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
For the Fiscal Year ended December 31, 1999
-----------------
OR
____ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ______________ to __________________
Commission file number 1-4315
ORANGE AND ROCKLAND UTILITIES, INC.
MANAGEMENT EMPLOYEES' SAVINGS PLAN
(Full title of the plan)
ORANGE AND ROCKLAND UTILTIES, INC.
----------------------------------
(Name of issuer of the securities held pursuant to the plan)
ONE BLUE HILL PLAZA
PEARL RIVER, NEW YORK, NY 10965
(Address of principal executive office)
<PAGE>
TABLE OF CONTENTS
Page
Signature of Plan Administrator 3
Report of Independent Public Accountants 5
Financial Statements and Notes:
Statements of Net Assets Available for Benefits 6
As of December 31, 1999 and 1998
Statements of Changes in Net Assets Available for Benefits
For the years ended December 31, 1999 and 1998 7
Note to Financial Statements 8
Supplementary Schedules:
I. Line 27a - Schedules of Assets Held for Investment 15
Purposes as of December 31, 1999
Exhibit
23 Consent of Independent Public Accountants to incorporation
by reference in the Prospectus of Registration Statement No.
33-25359 of their report dated May 15, 2000.
Note: All other schedules are omitted since they are not applicable or are
not required based on the disclosure requirements of the Employees'
Retirement Income Security Act of 1974 and applicable regulations
issued by the Department of Labor.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the directors (or other persons who administer the plan) have duly caused this
annual report to be signed by the undersigned hereunto duly authorized.
ORANGE AND ROCKLAND UTILITIES, INC.
MANAGEMENT EMPLOYEES' SAVINGS PLAN
BY Hector J. Reyes
Hector J. Reyes
Plan Administrator
Date: May 15, 2000
<PAGE>
Orange and Rockland Utilities, Inc.
Management Employees' Savings Plan
Financial Statements
December 31, 1999 and 1998
<PAGE>
Report of Independent Accountants
May 15, 2000
To the Board of Directors of
Orange and Rockland Utilities, Inc.
and To the Participants and Plan Administrator of
Orange and Rockland Utilities, Inc. Management Employees' Savings Plan
In our opinion, the accompanying statement of net assets available for benefits
and the related statement of changes in net assets available for benefits
present fairly, in all material respects, the net assets available for benefits
of Orange and Rockland Utilities, Inc. Management Employees' Savings Plan (the
"Plan") at December 31, 1999, and the changes in net assets available for
benefits for the year then ended, in conformity with accounting principles
generally accepted in the United States. 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 audit. We conducted our audit
of these statements in accordance with auditing standards generally accepted in
the United States, which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audit provides a reasonable basis for the opinion expressed above. The financial
statements of the Plan as of December 31, 1998 were audited by other auditors
whose report dated May 24, 1999 expressed an unqualified opinion on those
statements.
Our audit was conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedule of assets held
for investment purposes is presented for purposes of additional analysis and is
not a required part of the basic financial statements but is supplementary
information required by the Department of Labor's Rules and Regulations of
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. This supplemental schedule is the responsibility of the Plan's management.
The supplemental schedule has been subjected to the auditing procedures applied
in the audit of the basic financial statements and, in our opinion, is fairly
stated in all material respects in relation to the basic financial statements
taken as a whole.
<PAGE>
Orange and Rockland Utilities, Inc.
Hourly Group Savings Plan
Notes to Financial Statements
Orange and Rockland Utilities, Inc.
Management Employees' Savings Plan
Statements of Net Assets Available for Benefits
December 31,
1999 1998
---- ----
Assets
Investments at fair value
Registered investment companies $ 54,571,248 $ 47,123,691
Common/collective trust 12,902,715 -
Interest in Stock Fund Master Trust - 4,762,095
Loans to participants 706,440 965,227
Investments at contract value
Interest in MIF Master Trust 6,306,142 16,935,210
------------ ------------
Total assets 74,486,545 69,786,223
------------ ------------
Net assets available
for benefits $ 74,486,545 $ 69,786,223
============ ============
The accompanying notes are an integral part of these financial statements.
