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, 1999 Commission File Number 1-9120
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
THRIFT AND TAX-DEFERRED 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.
<PAGE>
Stable Value Fund STATE STREET BANK AND TRUST COMPANY
----------------- 225 FRANKLIN STREET, M9
PRIMCO CAPITAL MANAGEMENT BOSTON, MASSACHUSSETTS 02110-2804
400 WEST MARKET STREET, SUITE 3300
LOUISVILLE, KENTUCKY 40202
Enterprise Common Stock Fund and ESOP Fund
------------------------------------------
THE CHASE MANHATTAN BANK PUBLIC SERVICE ENTERPRISE GROUP
270 PARK AVENUE, 6TH FLOOR INCORPORATED
NEW YORK, NEW YORK 10017 80 PARK PLAZA
NEWARK, NEW JERSEY 07101-1171
J.P. MORGAN
60 WALL STREET Large Company Stock Index Fund
NEW YORK, NEW YORK 10260-0060 ------------------------------
THE VANGUARD GROUP INSTITUTIONAL DIVISION
METROPOLITAN LIFE INSURANCE P.O. BOX 2900
COMPANY VALLEY FORGE, PENNSYLVANIA 19482
ONE MADISON AVENUE
NEW YORK, NEW YORK 10010-3690 Diversified Bond Fund
---------------------
BLACKROCK FINANCIAL MANAGEMENT, INC.
ALLSTATE LIFE INSURANCE COMPANY 345 PARK AVENUE
ALLSTATE PLAZA WEST NEW YORK, NEW YORK 10154
3100 SANDERS ROAD, SUITE M2
NORTHBROOK, ILLINOIS 60062-7154 International Stock Fund
------------------------
T. ROWE PRICE INC.
NEW YORK LIFE INSURANCE COMPANY 100 EAST PRATT STREET
260 CHERRY HILL ROAD BALTIMORE, MARYLAND 02120
PARSIPPANY, NEW JERSEY 07054-0422
Mid Size Company Stock Fund
---------------------------
AIG LIFE INSURANCE COMPANY PUTNAM INVESTMENTS
ONE ALICO PLAZA P.O. BOX 41203
P.O. BOX 667 PROVIDENCE, RHODE ISLAND 02940
WILMINGTON, DELAWARE 19899
Small Company Stock Fund
------------------------
CAISSE des DEPOTS MILLER ANDERSON & SHERRERD, LLP
9 WEST 57th STREET, 36TH FLOOR ONE TOWER BRIDGE
NEW YORK, NEW YORK 10019 WEST CONSHOHOCKEN, PENNSLYVANIA 19428
Schwab Personal Choice Retirement Account
-----------------------------------------
TRANSAMERICA LIFE INSURANCE CHARLES SCHWAB & CO., INC.
& ANNUITIES 4722 NORTH 24TH STREET, SUITE 300
1150 SOUTH OLIVE STREET, T7-05 PHOENIX, ARIZONA 85016
LOS ANGELES, CALIFORNIA 90015
JOHN HANCOCK MUTUAL LIFE
INSURANCE COMPANY
JOHN HANCOCK PLACE, 27th FLOOR
P.O. BOX 111
BOSTON, MASSACHUSSETTS 02117
<PAGE>
PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED
THRIFT AND TAX-DEFERRRED SAVINGS PLAN
INDEX
-----
PAGE
----
INDEPENDENT AUDITORS' REPORT............................................ 4
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF DECEMBER 31, 1999 AND 1998...................................... 5
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEARS ENDED DECEMBER 31, 1999 and 1998........................ 6
NOTES TO FINANCIAL STATEMENTS........................................... 7
SIGNATURES.............................................................. 20
EXHIBIT INDEX........................................................... 21
<PAGE>
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 Thrift and Tax-Deferred
Savings Plan (the "Plan") as of December 31, 1999 and 1998, 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, 1999
and 1998, 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 12, 2000
<PAGE>
<TABLE>
<CAPTION>
PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED
THRIFT AND TAX-DEFERRED SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
As of December 31,
-----------------------------------------------
1999 1998
--------------------- ---------------------
<S> <C> <C>
ASSETS
Investments, at fair value
Plan interest in Master Employee Benefit Plan Trust $675,562,138 $584,360,039
Receivables-Interest and Dividends 239,768 1,386,991
--------------------- ---------------------
Total Assets $675,801,906 $585,747,030
--------------------- ---------------------
LIABILITIES
Accounts Payable $412,457 $748,946
Forfeitures 244,434 --
--------------------- ---------------------
Total Liabilities $656,891 $748,946
--------------------- ---------------------
