<PAGE>
- ------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 (FEE REQUIRED)
For the fiscal year ended December 31, 1994 Commission File Number 1-973
A. Full title of the plan and the address of the plan, if
different from that of the issuer named below:
PUBLIC SERVICE ELECTRIC AND GAS COMPANY EMPLOYEE SAVINGS PLAN
80 PARK PLAZA
NEWARK, NEW JERSEY 07101
MAILING ADDRESS: P.O. Box 570
NEWARK, NEW JERSEY 07101-0570
B. Name of issuer of the securities held pursuant to the plan and
the address of its principal executive office:
See page 2.
- ------------------------------------------------------------------------
<PAGE>
<PAGE>
- -----------------------------------------------------------------------
Equities Growth Fund A
TWENTIETH CENTURY INVESTORS, INC. PROVIDENT NATIONAL ASSURANCE
4500 MAIN STREET COMPANY
P.O.BOX 419200 FOUNTAIN SQUARE
KANSAS CITY, MISSOURI 64141-6200 CHATTANOOGA, TENNESSEE 37402
NEW YORK LIFE INSURANCE COMPANY
Balanced Fund B 501 MADISON AVENUE
PHOENIX SERIES FUND NEW YORK, NEW YORK 10010
101 MUNSON STREET
GREENFIELD, MASSACHUSETTS 01301
Fixed Income Fund C: Enterprise Common Stock Fund D
THE PRUDENTIAL LIFE INSURANCE COMPANY and ESOP Fund
OF AMERICA PUBLIC SERVICE ENTERPRISE GROUP
PRUDENTIAL PLAZA INCORPORATED
NEWARK, NEW JERSEY 07101 80 PARK PLAZA
NEWARK, NEW JERSEY 07101-1171
METROPOLITAN LIFE INSURANCE COMPANY
ONE MADISON AVENUE Stock Index Equities Fund E
NEW YORK, NEW YORK 10010-3690 BANKERS TRUST COMPANY
280 PARK AVENUE
NEW YORK, NEW YORK 10017
PRINCIPAL MUTUAL LIFE INSURANCE COMPANY
THE PRINCIPAL FINANCIAL GROUP Utilities Equities Fund F
DES MOINES, IOWA 50392-0001 FIDELITY PORTFOLIOS
82 DEVONSHIRE STREET
BOSTON, MASSACHUSETTS 02109
JOHN HANCOCK MUTUAL LIFE COMPANY
JOHN HANCOCK PLACE Government Securities Fund G
P.O.BOX 111 WEISS, PECK AND GREER
BOSTON, MASSACHUSETTS 02117 ONE NEW YORK PLAZA
NEW YORK, NEW YORK 10004
ALLSTATE LIFE INSURANCE COMPANY
ALLSTATE PLAZA WEST International Stock Fund H
3100 SANDERS ROAD T. ROWE PRICE INC.
NORTHBROOK, ILLINOIS 60062 100 EAST PRATT STREET
BALTIMORE, MARYLAND 21202
- ------------------------------------------------------------------------
<PAGE>
<PAGE>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
EMPLOYEE SAVINGS PLAN
INDEX
PAGE
------
INDEPENDENT AUDITORS' REPORT..................................... 4
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF DECEMBER 31, 1994 AND 1993............................... 5-9
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEARS ENDED DECEMBER 31, 1994 and 1993................. 10-14
NOTES TO FINANCIAL STATEMENTS.................................... 15-25
SCHEDULE OF ASSETS HELD FOR INVESTMENT - Item 27a................ 26
SCHEDULES OF REPORTABLE TRANSACTIONS - Item 27d.................. 27
SIGNATURES....................................................... 28
EXHIBIT INDEX.................................................... 29
<PAGE>
<PAGE>
INDEPENDENT AUDITORS' REPORT
Employee Benefits Committee of
Public Service Electric and Gas Company:
We have audited the accompanying statements of net assets available for
benefits of the Public Service Electric and Gas Company Employee Savings
Plan (the "Plan") as of December 31, 1994 and 1993, 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, in all material
respects, the net assets available for benefits of the Plan at December
31, 1994 and 1993, and the changes in net assets available for benefits for
each of 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 information
by fund is presented for the purpose of additional analysis of the basic
financial statements rather than to present information regarding the net
assets available for benefits and changes in net assets available for
benefits of the individual funds, and is not a required part of the basic
financial statements. The supplemental schedules of (1) assets held for
investment as of December 31, 1994 and (2) transactions in excess of five
percent of the current value of plan assets for the year ended December 31,
1994 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, as amended. The supplemental information and the supplemental
schedules are the responsibility of the Plan's management. Such
supplemental information and schedules have been subjected to the auditing
procedures applied in our audit of the basic 1994 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.
DELOITTE & TOUCHE LLP
Parsippany, New Jersey
June 23, 1995
<PAGE>
<PAGE>
PAGE 1 OF 3
<TABLE>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
EMPLOYEE SAVINGS PLAN
Statement of Net Assets Available for Benefits
December 31, 1994
<CAPTION>
Supplemental Information by Fund
------------------------------------------------------
Equities Fixed Enterprise
Growth Balanced Income Common Stock
Total Fund A Fund B Fund C Fund D
ASSETS ------------ ------------ ------------ ------------ ------------
- ------
<S> <C> <C> <C> <C> <C>
Investments
Enterprise Common Stock............... $ 33,382,156 $ -- $ -- $ -- $ 23,462,252
Equities Growth Fund.................. 4,761,117 4,761,117 -- -- --
Balanced Fund......................... 2,180,156 -- 2,180,156 -- --
Insurance Annuity Contracts (GICs).... 74,101,089 -- -- 74,101,089 --
Stock Index Equities Fund............. 11,470,242 -- -- -- --
Utilities Equities Fund............... 2,745,366 -- -- -- --
Government Securities Fund............ 1,278,313 -- -- -- --
International Stock Fund.............. 3,180,664 -- -- -- --
------------ ------------ ------------ ------------ ------------
Total Investments................ 133,099,103 4,761,117 2,180,156 74,101,089 23,462,252
Participant Loans Receivable.......... 6,526,460 -- -- -- --
Receivables-Interest and Dividends.... 2,313,879 697,189 24,474 450,127 529,914
Cash and Temporary Cash Investments... 1,068,434 -- -- 535,627 510,068
------------ ------------ ------------ ------------ ------------
Total Assets..................... $143,007,876 $ 5,458,306 $ 2,204,630 $ 75,086,843 $ 24,502,234
------------ ------------ ------------ ------------ ------------
LIABILITIES
- -----------
Due to Active Participants............ $ 1,205,928 $ 29,571 $ (6,005) $ 625,669 $ 248,234
Purchases of Securities............... 469,630 -- -- -- 469,630
Accounts Payable...................... 220,990 666,621 29,478 (569,369) (196,367)
------------ ------------ ------------ ------------ ------------
Total Liabilities................ 1,896,548 696,192 23,473 56,300 521,497
NET ASSETS AVAILABLE FOR BENEFITS..... 141,111,328 4,762,114 2,181,157 75,030,543 23,980,737
------------ ------------ ------------ ------------ ------------
Total Liabilities and Net Assets
Available for Benefits......... $143,007,876 $ 5,458,306 $ 2,204,630 $ 75,086,843 $ 24,502,234
============ ============ ============ ============ ============
<FN>
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
<PAGE>
PAGE 2 OF 3
<TABLE>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
EMPLOYEE SAVINGS PLAN
Statement of Net Assets Available for Benefits (Continued)
December 31, 1994
<CAPTION> Supplemental Information by Fund (Continued)
-------------------------------------------------------------------
Stock Index Utilities Government
Equities Equities Securities International
Stock
Fund E Fund F Fund G Fund H ESOP Fund
----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
ASSETS
- ------
Investments
Enterprise Common Stock.............. $ -- $ -- $ -- $ -- $ 9,919,904
Equities Growth Fund................. -- -- -- -- --
Balanced Fund........................ -- -- -- -- --
Insurance Annuity Contracts (GICs)... -- -- -- -- --
Stock Index Equities Fund............ 11,470,242 -- -- -- --
Utilities Equities Fund.............. -- 2,745,366 -- -- --
Government Securities Fund........... -- -- 1,278,313 -- --
International Stock Fund............. -- -- -- 3,180,664 --
----------- ----------- ----------- ----------- -----------
Total Investments............... 11,470,242 2,745,366 1,278,313 3,180,664 9,919,914
Participant Loans Receivable......... -- -- -- -- --
Receivables-Interest and Dividends... 139,161 137,994 8,852 194,269 131,404
Cash and Temporary Cash Investments.. -- -- -- -- 10,785
----------- ----------- ----------- ----------- -----------
Total Assets....................$ 11,609,403 $ 2,883,360 $ 1,287,165 $ 3,374,933 $10,062,093
----------- ----------- ----------- ----------- -----------
LIABILITIES
- -----------
Due to Active Participants........... $ 48,026 $ (6,935) $ (9,061) $ -- $ 276,429
Purchases of Securities.............. -- -- -- -- --
Accounts Payable..................... 84,615 139,858 16,182 194,272 (145,201)
----------- ----------- ----------- ----------- -----------
Total Liabilities............... 132,641 132,923 7,121 194,272 131,228
NET ASSETS AVAILABLE FOR BENEFITS.... 11,476,762 2,750,437 1,280,044 3,180,661 9,930,865
----------- ----------- ----------- ----------- -----------
Total Liabilities and Net Assets
Available for Benefits........ $11,609,403 $ 2,883,360 $ 1,287,165 $3,374,933 $10,062,093
=========== =========== =========== =========== ==========-
<FN>
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
<PAGE>
PAGE 3 OF 3
<TABLE>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
EMPLOYEE SAVINGS PLAN
Statement of Net Assets Available for Benefits (Concluded)
December 31, 1994
<CAPTION>
Supplemental Information by Fund (Concluded)
--------------------------------------------
Holding Trust Loan
Account Fund
----------- -----------
<S> <C> <C>
ASSETS
- ------
Investments
Enterprise Common Stock............... $ -- $ --
Equities Growth Fund.................. -- --
Balanced Fund......................... -- --
Insurance Annuity Contracts (GICs).... -- --
Stock Index Equities Fund............. -- --
Utilities Equities Fund............... -- --
Government Securities Fund............ -- --
International Stock Fund..............
----------- -----------
Total Investments................ -- --
Participant Loans Receivable.......... -- 6,526,460
Receivable Interest Dividends.......... 495 --
Cash and Temporary Cash Investments... 11,954 --
----------- -----------
Total Assets..................... $ 12,449 $ 6,526,460
----------- -----------
LIABILITIES
- -----------
Due to Active Participants............ $ -- $ --
Purchases of Securities............... -- --
Accounts Payable...................... 5,101 (4,200)
----------- -----------
Total Liabilities................ 5,101 (4,200)
NET ASSETS AVAILABLE FOR BENEFITS..... 7,348 6,530,660
----------- -----------
Total Liabilities and Net Assets
Available for Benefits......... $ 12,449 $ 6,526,460
=========== ===========
<FN>
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
<PAGE>
PAGE 1 OF 2
<TABLE>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
EMPLOYEE SAVINGS PLAN
Statement of Net Assets Available for Benefits
December 31, 1993
<CAPTION>
Supplemental Information by Fund
---------------------------------------------------------
Equities Fixed Enterprise
Growth Balanced Income Common Stock
Total Fund A Fund B Fund C Fund D
ASSETS ----------- ------------ ------------ ------------ ------------
- ------
<S> <C> <C> <C> <C> <C>
Investments
Enterprise Common Stock.............$ 41,942,976 $ -- $ -- $ -- $ 27,281,344
Equities Growth Fund................ 3,503,930 3,503,930 -- -- --
Balanced Fund....................... 1,803,232 -- 1,803,232 -- --
Insurance Annuity Contracts(GICs)... 60,354,003 -- -- 60,354,003 --
Stock Index Equities Fund........... 10,029,607 -- -- -- --
Utilities Equities Fund............. 2,914,614 -- -- -- --
Government Securities Fund.......... 1,326,589 -- -- -- --
------------ ------------ ------------ ------------ ------------
Total Investments.............. 121,874,951 3,503,930 1,803,232 60,354,003 27,281,344
Participant Loans Receivable........ 4,176,049 -- -- -- --
Receivables-Interest and Dividends.. 1,202,648 10,655 4,029 309,692 457,545
Cash and Temporary Cash Investments. 1,742,300 -- -- 1,318,827 420,027
------------ ------------ ------------ ------------ ------------
Total Assets...................$128,995,948 $ 3,514,585 $ 1,807,261 $ 61,982,522 $ 28,158,916
------------ ------------ ------------ ------------ ------------
LIABILITIES
- -----------
Due to Active Participants..........$ 158,586 $ 4,408 $ 3,492 $ 53,806 $ 20,748
Purchases of Securities............. 840,889 -- -- -- 456,315
Due to (from) Other Funds........... -- 28,162 (16,508) 41,282 85,553
Accounts Payable.................... 10,428 602 274 5,860 1,783
------------ ------------ ------------ ------------ ------------
Total Liabilities.............. 1,009,903 33,172 (12,742) 100,948 564,399
NET ASSETS AVAILABLE FOR BENEFITS... 127,986,045 3,481,413 1,820,003 61,881,574 27,594,517
------------ ------------ ------------ ------------ ------------
Total Liabilities and Net
Assets Available for Benefits..$128,995,948 $ 3,514,585 $ 1,807,261 $ 61,982,522 $ 28,158,916
============ ============ ============ ============ ============
<FN>
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
<PAGE>
PAGE 2 OF 2
<TABLE>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
EMPLOYEE SAVINGS PLAN
Statement of Net Assets Available for Benefits (Concluded)
December 31, 1993
<CAPTION>
Supplemental Information by Fund (Concluded)
-----------------------------------------------------------------------
Stock Index Utilities Government
Equities Equities Securities Trust Loan
Fund E Fund F Fund G ESOP Fund Fund
ASSETS ----------- ------------ ------------ ------------ ------------
- ------
<S> <C> <C> <C> <C> <C>
Investments
Enterprise Common Stock.............$ -- $ -- $ -- $ 14,661,632 $ --
Equities Growth Fund................ -- -- -- -- --
Balanced Fund....................... -- -- -- -- --
Insurance Annuity Contracts (GICs).. -- -- -- -- --
Stock Index Equities Fund........... 10,029,607
Utilities Equities Fund............. 2,914,614 -- -- --
Government Securities Fund.......... -- -- 1,326,589 -- --
------------ ------------ ------------ ------------ ------------
Total Investments.............. 10,029,607 2,914,614 1,326,589 14,661,632 --
Participant Loans Receivable........ -- -- -- -- 4,176,049
Receivables-Interest and Dividends.. 15,689 374,556 30,468 14 --
Cash and Temporary Cash Investments. -- -- -- 3,446 --
------------ ------------ ------------ ------------ ------------
Total Assets...................$ 10,045,296 $ 3,289,170 $ 1,357,057 $ 14,665,092 $ 4,176,049
------------ ------------ ------------ ------------ ------------
LIABILITIES
- -----------
Due to Active Participants..........$ 11,025 $ -- $ -- $ 65,107 $ --
Purchases of Securities............. -- 358,024 26,550 -- --
Due to (from) Other Funds........... 34,637 8,624 (5,517) (27) (176,206)
Accounts Payable.................... 1,245 353 311 -- --
------------ ------------ ------------ ------------ ------------
Total Liabilities.............. 46,907 367,001 21,344 65,080 (176,206)
NET ASSETS AVAILABLE FOR BENEFITS... 9,998,389 2,922,169 1,335,713 14,600,012 4,352,255
------------ ------------ ------------ ------------ ------------
Total Liabilities and Net
Assets Available for Benefits..$ 10,045,296 $ 3,289,170 $ 1,357,057 $ 14,665,092 $ 4,176,049
============ ============ ============ ============ =============
<FN>
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
<PAGE>
PAGE 1 OF 3
<TABLE>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
EMPLOYEE SAVINGS PLAN
Statement of Changes in Net Assets Available for Benefits
For the Year Ended December 31, 1994
<CAPTION>
Supplemental Information by Fund
---------------------------------------------------------
Equities Fixed Enterprise
Growth Balanced Income Common Stock
Total Fund A Fund B Fund C Fund D
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
ADDITIONS
- ---------
Participant Deposits............ $ 20,750,375 $ 1,427,695 $ 657,428 $ 11,602,186 $ 2,867,954
Cash Receipts................... 43,371,546 -- -- -- --
Addition to Trust Loan Fund..... 4,702,212 -- -- -- --
Employer Contributions.......... 5,618,255 362,631 176,219 3,257,511 776,492
Interfund Transfers - net....... -- (2,112) (217,393) 1,166,391 (1,772,180)
Participant Loan Repayments..... -- 146,261 62,796 1,206,629 310,648
Total Deposits and ------------ ------------ ------------ ------------ ------------
Contributions.............. 74,442,388 1,934,475 679,050 17,232,717 2,182,914
------------ ------------ ------------ ------------ ------------
Income:
Interest........................ 4,340,788 -- -- 4,317,870 15,804
Dividends....................... 4,373,697 692,609 60,897 -- 1,815,220
Loan Interest Income............ 295,663 18,235 8,868 165,671 40,525
------------ ------------ ------------ ------------ ------------
Total Income............... 9,010,148 710,844 69,765 4,483,541 1,871,549
------------ ------------ ------------ ------------ ------------
Appreciation (Depreciation)
of Investment................. (8,972,959) (780,185) (148,045) -- (4,433,658)
------------ ------------ ------------ ------------ ------------
Total Additions............ 74,479,577 1,865,134 600,770 21,716,258 (379,195)
------------ ------------ ------------ ------------ ------------
DEDUCTIONS
- ----------
Cash Payments................... 43,367,612 -- -- -- --
Withdrawals..................... 8,423,163 220,702 88,027 4,465,784 1,403,859
Dividends paid.................. 866,438 -- -- -- --
Participant Loans............... 4,702,212 291,789 110,268 2,693,210 714,253
Transfer to Thrift & Tax-Def.
Savings Plan.................. 3,985,701 70,898 41,234 1,402,331 1,115,155
Forfeitures..................... 10,842 1,081 87 5,964 1,318
Other........................... (1,674) (37) -- -- --
------------ ------------ ------------ ------------ ------------
Total Deductions........... 61,354,294 584,433 239,616 8,567,289 3,234,585
------------ ------------ ------------ ------------ ------------
INCREASE (DECREASE) IN NET
ASSETS AVAILABLE FOR BENEFITS. 13,125,283 1,280,701 361,154 13,148,969 (3,613,780)
------------ ------------ ------------ ------------ ------------
Net Assets Available for
Benefits Beginning of period.. 127,986,045 3,481,413 1,820,003 61,881,574 27,594,517
------------ ------------ ------------ ------------ ------------
Net Assets Available
for Benefits End of Period.... $141,111,328 $ 4,762,114 $ 2,181,157 $ 75,030,543 $ 23,980,737
============ ============ ============ ============ ============
<FN>
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
<PAGE>
PAGE 2 OF 3
<TABLE>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
EMPLOYEE SAVINGS PLAN
Statement of Changes in Net Assets Available for Benefits (Continued)
For the Year Ended December 31, 1994
<CAPTION>
Supplemental Information by Fund (Continued)
-----------------------------------------------------------------------
Stock Index Utilities Government International
Equities Equities Securities Stock
Fund E Fund F Fund G Fund H ESOP Fund
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
ADDITIONS
- ---------
Participant Deposits............ $ 2,303,537 $ 894,472 $ 377,839 $ 619,264 $ --
Cash Receipts................... -- -- -- -- --
Addition to Trust Loan Fund..... -- -- -- -- --
Employer Contributions.......... 585,522 226,958 96,858 136,064 --
Interfund Transfers - net....... (376,887) (792,058) (338,482) 2,845,085 (512,364)
Participant Loan Repayments..... 291,041 76,668 40,658 67,460 --
Total Deposits and ------------ ------------ ------------ ------------ ------------
Contributions.............. 2,803,213 406,040 176,873 3,667,873 (512,364)
------------ ------------ ------------ ------------ ------------
Income:
Interest........................ -- -- -- -- 491
Dividends....................... 392,057 257,951 94,001 194,269 866,438
Loan Interest Income............ 40,797 10,060 4,721 6,786 --
------------ ------------ ------------ ------------ ------------
Total Income............... 432,854 268,011 98,722 201,055 866,929
------------ ------------ ------------ ------------ ------------
Appreciation (Depreciation)
of Investment................. (237,589) (455,881) (228,074) (302,370) (2,382,056)
------------ ------------ ------------ ------------ ------------
Total Additions............ 2,998,478 218,170 47,521 3,566,558 (2,027,491)
------------ ------------ ------------ ------------ ------------
DEDUCTIONS
- ----------
Cash Payments................... -- -- -- -- --
Withdrawals..................... 547,562 184,589 37,778 94,878 1,217,643
Dividends paid.................. -- -- -- -- 866,438
Participant Loans............... 562,805 148,704 52,941 128,242 --
Transfer to Thrift & Tax Def.