<PAGE>
Orange and Rockland Utilities, Inc.
Management Employees' Savings Plan
Statements of Changes in Net Assets Available for Benefits
December 31,
1999 1998
---- ----
Additions:
Contributions
Employee (Pre-tax and after-tax) $ 2,870,689 $ 3,234,159
Rollovers 45,795 71,645
Employer match 465,701 522,200
------------ ------------
Total contributions 3,382,185 3,828,004
------------ ------------
Earnings on investments
Interest and dividend income 4,091,498 2,819,176
Interest on loans to participants 53,365 80,429
Net appreciation in fair value
of investments 6,894,500 7,872,158
Plan's interest in MIF Master Trust
investment income and gains 969,215 927,468
Plan's interest in Stock Fund Master Trust
investment income and gains 257,079 1,001,527
------------ ------------
Total earnings on investments 12,265,657 12,700,758
Total additions 15,647,842 16,528,762
------------ ------------
Deductions:
Benefit payments to participants 8,642,057 4,843,849
------------ ------------
Net increase prior to transfers 7,005,785 11,684,913
Net transfers to other plans (2,305,463) (195,634)
------------ -------------
Net increase in net assets 4,700,322 11,489,279
Net assets available for benefits
Beginning of year 69,786,223 58,296,944
------------ ------------
End of year $ 74,486,545 $ 69,786,223
============ ============
The accompanying notes are an integral part of these financial statements.
<PAGE>
Orange and Rockland Utilities, Inc.
Hourly Group Savings Plan
Notes to Financial Statements
Orange and Rockland Utilities, Inc.
Management Employees' Savings Plan
Notes to Financial Statements
1. Description of the Plan
The following description of the Orange and Rockland Utilities, Inc. (the
"Company") Management Employees' Savings Plan (the "Plan") provides only
general information. Participants should refer to the plan document for a
more complete description.
General
The Plan's purpose is to provide eligible management employees of the
Company ("Participants") a program whereby the Company can contribute on
behalf of a Plan Participant an elected percentage of the Participant's
compensation on a before-tax basis pursuant to section 401(k) of the
Internal Revenue Code of 1986, as amended. In addition, the Plan is
designed to further supplement before-tax 401(K) contributions through
Company matching contributions and Participant after-tax contributions.
Plan administration
The Plan is administered by the Company's Retirement Committee, whose
members are appointed by the Company's Board of Directors. The Plan's
investments are held with Fidelity Management Trust Company ("FMTC") in
accordance with the terms of a master trust agreement between FMTC and the
Company.
Contributions
The Company provides matching contribution of 50% of Participants
before-tax contributions to the Plan up to 3% of each Participant's
compensation. The maximum Company matching contribution per Participant,
therefore, is 1.5% of compensation.
Participants may elect to make before-tax contributions or a combination
of before-tax and after-tax contributions in a maximum amount of 15% of
compensation. Participants' Company matching contributions are invested in
accordance with Participants' before-tax investment elections.
Vesting
Separate accounts are maintained for each Participant's interest in the
Plan. Participant accounts, including Company matching contributions, are
at all times fully vested and nonforfeitable.
Payment of benefits
A Participant may elect to withdraw, according to the Plan's rules
governing withdrawals, all or a portion of the Participant's after-tax
contributions and earnings, in accordance with the terms of the Plan. The
earnings portion of the withdrawals may be subject to an excise tax.
<PAGE>
Orange and Rockland Utilities, Inc.
Management Employees' Savings Plan
Notes to Financial Statements
Orange and Rockland Utilities, Inc. 2
Management Employees' Savings Plan
Notes to Financial Statements
A Participant, in general, may withdraw before-tax contributions and
earnings only in the case of hardship and in accordance with the terms of
the Plan. The Participant may be subject to an excise tax on the taxable
portion of such withdrawal.