Net Assets Available for Benefits $675,145,015 $584,998,084
===================== =====================
See Notes to Financial Statements
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED
THRIFT AND TAX-DEFERRED SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS
AVAILABLE FOR BENEFITS
For the Year Ended December 31,
-----------------------------------------------
1999 1998
--------------------- ---------------------
<S> <C> <C>
ADDITIONS
Participant Deposits $34,231,928 $32,002,038
Employer Contributions 8,488,403 7,894,743
--------------------- ---------------------
Total Deposits and Contributions 42,720,331 39,896,781
Plan Interest in Master Employee Benefit Trust
Investment Income 83,907,169 82,635,723
--------------------- ---------------------
Total Additions 126,627,500 122,532,504
--------------------- ---------------------
DEDUCTIONS
Withdrawals 38,624,120 36,763,026
Forfeitures 479,081 351,229
Administrative Expenses 992,422 1,308,125
Transfer to/(from) Thrift and Tax-Deferred Savings Plan (3,615,054) 2,329,757
--------------------- ---------------------
Total Deductions 36,480,569 40,752,137
--------------------- ---------------------
INCREASE IN NET ASSETS AVAILABLE
FOR BENEFITS 90,146,931 81,780,367
NET ASSETS AVAILABLE FOR
BENEFITS-BEGINNING OF YEAR 584,998,084 503,217,717
--------------------- ---------------------
NET ASSETS AVAILABLE FOR
BENEFITS-END OF YEAR $675,145,015 $584,998,084
===================== =====================
See Notes to Financial Statements
</TABLE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS
1. SUMMARY OF THE PLAN
The Board of Directors of Public Service Electric and Gas Company (PSE&G)
adopted the PSE&G Thrift and Tax-Deferred Savings Plan (Now, the Public Service
Enterprise Group Incorporated Employee Savings Plan (Savings Plan)) to encourage
thrift and savings by eligible employees (Eligible Employees) which was first
offered to Eligible Employees in 1981. Effective January 1, 1996, the trust that
holds the Plan assets was converted into the Public Service Electric and Gas
Company Master Employee Benefit Plan Trust, (Master Trust), a master trust
covering all of the qualified retirement plans including the Plan and the
Public Service Electric and Gas Company Employee Savings Plan (Now, the Public
Service Enterprise Group Incorporated Employee Savings Plan (Savings Plan)).
Bankers Trust Company 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 January 1, 2000, at which time primary sponsorship of the Plan
was changed from PSE&G to PSE&G's parent corporation, Public Service Enterprise
Group Incorporated (the Company). As a result, the Plan was renamed the Public
Service Enterprise Group Incorporated Thrift and Tax-Deferred 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 changes and to add additional investment
options under the Plan, including the Schwab Personal Choice Retirement Account
(PCRA).
An employee may participate in the Plan from the date of hire. Matching Company
contributions begin when an employee has completed one Year of Service as
defined by the Plan. At the time any employee who is a Participant in the
Savings Plan becomes an Eligible Employee for the Plan, that employee will
automatically be enrolled in the Plan, all balances in the Savings Plan will be
transferred to the Plan and all contributions and investment elections in effect
for the Savings Plan will remain in effect. Participation in the Plan is
entirely voluntary, except with respect to those employees who participated in
the Employee Stock Ownership Plan (ESOP) Fund as a result of their participation
in the PSE&G Tax Reduction Act Employee Stock Ownership Plan (TRASOP) and/or the
PSE&G Payroll-Based Employee Stock Ownership Plan (PAYSOP), which were merged
into this Plan in 1988. Eligible Employees are those employees not covered by a
collective bargaining agreement of the Company or any affiliate of the Company
(together hereafter each called an "Employer" or collectively "Employers").
