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 [FEE REQUIRED]. For the fiscal year ended December 31, 1995
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 2-93265
A. Full title of the plan and the address of the plan, if different from that
of the issuer named below:
Texas-New Mexico Power Company Thrift Plan for Employees
4100 International Plaza
P. O. Box 2943
Fort Worth, Texas 76113
B. Name of issuer of the securities held pursuant to the plan and the address
of its principal executive office:
TNP Enterprises, Inc.
4100 International Plaza
P. O. Box 2943
Fort Worth, Texas 76113
<PAGE>
REQUIRED INFORMATION
The following financial statements prepared in accordance with the
financial reporting requirements of ERISA and exhibits are filed for the
Texas-New Mexico Power Company Thrift Plan for Employees:
Financial Statements and Schedules
Independent Auditors' Report
Statements of Net Assets Available for Benefits, December 31, 1995, and
1994
Statements of Changes in Net Assets Available for Benefits, Years Ended
December 31, 1995, and 1994
Notes to Financial Statements, December 31, 1995, and 1994
Item 27(a) - Schedule of Assets Held for Investment Purposes, December 31,
1995
Item 27(d) - Schedule of Reportable Transactions, Year Ended December 31,
1995
Exhibit
-------
23 - Independent Auditors' Consent
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934,
the administrator and/or Thrift Plan Committee has duly caused this annual
report to be signed on its behalf by the undersigned hereunto duly authorized.
TEXAS-NEW MEXICO POWER COMPANY THRIFT
PLAN FOR EMPLOYEES
Date: July 12, 1996
By \s\ Dennis R. Cash
-----------------------------
DENNIS R. CASH, as Vice President of
Texas-Mexico Power Company as
Administrator of the
Thrift Plan and as member of Thrift Plan
Committee
TEXAS-NEW MEXICO POWER COMPANY
THRIFT PLAN FOR EMPLOYEES
Financial Statements and Supplemental Schedules
December 31, 1995 and 1994
(With Independent Auditors'
Report Thereon)
<PAGE>
Independent Auditors' Report
The Trustee and Thrift Plan Committee
Texas-New Mexico Power Company
Thrift Plan for Employees:
We have audited the accompanying statements of net assets available for benefits
of Texas-New Mexico Power Company Thrift Plan for Employees (the Plan) as of
December 31, 1995 and 1994, 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, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of Texas-New Mexico
Power Company Thrift Plan for Employees as of December 31, 1995 and 1994, and
the changes in net assets available for benefits for the years then ended in
conformity with generally accepted accounting principles.
Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of Item 27a -
Schedule of Assets Held for Investment Purposes and Item 27d - Schedule of
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 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.
KPMG Peat Marwick LLP
Fort Worth, Texas
July 8, 1996
<PAGE>
TEXAS-NEW MEXICO POWER COMPANY
THRIFT PLAN FOR EMPLOYEES
Statements of Net Assets Available for Benefits
December 31, 1995 and 1994
<TABLE>
<CAPTION>
1995 1994
---- ----
Investments, at fair value:
<S> <C> <C>
TNP Enterprises, Inc. Common Stock Fund
(2,347,828 units in 1995) $ 28,005,840 -
Common stock of TNP Enterprises, Inc.