Upon termination of employment for any reason, a Participant's account
balance, if less than or equal to $5,000 will be distributed to the
Participant or designated beneficiary as soon as administratively
practicable, unless the Participant elects to defer such distribution in
accordance with the terms of the Plan, but in no event later than the 12
month period following the Participant's date of termination. However, if
the value of a Participant's account is greater than $5,000 the
Participant's account will not be distributed until the Participant elects
in writing to receive such distribution, subject to certain limitations,
and in accordance with the terms of the Plan.
In addition, the taxable portion of the distribution may be subject to an
excise tax.
Transfers from other plans
Any amounts, including any promissory note with respect to any outstanding
loan, held on behalf of Orange and Rockland Utilities, Inc. Hourly Group
Savings Plan (the "Hourly Plan") Participants who become management
employees are transferred to the Plan in accordance with the terms of the
Plan. The transferred Hourly Plan contributions will be treated in the
same manner as before-tax contributions except where otherwise
specifically provided in the Plan.
In addition, following a Participant's transfer to a local 503 IBEW
bargaining unit position, all amounts held in the Participant's account
will be transferred to the Hourly Plan, and any promissory note shall be
transferred, subject to certain limitations with respect to the portion of
a loan, if any, attributable to after-tax contributions, in accordance
with the provisions of the Plan.
Rollover contributions
Employees may elect to rollover into the Plan any cash received in any
distribution from a pension, profit sharing or stock bonus plan meeting
the requirements of Section 401(a) of the Internal Revenue Code of 1986,
or from any qualifying individual retirement account or annuity. Rollover
contributions are invested and otherwise treated in the same manner as
other contributions except where otherwise specifically provided in the
Plan.
Loans receivable from participants
A Participant may obtain a loan under the Plan in a minimum amount of $500
and subject to a maximum amount as provided in the Plan, but in no event
in excess of the Participant's account balance. No more than one loan
request may be made by a Participant in any twelve month period and only
one loan per Participant may be
<PAGE>
outstanding at a time. The interest rate charged on general purpose loans
is equal to the Orange and Rockland Federal Credit Union interest rate for
a share secured loan for 48 months. The interest rate on principal
residence loans is based upon the FNMA rate for a 30-year fixed rate
mortgage. Interest rates will change quarterly, and shall be the rate in
effect 5 business days prior to the first day of the quarter. The interest
rate established for a loan will not be changed during the term of the
loan.
Each loan will be evidenced by a promissory note payable to the Trustee
for the loan amount, including interest, and secured by a lien on the
Participant's account. The terms of the loan generally require repayment
within five years. Loans become due and payable in full upon termination
of employment or if the loan repayments have not been current for 60 days.
Amendment or discontinuance of Plan
While the Company expects to continue the Plan indefinitely, it reserves
the right to amend or terminate the Plan at any time, in whole or in part,
provided that no amendment may retroactively reduce the rights of
Participants.
2. Summary of Significant Accounting Polices
Accounting basis and valuation of investments
The financial statements of the Plan have been prepared on the accrual
basis of accounting in accordance with generally accepted accounting
principles as applied to employee benefit plans and in accordance with the
requirements of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA").
Investments in common and collective trusts ("funds") are stated at
estimated fair value, which have been determined based on the unit value
of the funds. Unit values are determined by the sponsor of such funds by
dividing the fund's net assets at fair value by its units outstanding at
the valuation dates. 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. Loans to Participants are valued at cost which
approximates fair value. The investments in the Managed Income Fund Master
Trust investment account (the "MIF Master Trust"), other than cash
equivalents, are valued at contract value. Contract value is determined by
the contributions made plus interest at the rate specified in the various
investment contracts, less distributions made. Net appreciation in fair
value of investments consists of the unrealized appreciation or
depreciation of investments held during the year and the realized gain or
loss on investments sold during the year.
<PAGE>
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, liabilities,
changes therein and disclosure of contingent assets and liabilities.
Actual results could differ from those estimates.
Related party transactions
The Plan invests in shares of mutual funds managed by an affiliate of
FMTC. Transactions in such investments qualify as party-in-interest
transactions which are exempt from the prohibited transaction rules.