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) may elect to make
basic deposits to Investment Funds of such Participant's choosing within the
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Continued)
Thrift Account Fund of 1% - 8% of his/her compensation (Basic Deposits)
and his/her respective Employer will contribute an amount equal to 50% thereof,
subject to certain exceptions and limitations (Employer Contributions). Employer
Contributions with respect to Basic Deposits in excess of 6% and up to 8% of
Compensation are made in shares of the Company's Common Stock, and are not
available for transfer to any other 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 such Funds in increments of 1% of
Compensation up to an additional 17% 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, 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 Internal Revenue Code of 1986,
as amended (IRC).
The maximum amount of Deferred Deposits to a Participant's Thrift Account may
have to be limited to less than 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. If the maximum permitted percentage of Compensation for Thrift
Account Deferred Deposits is reduced, then all Deferred Deposits in excess of
such percentage will automatically be treated as Nondeferred Deposits. This will
result in taxable income to the affected Participants for Deferred Deposits in
excess of any limit so established. 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.
Thrift Account Deposits are made through payroll deductions by the Participant's
Employer, rollover contributions from other qualified plans and Additional Lump
Sum Deposits. Deposits by Participants and contributions by their respective
Employers are transferred to the Trustee and separately held in the Plan's
Thrift 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 6%, which
are invested in the Enterprise Common Stock Fund.
<PAGE>
Loan Provisions
The Trustee may, subject to the approval of the Director of Performance and
Rewards of PSEG Services Corporation, lend a Participant who is employed by an
Employer an amount up to 50% of the value of the vested portion of such
Participant's Thrift Account and ESOP Fund, but no more than the aggregate value
of such Participant's Thrift Account or $50,000, whichever is less. 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 over a period 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 Thrift
Account and repayments of principal of any loan together with interest thereon,
are invested in the Thrift 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 1998, the rates of interest on
loans granted to Participants, by quarter and starting with the first quarter,
were 7.75%, 7.75%, 7.75% and 8.25%. (See Note 2. SIGNIFICANT ACCOUNTING POLICIES
- Loans.)
Vesting
Employer Contributions to a Participant's Thrift Account are immediately vested
upon a Participant's completion of five years of service with the Employer or
when a Participant reaches the age of 65, is disabled, laid off or dies. A
Participant who was formerly a participant in the U.S. Energy Partners 401 (K)
Plan (which was merged into the Plan in 1996), will become vested in the value
of his or her U.S. Energy Partners Employer Contribution Sub-account according
to the following schedule:
Years of Service Vested Percentage
---------------- -----------------
Less than one 0%
One 20%
Two 40%
Three 60%
Four 80%
Five or More 100%
<PAGE>
All amounts credited to a Participant's ESOP Fund are fully vested. Effective
January 1, 2000, the Plan was amended to provide 100% immediate vesting of
Employer Contributions for all Participants.
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 at the Trustee Bank 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 in accordance with
generally accepted accounting principles.
<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 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.
Dividends and Interest
Dividends, interest and other income attributable to each Investment Fund of the
Plan are reinvested in that Investment Fund to the extent not used to pay direct
expenses of that Investment Fund. (See Expenses of Plan, below.)
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 1999, the
composite rate of interest earned by such assets so invested was not less than
6.08%.
ESOP Fund Participants receive quarterly payments directly from the Trustee
equal to the dividends paid to the Trustee on the shares of Enterprise Common
Stock held for their ESOP Fund.
Valuation of Investments
The value of the Enterprise Common Stock Fund, the Large Company Stock Index
Fund, the Diversified Bond Fund, the International Stock Fund, the Mid Size
Company Fund, the Small Company Stock Fund, the investments in the Schwab PCRA
and the shares of the Company's Common Stock held by the ESOP Fund is based upon
quoted market values. The value of the Stable Value Fund is based on the
contract value of all GICs in which the assets of the Stable Value Fund are
invested. These contracts are included in the financial statements at contract
value, which approximates fair value. Temporary investments are valued at cost,
which approximates fair market value. Securities transactions are accounted for
on the trade date.