(1,722,018 shares in 1994) - 25,615,021
AIM Constellation Fund (28,612 units in 1995) 644,069 -
Templeton Foreign Fund (18,193 units in 1995) 167,014 -
Vanguard Index 500 Fund (115,560 units
in 1995 and 134,954 units in 1994) 6,656,237 5,798,963
Vanguard Wellesley Income Fund (237,033
units in 1995 and 355,230 units in 1994) 4,844,947 6,056,669
United States Treasury Bills - 14,306,147
United States Savings Bonds - 116,372
Nations Short - Intermediate Government Fund
(35,228 units in 1995) (note 6) 146,547 -
Nations Prime Fund (8,363,615 units) (note 6) 8,363,615 -
Participants' notes receivable 3,099,180 -
Total investments 51,927,449 51,893,172
Employer's contributions receivable (note 1(b)) 689,983 -
Participants' contributions receivable 103,383 -
Cash 11,921 128,702
---------- ----------
Net assets available for benefits $ 52,732,736 52,021,874
========== ==========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
TEXAS-NEW MEXICO POWER COMPANY
THRIFT PLAN FOR EMPLOYEES
Statements of Changes in Net Assets Available for Benefits
Years ended December 31, 1995 and 1994
<TABLE>
<CAPTION>
1995 1994
---- ----
Additions to net assets:
Investment income:
<S> <C> <C>
Dividends on common stock of
TNP Enterprises, Inc. $ 321,310 1,861,905
Dividends on mutual funds 531,597 629,591
Interest on participants' loans (net of fees) 66,319 -
Other interest 541,203 -
Net appreciation (depreciation) in fair
value of investments (note 5) 9,444,935 (2,647,227)
---------- ----------
Net investment income (loss) 10,905,364 (155,731)
---------- ----------
Contributions (note 1(b)):
Employer 1,746,355 753,349
Employees 2,737,862 2,517,943
---------- ----------
4,484,217 3,271,292
---------- ----------
Total additions 15,389,581 3,115,561
Deduction from net assets - benefits paid to
participants 14,678,719 1,655,309
---------- ----------
Net increase 710,862 1,460,252
---------- ----------
Net assets available for benefits:
Beginning of year 52,021,874 50,561,622
---------- ----------
End of year (note 7) $ 52,732,736 52,021,874
========== ==========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
TEXAS-NEW MEXICO POWER COMPANY
THRIFT PLAN FOR EMPLOYEES
Notes to Financial Statements
December 31, 1995 and 1994
(1) Description of Plan
The following description of the Texas-New Mexico Power Company Thrift Plan
for Employees (the Plan) provides only general information. Participants
should refer to the Plan agreement for a more complete description of the
Plan's provisions.
(a) General
The Plan is a defined contribution plan covering employees of
Texas-New Mexico Power Company (the Company or Employer), a
wholly owned subsidiary of TNP Enterprises, Inc. (TNPE), who are
scheduled to work at least 1,000 hours year. The Plan is subject
to the provisions of the Employee Retirement Income Security Act
of 1974 (ERISA). The Company's Board of Directors adopted an
amended and restated Plan effective May 1, 1995; several of the
major revisions are discussed in the following notes. The Plan is
administered by NationsBank of Georgia, N. A., as trustee.
(b) Contributions
Each year, participants may contribute, pursuant to a salary
reduction arrangement, from 2% to 12% of their annual
compensation (up to $9,240 in 1995 and 1994).
The Company may make matching contributions, up to 6% of eligible
compensation, at the discretion of the Company's Board of
Directors. Effective May 1, 1995, the Company's Board of
Directors dedicated a portion of its matching contribution of up
to 3% of eligible compensation for 1995, to meeting specified
performance goals during 1995. Based upon achievement of the 1995
performance goals, the Plan accrued such contributions of
$653,148 which the Company funded in 1996.
Effective January 1, 1993, the Company suspended its matching
contributions to the Plan; however, in 1994 the Company's Board
of Directors approved restoration of the Company's matching
contributions, effective for participant contributions after June
30, 1994.
The Employer's contributions are used to purchase units of the
TNPE common stock fund, which participants may later convert into
units of other investment options.
(c) Expenses of Administering the Plan
Allcosts and expenses incurred in administering the Plan, except
for costs born by respective participants to originate
participant notes receivable, have been paid by the Company.
<PAGE>
TEXAS-NEW MEXICO POWER COMPANY
THRIFT PLAN FOR EMPLOYEES
Notes to Financial Statements
(1) Description of Plan, Continued
(d) Participant Accounts
Each participant's account is credited with that participant's
contributions, the Company's matching contributions and allocated
investment earnings and losses of the directed investments in the
participant's account. Effective April 28, 1994, the Plan was
amended to also allow participants to transfer funds from other
qualified plans.