Savings Plan.................. 408,038 56,300 12,088 162,777 557,575
Forfeitures..................... 1,700 309 383 -- --
Other........................... -- -- -- -- --
------------ ------------ ------------ ------------ ------------
Total Deductions........... 1,520,105 389,902 103,190 385,897 2,641,656
------------ ------------ ------------ ------------ ------------
INCREASE (DECREASE) IN NET
ASSETS AVAILABLE FOR BENEFITS. 1,478,373 (171,732) (55,669) 3,180,661 (4,669,147)
------------ ------------ ------------ ------------ ------------
Net Assets Available for
Benefits Beginning of period.. 9,998,389 2,922,169 1,335,713 -- 14,600,012
------------ ------------ ------------ ------------ ------------
Net Assets Available
for Benefits End of Period.... $ 11,476,762 $ 2,750,437 $ 1,280,044 $ 3,180,661 $ 9,930,865
============ ============ ============ ============ ============
<FN>
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
<PAGE>
PAGE 3 OF 3
<TABLE>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
EMPLOYEE SAVINGS PLAN
Statement of Changes in Net Assets Available for Benefits (Concluded)
For the Year Ended December 31, 1994
<CAPTION>
Supplemental Information by Fund (Concluded)
-----------------------------------------------------------------------
Holding Trust Loan
Account Fund
------------ ------------
<S> <C> <C>
- ---------
Participant Deposits............. $ -- $ --
Cash Receipts.................... 43,371,546 --
Addition to Trust Loan Fund...... -- 4,702,212
Employer Contributions........... -- --
Interfund Transfers - net........ -- --
Participant Loan Repayments...... -- (2,202,161)
Total Deposits and ------------ ------------
Contributions............... 43,371,546 2,500,051
------------ ------------
Interest......................... 6,623 --
Dividends........................ 255 --
Loan Interest Income.............. -- --
------------ ------------
Total Income................ 6,878 --
------------ ------------
Appreciation (Depreciation)
of Investment.................. (5,101) --
------------ ------------
Total Additions............. 43,373,323 2,500,051
------------ ------------
DEDUCTIONS
- ----------
Cash Payments.................... 43,367,612 --
Withdrawals...................... -- 162,341
Dividends paid................... -- --
Participant Loans................ -- --
Transfer to Thrift & Tax Def.
Savings Plan................... -- 159,305
Forfeitures....................... -- --
Other............................ (1,637) --
------------ ------------
Total Deductions............ 43,365,975 321,646
------------ ------------
INCREASE (DECREASE) IN NET
ASSETS AVAILABLE FOR BENEFITS.. 7,348 2,178,405
------------ ------------
Net Assets Available for
Benefits Beginning of period... -- 4,352,255
------------ ------------
Net Assets Available
for Benefits End of Period..... $ 7,348 $ 6,530,660
============ ============
<FN>
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
<PAGE>
PAGE 1 OF 2
<TABLE>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
EMPLOYEE SAVINGS PLAN
Statement of Changes in Net Assets Available for Benefits
For the Year Ended December 31, 1993
<CAPTION>
Supplemental Information by Fund
---------------------------------------------------------
Equities Fixed Enterprise
Growth Balanced Income Common Stock
Total Fund A Fund B Fund C Fund D
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
ADDITIONS
- ---------
Participant Deposits........... $ 18,038,129 $ 1,157,304 $ 567,298 $ 10,676,400 $ 2,608,168
Addition to Trust Loan Fund.... 2,712,252
Employer Contributions......... 4,039,976 240,564 121,763 2,465,262 581,839
Interfund Transfers - net...... -- (26,621) 169,501 (1,117,837) (92,738)
Participant Loan Repayments.... -- 94,691 43,979 881,011 177,996
Total Deposits and ------------ ------------ ------------ ------------ ------------
Contributions............. 24,790,357 1,465,938 902,541 12,904,836 3,275,265
------------ ------------ ------------ ------------ ------------
Income:
Interest....................... 3,900,526 -- -- 3,899,073 1,213
Dividends...................... 3,685,716 372,225 84,603 -- 1,742,504
Loan Interest Income........... 215,211 13,124 6,129 133,454 27,499
------------ ------------ ------------ ------------ ------------
Total Income.............. 7,801,453 385,349 90,732 4,032,527 1,771,216
------------ ------------ ------------ ------------ ------------
Net Appreciation (Depreciation)
of Investment................ 1,616,271 (233,430) (3,851) -- 716,928
------------ ------------ ------------ ------------ ------------
Total Additions........... 34,208,081 1,617,857 989,422 16,937,363 5,763,409
------------ ------------ ------------ ------------ ------------
DEDUCTIONS
- ----------
Withdrawals.................... 6,583,739 92,960 59,499 3,414,652 1,424,110
Dividends paid................. 1,020,792 -- -- -- --
Participant Loans.............. 2,712,252 125,065 50,445 1,564,562 499,246
Other.......................... 10,634 602 274 5,860 1,783
------------ ------------ ------------ ------------ ------------
Total Deductions.......... 10,327,417 218,627 110,218 4,985,074 1,925,139
------------ ------------ ------------ ------------ ------------
INCREASE (DECREASE) IN
NET ASSETS AVAILABLE
FOR BENEFITS................. 23,880,664 1,399,230 879,204 11,952,289 3,838,270
------------ ------------ ------------ ------------ ------------
Net Assets Available for
Benefits
Beginning of period............ 104,105,381 2,082,183 940,799 49,929,285 23,756,247
------------ ------------ ------------ ------------ ------------
Net Assets Available
for Benefits
End of Period.................. $127,986,045 $ 3,481,413 $ 1,820,003 $ 61,881,574 $ 27,594,517
============ ============ ============ ============ ============
<FN>
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
<PAGE>
PAGE 2 OF 2
<TABLE>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
EMPLOYEE SAVINGS PLAN
Statement of Changes in Net Assets Available for Benefits (Concluded)
For the Year Ended December 31, 1993
<CAPTION>
Supplemental Information by Fund (Concluded)
-----------------------------------------------------------------------
Stock Index Utilities Government
Equities Equities Securities Trust Loan
Fund E Fund F Fund G ESOP Fund Fund
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
ADDITIONS
- ---------
Participant Deposits........... $ 1,952,865 $ 747,871 $ 328,223 $ -- $ --
Addition to Trust Loan Fund.... -- -- -- -- 2,712,252
Employer Contributions......... 412,534 150,258 67,756 -- --
Interfund Transfers - net...... 377,378 678,761 270,584 (259,028) --
Participant Loan Repayments.... 164,515 41,136 19,721 -- (1,423,049)
Total Deposits and ------------ ------------ ------------ ------------ ------------
Contributions............. 2,907,292 1,618,026 686,284 (259,028) 1,289,203
------------ ------------ ------------ ------------ ------------
Income:
Interest....................... -- -- -- 240 --
Dividends...................... 38 377,991 87,563 1,020,792 --
Loan Interest Income........... 25,053 6,774 3,178 -- --
------------ ------------ ------------ ------------ ------------
Total Income.............. 25,091 384,765 90,741 1,021,032 --
------------ ------------ ------------ ------------ ------------
Net Appreciation (Depreciation)
of Investment................ 813,700 (225,924) (19,502) 568,350 --
------------ ------------ ------------ ------------ ------------
Total Additions........... 3,746,083 1,776,867 757,523 1,330,354 1,289,203
------------ ------------ ------------ ------------ ------------
DEDUCTIONS
- ----------
Withdrawals.................... 370,906 47,133 18,701 1,155,778 --
Dividends paid................. -- -- -- 1,020,792 --
Participant Loans.............. 376,505 70,346 26,083 -- --
Other.......................... 1,245 451 419 -- --
------------ ------------ ------------ ------------ ------------
Total Deductions.......... 748,656 117,930 45,203 2,176,570 --
------------ ------------ ------------ ------------ ------------
INCREASE (DECREASE) IN
NET ASSETS AVAILABLE
FOR BENEFITS................. 2,997,427 1,658,937 712,320 (846,216) 1,289,203
------------ ------------ ------------ ------------ ------------
Net Assets Available for
Benefits
Beginning of period............ 7,000,962 1,263,232 623,393 15,446,228 3,063,052
------------ ------------ ------------ ------------ ------------
Net Assets Available
for Benefits
End of Period.................. $ 9,998,389 $ 2,922,169 $ 1,335,713 $ 14,600,012 $ 4,352,255
============ ============ ============ ============ ============
<FN>
SEE NOTES TO FINANCIAL STATEMENTS.
</TABLE>
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS
1. SUMMARY OF THE PLAN
The Board of Directors of Public Service Electric and Gas Company (PSE&G
or the Company) adopted the Public Service Electric and Gas Company
Employee Savings Plan (Plan) to encourage thrift and savings by eligible
bargaining unit employees of PSE&G (Eligible Employees). It was first
offered to Eligible Employees in November 1987 as a result of collective
bargaining, and contributions began in January 1988. The Plan was last
amended April 10, 1995 to permit, among other things, participation in the
Plan by Affiliates of PSE&G and their bargaining unit employees (each such
participating Affiliate with PSE&G, an "Employer"). Participation in the
Plan is entirely voluntary, except with respect to those employees who
participate in the Employee Stock Ownership Plan (ESOP) Fund as a result
of their participation in PSE&G's TRASOP and/or PAYSOP, which plans were
merged into the Plan. Eligible Employees are those employees covered by
a collective bargaining agreement and who have completed 1,000 hours of
service with an Employer. Certain Eligible Employees may also elect to
have a distribution from another qualified corporate plan contributed as
a rollover contribution with the approval of PSE&G's Employee Benefits
Committee (Committee), the Plan Administrator. The Plan's Trust Fund
consists of the Savings Account Fund and the ESOP Fund, which are
separately maintained.
Under the Plan, participating Eligible Employees (Participants) may elect
to make basic deposits to Investment Funds of such Participants' choosing
within the Savings Account of 1%, 2%, 3%, 4%, or 5% of their compensation
(Basic Deposits), and the Employer will contribute an amount equal to 45%
thereof (35% prior to 5/1/94 and 50%, effective 5/1/95), subject to certain
exceptions and limitations (Employer Contributions). In addition,
Participants may elect to make supplemental deposits to their Savings
Accounts in increments of 1% of Compensation up to an additional 10% (20%
starting in 1995)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).
In the case of Participants employed by CEA Newark Bay Services, Inc.,
(which adopted the Plan effective January 1, 1995) they may elect to make
basic deposits to Investment Funds of such Participants choosing within the
Savings Account of 1%, 2%, 3%, 4%, 5%, 6% of their Basic Deposits, and the
Employer will contribute an amount equal to 50% thereof, subject to certain
exceptions and limitations (Employer Contributions). In addition,
Participants may elect to make supplemental deposits to their Savings
Account in increments of 1% of Compensation up to an additional
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS -(Continued)
19% 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).
Starting January 1, 1995 each Participant may, within any Plan Year, make
one or more Additional Lump Sum Deposits on a Nondeferred basis in the
minimum amount 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.
The maximum amount of Deferred Deposits to a Participant's Savings Account
may have to be limited to less than 15% of Compensation to meet
requirements of the Internal Revenue Code of 1986, as amended (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
Savings 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.
Savings Account Deposits are made through payroll deductions by the
Employer, rollover contributions from other qualified plans and, starting
January 1, 1995, Additional Lump Sum Deposits. Deposits by Participants
and Employer Contributions are transferred to a Trustee and separately held
in the Plan's Savings Account Fund of the Trust Fund for investment and
other transactions, as directed by Participants. Participants are entitled
to choose from among the Investment Funds offered under the Plan in which
to invest Deposits and Employer Contributions.
Bankers Trust Company is the Trustee of the Trust Fund established pursuant
to the Plan.
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS -(Continued)
Loan Provisions
The Trustee may, subject to the approval of PSE&G's General Manager
Compensation and Benefits, lend a Participant an amount up to 50% of the
value of the vested portion of such Participant's Savings Account and ESOP
Fund, but no more than the aggregate value of such Participant's Savings
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 of 12,
24, 36, 48 or 60 months as selected by the Participant. However, a
Participant may repay any such loan in full by check at any time (beginning
January 1, 1995, partial lump sum payments are also accepted) in accordance
with such rules as may be prescribed by the Committee. A Participant may
not apply for more than one loan in any calendar year. A loan to a
Participant is considered an investment of such Participant's Savings
Account and repayments of principal of any loan, together with interest
thereon, are invested in the Savings Account Investment Funds of the Plan
in accordance with the Participant's then-current investment direction for
Deposits and Employer Contributions.
Each loan bears interest at a rate fixed from time to time by the Committee
taking into consideration interest rates currently then being charged. The
rate of interest applicable to any loan at its inception remains in effect
for the duration of such loan. During 1994, the rate of interest on loans
granted to Participants, by quarter and starting with the first quarter,
was 6%, 6-1/4%, 7-1/4%, 7-3/4%. (See Note 2. SIGNIFICANT ACCOUNTING
POLICIES - Loans.)
2. SIGNIFICANT ACCOUNTING POLICIES
The financial statements of the Plan have been prepared in accordance with
generally accepted accounting principles.
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 Fund. (See Expenses of Plan, below.)
All Deposits and Employer Contributions to Fixed Income Fund C earn
interest at the composite rate of all Guaranteed Investment Contracts of
insurance companies (GICs) in which the assets of such fund are then
invested. Such rate varies, as such GICs mature or are entered into and as
Deposits and Employer Contributions are made to and withdrawn from such
GICs. Under the GICs in effect during 1994, the composite rate of interest
earned by such assets so invested was not less than 6.64%.
ESOP Fund Participants receive quarterly payments directly from the
Trustee equal to the dividends paid to the Trustee on the shares of Common
Stock of Public Service Enterprise Group Incorporated (Enterprise), the
parent of PSE&G, held for their ESOP Fund.
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS -(Continued)
Valuation of Investments
Investments of Equities Growth Fund A, Balanced Fund B, Enterprise Common
Stock Fund D, Stock Index Equities Fund E, Utilities Equities Fund F,
Government Securities Fund G, International Stock Fund H, and the shares
of Enterprise Common Stock held by the ESOP Fund are based upon quoted
market values. The Plan has invested the assets of Fixed Income Fund C in
GICs. The value of Fixed Income Fund C is based on the contract value of
all GICs in which the assets of the fund are invested. Temporary
investments are valued at cost which approximates fair market value.
Securities transactions are accounted for on the trade date.
In September 1994, the American Institute of Certified Public Accountants
issued Statement of Position 94-4 (SOP94-4), "Reporting of Investment
Contracts Held by Health and Welfare Benefit Plans and Defined-Contribution
Pension Plans" which requires investment contracts issued by either an
insurance enterprise or other entity to be reported at either fair value
or contract value. SOP 94-4 is effective for plan years beginning after
December 15, 1994, except that the application to investment contracts
entered into before December 31, 1993, is delayed to plan years beginning
after December 15, 1995. The Plan is currently evaluating what impact, if
any, the adoption of SOP 94-4 will have on the financial statements of the
Plan as of and for the year ended December 31, 1995.
The Plan's financial statements have been prepared in accordance with
financial reporting requirements of the Employee Retirement Income Security
Act of 1974, as amended, (ERISA) as permitted by the 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 ending of the
Plan year. These changes had no material effect on net assets available
for Plan benefits.
Expenses of Plan
All expenses incurred in connection with the administration of the Plan,
including expenses of the Trustee, but excluding brokerage commissions and
taxes relating to the sale of shares of Enterprise Common Stock at the
direction of Participants, were paid directly by PSE&G.
The assets of Common Stock Fund D and the ESOP Fund are invested in shares
of Enterprise Common Stock. Shares of Enterprise Common Stock required for
Fund D are purchased by the Trustee either directly from Enterprise at its
sole discretion, on the open market through a broker or from the ESOP Fund.
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS -(Continued)
All shares sold for Common Stock Fund D and the ESOP Fund are sold by the
Trustee on the open market through a broker. Brokerage commissions and
taxes are paid by the Participants. However, in situations where the ESOP
is in a "sell" position and Fund D is in a "buy" position, Fund D will buy
from the ESOP at the closing price on the N.Y. Stock Exchange. In such
case, no brokerage commissions will be charged in the transaction.
Loans
A loan to a Participant is considered an investment of such Participant's
Savings Account and the principal amount of the loan is treated as a
separate investment within the various sub-accounts of the Participant's
Savings 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 Plan's Investment Funds
in the same manner as the Participant's then current-investment direction
for Deposits and Employer Contributions.
Loan amounts are taken from sub-accounts of a Participant's Savings Account
in the following order:
(a) Deferred Deposits
(b) Unmatured vested Employer Contributions
(c) Matured vested Employer Contributions
(d) Rollover Contributions
(e) Unmatured post-1986 Nondeferred Deposits
(f) Matured post-1986 Nondeferred Deposits
(g) Pre-1987 Nondeferred Deposits
Each loan is secured by an assignment of the Participant's entire right,
title and interest in and to the 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 Savings Account
Participants are permitted to transfer all, but not less than all, shares
from their ESOP Funds to their Savings Accounts. To effect such transfers,
the Trustee will sell the shares of Enterprise Common Stock held in the
ESOP Fund and invest the proceeds in the Savings Account Funds designated
by the Participant. The cash value of each share of Enterprise Common Stock
so transferred will be equal to the price per share of Enterprise Common
Stock actually received by the Trustee. Any such transfer is treated as a
rollover contribution.
Vesting
Employer Contributions to a Participant's Savings Account are immediately
vested upon a Participant's completion of five years of service with an
Employer or when a Participant is eligible for an immediately payable
retirement benefit, attains age 65, is disabled, is laid off or dies. All
amounts credited to a Participant's ESOP Fund are fully vested.
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS -(Continued)
Penalties upon Withdrawal
However, if a Participant withdraws his entire vested Employer
Contributions and/or Deposits before they have been in the Plan for two
full calendar years, such Participant loses 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 Administrator. 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. Distributions to Participants of approved hardship withdrawals
are made as soon as practicable after such approval.
Benefits Payable
The AICPA Audit and Accounting Guide, requires that benefits payable to
persons who are not active participants in a defined contribution plan be
disclosed in the footnotes to the financial statements rather than be
recorded as a liability of the Plan. As of December 31, 1994, and December
31, 1993, the net assets available for benefits included benefits due to
Participants who are no longer active Participants in the Plan in the
amounts of $195,358 and $747,418, respectively.
3. INVESTMENTS
The financial statements of the Plan include the following:
a. Savings Account Investment Funds
(1) The assets of Equities Growth Fund A are invested in the
capital stock of the Twentieth Century Investors Inc.
Growth Fund (the "Twentieth Century Growth Fund") a no-
load, open-ended investment company or mutual fund. The
prospectus for the Twentieth Century Growth Fund indicates
that such fund invests primarily in the common stock of
companies considered by its investment manager to have
above average potential for capital appreciation.
(2) The assets of Balanced Fund B are invested in the capital
stock of Phoenix Series Fund Balanced Series (the "Phoenix
Balanced Fund") a no-load, open-ended investment company or
mutual fund. The prospectus for the Phoenix Balanced Fund
indicates that such fund invests primarily in a combination
of equity and fixed income debt securities that its
investment manager expects to provide current income along
with long-term capital growth and conservation of capital.
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS -(Continued)
(3) The assets of Fixed Income Fund C are invested in GICs with
various insurance companies which contractually provide for
a guarantee of principal and interest for the respective
contract periods.
The following GICs are continuing:
(i) A four and one-half year contract expiring June
30, 1996 and a five and one-half year contract
expiring June 30, 1997, with Provident National
Assurance Company, effective interest rates of
6.62% and 6.80%, respectively;
(ii) A four-year contract which will expire on
December 31, 1997, with Metropolitan Life
Insurance Company, effective interest rate of
5.72%;
(iii) A four-year contract which will expire January 1,
1996, with John Hancock Mutual Life Insurance
Company, effective interest rate of 6.10%.
(iv) A five-year contract which will expire January 1,
1997, with Principal Mutual Life Insurance
Company, effective interest rate of 6.80%;
(v) A five-year contract which will expire January 4,
1999, with Allstate Life Insurance Company,
effective interest rate of 5.65%; and
(vi) A five-year contract which will expire June 30,
1999, with New York Life Insurance Company,
effective interest rate of 7.07%.
(4) The assets of Enterprise Common Stock Fund D are invested
by the Trustee in Enterprise Common Stock.
(5) The assets of Stock Index Equities Fund E are invested by
the Trustee in BT Institutional Equity 500 Index Fund
("Stock Index Equities Fund"), a no-load mutual fund
managed by Bankers Trust Company so as to achieve the
approximate return of the Standard and Poor's 500 Composite
Stock Price Index.
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS -(Continued)
(6) The assets of Utilities Equities Fund F are invested in the
capital stock of Fidelity Income Fund Utilities (the
"Fidelity Utilities Fund"), a no-load, open-ended
investment company or mutual fund. The prospectus for the
Fidelity Utilities Fund indicates that such fund invests
primarily in equity securities of gas and electric utility
companies and companies engaged in the communications
field. The Fidelity Utilities Fund may, from time to time,
include shares of Enterprise Common Stock or PSE&G
preferred stock.
(7) The assets of Government Securities Fund G are invested in
the capital stock of Weiss, Peck and Greer Mutual Fund's
Government Securities Fund (the "WPG Government Securities
Fund"), a no-load, open-ended investment company or mutual
fund. The prospectus for the WPG Government Securities Fund
indicates that such fund invests primarily in debt
obligations issued or guaranteed by the U.S. Government,
its agencies or instrumentalities which have remaining
maturities of one year or more.
(8) The assets of International Stock Fund H are invested in
the capital stock of T. Rowe Price International Funds Inc.
(the T. Rowe Price International Stock Fund"), a no-load,
open-ended investment company or mutual fund. The
prospectus for T. Rowe Price International Stock Fund
indicates that such fund invests primarily in common stocks
of established, non-U.S. companies.
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS -(Continued)
b. ESOP FUND
Shares of Enterprise 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 bargaining unit
portions of the PSE&G's former TRASOP and PAYSOP. No additional
contributions in or transfers into the ESOP Fund are presently
permitted or were allowed during 1994.
c. PARTICIPANTS
Participants
As of December 31,
------------------------
1994 1993 1992
------ ------ ------
Total Plan Participants............ 8,138 7,965 7,209
Participants by Fund
--------------------
Equities Growth Fund A ............ 1,165 1,020 758
Balanced Fund B ................... 690 660 439
Fixed Income Fund C ............... 4,801 4,942 4,807
Enterprise Common Stock Fund D .... 2,709 2,987 2,704
Stock Index Equities Fund E ....... 1,826 1,850 1,585
Utilities Equities Fund F ......... 876 896 519
Government Securities Fund G ...... 431 415 290
International Stock Fund H (1)..... 706 -- --
ESOP Fund ......................... 1,426 1,690 1,822
-----------------------------------
(1) New investment option in 1994
4. UNIT VALUE INFORMATION - SAVINGS ACCOUNT INVESTMENT FUNDS
Unit values of the Investment Funds were determined the last business day
of each month and, starting February 1, 1994 have been determined at the
end of each business day (Valuation Date) by dividing the market value of
net assets available for benefits by the number of units allocated to all
Participants as of the respective Valuation Date.