<PAGE>
The Plan's financial statements have been prepared in accordance with the
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 are 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.
Loans
A loan to a Participant is considered an investment in such Participant's Thrift
Account and the principal amount of the loan is treated as a separate investment
within the various sub-accounts of the Participant's Thrift Account. 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 Thrift 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 Thrift 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
<PAGE>
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. (See Note 1. SUMMARY OF THE PLAN - Loan Provisions.)
Interfund Transfers -- ESOP Fund to Thrift Account
Participants are permitted to transfer all, but not less than all, shares of the
Company's Common Stock from their ESOP Funds to their Thrift Accounts. To effect
such transfers, the Trustee will sell the shares of the Company's Common Stock
held in the ESOP Fund and invest the proceeds in the Thrift 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.
3. INVESTMENTS
The following presents investments that represent 5 percent or more of the
Plan's net assets as of December 31, 1999:
Guaranteed Investment Contracts $ 183,240,270
Common Stock of Public Service Enterprise Group Incorporated* 72,392,323
Institutional Equity Index Mutual Funds 194,554,256
Putnam Vista Mutual Funds 66,586,949
T. Rowe Price International Mutual Funds 44,560,991
* Non-Participant directed
The financial statements of the Plan include the following:
A. Thrift 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 Savings Plan. The assets of the Stable Value Fund
are invested in Traditional GICs or Synthetic GICs. (See Note 2.
SIGNIFICANT ACCOUNTING POLICIES - Dividends and Interest.) All
contract values approximate fair values. As of December 31, 1999,
the Plan's interest in the following GICs was approximately 62%.
The following Traditional GICs are 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 $10,001,841;
<PAGE>
(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 $6,441,763; and
(iii)A five-year contract expiring June 30, 2000, with AIG Life
Insurance Company, effective interest rate of 6.14%,
contract value of $9,530,893.
The following Synthetic GICs are 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, 1999 of 6.39% and a contract value
of $67,629,827;
(ii) 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, 1999 of 6.77% and a contract value of
$37,613,595;
(iii)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, 1999 of 6.33% and a
contract value of $61,293,508;
(iv) 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, 1999 of 5.28%
and a contract value of $46,300,413;
(v) An open-ended contract with Transamerica Life & Annuity as
the book value wrapper and PRIMCO Capital Management
managing the underlying portfolio providing an effective
crediting rate as of December 31, 1999 of 5.70% and a
contract value of $33,021,806;
(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, 1999 of 5.34%
and a contract value of $8,630,895;
(vii)Two five-year floating rate contracts with Caisse des
Depots, expiring November 26, 2002, effective crediting rate
on each contract as of December 31, 1999 of 6.19%, contract
values of $4,023,766 and $2,011,883;
<PAGE>
(viii) Two five-year floating rate contracts with Caisse des
Depots, expiring December 12, 2002, effective crediting rate
on each contract as of December 31, 1999 of 6.22%, contract
values of $4,013,248 and $2,006,624; and
(iv) A five-year floating-rate contract with Caisse des Depots,
expiring February 3, 2003, effective crediting rate as of
December 31, 1999 of 6.08%, contract value of $3,028,760.
(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 ("Stock
Index Equities Fund"), a no-load mutual fund managed by The
Vanguard Group, Inc. The prospectus for the Stock Index Equities
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.
<PAGE>
(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) On March 31, 1998, the assets of the Conservative Pre-Mix
Portfolio were merged, for investment purposes, with the
Conservative Pre-Mix Portfolio assets of the Savings Plan. 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) On March 31, 1998, the assets of the Moderate Pre-Mix Portfolio
were merged, for investment purposes, with the Moderate Pre-Mix
Portfolio assets of the Savings Plan. 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
Shares of the Company's Common Stock held as assets of the Plan's
ESOP Fund were transferred to the Plan in 1988 as a result of the
spin-off and merger with the Plan of the non-bargaining unit portions
of PSE&G's former TRASOP and PAYSOP. No additional contributions to or
transfers into the ESOP Fund are presently permitted or were allowed
during 1999.