Administrative expenses
The costs of general administration of the Plan and trustee fees including
trustee fees associated with the Stock Fund are paid by the Company. The
expenses of the investment funds, including management fees of the
investment managers of the Registered Investment Companies and the Managed
Income Fund, are deducted from the earnings of those funds.
3. Investment Options
Participant contributions and Company matching contributions are invested,
at the election of the Participant, in one or a combination of funds.
Investment elections may be made by Participants in multiples of 1%.
4. Investment in Master Trusts
Managed Income Fund
The assets of the Plan's Managed Income Fund ("MIF") are commingled for
investment purposes in the MIF Master Trust with the assets of the Hourly
Plan's Managed Income Fund. The MIF Master Trust is being administered by
FMTC and new contributions are invested in FMTC's Managed Income Portfolio
("MIP") in addition to the fixed-income investments previously purchased
for the fund. As the previous fixed-income investments mature, all
proceeds will be invested in the MIP. All of the investments of the MIF
Master Trust are stated at contract value except for the cash equivalents,
which are stated at fair value.
The investment experience of the MIF Master Trust is allocated monthly
based on the MIF Master Trust's assets as calculated by MFTC. The amount
is derived from the prior month-end contract value of each Plan's Managed
Income Fund, plus contributions and transfers in, less benefit payments
and transfers out for the current month.
<PAGE>
The percentage interests in the MIF Master Trust for the Plan's Managed
Income Fund at December 31, 1999 and 1998 were 56.18% and 53.84%,
respectively.
The Master Trust' s assets, at December 31, 1999 and December 31, 1998 are
presented in the following table:
1999 1998
Investments:
At Fair Market Value -
Cash Equivalents $ 137,862 $ 1,488,753
At Contract Value -
Fixed-Rate Insurance Company Contracts - 2,494,941
Pooled Fund Investment 11,087,163 27,472,848
---------- -----------
11,087,163 29,967,789
Net Assets $11,225,025 $31,456,542
=========== ===========
The earnings on the MIF Master Trust's investments consist primarily of
interest income on the various fixed-income securities. For the years
ended December 31, 1999 and 1998 such earnings were $1,757,916 and
$1,746,586, respectively.
Stock Fund
The assets of the Plan's Stock Fund were commingled for investment
purposes in the Stock Fund Master Trust with the assets of the Hourly
Plan's Stock Fund and were invested by FMTC primarily in common stock of
the Company along with a small portion of money market instruments for
liquidity. Participant interests were stated in units to allow for daily
valuation. In accordance with Plan amendments, effective July 8, 1999 when
the Company became a wholly-owned subsidiary of Consolidated Edison, Inc.,
the Company Stock Fund was eliminated. The proceeds received for the stock
held in the Fund, as well as any money market balances, were initially
reinvested in the Managed Income Fund and thereafter as directed by
Participants. At the year ended December 31, 1998, there were
approximately 246,103 units in the Stock Fund with a Net Asset Value of
$19.35 per unit.
The purchase price of such stock included brokerage commissions and any
transfer taxes, if applicable. The Stock Fund was stated at fair market
value.
The percentage interest in the Stock Fund Master Trust for the Plan's
Stock Fund at December 31, 1998 was 53.47%.
<PAGE>
The Stock Fund Master Trust's assets at December 31, 1998 are presented in
the following table:
1998
Investments:
At Fair Market Value-
Cash Equivalents $ 96,501
Common Stock - Orange and
Rockland Utilities, Inc. 8,807,013
----------
8,903,514
Receivables 3,206
----------
Net Assets $ 8,906,720
=============
The earnings on investments of the Stock Fund Master Trust were credited
to Participant accounts in accordance with IRS guidelines. The earnings of
the Stock Fund Master Trust for the period ended July 8, 1999 and the year
ended December 31, 1998 are presented in the following table:
January 1, 1999 Year
To Ended
July 8, 1999 1998
Interest on cash equivalents $ 4,275 $ 4,671
Dividend income 205,494 381,189
Gain on sale of assets 3,568,455 385,648
Unrealized appreciation of assets (3,319,951) 1,208,194
---------- ----------
Earnings on investments $ 458,273 $1,979,702
========== ==========
5. Federal Income Tax Status
The Internal Revenue Service has determined and informed the Company by a
letter dated December 11, 1997, 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 and the Plan's tax counsel believe
that the Plan is designed and is currently being operated in compliance
with the applicable requirements of the IRC.