New units are allocated to each Participant's Savings Account monthly and
starting February 1, 1994, have been allocated at the end of each business
day by dividing Deposits made by, or on behalf of, such Participant for
such month or business day and the related Employer Contributions, if any,
together with repayment of the principal amount of any loan to the
Participant's Savings Account including interest earned thereon during the
month or business day, respectively, by the unit value determined as of the
end of the Valuation Date. If a Participant makes a transfer between
Investment Funds, makes a withdrawal, receives a distribution or a loan,
or makes a rollover contribution, the amount so transferred, withdrawn,
distributed, loaned, or rolled over is also determined by the unit value
of each Investment Fund as of the applicable Valuation Date for such
transaction.
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS -(Continued)
The Investment Fund unit information as of the last business day of each
year is as follows:
Investment Fund Year Unit Value Number of Units
- --------------- ---- ---------- ---------------
(Dollars)
Equities Growth Fund A.......... 1994 18.740000 254,061.739
1993 10.000000 347,435.857
1992 1.024268 2,032,849.041
Balanced Fund B ................ 1994 14.830000 147,009.844
1993 10.000000 181,026.753
1992 1.079134 871,809.551
Fixed Income Fund C............. 1994 10.625695 6,973,763.974
1993 10.000000 6,143,922.175
1992 1.561574 31,973,690.038
Enterprise Common Stock Fund D.. 1994 9.472822 2,476,796.460
1993 10.000000 2,747,032.952
1992 1.794902 13,235,402.932
Stock Index Equities Fund E..... 1994 10.440000 1,098,682.137
1993 10.000000 998,756.270
1992 2.043185 3,426,494.513
Utilities Equities Fund F ...... 1994 13.060000 210,211.776
1993 9.699076 301,270.143
1992 1.067409 1,183,456.011
Government Securities Fund G ... 1994 9.012366 141,839.889
1993 10.000000 133,564.887
1992 1.076746 578,960.254
International Stock Fund H (1).. 1994 11.320000 280,977.378
- -------------------------------
(1) New investment option in 1994
ESOP FUND VALUATION
Enterprise Common Stock share value is determined by using the closing
market price on the New York Stock Exchange as reported in the Wall Street
Journal as Composite Transactions. If a Participant withdraws shares, the
shares are, at Participant's election, either distributed to such
Participant or sold by the Trustee and the proceeds, net of commissions and
taxes, are distributed to the Participant.
<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS -(Continued)
The ESOP Fund information as of the last business day of each year is as
follows:
Year Price per share Number of Shares
---- --------------- ----------------
ESOP Fund 1994 $26.500 374,336
1993 $32.000 451,466
1992 $30.875 500,283
5. FEDERAL INCOME TAXES
The Company believes that the Plan and its related Trust, including the
portions of the former TRASOP and PAYSOP applicable to bargaining unit
Participants, which portions were spun-off and merged with the Plan
effective January 1, 1988, are qualified under Sections 401(a) and 501(a)
of the IRC and, as such, the Plan is exempt from taxation on its earnings.
A determination letter to such effect was obtained from the Internal
Revenue Service (IRS) in 1988. Participants are not taxed either on
Company Contributions or on the earnings credited to their Savings Account,
until distribution of such Savings Account. On December 30, 1994, the
Company submitted an application to the IRS for a determination that the
Plan and Trust continue to be qualified under applicable law.
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.
7. SUBSEQUENT EVENTS
The assets of Fixed Income Fund C will be invested after December 31, 1994
in GICs with the following insurance companies which contractually provide
for a return of principal and a fixed interest rate for the contract
period:
Effective January 1, 1995, a five year contract expiring December 31,
1999 with Metropolitan Life Insurance Company, effective interest rate
of 8.12%.
Effective January 1, 1995, a five year contract expiring December 31,
1999 with The Prudential Life Insurance Company, effective interest
rate of 8.01%
Starting January 18, 1995 the following new investment fund became
available:
The assets of Government Securities Fund G were transferred from
the Weiss Peck and Greer Mutual Fund's Government Securities
Fund to the Voyageur U.S. Government Securities Fund (the
"Voyageur U.S. Government Securities Fund") an open-end
investment Company or mutual fund.
<PAGE>
<PAGE>
<TABLE>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
EMPLOYEE SAVINGS PLAN
<CAPTION>
SCHEDULE OF ASSETS HELD FOR INVESTMENT - ITEM 27a
DECEMBER 31, 1994
Identity of Issue Units/Shares Historical Cost Market Value Unit Value
- ----------------- ------------ --------------- ------------ -----------
<S> <C> <C> <C> <C>
Equities Growth Fund A.................. 254,062 $ 5,689,495 $ 4,761,117 $ 18.74
---------- ------------ ------------ -----------
Balanced Fund B......................... 147,010 $ 2,308,279 $ 2,180,156 $ 14.83
---------- ------------ ------------ -----------
Fixed Income Fund C (Insurance
Annuity Contracts-GICs):
Provident National Assurance Company
-- 6.80%, four and one-half year
contract expiring 6/30/97.......... 10,172,794 $ 10,172,794 $ 10,172,794 --
-- 6.62%, four and one half-year
contract expiring 6/30/96.......... 5,653,051 $ 5,653,051 $ 5,653,051 --
Metropolitan Life Insurance Company
-- 5.72%, four-year contract
expiring 12/31/97.................. 5,261,902 $ 5,261,902 $ 5,261,902 --
Prudential Life Insurance Company
-- 8.98%, four-year contract
expiring 12/31/94.................. 10,084,866 $ 10,084,866 $ 10,084,866 --
Principal Mutual Life Insurance Company
-- 6.80%, five-year contract
expiring 1/1/97.................... 8,888,357 $ 8,888,357 $ 8,888,357 --
John Hancock Mutual Life
Insurance Company
-- 6.10%, four-year contract
expiring 1/1/96.................... 10,976,332 $ 10,976,332 $ 10,976,332 --
Allstate Life Insurance Company
-- 5.65%, five-year contract
expiring 1/4/99.................... 12,590,164 $ 12,590,164 $ 12,590,164 --
New York Life Insurance Company
-- 7.07%, five-year contract
expiring 6/30/99................... 10,473,623 $ 10,473,623 $ 10,473,623 --
---------- ------------ ------------ -----------
74,101,089 $ 74,101,089 $ 74,101,089 $ 1.00
---------- ------------ ------------ -----------
Equities Fund D (Common Stock
of Public Service Enterprise
Group, Inc.).......................... 885,368 $ 24,781,619 $ 23,462,252 $ 26.50
---------- ------------ ------------ -----------
Equities Fund E (BT Institutional Equity
Index Fund)........................... 1,098,682 $ 11,774,753 $ 11,470,242 $ 10.44
---------- ------------ ------------ -----------
Utilities Equities Fund F............... 210,212 $ 3,121,895 $ 2,745,366 $ 13.06
---------- ------------ ------------ -----------
Government Securities Fund G............ 141,840 $ 1,461,508 $ 1,278,313 $ 9.01
---------- ------------ ------------ -----------
International Stock Fund H.............. 280,977 $ 3,476,716 $ 3,180,664 $ 11.32
---------- ------------ ------------ -----------
Employee Stock Ownership Plan
(Common Stock of Public Service
Enterprise Group, Inc.)............... 374,336 $ 3,971,459 $ 9,919,904 $ 26.50
---------- ------------ ------------ -----------
Total Investments.................. -- $130,686,813 $133,099,103 --
Loans to Participants (interest rates
ranging from 6% to 7.75%, maturity
date of one to five years).......... -- $ 6,526,460 $ 6,526,460 --
---------- ------------ ------------ -----------
Total Assets Held for Investment... -- $137,213,273 $139,625,563 --
========== ============ ============ ===========
<FN>
Required by Department of Labor Regulation 2520.103-10(b)(6).103-6.
</TABLE>
<PAGE>
<PAGE>
<TABLE>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
EMPLOYEE SAVINGS PLAN
<CAPTION>
SCHEDULE OF REPORTABLE CUMULATIVE TRANSACTIONS FOR THE YEAR
ENDED DECEMBER 31, 1994* - Item 27d
Number Number Value Value
of of of of
Security Purchases Sales Purchases Sales Net Gain
- -------- --------- --------- ----------- ----------- ------------
<S> <C> <C> <C> <C> <C>
Investment Contracts:
Metropolitan Life
Insurance Company............ 1 7 $ 62,241 $ 8,530,930
Allstate Life Insurance
Company...................... 17 2 $15,045,983 $ 2,455,820
New York Life Insurance
Company...................... 24 6 $11,066,570 $ 592,948
Public Service Enterprise
Group Inc. Holding Company... 88 110 $ 3,654,755 $ 3,405,361 $ 1,026,125
BT Institutional Directed
Account Cash Fund.............. 334 449 $45,655,783 $46,329,650 --
BT Institutional Equity Index
Fund......................... 0 3 -- $10,141,502 $ 2,245,542
PSE&G Participant Loan......... 469 199 $ 4,780,389 $ 2,392,190 --
SCHEDULE OF REPORTABLE INDIVIDUAL TRANSACTIONS FOR THE YEAR
ENDED DECEMBER 31, 1994* Item 27d
Purchase Sales Net Gain
------------ ------------ -----------
BT Institutional Equity Index Fund... $10,099,457 $ 2,235,982
Allstate Life Insurance Company...... $ 9,000,000
Metropolitan Life Insurance Company.. $ 8,530,930
* Reportable transactions as required by ERISA consist of any transaction or
series of transactions within the plan year with the same person or entity
which, when aggregated, involves an amount that is in excess of 5% of the
current value of plan assets at the beginning of the plan year.
</TABLE>
<PAGE>
<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 Electric and Gas Company
Employee Savings Plan
---------------------------------------
(Name of Plan)
By JAMES T. FORAN
---------------------------------------
JAMES T. FORAN
Member of the Employee
Benefits Committee
Date: June 30, 1995
<PAGE>
<PAGE>
EXHIBIT INDEX
Exhibit Number
- --------------------------------
1 Public Service Electric and Gas
Company Employee Savings Plan, as
amended through April 10, 1995.
2 Independent Auditors' Consent.
PAGE
<PAGE>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
EMPLOYEE SAVINGS PLAN
EXHIBIT 1
As Amended through April 10, 1995<PAGE>
<PAGE>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
EMPLOYEE SAVINGS PLAN
TABLE OF CONTENTS
Page
ARTICLE I
AMENDMENT - PURPOSE . . . . . . . . . . . . . . . . . . . . . . . . .1
Section 1.1. Amendment of the Plan . . . . . . . . . . . . . . . . .1
Section 1.2. Purpose . . . . . . . . . . . . . . . . . . . . . . . .1
ARTICLE II
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1
Section 2.1. Account. . . . . . . . . . . . . . . . . . . . . . . .1
Section 2.2. Active Participant . . . . . . . . . . . . . . . . . .1
Section 2.3. Additional Lump Sum Deposits . . . . . . . . . . . . .1
Section 2.4. Affiliate. . . . . . . . . . . . . . . . . . . . . . .2
Section 2.5. Balanced Fund. . . . . . . . . . . . . . . . . . . . .2
Section 2.6. Basic Deposits . . . . . . . . . . . . . . . . . . . .2
Section 2.7. Board of Directors . . . . . . . . . . . . . . . . . .2
Section 2.8. Code . . . . . . . . . . . . . . . . . . . . . . . . .2
Section 2.9. Commissioner . . . . . . . . . . . . . . . . . . . . .2
Section 2.10. Committee or Employee Benefits Committee . . . . . . .2
Section 2.11. Company. . . . . . . . . . . . . . . . . . . . . . . .2
Section 2.12. Compensation . . . . . . . . . . . . . . . . . . . . .2
Section 2.13. Deferred . . . . . . . . . . . . . . . . . . . . . . .3
Section 2.14. Deposits . . . . . . . . . . . . . . . . . . . . . . .3
Section 2.15. Disability . . . . . . . . . . . . . . . . . . . . . .4
Section 2.16. Effective Date . . . . . . . . . . . . . . . . . . . .4
Section 2.17. Eligible Employee. . . . . . . . . . . . . . . . . . .4
Section 2.18. Employee . . . . . . . . . . . . . . . . . . . . . . .4
Section 2.19. Employer . . . . . . . . . . . . . . . . . . . . . . .4
Section 2.20. Employer Contributions . . . . . . . . . . . . . . . .4
Section 2.21. Enrollment Date. . . . . . . . . . . . . . . . . . . .4
Section 2.22. Enterprise . . . . . . . . . . . . . . . . . . . . . .4
Section 2.23. Enterprise Common Stock. . . . . . . . . . . . . . . .4
Section 2.24. Enterprise Common Stock Fund . . . . . . . . . . . . .4
Section 2.25. Equities Fund. . . . . . . . . . . . . . . . . . . . .5
Section 2.26. Equities Index Fund. . . . . . . . . . . . . . . . . .5
Section 2.27. ERISA. . . . . . . . . . . . . . . . . . . . . . . . .5
Section 2.28. ESOP Account . . . . . . . . . . . . . . . . . . . . .5
Section 2.29. Fixed Income Fund. . . . . . . . . . . . . . . . . . .5
Section 2.30. Funds. . . . . . . . . . . . . . . . . . . . . . . . .5
Section 2.31. General Manager. . . . . . . . . . . . . . . . . . . .5
Section 2.32. Government Obligations Fund. . . . . . . . . . . . . .5
<PAGE>
<PAGE>
Section 2.33. Highly Compensated Employee . . . . . . . . . . . . .5
Section 2.34. Highly Compensated Participant . . . . . . . . . . . .8
Section 2.35. Hour of Service. . . . . . . . . . . . . . . . . . . .8
Section 2.36. Investment Manager . . . . . . . . . . . . . . . . . .8
Section 2.37. Lay Off or Laid Off. . . . . . . . . . . . . . . . . .8
Section 2.38. Leased Employee. . . . . . . . . . . . . . . . . . . .8
Section 2.39. Matured. . . . . . . . . . . . . . . . . . . . . . . .9
Section 2.40. Nondeferred. . . . . . . . . . . . . . . . . . . . . .9
Section 2.41. Participant. . . . . . . . . . . . . . . . . . . . . .9
Section 2.42. Participating Affiliate. . . . . . . . . . . . . . . .9
Section 2.43. Plan . . . . . . . . . . . . . . . . . . . . . . . . .9
Section 2.44. Plan Year. . . . . . . . . . . . . . . . . . . . . . .9
Section 2.45. Qualified Domestic Relations Order
or QDRO. . . . . . . . . . . . . . . . . . . . . . . .9
Section 2.46. Recordkeeper . . . . . . . . . . . . . . . . . . . . 10
Section 2.47. Required Beginning Date. . . . . . . . . . . . . . . 10
Section 2.48. Retirement . . . . . . . . . . . . . . . . . . . . . 10
Section 2.49. Rollover Contributions . . . . . . . . . . . . . . . 10
Section 2.50. Savings Account. . . . . . . . . . . . . . . . . . . 11
Section 2.51. Supplemental Deposits. . . . . . . . . . . . . . . . 11
Section 2.52. Trust Agreement. . . . . . . . . . . . . . . . . . . 11
Section 2.53. Trust Fund . . . . . . . . . . . . . . . . . . . . . 11
Section 2.54. Trustee. . . . . . . . . . . . . . . . . . . . . . . 12
Section 2.55. Year of Service. . . . . . . . . . . . . . . . . . . 12
ARTICLE III
PARTICIPATION . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 3.1. Participation. . . . . . . . . . . . . . . . . . . . 12
Section 3.2. Effective Date of Participation. . . . . . . . . . . 13
ARTICLE IV
DEPOSITS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 4.1. Basic Deposits . . . . . . . . . . . . . . . . . . . 13
Section 4.2. Supplemental Deposits. . . . . . . . . . . . . . . . 15
Section 4.3. Additional Lump Sum Deposits . . . . . . . . . . . . 16
Section 4.4. Method of Deposits . . . . . . . . . . . . . . . . . 16
Section 4.5. Limit on Deferred Deposits . . . . . . . . . . . . . 17
Section 4.6. Distribution of Excess Deferral Amounts. . . . . . . 17
Section 4.7. Code Section 401(k) Limits on Deferred
Deposits . . . . . . . . . . . . . . . . . . . . . . 18
Section 4.8. Unmatched Employer Contributions . . . . . . . . . . 18
Section 4.9. Code Section 401(m) Limits on Non-
deferred Deposits and Employer
Contributions. . . . . . . . . . . . . . . . . . . . 19
Section 4.10. Changing Deposit Percentages . . . . . . . . . . . . 19
<PAGE>
<PAGE>
Section 4.11. Suspension of Deposits . . . . . . . . . . . . . . . 19
Section 4.12. Limit on Additional Lump Sum Deposits. . . . . . . . 20
Section 4.13. Elections. . . . . . . . . . . . . . . . . . . . . . 20
Section 4.14. Rollover Contributions . . . . . . . . . . . . . . . 20
ARTICLE V
EMPLOYER CONTRIBUTIONS. . . . . . . . . . . . . . . . . . . . . . . 21
Section 5.1. Amount and Payment of Employer Contribu-
tions. . . . . . . . . . . . . . . . . . . . . . . . 21
Section 5.2. Reduction of Employer Contributions by
Forfeitures. . . . . . . . . . . . . . . . . . . . . 22
Section 5.3. Maximum Annual Additions . . . . . . . . . . . . . . 22
Section 5.4. Return of Employer Contributions . . . . . . . . . . 22
ARTICLE VI
SAVINGS ACCOUNT INVESTMENTS . . . . . . . . . . . . . . . . . . . . 23
Section 6.1. Investment of Deposits, Rollover Contribu-
tions and Employer Contributions . . . . . . . . . . 23
Section 6.2. Change in Investment Direction . . . . . . . . . . . 23
Section 6.3. Transfer of Investments. . . . . . . . . . . . . . . 24
Section 6.4. Loans. . . . . . . . . . . . . . . . . . . . . . . . 24
ARTICLE VII
SAVINGS ACCOUNT FUNDS . . . . . . . . . . . . . . . . . . . . . . . 25
Section 7.1. Establishment of Funds . . . . . . . . . . . . . . . 25
Section 7.2. Enterprise Common Stock Fund . . . . . . . . . . . . 26
ARTICLE VIII
SAVINGS ACCOUNTS. . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 8.1. Establishment of Savings Accounts. . . . . . . . . . 27
Section 8.2. Measure of Savings Accounts. . . . . . . . . . . . . 28
Section 8.3. Valuation of Funds . . . . . . . . . . . . . . . . . 29
Section 8.4. Valuation of Savings Accounts. . . . . . . . . . . . 29
Section 8.5. Separate Accounting. . . . . . . . . . . . . . . . . 29
ARTICLE IX
ESOP ACCOUNTS . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 9.1. Maintenance of Separate Accounts . . . . . . . . . . 30
<PAGE>
<PAGE>
Section 9.2. Allocation of Distributions. . . . . . . . . . . . . 30
Section 9.3. Withdrawals or Transfers During Employ-
ment . . . . . . . . . . . . . . . . . . . . . . . . 30
Section 9.4. Dividends and Other Income . . . . . . . . . . . . . 31
Section 9.5. Voting of ESOP Account Common Stock. . . . . . . . . 32
ARTICLE X
VESTING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 10.1. Vesting of Employer Contributions. . . . . . . . . . 32
Section 10.2. Vesting of Deposits, Rollover Contributions
and the ESOP Account . . . . . . . . . . . . . . . . 33
ARTICLE XI
ACCOUNT DISTRIBUTIONS AND WITHDRAWALS . . . . . . . . . . . . . . . 33
Section 11.1. Distribution Upon Retirement, Disability,
Lay Off or Death . . . . . . . . . . . . . . . . . . 33
Section 11.2. Distribution Upon Other Termination
of Employment. . . . . . . . . . . . . . . . . . . . 34
Section 11.3. Withdrawal of Nondeferred Deposits and
Employer Contributions During Employment . . . . . . 35
Section 11.4. Withdrawals of Deferred Deposits
During Employment After Age 59 1/2 . . . . . . . . . 36
Section 11.5. Hardship Withdrawals . . . . . . . . . . . . . . . . 37
Section 11.6. Suspension of Participation. . . . . . . . . . . . . 40
Section 11.7. Transfer of Employment . . . . . . . . . . . . . . . 40
Section 11.8. Form of Distributions. . . . . . . . . . . . . . . . 40
Section 11.9. Time of Distributions. . . . . . . . . . . . . . . . 42
Section 11.10. Limitation on Post Age 70 1/2 Distribu-
tions. . . . . . . . . . . . . . . . . . . . . . . . 43
Section 11.11. Distribution in the Case of Certain
Disabilities . . . . . . . . . . . . . . . . . . . . 44
Section 11.12. Loans. . . . . . . . . . . . . . . . . . . . . . . . 45
Section 11.13. Inability to Locate Payee. . . . . . . . . . . . . . 47
Section 11.14. Federal Income Tax Withholding
on Distributions and Withdrawals . . . . . . . . . . 47
ARTICLE XII
LIMITS ON BENEFITS AND CONTRIBUTIONS UNDER
QUALIFIED PLANS . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Section 12.1. Definitions. . . . . . . . . . . . . . . . . . . . . 48
Section 12.2. Annual Addition Limits . . . . . . . . . . . . . . . 58
Section 12.3. Overall Limit. . . . . . . . . . . . . . . . . . . . 61
Section 12.4. Special Rules. . . . . . . . . . . . . . . . . . . . 62
<PAGE>
<PAGE>
ARTICLE XIII
TOP-HEAVY REQUIREMENTS. . . . . . . . . . . . . . . . . . . . . . . 63
Section 13.1. Definitions. . . . . . . . . . . . . . . . . . . . . 63
Section 13.2. General Requirements . . . . . . . . . . . . . . . . 66
Section 13.3. Maximum Compensation . . . . . . . . . . . . . . . . 66
Section 13.4. Vesting. . . . . . . . . . . . . . . . . . . . . . . 66
Section 13.5. Minimum Contributions. . . . . . . . . . . . . . . . 66
Section 13.6. Participants Under Defined Benefit Plans . . . . . . 68
Section 13.7. Super Top-Heavy Plans. . . . . . . . . . . . . . . . 68
Section 13.8. Determination of Top-Heaviness . . . . . . . . . . . 69
Section 13.9. Determination of Super Top-Heaviness. . . . . . . . 69
Section 13.10. Calculation of Top-Heavy Ratios. . . . . . . . . . . 69
Section 13.11. Cumulative Accounts and Cumulative
Accrued Benefits. . . . . . . . . . . . . . . . . . 70
ARTICLE XIV
BENEFICIARY IN EVENT OF DEATH . . . . . . . . . . . . . . . . . . . 72
Section 14.1. Designation and Change of Beneficiary. . . . . . . . 72
ARTICLE XV
ADMINISTRATION. . . . . . . . . . . . . . . . . . . . . . . . . . . 73
Section 15.1. Named Fiduciary. . . . . . . . . . . . . . . . . . . 73
Section 15.2. Administration . . . . . . . . . . . . . . . . . . . 73
Section 15.3. Control and Management of Assets . . . . . . . . . . 75
Section 15.4. Benefits to be Paid from Trust . . . . . . . . . . . 76
Section 15.5. Expenses . . . . . . . . . . . . . . . . . . . . . . 76
ARTICLE XVI
CLAIMS PROCEDURE. . . . . . . . . . . . . . . . . . . . . . . . . . 76
Section 16.1. Filing of Claims . . . . . . . . . . . . . . . . . . 76
Section 16.2. Appeal of Claims . . . . . . . . . . . . . . . . . . 76
Section 16.3. Review of Appeals. . . . . . . . . . . . . . . . . . 77
ARTICLE XVII
MERGER OR CONSOLIDATION . . . . . . . . . . . . . . . . . . . . . . 77
Section 17.1. Merger or Consolidation. . . . . . . . . . . . . . . 77
<PAGE>
<PAGE>
ARTICLE XVIII
NON-ALIENATION OF BENEFITS. . . . . . . . . . . . . . . . . . . . . 77
Section 18.1. Non-Alienation of Benefits . . . . . . . . . . . . . 77
ARTICLE XIX
AMENDMENTS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
Section 19.1. Amendment Process. . . . . . . . . . . . . . . . . . 78
ARTICLE XX
TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
Section 20.1. Authority to Terminate . . . . . . . . . . . . . . . 78
Section 20.2. Distribution Upon Termination. . . . . . . . . . . . 78
ARTICLE XXI
PLAN CONFERS NO RIGHT TO EMPLOYMENT . . . . . . . . . . . . . . . . 79
Section 21.1. No Right to Employment . . . . . . . . . . . . . . . 79
ARTICLE XXII
ALTERNATE PAYEES. . . . . . . . . . . . . . . . . . . . . . . . . . 79
Section 22.1. Alternate Payees Under QDROs . . . . . . . . . . . . 79
ARTICLE XXIII
CONSTRUCTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
Section 23.1. Governing Law. . . . . . . . . . . . . . . . . . . . 80
Section 23.2. Headings . . . . . . . . . . . . . . . . . . . . . . 80
<PAGE>
<PAGE>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
EMPLOYEE SAVINGS PLAN
ARTICLE I
AMENDMENT - PURPOSE
SECTION 1.1. AMENDMENT OF THE PLAN. Public Service Electric and Gas
Company hereby further amends, on April 10, 1995 and effective January 5,
1995, its Employee Savings Plan, a savings, profit-sharing and tax-credit
employee stock ownership plan for its Eligible Employees and those of its
Affiliates. The Plan as so amended reflects changes in Plan provisions to
permit participation by Eligible Employees of Affiliates.
