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, 1998.
[ ] Transition Report Pursuant to Section 15(d) of the Securities Exchange
Act of 1934
[No Fee Required]
For the transition period from _______ to _______.
Commission file number 0-18595
A. Full title of the plan and the address of the plan, if different from
that of the issuer
named below:
ELIZABETHTOWN WATER COMPANY SAVINGS AND INVESTMENT PLAN - 401-K
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
E'TOWN CORPORATION
600 South Avenue
Westfield, New Jersey 07090
<PAGE>
- -------------------------------------------------------------------------------
ELIZABETHTOWN WATER COMPANY
SAVINGS AND INVESTMENT PLAN - 401(k)
financial statements for the years
ended December 31, 1998 and 1997 and
supplemental schedules for the
year ended December 31, 1998 and
independent auditors' report
prepared for filing as part of the annual
return/report of employee benefit plan (FORM 5500)
<PAGE>
ELIZABETHTOWN WATER COMPANY
SAVINGS AND INVESTMENT PLAN -
401(k)
TABLE OF CONTENTS
- -------------------------------------------------------------------------------
DESCRIPTION PAGE
Independent Auditors' Report 1
Statements of Net Assets Available for Benefits as of
December 31, 1998 and 1997 2 - 3
Statements of Changes in Net Assets Available for
Benefits for the Years Ended December 31, 1998 and 1997 4 - 5
Notes to Financial Statements for the Years Ended
December 31, 1998 and 1997 6 - 9
Supplemental Schedule of Assets Held for Investment Purposes
as of December 31, 1998 (Item 27a) 10
Supplemental Schedule of Reportable Transactions for
the Year Ended December 31, 1998 (Item 27d) 11
Supplemental schedules not filed herewith are omitted
because of the absence of conditions under which
they are required.
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<PAGE>
INDEPENDENT AUDITORS' REPORT
Elizabethtown Water Company
Savings and Investment Plan - 401(k)
We have audited, by fund and in total, the accompanying statements of net
assets available for benefits of Elizabethtown Water Company Savings and
Investment Plan - 401(k) (the "Plan") as of December 31, 1998 and
1997, 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 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, such financial statements present fairly, by fund and in
total, in all material respects, the net assets available for benefits of the
Plan at December 31, 1998 and 1997, and the changes in net assets available
for benefits for the years then ended in conformity with generally accepted
accounting principles.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules listed in
the table of contents 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 schedules are the responsibility of the Plan's
management. Such schedules have been subjected to the auditing procedures
applied in our audit of the basic 1998 financial statements and, in our
opinion, are fairly stated in all material respects when considered in
relation to the basic financial statements taken as a whole.
/s/ Deloitte & Touche LLP
Parsippany, New Jersey
June 25, 1999
<PAGE>
ELIZABETHTOWN WATER COMPANY
SAVINGS AND INVESTMENT PLAN - 401(K)
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF DECEMBER 31, 1998
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<TABLE>
<CAPTION>
Fidelity
PNC Fidelity PNC BlackRock Advisor BlackRock E'town
Investment Advisor Balanced Large Cap Growth Janus Small Corporation
Contract High Yield Profile Value Opportunity Worldwide Cap Growth Common Loan
Fund Fund Fund Equity Fund Fund Fund Equity Fund Stock Fund Fund Total
--------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ASSETS:
Contributions Receivable $4,525 $2,933 $3,264 $8,917 $8,185 $7,861 $4,690 $22,927 - $63,302
Accounts Receivable 6,313 - - - - - - - - 6,313
Accrued Repayment
of Loans 185 293 418 962 700 840 229 875 - 4,502
Investments 967,290 497,859 820,822 2,238,740 1,530,996 1,510,911 865,621 11,613,980 $314,229 20,360,448
---------- --------- --------- ---------- --------- ----------- -------- ---------- --------- ----------
Total Assets 978,313 501,085 824,504 2,248,619 1,539,881 1,519,612 870,540 11,637,782 314,229 20,434,565
---------- --------- --------- ---------- --------- ----------- -------- ---------- --------- ----------
LIABILITIES:
Forfeitures due
the Company - - - - - - - - - 0
---------- --------- --------- ---------- --------- ---------- -------- ---------- --------- ----------
Total Liabilities - - - - - - - - - 0
---------- --------- --------- ---------- --------- --------- --------- ---------- --------- ----------
NET ASSETS AVAILABLE
FOR BENEFITS $978,313 $501,085 $824,504 $2,248,619 $1,539,881 $1,519,612 $870,540 $11,637,782 $314,229 $20,434,565
========== ========= ======== ========== ========== ========== ======== =========== ======== ===========
</TABLE>
-2-
See notes to financial statements.