(e) Vesting
Participants are fully vested in their contributions and the
Company's matching contributions, including actual earnings
thereon, at all times.
In the event of complete or partial termination of the Plan, the
assets of the Plan shall be distributed to the participants and
their beneficiaries in accordance with the Plan agreement.
(f) Investment Options
Effective May 1, 1995, participants may direct contributions in
1% increments (previously 10% increments) in any of seven
investment options (previously four options):
TNP Enterprises, Inc. Common Stock Fund - Funds are invested in a
unitized fund that invests primarily in the common stock of TNPE
with a portion in a money market fund for liquidity purposes.
AIM Constellation Fund - Funds are invested in units of a
registered investment company that seeks aggressive capital
appreciation primarily through investment in common stocks with a
emphasis on medium-sized and smaller emerging growth companies.
Templeton Foreign Fund - Funds are invested in units of a
registered investment company that seeks long-term capital growth
through investments primarily in equity securities and debt
obligations of companies and governments outside the United
States.
Vanguard Index 500 Fund - Funds are invested in units of a
registered investment company that invests primarily in U.S.
Government and corporate debt obligations and dividend-paying
equity securities.
Vanguard Wellesley Income Fund - Funds are invested in units of a
registered investment company that invests primarily in various
equity security portfolios that seek to match the performance of
distinct market indices.
<PAGE>
TEXAS-NEW MEXICO POWER COMPANY
THRIFT PLAN FOR EMPLOYEES
Notes to Financial Statements
(1) Description of Plan, Continued
(f) Investment Options, Continued
Nations Short - Intermediate Government Fund - Funds are invested
in units of a registered investment company that invests
primarily in U. S. Treasury bonds and notes, U. S. Government
Agency bonds and Government Mortgage - backed securities, all
structured to have an average weighted maturity of less than five
years.
Nations PrimeFund - Funds are invested in units of a registered
investment company that invests primarily in commercial paper,
certificates of deposit and other money market instruments, all
with a maturity of less than thirteen months.
Prior to May 1, 1995 participants also had the following
investment options:
TNPE Common Stock - Funds were invested in the common stock of
TNPE (eliminated as an option as of May 1, 1995)
Certain U.S. Government securities - Funds were invested in
certain U.S. Treasury Bills and Savings Bonds (eliminated as an
option as of May 1, 1995).
Effective May 1, 1995, participants may change their investment
options daily (previously quarterly).
(g) Participant Notes Receivable
Participants may borrow from their fund accounts a minimum of
$1,000 up to a maximum equal to the lesser of $50,000 or 50
percent of their account balance. Loan transactions are treated
as a transfer to (from) one of the investment funds from (to) the
Participants' Notes Receivable. Loan terms range from 6 to 60
months. The loans are secured by the balance in the participant's
account and bear interest at a rate equal to the NationsBank
prime rate on the first business day of the month in which the
loan originated plus 1 percent. Interest rates range from 9.75
percent to 10 percent. Principal and interest is paid ratably
through payroll deductions.
(h) Payment of Benefits
Upon termination of service, a participant may elect to receive
either a lump-sum amount equal to the value of their account, or
installments over a 5-year period.
(i) Use of Estimates
The Plan Administrator has made a number of estimates and
assumptions relating to the reporting of assets and liabilities
to prepare these financial statements in conformity with
generally accepted accounting principles. Actual results could
differ from those estimates.
<PAGE>
TEXAS-NEW MEXICO POWER COMPANY
THRIFT PLAN FOR EMPLOYEES
Notes to Financial Statements
(2) Summary of Significant Accounting Policies
(a) Basis of Presentation
The accompanying financial statements have been prepared on the
accrual basis of accounting.