<PAGE>
6. Merger and Divestiture Amendments
On April 8, 1999, the Company's Board of Directors adopted amendments to
the Plan, as a result of (1) the merger of the Company and Consolidated
Edison, Inc. ("Con Edison"), whereby the Company became a wholly owned
subsidiary through the purchase of all of the Company's common stock by
Con Edison and (2) sale of the Company's electric generating assets to
subsidiaries of Southern Energy, Inc. ("Southern"), including the hiring
of certain Company employees by Southern. The following is a summary of
the significant changes to the Plan resulting from the merger and
divestiture.
Merger - Effective July 8, 1999, when all of the common stock of the
Company was acquired by Con Edison, the Company Stock Fund was eliminated.
The proceeds received from such stock held in the Company Stock Fund were
initially reinvested in the Managed Income Fund and thereafter as directed
by the Participants. There is no requirement that an investment fund be
maintained in shares of the acquiring entity.
Divestiture - As a result of the transfer of the Company's electric
generating assets to Southern, the portion of the Plan consisting of
account balances of those employees who were Participants in the Plan and
who had been hired by Southern, were spun off from the Plan and
transferred to a similar plan maintained by Southern; and the assets of
the Plan attributable to the Plan's transferred account balances were spun
off from the Company's Master Trust with FMTC and transferred to a trust
under a savings plan maintained by Southern. Furthermore, each Participant
in the Plan whose account balance was spun off and transferred to a
Southern plan ceased to be a Participant in the Plan.
<PAGE>
Orange and Rockland Utilities, Inc.
Management Employees' Savings Plan
Line 27a - Schedule of Assets Held for Investment PurposesAdditional Information
December 31, 1999 Schedule A
Shares, Units, Cost of Current
Description of Investment Principal Amount Asset Value
Registered Investment Companies
Fidelity Growth and Income Portfolio 463,641 $15,772,760 $21,865,317
Fidelity Magellan Fund 109,575 10,997,364 14,971,222
Fidelity OTC Portfolio 173,634 6,772,982 11,801,909
Fidelity Asset Manager Fund 184,709 3,171,222 3,394,954
Fidelity Worldwide Fund 127,530 2,123,905 2,537,846
Total Registered Investment Companies 38,838,233 54,571,248
----------- -----------
Loan Fund
Loans Receivable - - 706,440
Highest rate - 10.15%
Lowest rate - 6.60%
Interest in MIF Trust 6,306,142 6,306,142 6,306,142
Common/Collective Trust
Fidelity Managed Income Portfolio 12,902,715 12,902,715 12,902,715
Total assets held for
investment purposes $58,047,090 $74,486,545
=========== ===========
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
FOR ANNUAL REPORTS OF EMPLOYEE STOCK PURCHASE, SAVINGS AND SIMILAR PLAN
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
For the Fiscal Year ended December 31, 1999
-----------------
OR
____ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from ______________ to __________________
Commission file number 1-4315
ORANGE AND ROCKLAND UTILITIES, INC.
MANAGEMENT EMPLOYEES' SAVINGS PLAN
(Full title of the plan)
ORANGE AND ROCKLAND UTILTIES, INC.
----------------------------------
(Name of issuer of the securities held pursuant to the plan)
ONE BLUE HILL PLAZA
PEARL RIVER, NEW YORK, NY 10965
(Address of principal executive office)
EXHIBITS
Volume 1 of 1
<PAGE>
EXHIBIT INDEX
Exhibit
Number
23 Consent of Independent Public Accountants to incorporation by reference
in the Prospectus of Registration Statement No. 33-25359 of their report dated
May 15, 2000.