- -------------------------------------------------------------------------------
<PAGE>
ELIZABETHTOWN WATER COMPANY
SAVINGS AND INVESTMENT PLAN - 401(K)
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF DECEMBER 31, 1997
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Compass Fidelity Compass Capital
PNC Fidelity PNC Capital Advisor Small Cap E'town
Investment Advisor Balanced Large Growth Janus Growth Corporation
Contract High Profile Cap Value Opportunities Worldwide Equity Common Loan
Fund Yield Fund Fund Equity Fund Fund Fund Fund Stock Fund Fund Total
-------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ASSETS:
Contributions Receivable $3,948 $2,799 $2,793 $7,611 $7,460 $7,405 $5,049 $21,694 - $58,759
Accounts Receivable 2,154 - - - - - - - - 2,154
Accrued Repayment of Loans 189 223 326 670 489 727 243 665 - 3,532
Investments 753,491 444,400 629,455 1,906,108 1,098,115 1,095,413 780,312 9,778,258 $291,091 16,776,643
---------- --------- --------- ---------- --------- --------- --------- ---------- --------- ----------
Total Assets 759,782 447,422 632,574 1,914,389 1,106,064 1,103,545 785,604 9,800,617 291,091 16,841,088
---------- --------- --------- ---------- --------- --------- --------- ---------- --------- ----------
LIABILITIES:
Forfeitures due the Company - - - - - - - - - 0
---------- --------- --------- ---------- --------- --------- --------- ---------- --------- ----------
Total Liabilities - - - - - - - - - 0
---------- --------- --------- ---------- --------- --------- --------- ---------- --------- ----------
NET ASSETS AVAILABLE
FOR BENEFITS $759,782 $447,422 $632,574 $1,914,389 $1,106,064 $1,103,545 $785,604 $9,800,617 $291,091 $16,841,088
========= ========= ========= ========== ========== ========== ======== ========== ======== ===========
</TABLE>
-3-
See notes to financial statements.
- -------------------------------------------------------------------------------
<PAGE>
ELIZABETHTOWN WATER COMPANY
SAVINGS AND INVESTMENT PLAN - 401(K)
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1998
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Black Fidelity Black E'town
PNC Fidelity PNC Rock Advisor Rock Corporation
Investment Advisor Balanced Large Growth Janus Small Common
Contract High Profile Cap Value Opportunities Worldwide Cap Growth Stock Loan
Fund Yield Fund Fund Equity Fund Fund Fund Equity Fund Fund Fund Total
---------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ADDITIONS:
Contributions:
Employer - - - - - - - $455,526 - $455,526
Employees $108,352 $77,917 $89,293 $220,906 $218,514 $203,381 $123,529 157,633 - 1,199,525
Dividend Income - 47,688 - 148,640 63,846 6,469 - 484,207 - 750,850
Interest Income - - - - - - - 6,643 $31,175 37,818
Rollovers - - 6,540 6,540 7,385 - 6,540 282 - 27,287
Net Appreciation (Depreciation)
in fair value of investments 50,555 (53,305) 92,316 50,292 215,140 271,644 59,415 1,731,884 - 2,417,941
Transfers between Funds 70,641 6,101 4,883 (35,149) 323 (13,899) (69,160) 36,260 - 0
Participant Loans - - - - - - - - 99,900 99,900
Repayment of Loan 4,848 7,732 10,069 22,743 15,663 20,564 5,677 20,641 - 107,937
-------- --------- -------- ------- --------- --------- ---------- -------- ------- ---------