(b) Investment Valuation and Income Recognition
The Plan's investments are stated at fair value. The TNPE Common
Stock Fund is valued using quoted market prices for the common
stock of TNPE and the Money Market Funds included in the fund.
Shares of registered investment companies are valued at quoted
market prices which represent the net asset value of shares held
by the Plan at year-end. U. S. Treasury Bills were valued using
quoted market prices. U. S. Savings Bonds were valued at
redemption value, which approximated fair value. Participant
notes receivable are valued at cost, which approximates fair
value.
Purchases and sales of securities are recorded on the trade date
(the date the buy or sell order is executed). Interest income is
recorded on the accrual basis. Dividends on common stock of TNPE
are recorded on the ex-dividend date. Dividends on mutual funds
are recorded when declared.
(c) Payment of Benefits
Benefits are recorded when paid.
(3) Plan Termination
Although it has not expressed any intent to do so, the Company has the
right under the Plan to discontinue contributions at any time and to
terminate the Plan subject to the provisions of ERISA.
(4) Tax Status
The Internal Revenue Service has determined and informed the Company by
letter dated June 12, 1991, that the Plan and related trust are designed in
accordance with applicable sections of the Internal Revenue Code (IRC). The
Plan has been amended since receiving the determination letter. However,
the Plan administrator believes the Plan is designed and is currently being
operated in compliance with the applicable requirements of the IRC.
Contributions to a participant's account and the related investment
earnings are not included in a participant's taxable income until such
amounts are distributed to that participant.
<PAGE>
TEXAS-NEW MEXICO POWER COMPANY
THRIFT PLAN FOR EMPLOYEES
Notes to Financial Statements
(5) Investments
Net appreciation (depreciation) in the fair value of investments bought,
sold, and held by the Plan during 1995 and 1994 is summarized as follows:
<TABLE>
<CAPTION>
1995 1994
---- ----
<S> <C> <C>
TNP Enterprises, Inc. Common Stock Fund $ 3,425,906 -
Common stock of TNPE 3,390,577 (2,418,409)
AIM Constellation Fund (4,218) -
Templeton Foreign Fund (5,859) -
Vanguard Index 500 Fund 1,735,348 (110,569)
Vanguard Wellesley Income Fund 900,096 (702,907)
United States Treasury Bills - 581,751
United States Savings Bonds - 2,907
Nations Short-Intermediate Government Fund 3,085 -
--------- ---------
$ 9,444,935 (2,647,227)
========= =========
</TABLE>
(6) Related Party Transactions
Certain Plan investments are shares of mutual funds managed by NationsBank
Corporation affiliates. NationsBank of Georgia, N.A., a wholly owned
subsidiary of NationsBank Corporation, is the trustee as defined by the
Plan and, therefore, these transactions qualify as party-in-interest.
<PAGE>
TEXAS-NEW MEXICO POWER COMPANY
THRIFT PLAN FOR EMPLOYEES
Notes to Financial Statements
(7) Changes in Net Assets Allocated to Investment Funds
The following is an analysis of changes in net assets allocated to investment
funds for the years ended December 31, 1995 and 1994:
<TABLE>
<CAPTION>
Balance at Net Balance at
January 1, Investment Benefits December 31,
1995 Income Contributions Paid Transfers 1995
---- ------ ------------- ---- --------- ----
<S> <C> <C> <C> <C> <C> <C>
TNP Enterprises,
Inc. Common
Stock Fund $ - 3,425,948 1,345,461 (1,657,228) 24,891,659 28,005,840
Common stock
of TNPE 25,615,021 3,711,887 940,883 (3,599,610) (26,668,181) -
AIM
Constellation
Fund - 15,337 293,990 (5,130) 339,872 644,069
Templeton
Foreign Fund - 2,393 114,229 - 50,392 167,014
Vanguard
Index