C. Schwab PCRA
In 1999 an additional investment choice was offered, the Schwab
PCRA. 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 must come from
balances transferred from the other options in the Plan. Currently, up
to 50% of a Participant's balance may be transferred to the Schwab
PCRA.
<PAGE>
D. Participants
Participants
As of December 31,
------------------
1999 1998
---- ----
Total Plan Participants 5,059 4,992
Participants by Fund
Stable Value Fund 3,104 3,256
Enterprise Common Stock Fund 4,133 4,030
Large Company Stock Index Fund 3,236 3,017
Diversified Bond Fund 653 720
International Stock Fund 1,433 1,373
Mid Size Company Fund 2,015 1,695
Conservative Pre-Mix Portfolio 683 667
Moderate Pre-Mix Portfolio 1,265 1,227
Aggressive Pre-Mix Portfolio 1,587 1,499
Small Company Stock Fund 178 --
ESOP Fund 423 453
Schwab PCRA 120 --
<PAGE>
4. INVESTMENT OF THE PLAN AND SAVINGS 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 Savings Plan. The following tables present the fair
values of and the investment income recognized by the investments of the Plan
and Savings Plan in the Master Trust as of and for the periods ending December
31, 1999 and 1998. As of December 31, 1999 and 1998, the Plan's interest in such
assets of the Master Trust were approximately 62% and 63%, respectively.
December 31,
------------
1999 1998
---- ----
Investments at fair value:
Participant Loans $ 28,151,855 $ 25,454,147
Cash and Cash equivalents 71,742,424 45,231,345
Common Stock of Enterprise (2) 115,952,779 119,349,502
Mutual Funds 558,830,359 424,228,419
Guaranteed Investment Contract 295,548,822 310,046,617
Investments in Schwab PCRA 11,840,257 --
--------------- -------------
$ 1,082,066,496 $ 924,310,030
=============== =============
December 31,
------------
1999 1998
---- ----
Investment income recognized:
Net appreciation in fair value of
Mutual Funds (1) $ 118,766,391 $ 79,392,487
Net appreciation/(depreciation) in
fair value of Common Stock
Enterprise (2) (15,922,101) 24,932,427
Interest from Mutual Funds 1,253,314 1,074,445
Interest from Common Stock of
Enterprise (2) 333,839 272,697
Interest from Guaranteed Investment
Contracts 20,726,074 20,481,619
Dividends from Common Stock of
Enterprise (2) 6,033,820 5,405,541
--------------- -------------
$ 131,191,337 $ 131,559,216
=============== =============
(1) Includes dividends earned from mutual funds.
(2) Due to certain restrictions of the Plan, investments in the Enterprise
Common Stock Fund and the ESOP Fund are considered non-participant
directed. Information about the significant components of net assets
and changes in net assets relating to the nonparticipant-directed
investments is included in the table above. During 1999, total
Participant Deposits and Employer Contributions to these funds were
$10,372,237 and total withdrawals and benefits paid were $4,489,438.
<PAGE>
NOTES TO FINANCIAL STATEMENTS (Concluded)
5. FEDERAL INCOME TAXES
The Plan is intended to be qualified under Section 401(a) of the IRC and is
intended to be exempt from taxation under Section 501(a) of the IRC. The Plan
received a favorable Internal Revenue Service determination letter dated April
8, 1998. The Plan administrator believes that the Plan is currently designed and
being operated in compliance with the applicable requirements of the IRC and the
related trust was tax-exempt as of financial statement date. Therefore, no
provision of income taxes has been included in the Plan's financial statements.
6. 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.
<PAGE>
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
Thrift and Tax-Deferred Savings Plan
(Name of Plan)
By: M. PETER MELLETT
--------------------------------------------
M. Peter Mellett
Chairman of Employee
Benefits Committee
Date: June 29, 2000
<PAGE>
EXHIBIT INDEX
-------------
Exhibit Number
--------------
1 Public Service Enterprise Group Incorporated Thrift and Tax-Deferred
Savings Plan, amended as of January 1, 2000.
2 Independent Auditors' Consent.