Total Additions 234,396 86,133 203,101 413,972 520,871 488,159 126,001 2,893,076 131,075 5,096,784
-------- --------- -------- ------- --------- --------- ---------- --------- ------- ---------
DEDUCTIONS:
Distributions to Participants 14,593 26,728 2,637 57,456 74,654 56,041 31,002 1,031,483 - 1,294,594
Forfeitures - - - - - - - 876 - 876
Employee Loans 1,272 5,742 8,534 22,286 12,400 16,051 10,063 23,552 - 99,900
Repayment of Loans - - - - - - - - 107,937 107,937
-------- -------- ------- ------- ---------- --------- ---------- --------- ------ ---------
Total Deductions 15,865 32,470 11,171 79,742 87,054 72,092 41,065 1,055,911 107,937 1,503,307
-------- -------- -------- ------- ---------- --------- ---------- --------- ------ ---------
NET INCREASE (DECREASE) 218,531 53,663 191,930 334,230 433,817 416,067 84,936 1,837,165 23,138 3,593,477
NET ASSETS AVAILABLE FOR,
BENEFITS, BEGINNING OF YEAR 759,782 447,422 632,574 1,914,389 1,106,064 1,103,545 785,604 9,800,617 291,091 16,841,088
-------- -------- -------- ---------- ---------- --------- ---------- --------- ------- ----------
NET ASSETS AVAILABLE FOR
BENEFITS, END OF YEAR $978,313 $501,085 $824,504 $2,248,619 $1,539,881 $1,519,612 $870,540 $11,637,782 $314,229 $20,434,565
======== ======== ======== ========== ========== ========== ======== =========== ======== ===========
-4-
See notes to financial statements.
<PAGE>
ELIZABETHTOWN WATER COMPANY
SAVINGS AND INVESTMENT PLAN - 401(K)
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1997
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
Evergreen
Intermediate
Evergreen Term PNC Fidelity PNC
Growth Government Investment Advisor Balanced
Savings & Income Securities Contract High Yield Profile
Fund Fund Fund Fund Yield Fund
--------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
ADDITIONS:
Contributions:
Employer - - - - - -
Employees $41,810 $124,160 $35,186 $79,191 $58,498 $63,232
Dividend Income - 10,763 9,645 - 12,535 -
Interest Income 18 105 15 772 - 44
Rollovers 1,017 1,780 509 - - 5,594
Net Appreciation (Depreciation)
in fair value of investments 13,738 (25,495) (15,204) 51,502 12,257 32,721
Transfer from Old Funds - - - 1,852,572 - -
Transfers between Funds 12,876 (10,627) (26,748) (1,207,481) 374,661 544,319
Participant Loans - - - - - -
Repayment of Loan 2,018 3,845 1,082 3,005 3,370 4,461
--------- ----------- --------- ---------- --------- ----------
Total Additions 71,477 104,531 4,485 779,561 461,321 650,371
--------- ----------- ---------- ---------- --------- ----------
DEDUCTIONS:
Distributions to Participants 8,423 21,075 5,138 6,833 3,433 2,125
Forfeitures - - - - - -
Employee Loans 6,438 1,350 622 12,946 10,466 15,672
Repayment of Loans - - - - - -
Transfer to New Funds 947,619 2,993,304 905,558 - - -
--------- ----------- ---------- ---------- --------- ----------
Total Deductions 962,480 3,015,729 911,318 19,779 13,899 17,797
--------- ----------- ---------- ---------- --------- ----------
NET INCREASE (DECREASE) (891,003) (2,911,198) (906,833) 759,782 447,422 632,574
TRANSFER OF ELIZABETHTOWN
WATER COMPANY EMPLOYEE
STOCK OWNERSHIP PLAN ASSETS - - - - - -
NET ASSETS AVAILABLE FOR
BENEFITS, BEGINNING OF YEAR 891,003 2,911,198 906,833 - - -