SECTION 1.2. PURPOSE. The purpose of the Plan is to encourage and
assist thrift and savings by eligible bargaining unit employees of Public
Service Electric and Gas Company and its Affiliates through tax-sheltered
forms of investment.
ARTICLE II
DEFINITIONS
When used herein, the words and phrases hereinafter defined shall have
the following meanings unless a different meaning is clearly required by
the context of the Plan:
SECTION 2.1. "Account" shall mean the separate account maintained in
the Plan for each Participant which consists of the Participant's Savings
Account and/or the Participant's ESOP Account.
SECTION 2.2. "Active Participant" shall mean a Participant who is an
Eligible Employee presently making Nondeferred Deposits or for whom
Deferred Deposits are presently being made.
SECTION 2.3. "Additional Lump Sum Deposits" shall mean that amount
which is contributed to the Plan by a Participant on a lump sum basis.
Additional Lump Sum Deposits shall not be entitled to be matched by
Employer Contributions.
SECTION 2.4. "Affiliate" shall mean any organization which is a
member of a controlled group of corporations (as defined in Code section
414(b) as modified by Code section 415(h)) which includes the Company, or
any trades or businesses (whether or not incorporated) which are under
common control (as defined in Code section 414(c) as modified by Code
section 415(h)) with the Company, or a member of an affiliated service
group (as defined in Code section 414(m)) which includes the Company, or
any other entity required to be aggregated with the Company pursuant to
regulations promulgated pursuant to Code section 414(o).
SECTION 2.5. "Balanced Fund" shall mean the Fund or Funds established
pursuant to Section 7.1(f).
<PAGE>
<PAGE>
SECTION 2.6. "Basic Deposits" shall mean that amount, not less than
1%, nor more than 5% (6% for Participants who are Employees of CEA Newark
Bay Services, Inc.) (or such lower maximum percentages as may be
established by the Committee) of a Participant's Compensation, contributed
to the Plan through payroll deduction by or on behalf of a Participant
which is entitled to be matched by Company Contributions.
SECTION 2.7. "Board of Directors" shall mean the Board of Directors
of the Company.
SECTION 2.8. "Code" shall mean the Internal Revenue Code of 1986, as
amended, or as it may be amended from time to time.
SECTION 2.9. "Commissioner" shall mean the Commissioner of Internal
Revenue.
SECTION 2.10. "Committee" or "Employee Benefits Committee" shall mean
the Employee Benefits Committee of the Company appointed by the Board of
Directors.
SECTION 2.11. "Company" shall mean Public Service Electric and Gas
Company.
SECTION 2.12. "Compensation" shall mean the total remuneration paid
to a Participant for services rendered to an Employer excluding the
Employer's cost for any public or private employee benefit plan, but
including all Deferred Basic and Supplemental Deposits made by a
Participant or on a Participant's behalf to this Plan and all elective
contributions that are made by an Employer on behalf of a Participant which
are not includable in income under Code section 125, under rules adopted
by the Committee which are uniformly applicable to all Participants
similarly situated. However, Compensation shall not include the following:
(a) any amounts which are deferred under any Deferred Compensation
Plan of any Employer and any payments from any such plans of any
previously deferred amount;
(b) any amounts which constitute a reimbursement of expenses;
(c) the following miscellaneous payments:
(1) Separation pay;
(2) Gratuity Payments upon death;
(3) Payment for vacation due at time of death;
(4) Worker's Compensation for permanent partial disability; and
(5) Employer contributions for social security, unemployment
compensation or other taxes; and
(d) the following special international payments:
(1) International service premium;
(2) Cost of living allowance;
(3) Equalization Pay;
(4) Foreign service pay; and
(5) Hardship allowance.
In any case, however, for the purposes of the Plan, Compensation for
any Plan Year shall not exceed the limit imposed by Code section
401(a)(17).
SECTION 2.13. "Deferred" in reference to Deposits shall mean that
such Deposits are deferred from current federal income taxation under Code
section 401(k).
<PAGE>
<PAGE>
SECTION 2.14. "Deposits" shall mean the aggregate of Additional Lump
Sum Deposits, Basic Deposits and Supplemental Deposits made by or on behalf
of a Participant to his or her Savings Account. The total of all Deposits
made by or on behalf of a Participant in any Plan Year shall not exceed 25%
of the Participant's Compensation for such Plan Year.
SECTION 2.15. "Disability" shall mean any physical or mental
condition which renders a Participant incapable of performing further work
for his or her Employer, as certified in writing by a Doctor of Medicine
designated and approved by the Committee.
SECTION 2.16. "Effective Date" shall mean February 1, 1994.
SECTION 2.17. "Eligible Employee" shall mean any Employee who has
completed at least one Year of Service whether or not he or she actually
elects to make any Deposits.
SECTION 2.18. "Employee" shall mean any individual in the employ of
an Employer who is included in a unit of employees covered by a collective
bargaining agreement. The term "Employee" shall not include a consultant
or independent contractor doing work for an Employer or a person employed
by a consultant or independent contractor doing work for an Employer.
SECTION 2.19. "Employer" shall mean the Company and any Participating
Affiliate.
SECTION 2.20. "Employer Contributions" shall mean the matching
amounts contributed to the Plan on behalf of Participants by an Employer
in accordance with Section 5.1.
SECTION 2.21. "Enrollment Date" shall mean the earliest of:
(a) the first day of the first payroll period in which payroll deductions
from a Participant's Compensation are made for Deposits under the Plan; (b)
the date an Additional Lump Sum Deposit is accepted by the Plan from a
Participant; (c) the date a Rollover Contribution is accepted from a
Participant for payment to the Trustee for investment in the Plan in
accordance with Section 4.12; or (d) the date an ESOP Account is
established on behalf of a Participant.
SECTION 2.22. "Enterprise" shall mean the Company's parent, Public
Service Enterprise Group Incorporated.
SECTION 2.23. "Enterprise Common Stock" shall mean the Common Stock,
without nominal or par value, of Enterprise.
SECTION 2.24. "Enterprise Common Stock Fund" shall mean the Fund
established pursuant to Section 7.1(c).
SECTION 2.25. "Equities Fund" shall mean the Fund or Funds
established pursuant to Section 7.1(a).
SECTION 2.26. "Equities Index Fund" shall mean the Fund established
pursuant to Section 7.1(d).
SECTION 2.27. "ERISA" shall mean the Employee Retirement Income
Security Act of 1974, as amended, or as it may be amended from time to
time.
SECTION 2.28. "ESOP Account" shall mean that separate portion of an
Account established pursuant to Section 9.1 which evidences the shares of
Enterprise Common Stock transferred to the Plan for the Account of a
Participant, pursuant to the merger with this Plan with the Public Service
Electric and Gas Company Tax Reduction Act Employee Stock Ownership Plan
(TRASOP) and/or the Public Service Electric and Gas Company Payroll-Based
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Employee Stock Ownership Plan (PAYSOP), including the net worth of the
Trust Fund attributable thereto.
SECTION 2.29. "Fixed Income Fund" shall mean the Fund or Funds
established pursuant to SECTION 7.1(b).
SECTION 2.30. "Funds" shall mean the several investment Funds
established pursuant to SECTION 7.1. As used in the singular, "Fund" shall
mean one of such Funds.
SECTION 2.31. "General Manager" shall mean the General Manager,
Compensation and Benefits of the Company.
SECTION 2.32. "Government Obligations Fund" shall mean the Fund or
Funds established pursuant to SECTION 7.1(e).
SECTION 2.33. "Highly Compensated Employee" shall mean:
(a) For any Plan Year, any Employee who, during the Plan Year or the
preceding Plan Year--
(1) was at any time a 5% owner;
(2) received Compensation for such Plan Year from the Company
or an Affiliate in excess of the amount provided for by
Code section 414(q)(1)(B);
(3) received Compensation for such Plan Year from the Company
or an Affiliate in excess of the amount provided for by
Code section 414(q)(1)(C) and was in the top-paid group of
Employees; or
(4) was at any time an officer of the Company or of an
Affiliate and received Compensation for such Plan Year
greater than 50% of the amount provided for by Code section
415(b)(1)(A).
(b) In the case of the Plan Year for which the relevant
determination is being made, an Employee not described in
subparagraph (a)(2), (a)(3) or (a)(4) of this Section for the
preceding Plan Year (without regard to this paragraph) shall not
be treated as described in such subparagraphs (a)(2), (a)(3) or
(a)(4) unless such Employee is a member of the group consisting
of the 100 Employees paid the greatest Compensation during the
year for which such determination is being made.
(c) For purposes of this Section, an Employee shall be treated as a
5% owner for any Plan Year if at any time during such Plan Year
such Employee was a 5% owner (as defined in Code section
416(i)(1)) of the Company or an Affiliate.
(d) For purposes of this Section, an Employee shall be considered as
being in the top-paid group of Employees for any Plan Year if
such Employee is in the group consisting of the top 20% of the
Employees when ranked on the basis of Compensation paid during
such Plan Year.
(e) For purposes of determining the top-paid group under paragraph
(d), the following Employees shall be excluded:
(1) Employees who have not completed 6 months of service;
(2) Employees who normally work less than 17 1/2 hours per
week;
(3) Employees who normally work during not more than six months
during any year;
(4) Employees who have not attained age 21; and
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(5) Employees who are nonresident aliens and who receive no
earned income (within the meaning of Code section
911(d)(2)) from the Company or an Affiliate which
constitutes income from sources within the United States
(within the meaning of Code section 861(a)(3)).
(f) For purposes of subparagraph (a)(4) of this Section, no more
than 50 Employees (or, if lesser, the greater of three Employees
or 10% of the Employees) shall be treated as officers. If for
any year no officer of the Company or an Affiliate is described
in subparagraph (a)(4) of this Section, the highest paid of the
officers of the Company or an Affiliate for such Plan Year shall
be treated as described in such subparagraph.
(g) If any individual is a member of the family of a 5% owner or of
a Highly Compensated Employee in the group consisting of the 10
Highly Compensated Employees paid the greatest Compensation
during the Plan Year, then: (1) except for purposes of SECTION
4.5, such individual shall not be considered a separate
Employee; and (2) any Compensation paid to such individual (and
any applicable contribution on behalf of such individual) shall
be treated as if it were paid to (or on behalf of) the 5% owner
or Highly Compensated Employee. For purposes of this
subparagraph (g), the term "family" shall mean, with respect to
any Employee, such Employee's spouse and lineal ascendants or
descendants and spouses of such lineal ascendants or
descendants; provided, however, that for purposes of determining
whether the limit on includable Compensation contained in Code
section 401(a)(17) (see Section 2.13) has been exceeded, the
term "family" shall mean, with respect to any Employee, such
Employee's spouse and the children of such Employee who have not
attained age 19 by the close of the Plan Year.
(h) For purposes of this Section, the term "Compensation" shall mean
Compensation within the meaning of SECTION 12.1(a)(4), but
including salary reduction contributions to a cafeteria plan, a
401(k) plan and a simplified employee pension.
(i) A former Employee shall be treated as a Highly Compensated
Employee if (1) such Employee was a Highly Compensated Employee
when such Employee separated from service or (2) such Employee
was a Highly Compensated Employee at any time after attaining
age 55.
SECTION 2.34. "Highly Compensated Participant" shall mean:
(a) those Highly Compensated Employees who are Participants or
(b) those Highly Compensated Employees who are Eligible Employees,
who have satisfied all conditions for participation under
SECTION 3.1, whether or not they actually elect to make any
Deposits or Rollover Contributions to the Plan.
SECTION 2.35. "Hour of Service" shall mean each hour for which an
Employee is directly or indirectly paid remuneration or entitled to such
payment by an Employer including any hours for which back pay, irrespective
of mitigation of damages, is either awarded or agreed to by an Employer.
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SECTION 2.36. "Investment Manager" shall mean an investment
manager as defined in ERISA SECTION 3(38).
SECTION 2.37. "Lay Off" or Laid Off" shall mean a Participant's
involuntary separation from service with an Employer because of a reduction
in work forces at a time when there is no further work available with an
Employer for which the Participant is qualified.
SECTION 2.38. "Leased Employee" shall mean an individual who is not
an Employee but who would be a leased employee as defined in Code section
414(n), but for the one year service requirement of Code section
414(n)(2)(B).
SECTION 2.39. "Matured" in reference to Deposits and Employer
Contributions shall mean that the respective amount has been held in the
Plan for at least twenty-four months.
SECTION 2.40. "Nondeferred" in reference to Deposits shall mean that
such Deposits are not deferred from current federal income taxation under
Code section 401(k).
SECTION 2.41. "Participant" shall mean any person who has an interest
in the Trust Fund.
SECTION 2.42. "Participating Affiliate" shall mean any Affiliate of
the Company which: (a) adopts the Plan with the approval of the Board of
Directors; (b) authorizes the Board of Directors and the Employee Benefits
Committee to act for it in all matters arising under or with respect to the
Plan; and (c) complies with such other terms and conditions relating to the
Plan as may be imposed by the Board of Directors.
SECTION 2.43. "Plan" shall mean this Public Service Electric and Gas
Company Employee Savings Plan, including all amendments hereto which may
hereafter be made.
SECTION 2.44. "Plan Year" shall mean the calendar year.
SECTION 2.45. "Qualified Domestic Relations Order" or "QDRO"
shall mean any judgment, decree or order pursuant to a state domestic
relations or community property law which relates to the provision of child
support or marital property rights, which creates or recognizes the
existence of an alternate payee's right to (or assigns to an alternate
payee the right to) receive all or part of a Participant's Account, and
which meets the requirements of (a) and (b) below, as interpreted in
accordance with Code section 414(p):
(a) such order specifies:
(1) the name and last known mailing address of the Participant
and each alternate payee;
(2) the amount or the percentage of the Participant's Account
to be paid to each alternate payee, or the manner in which
such amount or percentage is to be determined;
(3) the number of payments or the period to which the order
applies; and
(4) each plan to which such order applies;
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(b) such order does not require the Plan to:
(1) provide any type or form of benefit or option not otherwise
provided under the Plan;
(2) provide increased benefits; or
(3) pay to an alternate payee amounts required to be paid to
another alternate payee under a prior QDRO.
SECTION 2.46. "Recordkeeper" shall mean the person(s) or entity(ies)
designated by the Committee to maintain the records of the Plan and Plan
Accounts and to perform such other functions as may be designated by the
Committee.
SECTION 2.47. "Required Beginning Date" shall mean with respect to
distributions to any Participant, April 1 of the calendar year following
the calendar year in which the Participant attains age 70 1/2; provided,
however, that with respect to distributions to any Participant who attained
age 70 before July 1, 1987 and who was not a "5% owner" as defined in
SECTION 13.1(f)(3), the Required Beginning Date for such Participant shall
be April 1 of the calendar year following the calendar year in which (1)
the Participant attains age 70 1/2 or (2) the Participant retires,
whichever is later.
SECTION 2.48. "Retirement" shall mean the termination of employment
by a Participant other than by reason of his or her death:
(a) under circumstances entitling the Participant to an immediately
payable retirement benefit under any pension plan of an
Employer, or
(b) at or after age 65.
SECTION 2.49. "Rollover Contributions" shall mean Employee
contributions transferred to the Plan, in accordance with SECTION 4.12,
from a trust under another corporate plan, each qualified under Code
sections 501(a) and 401(a), respectively.
SECTION 2.50. "Savings Account" shall mean that separate portion of
an Account established pursuant to SECTION 8.1 and which consists of the
sum of the following subaccounts of such Participant:
(a) Basic Deposit Subaccount shall mean that portion of a
Participant's Savings Account which evidences the value of Basic
Deposits by or on behalf of a Participant under the Plan,
including the net worth of the Trust Fund attributable thereto.
(b) Supplemental Deposit Subaccount shall mean that portion of a
Participant's Savings Account which evidences the value of
Supplemental Deposits and Additional Lump Sum Deposits under the
Plan, assets transferred by the Participant from his or her ESOP
Account and Rollover Contributions to the Plan by or on behalf
of a Participant, including the net worth of the Trust Fund
attributable thereto.
(c) Employer Contribution Subaccount shall mean that portion of a
Participant's Savings Account which evidences the value of
Employer Contributions which have been credited to a
Participant's Account under Section 5.1 of the Plan (less any
forfeitures), including the net worth of the Trust Fund
attributable thereto.
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SECTION 2.51. "Supplemental Deposits" shall mean the amount, if any,
of Compensation contributed to the Plan through payroll deduction by or on
behalf of a Participant which is more than the maximum permitted Basic
Deposit.
SECTION 2.52. "Trust Agreement" shall mean the agreement between the
Company and the Trustee which provides for the management of the Trust Fund
and the investment of Deposits, Employer Contributions and Rollover
Contributions to the Plan and investment of the assets of ESOP Accounts.
SECTION 2.53. "Trust Fund" shall mean the aggregate of Basic and
Supplemental Deposits made by or on behalf of Participants, Rollover
Contributions and Employer Contributions, together with ESOP Accounts,
increased by any profits or income thereon, and decreased by any losses
thereon and by any payments made therefrom.
SECTION 2.54. "Trustee" shall mean any individual or individuals or
corporation or corporations by whom any assets of the Plan are held under
the Trust Agreement.
