bond Fund, 20% Large Company Stock Index Fund, 10% International Stock Fund, and 10% Small Company Stock Fund. Every quarter the Trustee re-aligns this portfolio to match its conservative (risk and return) investment strategy of 60% in bonds and 40% in stocks. (9) The assets of the Moderate Pre-Mix Portfolio are invested in specific percentages within a mix of five existing Plan investment Funds: 25% Large Company Stock Index Fund, 20% Stable Value Fund, 20% International Stock Fund, 20% Diversified Bond Fund, and 15% Small Company Stock Fund. Every quarter the trustee re-aligns this portfolio to match its moderate (risk and return) investment strategy of 60% in stocks and 40% in bonds. (10) The assets of the Aggressive Pre-Mix Portfolio are invested in specific percentages within a mix of four existing Plan investment Funds: 30% Large Company Stock Index Fund, 25% International Stock Fund, 25% Small Company Stock Fund, and 20% Diversified Bond Fund. Every quarter the Trustee re-aligns this portfolio to match its aggressive (risk and return) investment strategy of 80% in stocks and 20% in bonds. B. ESOP Fund During 2000 and 1999, no contributions to or transfers into the ESOP Fund were permitted. C. Schwab PCRA Fund Beginning in 1999, an additional investment choice was offered, the Schwab PCRA Fund. This is a self-directed brokerage account in which Participants can select and manage a wide selection of investments including mutual funds, stocks and bonds. Deposits into the Schwab PCRA Fund must come from balances transferred from the other options in the Plan. Currently, up to 75% of a participant's balance may be transferred to the Schwab PCRA Fund. D. Participants Participants As of December 31, --------------------------------- 2000 1999 ------------- ------------ Total Active Plan Participants 5,587 4,264 Participants by Fund: Stable Value Fund 2,585 2,700 Enterprise Common Stock Fund 1,480 1,393 Large Company Stock Index Fund 2,775 2,885 Diversified Bond Fund 398 315 International Stock Fund 1,001 992 Mid Size Company Fund 2,042 1,663 Conservative Pre-Mix Portfolio 369 330 Moderate Pre-Mix Portfolio 834 816 Aggressive Pre-Mix Portfolio 1,456 1,349 Small Company Stock Fund 542 111 ESOP Fund 857 926 Schwab PCRA 446 126 4. INVESTMENT OF THE PLAN AND THRIFT PLAN IN THE MASTER TRUST The Plan's investments are included in the Master Trust which was established for the investment of assets of all of the Company's qualified retirement plans including the Plan and the Thrift Plan. The following tables present the fair values of and the investment income recognized by the investments of the Plan and Thrift Plan in the Master Trust as of and for the periods ending December 31, 2000 and 1999. As of December 31, 2000 and 1999, the Plan's interests in such assets of the Master Trust were approximately 38%. See Note 3 for investments in excess of 5% of Plan Net Assets.
December 31, --------------------------------------------------- 2000 1999 ---------------------- ---------------------- Investments at fair value: Participant Loans $31,058,248 $ 28,151,855 Cash and Cash Equivalents 12,387,447 71,740,378 Enterprise Common Stock 158,237,865 115,952,779 Mutual Funds 557,693,509 558,830,359 Guaranteed Investment Contracts 354,239,114 295,548,822 Schwab PCRA Fund 27,297,856 11,840,257 ---------------------- ---------------------- $1,140,914,039 $ 1,082,064,450 ====================== ====================== December 31, --------------------------------------------------- 2000 1999 ---------------------- ---------------------- Investment income recognized: Net (depreciation) appreciation in fair value of Mutual Funds (1) $(56,882,819) $118,766,391 Net appreciation(depreciation) in fair value of Enterprise Common Stock 46,520,206 (15,922,101) Interest from Mutual Funds 2,367,179 1,253,314 Interest from Enterprise Common Stock Funds 136,761 333,839 Interest from Guaranteed Investment Contracts 19,761,800 20,726,074 Dividends from Enterprise Common Stock 6,487,715 6,033,820 ---------------------- ---------------------- $18,390,842 $ 131,191,337 ====================== ====================== (1) Includes dividends earned from mutual funds.
5. NON-PARTICIPANT DIRECTED INVESTMENTS Information about the net assets and the significant components of the changes in net assets relating to the non-participant directed investments is as follows:
As of December 31, ---------------------------------------- 2000 1999 ------------------- ----------------- Net Assets: Enterprise Common Stock Fund $64,184,801 $45,477,726 ------------------- ----------------- Changes in Net Assets: Deposits and Contributions $5,584,575 $5,389,691 Dividends and Interest 2,757,396 2,801,083 Net appreciation (depreciation) in Enterprise Common Stock 17,585,598 (6,493,205) Benefits paid to Participants (1,908,772) (2,046,976) Forfeitures (6,652) (12,479) Administrative Expenses (2,864) (1,156) Transfers from participant-directed investments (5,302,206) 229,178 ------------------- ----------------- Total Changes in Net Assets $18,707,075 $(133,864) =================== =================
6. FEDERAL INCOME TAXES The Plan is intended to be qualified under Section 401(a) of the Internal Revenue Code of 1986 (the "Code") and is intended to be exempt under Section 501(a) of the Code. The Plan received a favorable Internal Revenue Service determination letter dated April 8, 1998. The Plan has since been amended. However, the Plan Administrator believes that the Plan is currently being operated in compliance with the applicable requirements of the Code. Therefore, no provision for income taxes has been included in the Plan's financial statements. 7. COMPLIANCE WITH ERISA The Plan is generally subject to the provisions of Titles I and II of ERISA, including the provisions with respect to reporting, disclosure, participation, vesting and fiduciary responsibility. However, it is not subject to the funding requirements of Title I and benefits under the Plan are not guaranteed by the Pension Benefit Guarantee Corporation under Title IV of ERISA. SIGNATURES 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 thereunto duly authorized. Public Service Enterprise Group Incorporated Employee Savings Plan (Name of Plan) By: M. PETER MELLETT ---------------------------------------------- M. Peter Mellett Chairman of Employee Benefits Committee Date: June 29, 2001 EX-23 2 pseg-sp_ex23.txt INDEPENDENT AUDITOR'S CONSENT EXHIBIT INDEX Exhibit Number -------------- 23 Independent Auditors' Consent. EXHIBIT 23 INDEPENDENT AUDITORS' CONSENT We consent to the incorporation by reference in Registration Statements Nos. 33-18417 and 33-44582 on Forms S-8 of Public Service Enterprise Group Incorporated of our report dated June 15, 2001 appearing in this Annual Report on Form 11-K of the Public Service Enterprise Group Incorporated Employee Savings Plan for the year ended December 31, 2000. DELOITTE & TOUCHE LLP Parsippany, New Jersey June 28, 2001 -----END PRIVACY-ENHANCED MESSAGE-----