--------- ----------- ---------- ---------- --------- ---------
NET ASSETS AVAILABLE FOR
BENEFITS, END OF YEAR $0 $0 $0 $759,782 $447,422 $632,574
========= =========== =========== ========= ========= ========
</TABLE>
<PAGE>
ELIZABETHTOWN WATER COMPANY
SAVINGS AND INVESTMENT PLAN - 401(K)
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1997 (CONTINUED)
<TABLE>
<CAPTION>
Compass Compass
Capital Fidelity Capital E'town
Large Advisor Small Corporation
Cap Value Growth Janus Cap Growth Common
Equity Opportunities Worldwide Equity Stock Loan
Fund Fund Fund Fund Fund Fund Total
-----------------------------------------------------------------------------------
<S> <C> C> <C> <C> <C> <C> <C>
ADDITIONS:
Contributions:
Employer - - - - $411,292 - $411,292
Employees $155,008 $152,262 $150,451 $91,641 184,574 - 1,136,013
Dividend Income 22,720 11,167 35,763 - 478,121 - 580,714
Interest Income 3,245 74 74 53 3,101 $13,439 20,940
Rollovers 11,188 28,636 24,108 4,529 6,308 - 83,669
Net Appreciation (Depreciation)
in fair value of investments 595,533 98,838 (29,353) 65,196 2,034,842 - 2,834,575
Transfer from Old Funds 2,993,909 - - - - - 4,846,481
Transfers between Funds (1,800,068) 834,102 988,751 633,343 (343,128) - 0
Participant Loans - - - - - 199,042 199,042
Repayment of Loan 7,454 5,688 10,676 4,847 12,394 - 58,840
------------------------ ----------- ----------- ----------- ---------- ----------
Total Additions 1,988,989 1,130,767 1,180,470 799,609 2,787,504 212,481 10,171,566
----------- ------------ ----------- ----------- ----------- ---------- ----------
DEDUCTIONS:
Distributions to Participants 23,895 3,649 39,604 4,564 414,507 - 533,246
Forfeitures - - - - 110 - 110
Employee Loans 50,705 21,054 37,321 9,441 33,027 - 199,042
Repayment of Loans - - - - - 58,840 58,840
Transfer to New Funds - - - - - - 4,846,481
----------- ------------ ----------- ----------- ----------- ---------- ----------
Total Deductions 74,600 24,703 76,925 14,005 447,644 58,84 5,637,719
----------- ------------ ----------- ----------- ----------- ---------- ----------
NET INCREASE (DECREASE) 1,914,389 1,106,064 1,103,545 785,604 2,339,860 153,641 4,533,847
TRANSFER OF ELIZABETHTOWN
WATER COMPANY EMPLOYEE
STOCK OWNERSHIP PLAN ASSETS - - - - 3,348,707 - 3,348,707
NET ASSETS AVAILABLE FOR
BENEFITS, BEGINNING OF YEAR - - - - 4,112,050 137,450 8,958,534
------------------------ ----------- ----------- ----------- ---------- ----------
NET ASSETS AVAILABLE FOR
BENEFITS, END OF YEAR $1,914,389 $1,106,064 $1,103,545 $785,604 $9,800,617 $291,091 $16,841,088
=========== ============ =========== =========== =========== ========= ==========
</TABLE>
-5-
See notes to financial statements.
<PAGE>
ELIZABETHTOWN WATER COMPANY
SAVINGS AND INVESTMENT PLAN - 401(k)
NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1998 AND 1997
1. DESCRIPTION OF THE PLAN
General
The Savings and Investment Plan - 401(k) (Plan) was adopted by the
Elizabethtown Water Company (Company) as of January 1, 1988. The Plan is
administered by the Administrative Committee of the Company, appointed
from time to time by the Board of Directors. Expenses
incurred in the administration of the Plan are paid by the Company.