SECTION 2.55. "Year of Service" shall mean the twelve consecutive
month period beginning on the first day of the month in which an Employee
commences employment with an Employer and each succeeding twelve
consecutive month period beginning on the yearly anniversary of such day,
during which the Employee completes not less than 1,000 Hours of Service;
and the determination of whether an Employee shall have completed not less
than 1,000 Hours of Service during any such period shall be made by
crediting such Employee with 190 Hours of Service for each calendar month
during such period in which the Employee is entitled to be credited with
at least one Hour of Service for such month. For the purposes of this
Section, there shall be included service with an Employer as an Employee
or as a Leased Employee.
ARTICLE III
PARTICIPATION
SECTION 3.1. PARTICIPATION. Each Eligible Employee may become a
Participant by applying with the Recordkeeper to establish a Savings
Account or when an ESOP Account was established on his or her behalf. An
Employee may become a Participant by applying with the Recordkeeper for the
Plan to accept a Rollover Contribution on such Employee's behalf.
By contacting the Recordkeeper and using its automatic voice response
system, the Eligible Employee can (a) arrange for the payment of an
Additional Lump Sum Deposit to the Plan, (b) authorize his or her Employer
to withhold an amount in a specified percentage of his or her Compensation
and (c) authorize the Recordkeeper and/or Employer to pay such amount to
the Trustee for investment in a Savings Account under the Plan in
accordance with the Eligible Employee's instructions.
Also by contacting the Recordkeeper and using its automatic voice
response system, the Employee can authorize his or her Employer to accept
a Rollover Contribution from another qualified corporate plan in accordance
with SECTION 4.12 and to pay such amount to the Trustee for investment
under the Plan in accordance with such Employee's instructions.
Participation in the Plan is entirely voluntary.
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SECTION 3.2. EFFECTIVE DATE OF PARTICIPATION. Participation in the
Plan shall be effective for an Eligible Employee and payroll deductions
shall commence, as soon as practicable after the Eligible Employee has
applied to the Recordkeeper for participation. Participation in the Plan
shall be effective for an Employee or an Eligible Employee making a
Rollover Contribution to the Plan as soon as practicable after such
Rollover Contribution is accepted for transfer in accordance with SECTION
4.12. An Employee making a Rollover Contribution may participate in the
Plan whether or not such Employee is an Eligible Employee. Participation
of an Employee in the Plan with respect to the ESOP Account became
effective upon receipt by the Plan of the assets credited to the account
of such Employee in the Company's TRASOP and/or PAYSOP pursuant to a merger
of such plan or plans with this Plan.
ARTICLE IV
DEPOSITS
SECTION 4.1. BASIC DEPOSITS.
(a) An Eligible Employee who is employed by the Company may elect:
(1) to make Basic Nondeferred Deposits to the Plan in an amount
equal to any of 1%, 2%, 3%, 4% or 5% of his or her
Compensation each pay period; or
(2) to have Basic Deferred Deposits made to the Plan by the
Company on his or her behalf in an amount equal to any of
1%, 2%, 3%, 4% or 5% of his or her Compensation each pay
period; or
(3) to make, or have made by the Company on his or her behalf,
any combination of amounts under (1) or (2) above, totaling
up to 5% of his or her Compensation each pay period;
(b) An Eligible Employee who is employed by CEA Newark Bay Services,
Inc. may elect:
(1) to make Basic Nondeferred Deposits to the Plan in an amount
equal to any of 1%, 2%, 3%, 4%, 5% or 6% of his or her
Compensation each pay period; or
(2) to have Basic Deferred Deposits made to the Plan by his or
her Employer on his or her behalf in an amount equal to any
of 1%, 2%, 3%, 4%, 5% or 6% of his or her Compensation each
pay period; or
(3) to make, or have made by his or her Employer on his or her
behalf, any combination of amounts under (1) or (2) above,
totaling up to 6% of his or her Compensation each pay
period; subject to the limitations of SECTIONS 4.5 and
5.3. Basic Deposits made by or on behalf of a Participant
shall be paid over by an Employer to the Trustee and
deposited in the Trust Fund as soon as practicable after
deduction and, in any event, within 90 days of deduction.
Such Basic Deposits shall be credited as soon as
practicable to such Participant's Basic Deposit Subaccount
in the Plan.
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SECTION 4.2. SUPPLEMENTAL DEPOSITS. Each Participant
(a) who is employed by the Company and who is electing the maximum
permitted Basic Deposit to the Plan may also elect:
(1) to make Supplemental Nondeferred Deposits to the Plan in an
amount equal to any integral multiple of 1% of his or her
Compensation up to a total of 20% of his or her
Compensation each pay period; or
(2) to have Supplemental Deferred Deposits made by the Company
on his or her behalf in an amount equal to any integral
multiple of 1% up to a total of 20% of his or her
Compensation each pay period; or
(3) to make, or have made by the Company on his or her behalf,
any combination of the amounts specified in (1) or (2)
above, totaling up to 20% of his or her Compensation each
pay period;
(b) who is employed by CEA Newark Bay Services, Inc. and who is
electing the maximum permitted Basic Deposit to the Plan may
also elect:
(1) to make Supplemental Nondeferred Deposits to the Plan in an
amount equal to any integral multiple of 1% of his or her
Compensation to a total of 19% of his or her Compensation
each pay period; or
(2) to have Supplemental Deferred Deposits made by an Employer
on his or her behalf in an amount equal to any integral
multiple of 1% of his or her Compensation up to a total of
19% of his or her Compensation each pay period; or
(3) to make, or have made by an Employer on his or her behalf,
any combination of the amounts specified in (1) or (2)
above, totalling up to 19% of his or her Compensation each
pay period; subject to limitations of SECTIONS 4.5 and
5.3. Supplemental Deposits made by or on behalf of a
Participant shall be paid over by an Employer to the
Trustee and deposited in the Trust Fund as soon as
practicable after deduction and, in any event, within 90
days of deduction. Such Supplemental Deposits shall be
credited as soon as practicable to such Participant's
Supplemental Deposit Subaccount in the Plan.
SECTION 4.3. ADDITIONAL LUMP SUM DEPOSITS. Within any Plan Year,
each Participant may make one or more Additional Lump Sum Deposits on a
Nondeferred basis in the minimum amount of $250.00 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 SECTIONS 4.5, 4.12 and
5.3. Additional Lump Sum Deposits made by a Participant shall be paid over
by the Recordkeeper to the Trustee and deposited in the Trust Fund as soon
as practicable, but no later than 90 days after receipt. Such Additional
Lump Sum Deposits shall be credited as soon as practicable to such
Participant's Supplemental Deposit Subaccount in the Plan.
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SECTION 4.4. METHOD OF DEPOSITS. Basic Deposits and Supplemental
Deposits by or on behalf of Active Participants shall be made by means of
payroll deduction. For convenience of administration, if the percentage
of Compensation elected to be contributed to the Plan by an Active
Participant is not equal to a whole dollar amount, such amount will be
increased to the next whole dollar amount in establishing the deduction to
be made from such Active Participant's pay. In addition, if an Active
Participant's Compensation is changed, the resulting change in deduction
shall be made as soon as practicable after such change in Compensation.
Additional Lump Sum Deposits shall be paid directly by Participants
to the Recordkeeper who shall forward them to the Trustee for investment
in the Participant's Savings Account in accordance with his or her then
current investment direction.
SECTION 4.5. LIMIT ON DEFERRED DEPOSITS. In no event may Deferred
Deposits for any Participant attributable to any taxable year of such
Participant (presumably the calendar year) exceed the amount permitted by
Code section 402(g). Where a Participant elects under Section 4.1 to have
Deferred Deposits made by an Employer to the Plan which would otherwise
exceed the limit of this SECTION 4.5, such excessive Deferred Deposits
shall be deemed to be Nondeferred Deposits to the Plan ("Deemed Nondeferred
Deposits") rather than Deferred Deposits to the Plan; provided, however,
that such Deemed Nondeferred Deposits shall be subject to the limits and
rules of SECTIONS 4.1 and 4.2; and provided further, that such Deemed
Nondeferred Deposits shall be deemed to be Basic Nondeferred Deposits (and,
therefore, matched by Employer Contributions as set forth in Article V) to
the extent possible under the limits of SECTIONS 2.6 and 4.1, taking into
account other Basic Deferred and Nondeferred Deposits of the Participant.
SECTION 4.6. DISTRIBUTION OF EXCESS DEFERRAL AMOUNTS.
(a) Notwithstanding any other provision of the Plan to the contrary,
an Employer shall distribute any Excess Deferral Amount (as
defined below), adjusted according to SECTION 4.6(d), to
Participants who claim such allocable Excess Deferral Amounts
for a calendar year. Such distribution shall be made no later
than the April 15th next following the end of the calendar year
for which such claim is made.
(b) For purposes of this Section 4.6, "Excess Deferral Amount" shall
mean the amount of Deferred Deposits for a calendar year that
the Participant allocates to this Plan and claims pursuant to
the election procedure set forth in SECTION 4.6(c) below.
(c) A Participant's election to claim an Excess Deferral Amount for
a calendar year shall be in writing, shall be submitted to the
Committee no later than the March 1st next following the end of
such calendar year, shall specify the Excess Deferral Amount and
shall state that if such amount is not distributed, such Excess
Deferral Amount, when added to amounts deferred under other
plans or arrangements described in Code sections 401(k), 408(k)
or 403(b), exceeds the limit imposed on the Participant by Code
section 402(g) for the taxable year (calendar year) in which the
deferral occurred.
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(d) The amount distributed to a Participant pursuant to this SECTION 4.6
with respect to a calendar year shall be increased or decreased, as
applicable, by investment income or losses attributable thereto. If
a loss is allocable to the Excess Deferral Amount, the amount
distributed shall not be less than the lesser of (1) the Participant's
Deferred Deposit Subaccount or (2) the Participant's Deferred Deposits
for the Plan Year during which the Excess Deferral Amount occurred.
SECTION 4.7. CODE SECTION 401(K) LIMITS ON DEFERRED DEPOSITS.
(a) Limitation. Deferred Deposits on behalf of Highly Compensated
Participants for a Plan Year shall not exceed the amount
permissible to meet the nondiscrimination test of Code section
401(k).
(b) Distribution of Excess Contributions. The Committee shall,
consistent with regulations under the Code, establish
nondiscriminatory rules to meet the requirements of this SECTION
4.7.
SECTION 4.8. UNMATCHED EMPLOYER CONTRIBUTIONS. If, as the result of
the operation of SECTIONS 4.5, 4.6 and/or 4.7, and before the operation of
SECTION 4.9, the combined Deposits of a Participant are adjusted in such
a way that Employer Contributions previously made on behalf of a
Participant for a Plan Year are no longer matched by such Participant's
Basic Deposits, then the matching Employer Contributions allocated to such
Participant's Account for such Plan Year shall be reduced, under
nondiscriminatory rules established by the Committee, to the extent
necessary to equal the percentage of Employer Contributions (as set forth
in Article V) with respect to the Participant's remaining Basic Deposits
for such Plan Year. The amount, if any, of previously allocated Employer
Contributions in excess of the percentage of Employer Contributions (as set
forth in Article V) of the Participant's remaining Basic Deposits shall be
forfeited and applied to reduce future Employer Contributions to the Plan.
SECTION 4.9. Code section 401(m) LIMITS ON NONDEFERRED DEPOSITS AND
EMPLOYER CONTRIBUTIONS.
(a) Limitation. Nondeferred Deposits by, together with Employer
Contributions on behalf of, Highly Compensated Participants for
a Plan Year shall not exceed the amount permissible to meet the
nondiscrimination tests of Code section 401(m).
(b) Distribution of Excess Contributions. The Committee shall,
consistent with regulations under the Code, establish
nondiscriminatory rules to meet the requirements of this SECTION
4.9.
SECTION 4.10. CHANGING DEPOSIT PERCENTAGES. The percentage of
Compensation deposited in the Plan by or on behalf of an Active Participant
shall continue in effect until such Active Participant shall change the
rate of such Deposits. An Active Participant may change the rate of
Deposits to a higher or lower percentage of Compensation within the
limitations of SECTIONS 4.1, 4.2 and 4.5 by arranging for such change with
the Recordkeeper or as otherwise prescribed by the Committee. Any such
change shall become effective as soon as practicable after receipt of the
notice of change by the Recordkeeper.
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SECTION 4.11. SUSPENSION OF DEPOSITS.
(a) An Active Participant may suspend all of the Deposits to the
Plan made by such Participant or on his or her behalf at any
time by arranging for such suspension with the Recordkeeper or
as otherwise prescribed by the Committee. Such suspension shall
be effective as soon as practicable after receipt of the notice
of suspension by the Recordkeeper, and shall continue until such
Participant elects to have Deposits resumed by arranging
therefor with the Recordkeeper. Payroll deductions under the
Plan shall begin again as soon as practicable after such notice
is received by the Recordkeeper.
(b) If, after other required and authorized deductions from an
Active Participant's pay, there is not sufficient money
available in any pay period to make the entire authorized
payroll deduction for such Participant's Nondeferred Deposits,
no payroll deduction shall be made therefor for that pay period.
(c) In case of any such total suspension of Deposits, pursuant to
SECTION 4.11(a), Employer Contributions on behalf of such
Participant shall be automatically suspended for a like period.
SECTION 4.12. LIMIT ON ADDITIONAL LUMP SUM DEPOSITS. No Additional
Lump Sum Deposits may be made by any Participant in any Plan Year in which
the aggregate amount of all of such Participant's Deposits under the Plan
exceeds 25% of such Participant's Compensation for that Plan Year. Any
Additional Lump Sum Deposits inadvertently received in excess of this
limitation shall be refunded to that Participant as soon as practicable
following determination of such excess.
SECTION 4.13. ELECTIONS. All elections under this Article IV shall
be made at the time, in the manner and subject to the conditions as are
specified by the Committee. Elections of Deferred Deposits shall in all
cases be irrevocably made prior to the beginning of the payroll period for
which such elections shall apply. In any year in which the Committee deems
it necessary to do so to meet the requirements of SECTION 4.5, 4.7, 4.9 or
5.3 or the Code and the regulations thereunder, the Committee may reduce,
for that Plan Year, the permissible amount of Deposits by or on behalf of
any or all Active Participants.
SECTION 4.14. ROLLOVER CONTRIBUTIONS. Subject to such rules as may
be established by the Committee, an Employee may transfer Rollover
Contributions to the Plan, to be deposited in his or her Supplemental
Deposit Account. The Employee must certify that such amount to be
transferred as a Rollover Contribution qualifies for such transfer under
the Code and regulations thereunder and must submit such information or
evidence, satisfactory to the Committee, that it may require in order to
approve such transfer. The Committee may impose such nondiscriminatory
requirements on such transfer as it deems necessary or desirable. In
addition, Rollover Contributions shall then be subject to all terms and
conditions of this Plan and the Trust Agreement and shall be treated in the
same manner as Supplemental Deposits, unless the context of the Plan or
Trust requires otherwise.
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ARTICLE V
EMPLOYER CONTRIBUTIONS
SECTION 5.1. AMOUNT AND PAYMENT OF EMPLOYER CONTRIBUTIONS.
(a) The Company shall contribute to the Plan on behalf of Participants
who are its Employees and who are making or having Basic Deposits to the
Plan made on their behalf an amount equal to 45% (50% effective May 1,
1995) of the aggregate of such Basic Deposits, except to the extent that
such Basic Deposits are reduced or distributed as provided in SECTIONS 4.5
through 4.9, and except as provided in this Article V and in SECTION 11.3.
(b) CEA Newark Bay Services, Inc. shall contribute to the Plan on
behalf of Participants who are its Employees and who are making or having
Basic Deposits to the Plan made on their behalf an amount equal to 50% of
such aggregate Basic Deposits, except to the extent that such Basic
Deposits are reduced or distributed as provided on SECTIONS 4.5 through
4.9, and except as provided in this Article V and in SECTION 11.3.
Employer Contributions shall be allocated as Nondeferred. Employer
Contributions with respect to a Plan Year shall be paid to the Trustee not
later than the due date (including extensions of time) for filing
Enterprise's consolidated Federal income tax return for such year. All
Employer Contributions may be made without regard to current or accumulated
earnings of the Company or any Affiliate. Notwithstanding the foregoing,
the Plan shall be designated a profit sharing plan for purposes of Code
sections 401(a), 402, 412 and 417.
SECTION 5.2. REDUCTION OF EMPLOYER CONTRIBUTIONS BY FORFEITURES. The
amount of an Employer's Contribution shall be reduced by the amount of the
reduction of an unmatched Employer Contribution allocable to a Highly
Compensated Participant as provided in SECTIONS 4.7, 4.8 and 4.9, by the
amount of any forfeiture as a result of termination of the employment of
an Active Participant as provided in SECTION 11.2 or as a result of the
Employer's inability to locate a Participant or beneficiary to whom a
benefit hereunder is due as provided in SECTION 11.12.
SECTION 5.3. MAXIMUM ANNUAL ADDITIONS. The maximum Annual Addition,
as defined in SECTION 12.1, for any Plan Year to any Participant's Account
may not exceed the amount provided for by Code section 415(c). The rules
governing the application of this SECTION 5.3 and other limitations imposed
by Code section 415 are more fully set forth in Article XII.
SECTION 5.4. RETURN OF EMPLOYER CONTRIBUTIONS.
(a) Notwithstanding any provision of the Plan to the contrary, any
Employer Contribution made to the Plan by reason of mistake of
fact may be returned to the Employer making such Employer
Contribution, provided the return of such Employer Contribution
is made within one year from the date the mistaken payment was
made and any amount so returned shall be disposed of as the
Committee shall direct.
(b) If the Internal Revenue Service determines that any contribution
by the Employer to the Plan is not deductible under Code section
404, the Employer shall have the option, which it may exercise
within one year after the date of the disallowance of such
deduction, to have such contribution returned to the Employer
and any amount so returned shall be disposed of as the Committee
shall direct.
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ARTICLE VI
SAVINGS ACCOUNT INVESTMENTS
SECTION 6.1. INVESTMENT OF DEPOSITS, ROLLOVER CONTRIBUTIONS AND
EMPLOYER CONTRIBUTIONS. Deposits, Rollover Contributions and Employer
Contributions to the Plan shall be invested by the Trustee under the Trust
Agreement in the Funds established pursuant to SECTION 7.1. Upon enrolling
in the Plan, each Participant shall specify, in such form as shall be
prescribed by the Committee, the percentage (which shall be an integral
multiple of 5% - including 0% but not exceeding 100% in the aggregate) of
Deposits and/or Rollover Contributions to his or her Savings Account which
shall be invested in each of such Funds. Employer Contributions with
respect to Basic Deposits shall be invested by the Trustee for the Account
of the Active Participant in the same Funds and in the same percentages as
directed by such Participant with respect to the Basic Deposits to his or
her Savings Account.
SECTION 6.2. CHANGE IN INVESTMENT DIRECTION. Any investment
direction given by a Participant under SECTION 6.1 shall continue in effect
until changed by the Participant. A Participant may change any such
direction by giving notice of such change in the form prescribed by the
Committee. Any such change shall become effective as soon as practicable
after receipt of the notice of change by the Recordkeeper. A change in
investment direction under this SECTION 6.2 shall not automatically cause
a transfer of investments under SECTION 6.3.
SECTION 6.3. TRANSFER OF INVESTMENTS. A Participant may direct that
all or any part (in integral multiples of 5%) of his or her interest in any
one or more of the Funds be transferred to any one or more of the other
Funds, except that no transfer may be made into a Participant's ESOP
Account. A Participant may also transfer his or her ESOP Account assets
(in 5% multiples but not exceeding 100% in the aggregate) into any one or
several of the Funds. However, any transfer from a Fund shall be subject
to such contractual limitations regarding transfers from such Fund as may
exist from time to time under the contracts governing investments held in
such Fund. A direction to transfer all or a portion of a Participant's
interest in a Fund shall be made by giving notice in the form prescribed
by the Committee. Subject to any contractual limitations that may be
applicable, any such transfer shall be made as soon as practicable after
receipt of the notice of such transfer by the Recordkeeper.
SECTION 6.4. LOANS. Participants may receive loans from their
Savings Accounts under the provisions of SECTION 11.12. A loan to a
Participant shall be considered an investment of such Participant's Savings
Account and the principal amount of the loan shall be treated as a separate
investment within the various subaccounts. Repayments of the principal
amount of the loan shall reduce such corresponding investments of each such
subaccount in the inverse order of such investment and repayments of such
principal along with any accrued interest thereon shall be invested in the
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Funds in accordance with the Participant's then current investment
direction. Loan amounts shall be taken from subaccounts 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.
Loan proceeds shall not be taken from a Participant's ESOP Account.
ARTICLE VII
SAVINGS ACCOUNT FUNDS
SECTION 7.1. ESTABLISHMENT OF FUNDS. The following Funds shall be
established exclusively for the collective investment of Trust Fund assets
attributable to Participant Savings Accounts, as directed by Participants:
(a) One or more "Equities Funds", the assets of which shall
principally be invested, directly or indirectly, in common
stocks of domestic or foreign corporations. To the extent
practicable, no Equities Fund shall invest in Enterprise Common
Stock.
(b) One or more "Fixed Income Funds" the assets of which shall
principally be invested in (i) a general account and/or separate
accounts maintained by an insurance company(ies) and/or a
deposit account(s) in a bank(s) pursuant to an agreement(s)
between the Trustee and such bank(s) or insurance company(ies)
under which each bank or insurance company agrees to pay a fixed
rate of interest for a specified period of time. The terms of
such agreements and the identity of such banks or insurance
companies shall be determined by the Committee from time to
time.
(c) An "Enterprise Common Stock Fund", the assets of which shall
principally be invested in Enterprise Common Stock.
(d) An "Equities Index Fund", the assets of which shall principally
be invested, directly or indirectly, in common stocks
substantially comprising the Standard and Poor's 500 Index.
(e) One or more "Government Obligations Funds", the assets of which
shall principally be invested, directly or indirectly, in debt
obligations issued or guaranteed by the U. S. Government, its
agencies or instrumentalities.