500 Fund 5,798,963 1,891,441 486,243 (1,419,342) (101,068) 6,656,237
Vanguard
Wellesley
Income Fund 6,056,669 1,247,793 360,221 (2,142,940) (676,796) 4,844,947
United States
Treasury Bills 14,306,147 194,921 131,377 (4,550,871) (10,081,574) -
United States
Savings Bonds 116,372 4,945 - (50,833) (70,484) -
Nations Short-
Intermediate
Government Fund - 6,963 54,372 (157,130) 242,342 146,547
Nations Prime Fund - 325,656 92,617 (1,057,411) 9,002,753 8,363,615
Participants'
notes receivable - 66,319 - (38,224) 3,071,085 3,099,180
Contributions
receivable - - 664,824 - 128,542 793,366
Cash 128,702 11,761 - - (128,542) 11,921
---------- ---------- --------- ---------- --------- ----------
Total $ 52,021,874 10,905,364 4,484,217 (14,678,719) - 52,732,736
========== ========== ========= ========== ========= ==========
</TABLE>
<PAGE>
(7) Changes in Net Assets Allocated to Investment Funds, Continued
<TABLE>
<CAPTION>
Net
Balance at Investment Balance at
January 1, Income Benefits December 31,
1994 (Loss) Contributions Paid Transfers 1994
---- ------ ------------- ---- --------- ----
<S> <C> <C> <C> <C> <C> <C>
Common stock
of TNPE $ 24,275,237 (556,504) 1,873,701 (448,344) 470,931 25,615,021
Vanguard Index
500 Fund 5,007,668 67,726 524,856 (75,686) 274,399 5,798,963
Vanguard
Wellesley
Income Fund 4,846,364 (251,611) 468,509 (150,883) 1,144,290 6,056,669
United States
Treasury Bills 16,061,141 581,751 404,226 (980,396) (1,760,575) 14,306,147
United States
Savings Bonds 144,175 2,907 - - (30,710) 116,372
Cash 227,037 - - - (98,335) 128,702
---------- ------- --------- --------- --------- ----------
Total $ 50,561,622 (155,731) 3,271,292 (1,655,309) - 52,021,874
========== ======= ========= ========= ========= ==========
</TABLE>
<PAGE>
TEXAS-NEW MEXICO POWER COMPANY
THRIFT PLAN FOR EMPLOYEES
Item 27a - Schedule of Assets Held for Investment Purposes
December 31, 1995
<TABLE>
<CAPTION>
Description of Investment
Identity of Issue, Including Maturity Date,
Borrower, Lessor Rate of Interest, Collateral, Current
or Similar Party Par or Maturity Value Cost Value
Mutual Funds:
<S> <C> <C> <C>
TNP Enterprises, Inc.
Common Stock
Fund* 2,347,828 units $ 24,679,327 28,005,840
AIM Constellation
Fund 28,612 units 650,825 644,069
Templeton Foreign
Fund 18,193 units 172,590 167,014
Vanguard Index 500
Fund 115,560 units 5,005,820 6,656,237
Vanguard Wellesley
Income Fund 237,033 units 4,429,510 4,844,947
Nations Short -
Intermediate
Government Fund* 35,228 units 144,560 146,547
Nations Prime Fund* 8,363,615 units 8,363,615 8,363,615
---------- ----------
43,446,247 48,828,269
Participants' notes 9.75% to 10% notes
receivable receivable due various
dates within 60 months,
secured by each respective
participant's remaining
investments. 3,099,180 3,099,180
---------- ----------
$ 46,545,427 51,927,449
========== ==========
* Party-in-interest
</TABLE>
<PAGE>
TEXAS-NEW MEXICO POWER COMPANY
THRIFT PLAN FOR EMPLOYEES
Item 27d - Schedule of Reportable Transactions
Year ended December 31, 1995
<TABLE>
<CAPTION>
Current
Expense Value of
Identity of Incurred Asset on
Party Description Purchase Selling Lease with Cost Transaction Net Gain
Involved of Asset Price Price Rental Transaction of Asset Date or (Loss)
-------- --------- ----- ----- ------ ----------- -------- ---- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
NationsBank, as Sales of 216,807 shares
trustee* of common stock of
TNP Enterprises,
Inc.* $ - 3,219,117 - - 3,631,600 3,219,117 (412,483)
NationsBank, as Purchase of 73,883
trustee* shares of common
stock of TNP
Enterprises, Inc.* 1,137,335 - - - 1,137,335 - -
NationsBank, as Exchange of 1,579,094
trustee* shares of common
stock of TNP
Enterprises, Inc.* for
2,566,359 units of
TNP Enterprises, Inc.