Effective January 1, 1997, the Company merged the Elizabethtown Water
Company Employee Stock Ownership Plan into the Plan. The merger of the
two plans does not have an impact on participants' benefits. In
connection with this merger, 105,871 shares of E'town Corporation common
stock were transferred to the E'town Corporation Common Stock Fund.
Eligibility
Employees of Elizabethtown Water Company, The Mount Holly Water Company,
E'town Corporation and E'town Properties who were non-union employees as
of January 1, 1988 were eligible to join the Plan. As of January 1,
1995, employees who are union employees are eligible to join the Plan.
Employees may become members of the Plan after three months of service
and may enter the Plan at the next entry date. The entry dates are
January 1 and July 1. If an employee withdraws from the Plan, the
employee may not rejoin the Plan until the second entry date following
withdrawal.
Contributions
Non-union employees may reduce their salaries up to 10% or a dollar limit
of $10,000 and direct that the salary reductions be invested in the
Plan. This salary reduction, in accordance with the Internal Revenue
Code Section 401(k), shall not be subject to Federal or state income
taxes. From January 1 through March 31, 1996, the Company matched 50%
and effective April 1, 1996, the Company matches 60% of participating
non-union employees' salary reductions up to 6%.
Union employees may reduce their salaries up to 6% and, effective
February 1, 1997 and 1998, the Company matched 20% and 25%, respectively,
of participating union employees' salary reductions up to that 6%.
Effective February 1, 1999, with the signing of a new union contract, the
participating union employees' can reduce their salaries up to 10% with
the Company matching 35% on the first 6%.
Salary reductions are deducted each payroll period and deposited along
with the Company's matching contributions with the Trustee at the end of
the month.
The Plan provides that the salary reductions and matching contributions
are recorded in the accounts of the eligible participants.
-6-
Vesting and Distribution
All salary reductions are 100% vested and non-forfeitable. Employees are
vested in Company matching contributions based upon years of service.
Employees vest 25% each year after two years of service and are 100%
vested after five years of service. Distributions may be made from the
plan upon retirement, disability, death or separation from service.
Distributions may also be made for special financial hardship situations
in accordance with the Internal Revenue Code guidelines.
Loans
Participants who are non-union may be granted a loan for Plan designated
purposes for up to 50% of their vested plan balance. Loans are repaid
over a period of up to 5 years, or longer for a loan for the purchase of
a principal residence. The interest rate is 2 points above prime or the
prevailing mortgage rate for a residential loan. At December 31, 1998,
interest rates on these loans range from 6.61% to 11% and maturity dates
range from February, 1999 to August, 2008. The loan and the interest
payments are credited to the participants' investment funds in relation
to the participants' investment decision. Effective February 1, 1999,
with the signing of a new union contract, union employees' are eligible
to apply for loans.
Termination of the Plan
The Plan may be terminated at any time by the Company. In the event of
termination, the assets of the Plan will be distributed to the
participants by the Trustees, according to the participants' account
balances, less the administration costs of the Trustee.
Investments
From January 1, 1996 to April 1, 1997 First Union National Bank
was the record keeper and Trustee of the Plan. At that time, participants
could elect to have their contributions invested in any of the four
following funds. The Company's matching contribution was invested
in the E'town Corporation Stock Fund.
Savings Fund - The Savings Fund is invested in a Guaranteed Investment
Contract Fund (GIC), managed by First Union National Bank which invests
in GIC's and short-term securities.
Evergreen Growth and Income Fund - The Growth and Income Fund is invested
in a Capital Appreciation Equity Fund managed by First Union National Bank
which invests in diversified common stocks and income securities
convertible into common stock.