(f) One or more "Balanced Funds", the assets of which shall be
principally invested, directly or indirectly, in a combination
of the common stocks and fixed-income securities of domestic
corporations.
Notwithstanding the foregoing, any or all of the above Funds may be
temporarily maintained in cash, or may be invested directly or indirectly
in certain short-term obligations as permitted by the Trust Agreement.
Dividends, interest and other income in respect of any Fund shall be
reinvested in the same Fund to the extent not used to pay expenses of the
Plan. Withdrawals, distributions and forfeitures, except as otherwise
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specified in the Plan, shall be charged pro rata against the various Funds
in which the subaccounts from which such withdrawals, distributions or
forfeitures are then invested.
SECTION 7.2. ENTERPRISE COMMON STOCK FUND.
(a) Enterprise Common Stock purchased for the Enterprise Common
Stock Fund shall be purchased by the Trustee on the open market
or directly from Enterprise should Enterprise elect to make such
sales.
(b) If Enterprise shall elect to sell shares of Enterprise Common
Stock directly to the Plan, the price to be paid by the Trustee
for any such purchases shall be the average of the high and low
sales prices of Enterprise Common Stock as reported by the New
York Stock Exchange on the date of purchase.
(c) All voting discretion, including the power to decide whether or
not to tender Enterprise Common Stock in connection with a
tender offer, with respect to the shares of Enterprise Common
Stock held under the Enterprise Common Stock Fund for the
Account of a Participant (whether vested or not vested) shall be
vested in the Trustee. However, the Trustee shall vote all such
shares in accordance with the directions of such Participant.
Within a reasonable time before voting rights are to be
exercised, the Employer or the Trustee shall cause to be sent to
each Participant entitled to give voting instructions all
information that Enterprise has or will distribute to
shareholders of Enterprise Common Stock regarding the exercise
of such voting rights. Shares with respect to which no voting
instructions are received shall not be voted by the Trustee.
(d) If, during the course of the Plan, Enterprise should grant to
the holders of Enterprise Common Stock rights to subscribe to an
issue or issues of securities of Enterprise, any such rights
attaching to the shares of Enterprise Common Stock held by the
Trustee under the Enterprise Common Stock Fund shall be sold by
the Trustee and the net proceeds applied by the Trustee to the
purchase of Enterprise Common Stock on the open market for such
Fund. Stock dividends on shares held by the Enterprise Common
Stock Fund, and stock issued upon any split of such shares,
shall be credited to such Enterprise Common Stock Fund.
ARTICLE VIII
SAVINGS ACCOUNTS
SECTION 8.1. ESTABLISHMENT OF SAVINGS ACCOUNTS. The Committee shall
maintain or cause to be maintained a Savings Account for each Participant
which shall consist of the following subaccounts: Basic Deposit
Subaccount, Supplemental Deposit Subaccount and Employer Contribution
Subaccount, the assets of which shall be invested pursuant to the direction
of the Participant as provided in Article VI. The assets of each such
subaccount of the Savings Account shall be identified as to Nondeferred or
Deferred.
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SECTION 8.2. MEASURE OF SAVINGS ACCOUNTS.
(a) The interests of Participants in the Funds shall be measured by
participating units in the particular Fund, the number and value
of which shall be determined as of each business day as provided
in the next paragraph. Each participating unit shall have an
equal beneficial interest in the Fund, and none shall have
priority or preference over any other.
(b) As soon as practicable at the end of each business day, the
Trustee shall determine the value of each such Fund as of such
business day in the manner prescribed in SECTION 8.3. The value
so determined shall be divided by the total number of
participating units allocated to the Accounts of Participants
participating in such Fund in accordance with subsection (a) as
of the prior business day. The resulting quotient shall be the
value of a participating unit as of such business day and
participating units shall be allocated, as such value, to and
from the Fund subaccounts of Participants for all transactions
by them or on their behalf with respect to the current business
day. The value of all participating units allocated to
Participants' Fund subaccounts shall be redetermined in a
similar manner each succeeding business day and participating
units shall be allocated to and from the Accounts of
Participants participating in such Fund at such value for all
transactions with respect to such business day. Fractional
units shall be calculated to such number of decimal places as
shall be determined by the Committee from time to time.
(c) If a Participant shall direct pursuant to SECTION 6.3 that his
or her interest in a Fund or any part thereof shall be
transferred to another Fund or Funds, or if such Participant's
interest in a Fund or any part thereof is distributed,
withdrawn, borrowed or forfeited under Articles IV or XI, the
number of participating units representing such interest or
portion thereof as of the applicable business day shall be
cancelled for purposes of any subsequent determination of the
number of and value of the participating units in such Fund.
SECTION 8.3. VALUATION OF FUNDS. The value of a Fund as of any
business day shall be the market value of all assets (including any
uninvested cash) held by the Fund as determined by the Trustee, reduced by
the amount of any accrued liabilities of the Fund on such business day and
by Deposits, Rollover Contributions and Employer Contributions with respect
to such business day. The Trustee's determination of market value shall
be binding and conclusive upon all parties.
SECTION 8.4. VALUATION OF SAVINGS ACCOUNTS. The value of a
Participant's subaccount for any Fund as of any business day shall be the
value of the participating units allocated to the Participant's subaccount
for such Fund as of such business day. The value of a Participant's
Account as of any business day shall be the aggregate of the values of such
subaccounts, determined as provided in the preceding Sections of this
Article VIII.
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SECTION 8.5. SEPARATE ACCOUNTING. The amounts of Deferred Deposits
in a Participant's Savings Account shall at all times be separately
accounted for from other amounts in such Savings Account, by allocating
investment gains and losses on Deferred Deposit amounts on a reasonable pro
rata basis and by adjusting the Deferred and other portions of the
subaccounts of a Participant's Savings Account for withdrawals,
distributions, borrowings and contributions. Gains, losses, withdrawals,
distributions, borrowings, forfeitures and other credits or charges shall
be separately allocated between such Deferred Deposit amounts and other
portions of the subaccounts on a reasonable and consistent basis.
ARTICLE IX
ESOP ACCOUNTS
SECTION 9.1. MAINTENANCE OF SEPARATE ACCOUNTS. Each ESOP Account
shall be maintained on the basis of shares of Enterprise Common Stock
allocated to such ESOP Account, with each ESOP Account being credited with
the number of full and fractional shares of Enterprise Common Stock so
allocated.
SECTION 9.2. ALLOCATION OF DISTRIBUTIONS. Any distributions received
by the Plan with respect to Enterprise Common Stock allocated to a
Participant's ESOP Account shall be allocated to such ESOP Account.
SECTION 9.3. WITHDRAWALS OR TRANSFERS DURING EMPLOYMENT.
(a) Notwithstanding any provision in the Plan to the contrary, a
Participant may withdraw in accordance with SECTION 11.3 or
transfer in accordance with SECTION 6.3, the shares of
Enterprise Common Stock allocated to Participant's ESOP Account
or the cash value thereof.
(b) With respect to an election of a Participant to withdraw
Enterprise Common Stock from Participant's ESOP Account, the
shares of Enterprise Common Stock, or the cash value at the
election of the Participant, shall be distributed in accordance
with Article XI, provided that such Participant elects to
withdraw all full and fractional shares of Enterprise Common
Stock allocated to such ESOP Account or the cash value thereof.
Such distribution shall be made as soon as practicable after
receipt by the Recordkeeper of the Participant's election to
withdraw.
(c) With respect to an election of a Participant to transfer the
cash value of all full and fractional shares of Enterprise
Common Stock from the Participant's ESOP Account to the
Participant's Savings Account, such transfer shall be made as
soon as practicable after receipt by the Recordkeeper of the
Participant's election to transfer, shall be deposited in the
Participant's Savings Account, shall be invested in one or more
(in multiples of 5% up to an aggregate of 100%) of the Savings
Account Funds as such Participant shall designate in writing and
thereafter shall be deemed a Rollover Contribution and treated
accordingly. The cash value of each share of Enterprise Common
Stock so transferred shall be equal to the price of a share of
Enterprise Common Stock actually received by the Trustee.
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(e) A Participant may not borrow from his or her ESOP Account.
SECTION 9.4. DIVIDENDS AND OTHER INCOME. Unless otherwise directed
as hereinafter provided, dividends paid in cash with respect to Enterprise
Common Stock allocated to a Participant's ESOP Account shall be distributed
to the Participant as soon thereafter as practicable and, in any event, not
later than 90 days after the close of the Plan Year in which paid.
Enterprise Common Stock delivered to the Trustee pursuant to a stock
dividend, stock split or reorganization, shall be allocated to the ESOP
Account of Participants in that proportion which the shares of each
Participant's ESOP Account bears to the total shares of all Participants'
ESOP Accounts.
SECTION 9.5. VOTING OF ESOP ACCOUNT COMMON STOCK. As provided in
SECTION 7.2 with respect to the Enterprise Common Stock Fund, all voting
discretion with respect to stock held in a Participant's ESOP Account,
including the power to decide whether or not to tender Enterprise Common
Stock in connection with a tender offer, shall be vested in the Trustee.
Each Participant shall be entitled to direct the Trustee as to the manner
in which voting rights attributable to Enterprise Common Stock (including
fractional shares or fractional rights to shares) allocated to such
Participant's ESOP Account are to be exercised. Within a reasonable time
before voting rights are to be exercised, the Trustee or the Employer shall
cause to be sent to each Participant entitled to give voting instructions
all information that Enterprise has or will distribute to shareholders of
Enterprise Common Stock regarding the exercise of such voting rights. Such
voting rights shall be exercised by the Trustee but only to the extent
directed by a Participant. Shares with respect to which no voting
instructions are received shall not be voted by the Trustee.
ARTICLE X
VESTING
SECTION 10.1. VESTING OF EMPLOYER CONTRIBUTIONS.
(a) Upon completion of five Years of Service, a Participant shall
have a 100% vested interest in his or her Savings Account
attributable to Employer Contributions made on behalf of such
Participant during any Plan Year. In addition, if a Participant
is eligible for Retirement, suffers a Disability, is Laid Off or
dies, such Participant shall have a 100% vested interest in his
or her Savings Account attributable to Employer Contributions
for all Plan Years.
(b) For purposes of determining Years of Service, a Participant
shall not be considered to have interrupted his or her
continuous service as a result of a leave of absence or as a
result of a termination of employment; provided, however, that
the periods of absence from employment for these reasons shall
not be counted toward Years of Service for vesting purposes.
SECTION 10.2. VESTING OF DEPOSITS, ROLLOVER CONTRIBUTIONS AND THE
ESOP ACCOUNT. A Participant's interest in his or her Savings Account
attributable to Deposits and Rollover Contributions for all Plan Years and
in his or her ESOP Account shall be 100% vested at all times.
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ARTICLE XI
ACCOUNT DISTRIBUTIONS AND WITHDRAWALS
SECTION 11.1. DISTRIBUTION UPON RETIREMENT, DISABILITY, LAY OFF OR DEATH.
If a Participant:
(a) terminates employment on account of Retirement or Disability;
(b) is Laid Off; or
(c) dies, then, in that event, the Participant's Savings Account,
determined as of the business day coinciding with or next
following the date of the last Deposit made by or which would
have been made on behalf of such Participant, together with the
Participant's ESOP Account, shall:
(1) if the value of such Account as so determined is $3,500 or
less, be distributed, subject to the provisions of SECTION
11.9(c), as soon as practicable to the Participant, or in
the case of death of the Participant, to the Participant's
beneficiary as determined in accordance with Article XIV
or, if none, to the Participant's estate; or
(2) if the value of such Account as so determined shall exceed
$3,500, be distributed upon the earliest of the
Participant's attainment of age 65, the death of such
Participant or the receipt by the Recordkeeper of an
application for distribution in a form prescribed by the
Committee. Provided, however, that a Participant may, by
application to the Recordkeeper made prior to the date
Participant attains age 65, defer distribution to any date
up to Participant's Required Beginning Date.
SECTION 11.2. DISTRIBUTION UPON OTHER TERMINATION OF EMPLOYMENT.
Upon Termination of a Participant's employment with an Employer or for
reasons other than Retirement, Disability, Lay Off or death, the vested
portion of the Participant's Account, determined as of the business day
coinciding with or next following the date of the last Deposit made by or
which would have been made on behalf of such Participant, or, if none, the
date coinciding with or next following the date of termination, shall:
(1) if the value of such Account as so determined is $3,500 or less,
be distributed, subject to the provisions of SECTION 11.9(c), as soon as
practicable to the Participant, or, in the case of death of the Participant
after termination of employment but prior to such distribution, to the
Participant's beneficiary, or, if none, to the Participant's estate; or
(2) if the value of such Account as so determined shall exceed $3,500,
be distributed upon the earliest of the Participant's attainment of age 65,
the death of the Participant or the receipt by the Recordkeeper of an
application for distribution in a form prescribed by the Committee.
Provided, however, that a Participant may, by application to the
Recordkeeper made prior to Participant's attaining age 65, defer
distribution to any date up to such Participant's Required Beginning Date.
The nonvested portion of the Participant's Account, determined as of
the date of termination, shall be forfeited and shall be applied thereafter
to reduce a subsequent contribution or contributions of the Employer as
provided in SECTION 5.2. If such former Participant is rehired by an
Employer on or before the end of and is employed by an Employer at the end
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of the fifth Plan Year after the Plan Year in which such termination
occurred, then such nonvested portion of the Participant's Account shall
be reinstated by the Employer and the Participant's right thereto shall be
determined as if the Participant had not terminated employment, provided
that the Participant repays to the Plan the amount of any distribution paid
to him or her on account of the termination of employment.
Any Participant who receives a distribution under this SECTION 11.2
shall be prohibited from participating in the Plan for the period of three
months following such distribution.
SECTION 11.3. WITHDRAWAL OF NONDEFERRED DEPOSITS AND EMPLOYER
CONTRIBUTIONS DURING EMPLOYMENT.
(a) A Participant may, by application to the Recordkeeper in the
form prescribed by the Committee, request to withdraw from the
Plan any or all of his or her Nondeferred Deposits and earnings
thereon and Vested Employer Contributions as well as earnings
thereon; provided, however, that the amount withdrawn shall be
at least $200, unless such withdrawal is of 100% of the value of
such Participant's Savings Account. A Participant who makes
such a withdrawal may not make a further withdrawal from his or
her Savings Account for a period of at least six months, except
as provided in SECTION 11.5.
(b) If a withdrawal includes Deposits that are not Matured, in
addition to the prohibition on future withdrawals contained in
(a) above, Employer Contributions with respect to such
Participant shall be suspended for a period of three months.
(c) Withdrawals shall be taken from a Participant's Savings Plan
subaccounts in the following order:
(1) Pre-1987 Nondeferred Deposits;
(2) Matured Post-1986 Nondeferred Deposits and earnings
thereon;
(3) Earnings on pre-1987 Nondeferred Deposits;
(4) Matured Vested Employer Contributions and earnings thereon;
(5) Unmatured Post-1986 Nondeferred Deposits and earnings
thereon.
(d) Any withdrawal made by a Participant pursuant to this SECTION
11.3 shall be made from all Funds in which the Nondeferred
Deposits and Employer Contributions by or on behalf of such
Participant are invested and shall be charged pro rata against
such subaccounts in the Participant's Savings Account.
(e) The amount of any withdrawal made by a Participant pursuant to
this Section 11.3 shall be determined as of the business day in
which the notice of withdrawal is received by the Recordkeeper.
SECTION 11.4. WITHDRAWALS OF DEFERRED DEPOSITS DURING EMPLOYMENT
AFTER AGE 59 1/2. A Participant over the age 59 1/2 may withdraw all or
a portion of the value of his or her Savings Account attributable to the
Deferred Deposits. The value of such Deferred Deposits for the purpose of
such withdrawal shall be determined as of the close of the business day in
which the notice of withdrawal is received by the Recordkeeper. The
minimum withdrawal permitted shall be $200, unless such withdrawal is 100%
of the current value of the Deferred portion of a Participant's Savings
Account. A Participant who makes such a withdrawal may not make any
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further withdrawal from his or her Savings Account for a period of at least
six months, except as provided in SECTION 11.5.
SECTION 11.5. HARDSHIP WITHDRAWALS.
(a) Upon the application of any Participant, or his or her legal
representative, the Committee, in accordance with a uniform
nondiscriminatory policy, shall permit such Participant to
withdraw such portion of the value of his or her vested Savings
Account as deemed to be necessary for the purpose of:
(1) Expenses for medical care described in Code section 213(d)
previously incurred by the Participant, the Participant's
spouse, or any dependents (as defined in Code section 152)
of the Participant or necessary for these persons to obtain
medical care described in Code section 213(d);
(2) Costs directly related to the purchase (excluding mortgage
payments) of a principal residence of the Participant;
(3) Payment of tuition and related educational fees for the
next 12 months of post-secondary education for the
Participant, the Participant's spouse, children, or any
dependents (as defined in Code section 152) of the
Participant; or
(4) Payments necessary to prevent the eviction of the
Participant from his principal residence or foreclosure on
the mortgage of the Participant's principal residence.
(b) A Participant or legal representative making application under
this SECTION 11.5 shall have the burden of presenting to the
Committee satisfactory proof of such need. The Committee shall
not permit withdrawal under this Section without first receiving
such proof as it shall deem necessary to demonstrate such
hardship.
(c) The amount which may be withdrawn shall be withdrawn, as
necessary, in the following order:
(1) Nondeferred Deposits together with vested Employer
Contributions, in the order prescribed by SECTION 11.3, but
without regard to the limitations on withdrawals of SECTION
11.3;
(2) Deferred Supplemental Deposits; and
(3) Deferred Basic Deposits.
(d) A withdrawal will be deemed to be necessary to satisfy an
immediate and heavy financial need of a Participant if all of
the following requirements are satisfied:
(1) The withdrawal is not in excess of the amount of the
immediate and heavy financial need of the Participant,
(2) The Participant has obtained all distributions, other than
hardship withdrawals, and all nontaxable loans currently
available under all plans maintained by the Company or an
Affiliate,
(3) The Participant is prohibited under the terms of the Plan
or an otherwise legally enforceable agreement from making
elective contributions and employee contributions to the
Plan and all other plans maintained by the Company or an
Affiliate for at least 12 months after receipt of the
hardship withdrawal, and
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(4) The Plan and all other plans maintained by the Employer,
provide that the Participant may not make elective
contributions for the Participant's taxable year
immediately following the taxable year of the hardship
withdrawal in excess of the applicable limit under Code
section 402(g) for such next taxable year less the amount
of such Participant's elective contributions for the
taxable year of the hardship withdrawal. A Participant
shall not fail to be treated as an eligible Participant for
purposes of paragraph (b) of this Section merely because he
is suspended in accordance with this provision.
(e) If a Participant shall make a withdrawal pursuant to this
SECTION 11.5, then
(1) the Participant shall not be permitted to make Deposits
(including Additional Lump Sum Deposits) to the Plan during
the one year period beginning on the date of receipt of
such withdrawal and
(2) a Participant's Deferred Deposits for the Participant's
taxable year next following the taxable year of the
hardship withdrawal may not exceed the limit established
under Code section 402(g) less the amount of Deferred
Deposits made by the Participant in the year of such
withdrawal.
(f) Amounts available for hardship withdrawals with respect to
Deferred Deposits will be limited to the amount of a
Participant's Deferred Deposits, plus earnings allocable thereto
which were credited to Participant's Accounts as of December 31,
1988, less the amount of any previous hardship withdrawals.
(g) A hardship withdrawal from the Savings Account shall not be
permitted unless and until a Participant has withdrawn, pursuant
to SECTION 9.3, all Enterprise Common Stock from his or her ESOP
Account.
(h) The hardship withdrawal shall be paid to the Participant in the
amount approved as soon as practicable after his or her
application is approved by the Committee.
SECTION 11.6. SUSPENSION OF PARTICIPATION. If a Participant shall
cease to be an Eligible Employee, Deposits and Employer Contributions to
his or her Savings Account shall be suspended and no Additional Lump Sum
Deposits shall be permitted to be made during the period of ineligibility.
Distribution of such Participant's Account shall be deferred until such
Participant's termination of employment with an Employer, whereupon the
Participant's Savings Account shall be distributed in accordance with the
applicable provisions of this Article XI. Such Participant shall continue
to be deemed a Participant for all purposes other than for Articles IV and
V during such period of ineligibility.
SECTION 11.7. TRANSFER OF EMPLOYMENT. If a Participant shall be
transferred to the employ of an Affiliate of the Company, distribution of
such Participant's Account shall be deferred until the Participant is no
longer in the employ of the Company or any Affiliate, whereupon the
Participant's Account shall be distributed in accordance with the
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applicable provisions of this Article XI. Such transferred Participant
shall continue to be deemed a Participant for all purposes other than for
Articles IV and V during such period of deferral of distribution.
SECTION 11.8. FORM OF DISTRIBUTIONS.
(a) All distributions from the Plan shall be made in money by check,
except that in the case of a lump sum distribution only, other
than a hardship withdrawal in accordance with SECTION 11.5, a
Participant may, by notice to the Recordkeeper in the form
prescribed by the Committee, elect to have any whole shares of
Enterprise Common Stock held for such Participant's Enterprise
Common Stock Fund subaccount and/or ESOP Account distributed in
shares of Enterprise Common Stock. The value of any fractional
shares shall be paid in money by check. Such an election may be
made at any time prior to the distribution under SECTION 11.1
and 11.2 or prior to receipt by the Recordkeeper of the notice
of withdrawal in the case of a distribution under SECTION 11.3.
If no such election is made, the entire value of the amount of
the Participant's Account being distributed shall be distributed
in money by check.