Common Stock Fund* 26,923,816 26,923,816 - - 26,923,816 25,663,594 -
NationsBank, as Sales of 397,769 units of
trustee* TNP Enterprises, Inc.
Common Stock Fund* - 4,271,468 - - 4,172,075 4,271,468 99,393
NationsBank, as Purchase of 179,238
trustee* units of TNP
Enterprises, Inc.
Common Stock Fund* 1,927,586 - - - 1,927,586 - -
Vanguard Index Purchase of 27,699 units
500 Fund of Vanguard Index
500 Fund 1,412,909 - - - 1,412,909 - -
Vanguard Index Sale of 47,093 units
500 Fund of Vanguard Index
500 Fund - 2,290,983 - - 1,984,684 2,290,983 306,299
</TABLE>
<PAGE>
TEXAS-NEW MEXICO POWER COMPANY
THRIFT PLAN FOR EMPLOYEES
Item 27d - Schedule of Reportable Transactions, Continued
Year ended December 31, 1995
<TABLE>
<CAPTION>
Current
Expense Value of
Identity of Incurred Asset on
Party Description Purchase Selling Lease with Cost Transaction Net Gain
Involved of Asset Price Price Rental Transaction of Asset Date or (Loss)
-------- --------- ----- ----- ------ ----------- -------- ---- ---------
<S> <C> <C> <C>
Vanguard Wellesley Sales of 182,769 units
Income Fund of Vanguard Wellesley
Income Fund - 3,362,172 - - 3,410,016 3,362,172 (47,844)
Vanguard Wellesley Purchases of 64,572
Income Fund units of Vanguard
Wellesley Income Fund 1,250,356 - - - 1,250,356 - -
U.S. Treasury Purchases of $3,810,000
face value treasury
bills, due March 30,
1995 3,773,410 - - - 3,773,410 3,773,410 -
U.S. Treasury Purchases of $10,105,000
face value treasury
bills, due April 27,
1995 10,035,506 - - - 10,035,506 10,035,506 -
U.S. Treasury Sales of $5,755,000
face value treasury
bills, due March 30,
1995 - 5,691,565 - - 5,691,565 5,691,565 -
U.S. Treasury Sales of $10,105,000
face value treasury
bills, due April 27,
1995 - 10,035,506 - - 10,035,506 10,035,506 -
NationsBank, as Purchases of 10,708,737
trustee* units of Nations Prime
Fund* 10,708,737 - - - 10,708,737 10,708,737 -
NationsBank, as Sales of 2,345,122 units
trustee* of Nations Prime
Fund* - 2,345,122 - - 2,345,122 2,345,122 -
* Party-in-interest
</TABLE>
<PAGE>
Independent Auditors' Consent
The Board of Directors
TNP Enterprises, Inc.
The Trustee and Thrift Plan Committee
Texas-New Mexico Power Company
Thrift Plan for Employees:
We consent to incorporation by reference in the Registration Statement (No.
2-93265) on Form S-8 of TNP Enterprises, Inc. of our report dated July 8, 1996,
relating to the statements of net assets available for benefits of Texas-New
Mexico Power Company Thrift Plan for Employees as of December 31, 1995 and 1994,
and the related statements of changes in net assets available for benefits for
the years then ended and related supplemental schedules, which report appears in
the December 31, 1995, annual report on Form 11-K of TNP Enterprises, Inc.
Fort Worth, Texas
July 11, 1996