Evergreen Intermediate-Term Government Securities Fund - The
Intermediate-Term Government Fund is invested in an intermediate-term
government securities fund managed by First Union National Bank which
invests primarily in U.S. Treasury obligations and money market instruments.
E'town Corporation Stock Fund - The Stock Fund is invested in E'town
Corporation common stock which is traded on the New York Stock Exchange.
The shares were held in trust for the Plan by First Union National Bank.
The Plan had 126,760 shares of E'town Corporation common stock at
December 31, 1996.
Effective April 1, 1997 PNC Bank was appointed record keeper and Trustee.
On that date, investments held in the previous First Union National Bank
funds were transferred to investments of PNC Bank. Participants may elect
-7-
to have their contributions and their investments balance invested in
any of the following eight investments:
PNC Investment Contract Fund - The PNC Investment Contract Fund is
invested in guaranteed investment contracts (GIC's) issued by insurance
companies and cash equivalents. This fund is managed by PNC Asset
Management. The average maturity of the fund is less than three years.
Fidelity Advisor High Yield Fund - The Fidelity Advisor High Yield
Fund is invested in bonds of mature and "turnaround" companies seeking
higher yields and appreciation through lower-rated bonds. This fund is
managed by Fidelity Investments.
PNC Balanced Profile Fund - The PNC Balanced Profile Fund is a
balanced fund invested in the following Compass Capital Funds: Select
Equity Portfolio, Growth Equity Portfolio, Value Equity Portfolio and
Mid-Cap Growth Equity Portfolio. These funds are managed by PNC Asset
Management.
BlackRock (Compass Capital) Large Cap Value Equity Fund - The Compass
Capital Large Cap Value Equity Fund invests in stock with prices relative
to earnings and book values that are below average and have a market
capitalization in excess of $5 billion. This fund is managed by Compass
Distributors, Inc.
Fidelity Advisor Growth Opportunities Fund - The Fidelity Advisor
Growth Opportunities Fund is invested in growth stocks of companies with
above average growth in sales and earnings. This fund is managed by Fidelity
Investments.
Janus Worldwide Fund - The Janus Worldwide Fund invests in common
stock of foreign and domestic companies seeking long term growth of capital.
This fund is managed by Janus.
BlackRock (Compass Capital) Small Cap Growth Equity Fund - The Compass
Capital Small Cap Growth Equity Fund invests in small cap stocks that
exhibit earnings growth rate prospects and have a market value
capitalization below $1 billion. This fund is managed by Compass
Distributors, Inc.
E'town Corporation Common Stock Fund - The E'town Corporation Stock Fund
is invested in E'town Corporation common stock which is traded on the
New York Stock Exchange. The shares are held in trust for the Plan by PNC
Bank. The Plan had 239,774 and 237,302 shares, respectively, of E'town
Corporation common stock at December 31, 1998 and 1997.
Effective, January 31, 1998 the Compass Capital Funds changed their name
to the BlackRock Funds. The Plan's investments are reported at fair market
value based on closing market quotations at December 31, 1998 and 1997.
Purchases and sales of securities are recorded on a trade date basis.
At December 31, 1998, the following investments held were greater
than 5% of the fair value of the Plan's net assets at the end of the Plan
year: BlackRock Large Cap Value Equity Fund, Fidelity Advisor Growth
Opportunities Fund, Janus Worldwide Fund and E'town Corporation Common
Stock Fund.
-8-
2. TAX STATUS
The Plan conforms with the requirements of Section 401(a) of the Internal
Revenue Code 1986 (the "Code") and is intended to be exempt from
taxation under Section 501(a) of the Code.
The Plan obtained its latest determination letter on July 24, 1995. The
Plan has been amended since receiving the determination letter. However,
the Plan administrator believes that the Plan is currently designed and
being operated in compliance with the applicable requirements of the Code
and the related trust was tax-exempt as of the financial statement date.
Therefore, there is no provision for income taxes in the Plan's financial
statements.