(b) All distributions from the Plan shall be made in one lump sum,
except that in the case of a distribution from a Participant's
Account on account of a Participant's Retirement, such
Participant may elect to have his or her Account, including the
ESOP Account, which is to be transferred into one of the Savings
Account Funds, distributed in annual or quarterly payments in
money by check by the Trustee in amounts as nearly equal as
possible for a specified number of years up to ten years. Each
payment shall be an amount equal to the Participant's Savings
Account as of the applicable date divided by the number of
payments remaining. No installment election shall be available
to a Participant unless, based on the business day coinciding
with or next following his or her election to receive
distribution in installments, such Participant would be entitled
to receive a first annual payment of not less than $1,000 or a
first quarterly payment of not less than $250. If a Participant
shall die prior to complete distribution of his or her Savings
Account pursuant to this subparagraph (b), the value of the
Participant's Savings Account shall be distributed as soon as
practicable in a lump sum to the Participant's beneficiary, or,
if none, to the Participant's estate. The amount so distributed
after a Participant's death shall be the remaining value of
Participant's Savings Account determined as of the business day
coinciding with or next following the date of the Participant's
death.
(c) If no election is made under subparagraph (b) above, and the
value of a Participant's Savings Account, when aggregated with
the value of any ESOP Account of the Participant, determined in
accordance with Article IX, exceeds $3,500, a distribution will
be made in one lump sum at the time provided for in SECTION
11.1, except as otherwise provided in SECTION 11.5.
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(d) Anything to the contrary notwithstanding, any Savings Account
distribution to be made to a Participant under subparagraph (b)
above shall be made in such a manner that the present value of
the payments to be made to the Participant during his or her
life expectancy are calculated to be more than 50% of the
present value of the total payments to be made to the
Participant and any beneficiaries.
SECTION 11.9. TIME OF DISTRIBUTIONS.
(a) All distributions from the Plan shall commence as soon as
practicable, and in any event no later than 60 days after the
close of the Plan Year in which the Participant terminates
employment, or, if applicable, requests distribution under
SECTION 11.1 and 11.2, or 60 days after the close of the Plan
Year in which the Participant elects to withdraw funds from the
Plan in the case of distributions under SECTIONS 9.3, 9.4, 11.3,
and 11.4.
(b) In the case of a distribution over a period of years under
subparagraph (b) of SECTION 11.8, the initial payment shall be
made at a time determined in accordance with subparagraph (a) of
this SECTION 11.9. In the case of annual distributions, the
remaining annual payments shall be made in successive calendar
years on such date each year as shall be determined by the
Committee, subject to the provisions of subparagraph (b) of
SECTION 11.8 in the case of the Participant's death. In the
case of quarterly distributions, the remaining payments shall be
made each successive three month period on such day during the
period as may be established by the Committee, subject to the
provisions of subparagraph (b) of SECTION 11.8 in the case of
the Participant's death.
(c) In the case of a distribution on account of a Participant's
Retirement, subject to the provisions of subsection 11.10, the
Participant may elect to have his or her Account distributed as
a lump sum during (1) the Plan Year next following the Plan Year
of his or her Retirement or (2) the next succeeding Plan Year
thereafter or (3) if the Account value exceeds $3,500, at any
time up to the Participant's Required Beginning Date. If no
such election is made, distribution shall commence in accordance
with SECTION 11.1 and subparagraph (a) above.
SECTION 11.10. LIMITATION ON POST AGE 70 1/2 DISTRIBUTIONS.
Notwithstanding the provisions of Sections 11.8 and 11.9:
(a) the entire interest of a Participant must:
(1) be distributed not later than the Participant's Required
Beginning Date, or,
(2) commence no later than such Required Beginning Date and be
payable in accordance with regulations under the Code over
a period not extending beyond the life expectancy of such
Participant.
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(b) If a Participant dies before his or her entire interest has been
distributed, then such entire interest (or the remaining part of
such interest if distribution thereof has commenced) shall be
distributed within five years after the Participant's death,
and, if distribution has commenced prior to death, shall be
distributed at least as rapidly as the method of distribution
being used as of the date of such Participant's death.
(c) The amount of the distribution required by this SECTION 11.10 is
to be determined by Treasury Regulations Section 1.72-9, Table
V using the attained age of the Participant as provided in
regulations without recalculation of the life expectancy.
Distribution will be made in accordance with the regulations
under Code section 401(a)(9), including the minimum distribution
incidental death benefit requirement of section 1.401(a)(9)-2,
and such regulations shall override any inconsistent Plan
provisions.
SECTION 11.11. DISTRIBUTION IN THE CASE OF CERTAIN DISABILITIES. In
the event that the Committee shall find that any person entitled to a
distribution under the Plan is unable to care for his or her affairs
because of illness or accident or because the person is a minor or has
died, the Committee may direct that any distribution due such person,
unless claim shall have been made therefor by a duly appointed legal
representative, be paid or applied to or for the benefit of such person,
or his or her spouse, any child of such person (including an adopted
child), any parent or other blood relative of such person, or a person with
whom the person resides, or any of them, and any such payment or
application so made shall be a complete discharge of the liabilities of the
Plan therefor.
SECTION 11.12. LOANS.
(a) The Committee shall have complete authority to establish and
administer a loan program to provide loans to Participants. The
loan program shall be contained in a separate written document
which shall constitute part of the Plan, and shall include the
following:
(1) A procedure for applying for loans;
(2) The basis on which loans will be approved or denied;
(3) Limitations (if any) on the types and amounts of loans
offered;
(4) The procedure under the loan program for determining a
reasonable rate of interest;
(5) The types of collateral which may secure a loan; and
(6) The events constituting default and the steps that will be
taken to preserve plan assets in the event of such default.
The rules and applicable limitations established by the loan
program shall be such as to prevent any loan from constituting
a prohibited transaction under Code section 4975 and ERISA
section 406, or a Plan distribution under Code section 72(p).
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(b) The Trustee shall, subject to the approval of the General
Manager, subject to compliance with the written loan program and
the provisions of the Code, lend a Participant, who is employed
by an Employer, an amount up to 50% of the vested portion of his
or her Account, including the ESOP Account, but not more than
$50,000 in the aggregate as of the date on which the loan is
approved reduced by the highest outstanding loan balance during
the preceding twelve months. However, no amount may be loaned
directly from any ESOP Account. The Director shall review each
application for a loan in a nondiscriminatory manner and in
accordance with such rules as may be prescribed by the
Committee. Loans, if approved, shall be made as soon thereafter
as practicable.
(c) In addition to such rules and regulations as the Committee may
adopt, all loans shall comply with the following terms and
conditions:
(1) An application for a loan by an eligible Participant shall
be made by making application therefor to the Recordkeeper
on a form prescribed by the Committee.
(2) An eligible Participant may not apply for more than one
loan in any calendar year nor for a loan with an initial
principal amount of less than $1,000 and, in any event, may
not have more than two (2) loans outstanding at any one
time.
(3) All loans, including interest thereon, shall be repaid by
payroll deduction in equal monthly installments over a
period of 12 ,24, 36, 48 or 60 months as selected by the
Participant. Nothing herein, however, shall prohibit a
Participant from prepaying such loan in whole or in part in
a lump sum in accordance with such rules as may be
established from time to time by the Committee.
(4) Each loan shall be secured by an assignment of the
Participant's entire right, title and interest in and to
the Trust Fund to the extent of the loan and accrued
interest thereon and shall be evidenced by the
Participant's promissory note for the amount of the loan,
including interest, payable to the order of the Trustee.
(5) Each loan shall bear interest at a reasonable rate (which
rate may be a variable rate) to be established from time to
time by the Committee, not in violation of any applicable
usury laws. In determining the interest rate, the
Committee shall take into consideration interest rates
being charged by other lenders at the time of such
determination.
(d) No distribution shall be made to any Participant or beneficiary
thereof unless and until all unpaid loans, including interest
thereon, have been repaid.
SECTION 11.13. INABILITY TO LOCATE PAYEE. Any benefit payable to a
Participant or beneficiary shall be forfeited if the Employer, after
reasonable effort, is unable to locate such Participant or beneficiary to
whom payment is due. The amount of any such forfeited benefit shall be
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applied to reduce the amount of Employer Contribution required under the
Plan as provided in SECTION 5.3. However, any such forfeited benefit shall
be reinstated and become payable if a claim therefor is made by such
Participant or beneficiary.
SECTION 11.14. FEDERAL INCOME TAX WITHHOLDING ON DISTRIBUTIONS AND
WITHDRAWALS. Distributions and withdrawals under this Plan shall be
subject to Federal income tax withholding as prescribed by Code section
3405 and the regulations thereunder.
ARTICLE XII
LIMITS ON BENEFITS AND CONTRIBUTIONS UNDER QUALIFIED PLANS
SECTION 12.1. DEFINITIONS. For purposes of this Article XII, the
following definitions and rules of interpretation shall apply:
(a) "Annual Additions" to a participant's account under a defined
benefit plan or a defined contribution plan is the sum, credited
to a participant's account for any Limitation Year, of:
(1) Company contributions,
(2) Forfeitures, if any,
(3) Employee contributions and
(4) Amounts, if any, attributable to medical benefits allocated
to an account established under Code section 419 A (d)(2)
on behalf of such Participant.
(b) "Annual Benefit"
(1) A benefit which is payable annually in the form of a
straight life annuity under a defined benefit plan. Such
benefit does not include any benefits attributable to
either employee contributions or rollover contributions.
If the defined benefit plan provides for a benefit which is
not payable in the form of a straight life annuity, the
benefit is adjusted in accordance with SECTION 12.1(b)(5)
below.
(2) Where a defined benefit plan provides for mandatory
employee contributions (as defined in Code section
411(c)(2)(C)), the Annual Benefit attributable to such
contributions is not taken into account. The Annual
Benefit attributable to mandatory contributions is
determined by using the factors described in Code section
411(c)(2)(B) and the regulations thereunder. However,
mandatory employee contributions and any voluntary employee
contributions are all considered a separate defined
contribution plan maintained by the Company.
(3) If rollover contributions are made to a defined benefit
plan, the Annual Benefit attributable to these
contributions is determined on the basis of reasonable
actuarial assumptions.
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(4) When there is a transfer of assets or liabilities from one
qualified defined benefit plan to another, the Annual
Benefit attributable to the assets transferred shall not be
taken into account by the transferee plan in applying the
limitations of Code section 415. The Annual Benefit
payable on account of the transfer for any individual that
is attributable to the assets transferred will be equal to
the Annual Benefit transferred on behalf of such individual
multiplied by a fraction, the numerator of which is the
total assets transferred and the denominator of which is
the total liabilities transferred.
(5) If a defined benefit plan provides a retirement benefit in
any form other than a straight life annuity, the plan
benefit is adjusted to a straight life annuity beginning at
the same age which is the actuarial equivalent of such
benefit in accordance with the rules determined by the
Commissioner. However, the following values are not taken
into account:
(i) The value of a qualified joint and survivor annuity
(as defined in Code section 417 and the regulations
thereunder) provided by the plan to the extent that
such value exceeds the sum of
(A) the value of a straight life annuity beginning on
the same date and
(B) the value of any post-retirement death benefits
which would be payable even if the annuity was
not in the form of a joint and survivor annuity.
(ii) The value of benefits that are not directly related to
retirement benefits (such as pre-retirement disability
and death benefits and post-retirement medical
benefits).
(iii) The value of benefits provided by the plan which
reflect post-retirement cost of living increases to
the extent that such increases are in accordance with
Code section 415(d) and the regulations thereunder.
(6) Where a defined benefit plan provides a retirement benefit
beginning before a participant has attained the Social
Security Retirement Age, the plan benefit shall, in
accordance with rules determined by the Commissioner, be
adjusted to the actuarial equivalent of a benefit
commencing at the Social Security Retirement Age. This
adjustment is only for purposes of applying the dollar
limitation described in Code section 415(b)(1)(A) and
SECTION 12.1(f)(1) to the Annual Benefit of the
participant.
(7) Where a participant has less than 10 Years of Service with
the Company at the time the Participant begins to receive
retirement benefits under the defined benefit plan, the
benefit limitations described in Code sections 415(b)(1)(B)
and 415(b)(4) and Section 12.1(f)(2) are to be reduced by
multiplying the otherwise applicable limitation by a
fraction:
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(i) the numerator which is the Years of Service (and
fractions thereof) with the Company as of, and
including the current Limitation Year, and
(ii) the denominator of which is 10. The preceding
sentence shall also apply for purposes of reducing the
benefit limitation described in Code section
415(b)(1)(A) and SECTION 12.1(f)(1), by substituting
years of participation for Years of Service wherever
it appears in such sentence.
(8) If the retirement benefit under a defined benefit plan
begins after the Participant has attained the Social
Security Retirement Age, the determination as to whether
the Maximum Permissible Defined Benefit Amount limitation
has been satisfied shall be made in accordance with
regulations prescribed by the Commissioner by adjusting
such benefit so that it is actuarially equivalent to such
a benefit beginning at the Social Security Retirement Age.
This adjustment is only for purposes of applying the
limitation described in Code section 415(b)(1)(A) and
SECTION 12.1(f)(1) to the Annual Benefit of the
participant.
(9) The Annual Benefit to which a participant is entitled at
any time under all defined benefit plans maintained by the
Company shall not, during the Limitation Year, exceed the
Maximum Permissible Defined Benefit Amount.
(10) In determining the actuarial equivalency for purposes of
SECTIONS 12.1(b)(5), 12.1(b)(6) and 12.1(b)(8) above, the
interest rate shall be 5%.
(c) "Company" shall mean the Company, as described in Section 2.11
and any Affiliate as defined in SECTION 2.4.
(d) "Compensation" with respect to a Limitation Year -
(1) includes amounts paid to a Participant (regardless of
whether he or she was such during the entire Limitation
Year);
(i) as wages, salaries, fees for professional services and
other amounts received (without regard to whether or
not an amount is paid in cash) for personal services
actually rendered in the course of employment with any
Company including but not limited to commissions,
compensation for services on the basis of a percentage
of profits, fringe benefits, reimbursements and other
expense allowances under nonaccountable plans (as
described in Treasury Regulation 1.b2-2(c)) and
bonuses;
(ii) for purposes of (A) above, earned income from sources
from outside the United States (as defined in Code
section 911(b)), whether or not excludable from gross
income under Code section 911 or deductible under Code
sections 931 and 933;
(iii) amounts described in Code sections 104(a)(3), 105(a)
and 105(h) but only to the extent that these amounts
are includable in the gross income of the Participant;
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(iv) in the case of an employee within the meaning of Code
section 401(c)(1) and the regulations thereunder, the
Participant's earned income (as described in Code
section 401(c)(2) and the regulations thereunder);
(v) amounts paid or reimbursed by the Company for moving
expenses incurred by the Participant, but only to the
extent that these amounts are not deductible by the
Participant under Code section 217.
(vi) The value of a nonqualified stock option granted to a
Participant by a Company, but only to the extent that
the value of the option is includable in the gross
income of the Participant for the taxable year in
which granted.
(vii) The amount includable in the gross income of a
Participant upon making the election described in Code
section 83(b).
(2) Compensation does not include -
(i) notwithstanding subsection (1)(A) of this SECTION
12.1(d), there shall be excluded from Compensation
amounts contributed to a plan qualified under section
401(k) of the Code as salary reduction contributions
(and not recharacterized as employee contributions
thereunder);
(ii) other contributions made by the Company to a plan of
deferred compensation to the extent that, before the
application of the Code section 415 limitations to the
plan, the contributions are not includable in the
gross income of the Participant for the taxable year
in which contributed. In addition, Company
contributions made on behalf of a Participant to a
simplified Participant pension described in Code
section 408(k) are not considered as Compensation for
the taxable year in which contributed to the extent
such contributions are deductible by the Participant
under Code section 219(b)(7). Additionally, any
distributions from a plan of deferred compensation are
not considered as Compensation, regardless of whether
such amounts are includable in the gross income of the
Participant when distributed. However, any amounts
received by a Participant pursuant to an unfunded
nonqualified plan shall be considered as Compensation
in the year such amounts are includable in the gross
income of the Participant;
(iii) amounts realized from the exercise of a nonqualified
stock option or when restricted stock (or property)
held by a Participant either becomes freely
transferable or is no longer subject to a substantial
risk of forfeiture (see Code section 83 and the
regulations thereunder);
(iv) amounts realized from the sale, exchange or other
disposition of stock acquired under a qualified stock
option;
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(v) other amounts which receive special tax benefits, such
as premiums for group term life insurance (but only to
the extent that the premiums are not includable in the
gross income of the Participant);
(e) "Limitation Year" - the Plan Year;
(f) "Maximum Permissible Defined Benefit Amount" - for a limitation
Year the Maximum Permissible Defined Benefit Amount with respect
to any Participant shall be the lesser of:
(1) $90,000, or,
(2) 100% of the Participant's average Compensation for his or
her high three consecutive Years of Service, subject to the
following rules:
(i) As of January 1 of each calendar year commencing with
the calendar year 1988, the dollar limitation set
forth in Paragraph (1) above shall be adjusted
automatically to equal the dollar limitation as
determined by the Commissioner for that calendar year
under Code section 415(d)(1)(A). This adjustment
dollar limitation applies for the Limitation Year
ending with or within the calendar year. It is
applicable to Employees who are Participants in the
Plan and to Employees who have retired or otherwise
terminated their service under the Plan with a
nonforfeitable right to accrued benefits, regardless
of whether they have actually begun to receive such
benefits. The Annual Benefit payable to a terminated
Participant which is otherwise limited by the dollar
limitation shall be increased to take into account the
adjustment of the dollar limitation.
(ii) With regard to Participants who have separated from
service with a nonforfeitable right to an accrued
benefit, the compensation limitation described in
paragraph (2) above applicable to Limitation Years
commencing on and after January 1, 1976 shall be
adjusted annually to take into account increases in
the cost of living. For any Limitation Year beginning
after the separation occurs, the adjustment of the
compensation limitation is made as specified in
regulations and rules prescribed by the Commissioner.
In the case of a Participant who separated from
service prior to January 1, 1976, the cost of living
adjustment of the compensation limitation under this
paragraph for all Limitation Years prior to January 1,
1976, is to be determined as provided by the
Commissioner.
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(iii) Anything herein to the contrary notwithstanding, in
the case of an individual who was a Participant in the
Plan before January 1, 1983, if such Participant's
"current accrued benefit" (as defined in section
235(g)(4) of the Tax Equity and Fiscal Responsibility
Act of 1982 ("TEFRA")) under the Plan as of the close
of the last Limitation Year beginning before January
1, 1983 exceeded the dollar limitation with respect to
such Participant under SECTION 12.1(g)(1), below, the
dollar limitation with respect to such Participant
under SECTION 12.1(g)(1) shall be equal to such
current accrued benefit.
(iv) Anything herein to the contrary notwithstanding, for
any individual who was a Participant in the Plan on
January 1, 1987, if such Participant's "current
accrued benefit" under the Plan, as that term is
defined in section 1106(i)(3)(B) of the Tax Reform Act
of 1986, as of the close of the last Limitation Year
beginning before January 1, 1987 exceeded the
limitation described in SECTION 12.1(f)(1) above, the
dollar limitation with respect to such Participant
under SECTION 12.1(f)(1) shall be equal to such
current accrued benefit.
(g) "Maximum Permissible Defined Contribution Amount" - for a
Limitation Year the Maximum Permissible Defined Contribution
Amount with respect to any Participant shall be the lesser of:
(1) $30,000, or if greater, one fourth of the limitation in
effect under Code section 415(b)(1)(A) (as adjusted by Code
section 415(d)(1)(A)); or
(2) 25% of the Participant's Compensation for the Limitation
year.
Notwithstanding the foregoing, or anything herein to the contrary, the
percentage of compensation limitation of this SECTION 12.1(g)(2) shall
not apply to any Annual Additions pursuant to SECTION 12.1(a)(4)
above.
(h) "Projected Annual Benefit" - the Annual Benefit to which a
Participant would be entitled under the Plan on the assumption
that he or she continues employment until the normal retirement
age (or current age, if that is later) thereunder, that his or
her Compensation continues at the same rate as in effect for the
Limitation Year under consideration until such age, and that all
other relevant factors used to determine benefits under the Plan
remain constant as of the current Limitation Year for all future
Limitation Years;
(i) "Social Security Retirement Age" - the age used as the
retirement age under Social Security Act section 216(1) except
that such section shall be applied:
(1) without regard to the age increase factor, and,
(2) as if the early retirement age under Social Security Act
section 216(1)(2) were 62.
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(j) For purposes of applying the limitations of Code sections
415(b), (c) and (e) to a Participant for a particular Limitation
Year, all qualified defined benefit plans (without regard to
whether a plan has been terminated) ever maintained by the
Company will be treated as one defined benefit plan and all
qualified defined contribution plans (without regard to whether
a plan has been terminated) ever maintained by the Company will
be treated as part of this Plan.