3. OTHER
The Plan's accounts are maintained on an accrual basis.
The Plan considers all highly liquid investments with maturity dates of
90 days or less to be cash equivalents.
There are no material lease commitments or parties in interest
transactions.
As of December 31, 1998 and 1997, no benefits were due to participants
who have withdrawn from participation in the Plan.
-9-
<PAGE>
ELIZABETHTOWN WATER COMPANY Form 5500
SAVINGS AND INVESTMENT PLAN - 401(k) Item 27(a)
SUPPLEMENTAL SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES (Item 27(a))
AS OF DECEMBER 31, 1998
- ------------------------------------------------------------------------------
Original Cost Market Value
PNC INVESTMENT CONTRACT FUND
486,172.98 Shares @ $1.9896 per share $897,838 $967,290
FIDELITY ADVISOR HIGH YIELD FUND
43,941.64 Shares @ $11.33 per share 548,981 497,859
PNC BALANCED PROFILE FUND
44,166.54 Shares @ $18.5847 per share 699,355 820,822
BLACKROCK LARGE CAP VALUE EQUITY FUND
140,008.76 Shares @ $15.99 per share 2,091,138 2,238,740
FIDELITY ADVISOR GROWTH OPPORTUNITIES FUND
30,491.85 Shares @ $50.21 per share 1,285,201 1,530,996
JANUS WORLDWIDE FUND
31,902.68 Shares @ $47.36 per share 1,300,565 1,510,911
BLACKROCK SMALL CAP GROWTH EQUITY FUND
40,019.46 Shares @ $21.63 per share 779,889 865,621
E'TOWN CORPORATION COMMON STOCK
239,774.15 Shares @ $47.375 per share 6,634,897 11,359,301
E'TOWN CORPORATION STOCK LIQUIDITY FUND
254,678.99 Shares @ $1.00 per share 254,679 254,679
LOAN FUND
Market value at December 31, 1998 represents the
total unpaid principal balance at the end of th
year. Interest rates on these loans range from
6.61% to 11%. Maturity dates range from
February, 1999 through August, 2008. 314,229 314,229
---------- ----------
TOTAL $14,806,772 $20,360,448
========== ===========
-10-
<PAGE>
Form 5500
Item 27(d)
ELIZABETHTOWN WATER COMPANY
SAVINGS AND INVESTMENT PLAN - 401(K)
SUPPLEMENTAL SCHEDULE OF REPORTABLE TRANSACTIONS (Item 27(d))
FOR THE YEAR ENDED DECEMBER 31, 1998 *
- --------------------------------------------------------------
- -----------------------------------------------------------------------------
Number Number Net
of Total of Total Gain /
Series of Transactions: Purchases Purchases Sales Sales (Loss)
E'Town Corporation
Common Stock 47 1,560,980 66 1,217,546 (525,468)
E'Town Corporation
Stock Liquidity Fund 53 1,378,986 55 1,365,891 -
* Reportable transactions consist of any single transaction or series of
transactions within the Plan year with the same person or entity or for the
same security which, when aggregated, involves an amount that is in excess of
5% of the fair value of Plan assets at the beginning of the Plan year.
- ------------------------------------------------------------------------------
-11-
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the trustees (or other persons who administer the employee benefit
plan) have duly caused this annual report to be signed on its behalf by the
undersigned hereunto duly authorized.
Date: June 29, 1999 ELIZABETHTOWN WATER COMPANY
SAVINGS AND INVESTMENT PLAN - 401(K)
By: /s/ Henry S. Patterson, III
Name: Henry S. Patterson III
Title: Trustee
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration Statement No.
33 - 19600 on Form S-8 of E'town Corporation of our report dated June 25, 1999
appearing in this Annual Report on Form 11-K of Elizabethtown Water Company
Savings and Investment Plan - 401(K) for the year ended December 31, 1998.
/s/ Deloitte & Touche LLP
Parsippany, New Jersey
June 28, 1999