SECTION 12.2. ANNUAL ADDITION LIMITS. The amount of the Annual
Addition which may be credited under this Plan to any Participant's Account
as of any allocation date shall not exceed the Maximum Permissible Defined
Contribution Amount (based upon his or her Compensation up to such
allocation date) reduced by the sum of any credits of Annual Additions made
to the Participant's Account under all defined contribution plans as of any
preceding allocation date within the Limitation Year. If an allocation
date of this Plan coincides with an allocation date of any other qualified
defined contribution plan maintained by the Company, the amount of the
Annual Additions which may be credited under this Plan to any Participant's
Account as of such date shall be an amount equal to the product of the
amount to be credited under this Plan without regard to this Section 12.2
multiplied by the lesser of one or a fraction, the numerator of which is
the amount described in this SECTION 12.2 during the Limitation Year and
the denominator of which is the amount that would be otherwise credited on
this allocation date under all defined contribution plans without regard
to this SECTION 12.2. However, if a security is not allocated to a
Participant's Account under any qualified tax credit employee stock
ownership plan of the Company because of the operation of the limitations
of Code section 415 and the provisions of this Section 12.2, no other
amount may be allocated to the Participant's Account under this Plan after
the allocation date for such tax credit employee stock ownership plan's
plan year, until all such unallocated securities have been allocated in
accordance with the provisions of such tax credit employee stock ownership
plan. If contributions to this Plan on behalf of a Participant are to be
reduced as a result of this SECTION 12.2, such reduction shall be effected
by reducing contributions in the following order: Supplemental Nondeferred
Deposits, Basic Nondeferred Deposits and corresponding matching Company
Contributions, Supplemental Deferred Deposits and finally, if necessary,
Basic Deferred Deposits and corresponding remaining matching Company
Contributions. If, as a result of a reasonable error in estimating a
Participant's Compensation, or under the limited facts and circumstances
which the Commissioner finds justify the availability of the rules set
forth in paragraphs (a)-(c) of this SECTION 12.2, the allocation of Annual
Additions under the terms of the Plan for a particular Participant would
cause the limitations of Code section 415 applicable to that Participant
for the Limitation Year to be exceeded, the excess amounts shall not be
deemed to be Annual Additions in that Limitation Year if they are treated
as follows:
(a) To the extent necessary, Deferred Deposits to the Plan shall be
recharacterized as Nondeferred Deposits and the Participant's
Nondeferred Deposits to the Plan (including Deferred Deposits
recharacterized as Nondeferred Deposits hereunder) and earnings
thereon shall be returned to the Participant.
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(b) The excess amounts in the Participant's Account consisting of
Company Contributions shall be used to reduce Company
Contributions for the next Limitation Year (and succeeding
Limitation Years, as necessary) for that Participant if that
Participant is covered by the Plan as of the end of the
Limitation Year. However, if that Participant is not covered by
the Plan as of the end of the Limitation Year then the excess
amounts must be held unallocated in a suspense account for the
Limitation Year and allocated and reallocated in the next
Limitation Year to all of the remaining Participants in the
Plan. If a suspense account is in existence at any time during
a particular Limitation Year, other than the first Limitation
Year described in the preceding sentence, all amounts in the
suspense account must be allocated and reallocated to
Participants' Accounts (subject to the limitations of Code
section 415) before any Company Contributions, may be made to
the Plan for that Limitation Year. Furthermore, the excess
amounts must be used to reduce Company Contributions for the
next Limitation Year (and succeeding Limitation Years, as
necessary) for all of the remaining Participants in the Plan.
For purposes of this subdivision, except as provided in (a) of
this SECTION 12.2, excess amounts may not be distributed to
Participants or former Participants.
(c) In the event of a termination of the Plan, the suspense account
described in (b) of this SECTION 12.2 shall revert to the
Company to the extent it may not then be allocated to any
Participant's Account.
(d) Notwithstanding any other provision in this SECTION 12.2, the
Company shall not contribute any amount that would cause an
allocation to the suspense account as of the date the
contribution is allocated. If the contribution is made prior to
the date as of which it is to be allocated, then such
contribution shall not exceed an amount that would cause an
allocation to the suspense account if the date of contribution
were an allocation date.
SECTION 12.3. OVERALL LIMIT. For any Participant of this Plan who
at any time participated in a defined benefit plan maintained by the
Company, the rate of benefit accrual by such Participant in each defined
benefit plan in which the Participant participates during the Limitation
Year will be reduced to the extent necessary to prevent the sum of the
following fractions, computed as of the close of the Limitation Year, from
exceeding 1.0:
(a) DEFINED BENEFIT PLAN FRACTION. Projected Annual Benefit of the
Participant under all defined benefit plans divided by: the
lesser of (1) the product of 1.25, multiplied by the dollar
limitation in effect under Code section 415(b)(1)(A) for such
Limitation Year, or (2) the product of 1.4 multiplied by the
amount which may be taken into account under Code section
415(b)(1)(B) with respect to such Participant for such
Limitation Year; and
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(b) DEFINED CONTRIBUTION PLAN FRACTION. Sum of Annual Additions to
such Participant's Account under all defined contribution plans
in such Limitation Year and for all prior Limitation Years
divided by: the sum of the lesser of the following amounts
determined for such year and for each prior Year of Service with
the Company: (1) the product of 1.25, multiplied by the dollar
limitation in effect under Code section 415(c)(1)(A) for such
Limitation Year, or (2) the product of (a) 1.4, multiplied by
(b) 25% of the Participant's Compensation for such Limitation
Year.
SECTION 12.4. SPECIAL RULES.
(a) For purposes of applying the Defined Contribution Plan Fraction
in Section 12.3 for any Limitation Year beginning after December
31, 1975 to Limitation Years before January 1, 1976, the
aggregate amount taken into account in determining the numerator
of such fraction is deemed not to exceed the aggregate amount
taken into account in determining the denominator of the
fraction.
(b) In any case where the sum of the fractions in SECTION 12.3 is
greater than 1.0, calculated as of the close of the last
Limitation Year beginning before January 1, 1983 for a
Participant, in accordance with regulations prescribed by the
Commissioner pursuant to TEFRA section 235(g)(3), an amount
shall be subtracted from the numerator of the defined
contribution plan fraction so that the sum of such fractions
does not exceed 1.0 for such Limitation Year.
(c) If the sum of the fractions in SECTION 12.3 would exceed 1.0,
calculated as of the close of the last Limitation Year beginning
before January 1, 1987 for a Participant, in accordance with
regulations prescribed by the Commissioner pursuant to section
1106(i)(4) of the Tax Reform Act of 1986, an amount shall be
subtracted from the numerator of the defined contribution plan
fraction (not exceeding such numerator) so that the sum of such
fractions does not exceed 1.0. This numerator, as adjusted
herein, will be used for the calculation of the defined
contribution plan fraction for Limitation Years commencing on or
after January 1, 1987.
ARTICLE XIII
TOP-HEAVY REQUIREMENTS
SECTION 13.1. DEFINITIONS. For purposes of this Article XIII, the
following definitions shall apply, to be interpreted in accordance with the
provisions of Code section 416 and the regulations thereunder:
(a) "Aggregation Group" shall mean a plan or group of plans which
includes all plans maintained by the Employers in which a Key
Employee is a Participant or which enables any plan in which a
Key Employee is a Participant to meet the requirements of Code
section 401(a)(4) or Code section 410, as well as all other
plans selected by the Company for permissive aggregation
inclusion of which would not prevent the group of plans from
continuing to meet the requirements of such Code sections.
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(b) "Compensation" with respect to a Plan Year shall be as defined
in Section XII without regard to SECTION 12.1(d)(2)(A).
(c) "Determination Date" shall mean, with respect to any Plan Year,
(1) the last day of the preceding Plan Year, or,
(2) in the case of the first Plan Year of any Plan, the last
day of such Plan Year.
(d) "Employee" shall mean, for purposes of this Article XIII, any
person employed by an Employer and shall also include any
beneficiary of such person, provided that the requirements of
SECTIONS 13.3, 13.4 and 13.5 shall not apply to any person
included in a unit of Employees covered by an agreement which
the Secretary of Labor finds to be a collective bargaining
agreement between Employee representatives and one or more
Employers if there is evidence that retirement benefits were the
subject of good faith bargaining between such Employee
representatives and such Employer or Employers.
(e) "Employer" shall mean, any corporation which is a member of a
controlled group of corporations (as defined in Code section
414(b)) which includes the Company or any trades or business
(whether or not incorporated) which are under common control (as
defined in Code section 414(c)) with the Company, or a member of
an affiliated service group (as defined in Code section 414(m))
which includes the Company.
(f) "Key Employee" shall mean, any Employee or former Employee who
is, at any time during the Plan Year, or was, during any one of
the four preceding Plan Years any one or more of the following:
(1) An officer of an Employer having an annual Compensation
greater than 50% of the amount in effect under Code section
415(b)(1)(A) for any Plan Year unless 50 other such
officers (or, if lesser, a number of such officers equal to
the greater of three or 10% of the Employees) have higher
annual Compensation.
(2) One of the 10 persons employed by an Employer having annual
Compensation greater than the limitation in effect under
Code section 415(c)(1)(A) for any Plan Year, and owning (or
considered as owning within the meaning of Code section
318) the largest interests in the Employers. For purposes
of this paragraph (2), if two Employees have the same
interest, the one with the greater Compensation shall be
treated as owning the larger interest.
(3) Any person owning (or considered as owning within the
meaning of Code section 318) more than 5% of the
outstanding stock of an Employer or stock possessing more
than 5% of the total combined voting power of such stock.
(4) A person who would be described in paragraph (3) above if
"1%" were substituted for "5%" each place it appears in
paragraph (3) above, and who has annual Compensation of
more than $150,000. For purposes of determining ownership
under this SECTION 13.11(f), Code section 318(a)(2)(C)
shall be applied by substituting "5%" for "50%" and the
rules of subsections (b), (c) and (m) of Code section 414
shall not apply.
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(g) "Year of Service" shall mean, a year which constitutes a "Year
of Service" under the rules of paragraphs (4), (5) and (6) of
Code section 411(a) to the extent not inconsistent with the
provisions of this Article XIII.
SECTION 13.2. GENERAL REQUIREMENTS. For any Plan Year
beginning after 1983 in which the Plan is a Top-Heavy Plan, the
requirements of this Article XIII must be met in accordance with Code
section 416 and the regulations thereunder. The provisions of this Article
XIII shall be inapplicable unless and until the Plan is a Top-Heavy Plan.
SECTION 13.3. MAXIMUM COMPENSATION. Compensation for any Employee
shall not be taken into account under the Plan in excess of the amount
provided for pursuant to Code section 401(a)(17) and the regulations
thereunder.
SECTION 13.4. VESTING. A Participant who is credited with an Hour
of Service while the Plan is Top-Heavy, or in any Plan Year after a Plan
Year in which the Plan is Top-Heavy, and who has completed at least three
Years of Service shall have a nonforfeitable right to 100% of his or her
accrued benefit derived from Employer Contributions and no such amount may
become forfeitable if the Plan later ceases to be Top-Heavy nor may such
amount be forfeited under the provisions of Code sections 411(a)(3)(B) or
411 (a)(3)(D). Such accrued benefit shall include benefits accrued before
the Plan becomes Top-Heavy, including benefits accrued prior to January 1,
1984. Notwithstanding any other provisions of this Plan to the contrary,
once the vesting requirements of this Section 13.4 become applicable, they
shall remain applicable even if the Plan later ceases to be Top-Heavy.
SECTION 13.5. MINIMUM CONTRIBUTIONS. Minimum Employer Contributions
for a Participant (not including a beneficiary of any Participant) who is
not a Key Employee shall be required under the Plan for the Plan Year as
follows:
(a) The amount of the minimum contribution shall be the lesser of
the following percentages of Compensation:
(1) four percent, or,
(2) the highest percentage at which such contributions are made
under the Plan for the Plan Year on behalf of a Key
Employee.
(i) For purposes of this paragraph (2), all defined
contribution plans required to be included in an
Aggregation Group shall be treated as one plan.
(ii) This paragraph (2) shall not apply if the Plan is
required to be included in an Aggregation Group and
the Plan enables a defined benefit plan required to be
included in the Aggregation Group to meet the
requirements of Code sections 401(a)(4) or 410.
(iii) For purposes of this paragraph (2), the calculation of
the percentage at which Employer Contributions are
made for a Key Employee shall be based only on his or
her Compensation not in excess of maximum counted
compensation as provided in SECTION 13.3.
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(b) There shall be disregarded for purposes of this SECTION 13.5,
contributions or benefits under Code section 3111, Title II of
the Social Security Act or any other federal or state law, and
for Plan Years beginning before December 31, 1984, there shall
also be disregarded any contributions attributable to a salary
reduction or a similar arrangement.
(c) For purposes of this SECTION 13.5, the term "Participant" shall
be deemed to refer to all Participants who have not separated
from service at the end of the Plan Year including, without
limitation, individuals who:
(1) failed to complete 1000 Hours of Service during the Plan
Year, or
(2) declined to make mandatory contributions to the Plan, or
(3) are excluded from the Plan because their Compensation is
less than a stated amount but who must be considered
Participants for the Plan to satisfy the coverage
requirements of Code section 410(b) in accordance with Code
section 401(a)(5).
SECTION 13.6. PARTICIPANTS UNDER DEFINED BENEFIT PLANS. If any Plan
Participant other than a Key Employee is also a Participant under a defined
benefit plan of an Employer, then SECTION 13.5(a) shall not apply and the
required minimum annual Employer Contribution for such Participant (not
including a beneficiary of a Participant) under this Plan shall be 7 1/2%
of Compensation, or such lesser amount as may be required to satisfy the
requirements of the Code related to Top-Heavy Plans. Such Employer
Contribution shall be made without regard to the amount of contributions,
if any, made to the Plan on behalf of Key Employees.
SECTION 13.7. SUPER TOP-HEAVY PLANS. If for any Plan Year in which
the Plan is a Top-Heavy Plan it is also a Super Top-Heavy Plan, then for
purposes of the limitations on Employer Contributions and benefits provided
in Code section 415, and SECTION 5.3. and Article XII of the Plan, the
dollar limitations in the defined benefit plan fraction and the defined
contribution plan fraction shall be multiplied by 1.0 rather than 1.25.
However, if the application of the provisions of this SECTION 13.7 would
cause any Participant to exceed the combined Code section 415 limitations
on Employer Contributions and benefits, then the application of the
provisions of this Section 13.7 shall be suspended as to such Participant
until such time as he or she no longer exceeds such limitations as modified
by this SECTION 13.7. During the period of such suspension, there shall
be no Employer Contributions, forfeitures or Non-Deferred Supplemental
Deposits allocated to such Participant under this or any other defined
contribution plan of the Employers and there shall be no accruals for such
Participant under any defined benefit plan of the Employers.
SECTION 13.8. DETERMINATION OF TOP-HEAVINESS. The determination of
whether this Plan is Top-Heavy shall be made as follows:
(a) If the Plan is not required to be included in an Aggregation
Group with other plans, then it shall be Top-Heavy only if when
considered by itself it is a Top-Heavy Plan and it is not
included in a permissive Aggregation Group that is not a Top-
Heavy Group.
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(b) If the Plan is required to be included in an Aggregation Group
with other plans, it shall be Top-Heavy only if the Aggregation
Group, including any permissively aggregated plans is Top-Heavy.
(c) If a plan is not a Top-Heavy Plan and is not required to be
included in an Aggregation Group, then it shall not be Top-Heavy
even if it is permissively aggregated in an Aggregation Group
which is a Top-Heavy Group.
SECTION 13.9. DETERMINATION OF SUPER TOP-HEAVINESS. This Plan shall
be a Super Top-Heavy Plan if it would be a Top-Heavy Plan under the
provisions of SECTION 13.8, but substituting "90%" for "60%" in the ratio
test of SECTION 13.10.
SECTION 13.10. CALCULATION OF TOP-HEAVY RATIOS. A Plan shall be Top-
Heavy and an Aggregation Group shall be a Top-Heavy Group with respect to
any Plan Year as of the Determination Date if the sum as of the
Determination Date of the Cumulative Accrued Benefits and the Cumulative
Accounts of Employees who are Key Employees for the Plan Year exceeds 60%
of a similar sum determined for all Employees, excluding former Key
Employees.
SECTION 13.11. CUMULATIVE ACCOUNTS AND CUMULATIVE ACCRUED BENEFITS.
The Cumulative Accounts and Cumulative Accrued Benefits for any Employee
shall be determined as follows:
(a) "Cumulative Account" shall mean the sum of the amount of an
Employee's Account under a defined contribution plan (for an
unaggregated Plan) or under all defined contribution plans
included in an Aggregation Group (for aggregated plans)
determined as of the most recent plan valuation date within a
12-month period ending on the Determination Date, increased by
any contributions due after such valuation date and before
Determination Date.
(b) "Cumulative Accrued Benefit" shall mean the sum of the present
value of an Employee's accrued benefits under a defined benefit
plan (for an unaggregated plan) or under all defined benefit
plans included in an Aggregation Group (for aggregated plans),
determined under the actuarial assumptions set forth in such
Plan or Plans, as of the most recent plan valuation date used by
the Plan actuary within the 12-month period ending on the
Determination Date as if the Employee voluntarily terminated
service as of such valuation date. The accrued benefit of any
Employee who is not a Key Employee shall be determined under the
method used for accrual purposes for all plans in the
Aggregation Group or, if there is no such method, as if such
benefit accrued not more rapidly than the slowest accrual rate
permitted under Code section 411(b)(1)(c).
(c) Accounts and benefits shall be calculated to include all amounts
attributable to both Employer and Employee contributions but
excluding amounts attributable to voluntary deductible Employee
contributions.
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(d) Accounts and benefits shall be increased by the aggregate
distributions during the five-year period ending on the
Determination Date made with respect to an Employee under the
Plan or Plans as the case may be or under a terminated plan
which, if it had not been terminated, would have been required
to be included in the Aggregation Group.
(e) Rollover Contributions and direct plan to plan transfers shall
be handled as follows:
(1) If the transfer is initiated by the Employee and made from
a plan maintained by one employer to a plan maintained by
another employer, the transferring plan continues to count
the amount transferred under the rules for counting
distributions. The receiving plan does not count the
amount if accepted after December 31, 1983, but does count
it if accepted prior to December 31, 1983.
(2) If the transfer is not initiated by the Employee or is made
between plans maintained by the Employers, the transferring
plan shall no longer count the amount transferred and the
receiving plan shall count the amount transferred.
(3) For purposes of this subsection (e), all Employers
aggregated under the rules of Code sections 414(b), (c) and
(m) shall be considered a single employer.
(f) For plan years beginning after December 31, 1984, the accrued
benefits and accounts of any Employee who has not performed
services for any Employer at any time during the five-year
period ending on the Determination Date shall not be taken into
account.
ARTICLE XIV
BENEFICIARY IN EVENT OF DEATH
SECTION 14.1. DESIGNATION AND CHANGE OF BENEFICIARY. Upon the death
of a married Participant, the spouse of the Participant shall be deemed the
designated beneficiary of the Participant, unless such spouse has
consented, in writing, to the designation of another beneficiary or
beneficiaries (which may include the estate of the Participant) or any
change thereof. If such other designated beneficiary or beneficiaries
predecease a married Participant, such Participant's spouse shall be deemed
the designated beneficiary of the Participant. If, in such case, the
Participant's spouse has also predeceased the Participant, the
Participant's Account shall be paid to his or her estate.
Each unmarried Participant shall have the right to designate a
beneficiary or beneficiaries to receive any distributions to be made under
Article XI upon the death of such Participant. An unmarried Participant
may from time to time, without the consent of any beneficiary, change or
cancel any such designation. If no beneficiary has been named by a
deceased unmarried Participant, or the designated beneficiary has
predeceased such Participant, the Participant's Account shall be paid to
his or her estate as beneficiary.
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Any spousal consent, beneficiary designation and any change therein
shall be made in the form and manner prescribed by the Committee and shall
be filed with the General Manager. Any distribution made to a beneficiary
of a deceased Participant under the Plan shall be made to the beneficiary
as soon as practicable after such Participant's death and shall be in the
form of a lump sum payment, regardless of the form of benefit selected by
the deceased Participant. The beneficiary may elect to have such payment
made in money by check, or may elect to have any whole shares of Enterprise
Common Stock held for the deceased Participant's Enterprise Common Stock
Fund subaccount and ESOP Account distributed in shares of Enterprise Common
Stock and the balance of the deceased Participant's Account (including the
value of any fractional shares of Enterprise Common Stock) paid in money
by check. If no election is made, the entire distribution to the
beneficiary shall be made in money by check.
ARTICLE XV
ADMINISTRATION
SECTION 15.1. NAMED FIDUCIARY. The Committee (and each member of the
Committee acting as such) shall be the named fiduciary of the Plan with
authority to control and manage the operation and administration of the
Plan.
SECTION 15.2. ADMINISTRATION.
(a) The Committee shall have full discretionary authority to
interpret the Plan and to answer all questions which arise
concerning the application, administration and interpretation of
the Plan. The Committee shall adopt such rules and procedures
as in its opinion are necessary and advisable to administer the
Plan and to transact its business. Subject to the other
requirements of this Article XV, the Committee
may --
(1) Employ agents to carry out non-fiduciary responsibilities;
(2) Employ agents to carry out fiduciary responsibilities
(other than trustee responsibilities as defined in ERISA
Section 405(c)(3));
(3) Consult with counsel, who may be of counsel to the Company
or an Affiliate; and
(4) Provide for the allocation of fiduciary responsibilities
(other than trustee responsibilities as defined in ERISA
Section 405(c)(3)) among its members. However, any action
described in subparagraphs (2) or (4) of this subparagraph
(a) and any modification or rescission of any such action,
may be effected by the Committee only by a resolution
approved by a majority of the Committee.
(b) The Committee shall keep written minutes of all its proceedings,
which shall be open to inspection by the Board of Directors. In
the case of any decision by the Committee with respect to a
claim for benefits under the Plan, the Committee shall include
in its minutes a brief explanation of the grounds upon which
such decision was based.
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(c) In performing their duties, the members of the Committee shall
act solely in the interest of the Participants in the Plan and
their beneficiaries and:
(1) for the exclusive purpose of providing benefits to the
Participants and their beneficiaries;
(2) with the care, skill, prudence and diligence under the
circumstances then prevailing that a prudent man or woman
acting in like capacity and familiar with such matters
would use in the conduct of an enterprise of a like
character and with like aims; and
(3) in accordance with the documents and instruments governing
the Plan insofar as such documents and instruments are
consistent with the provisions of Title I of ERISA. In
addition to any other duties the Committee may have, the
Committee shall periodically review the performance of the
Trustee and any Investment Managers and the performance of
all other persons to whom fiduciary duties have been
delegated or allocated pursuant to the provisions of this
Article XV.
(d) The Company agrees to indemnify and reimburse, to the fullest
extent permitted by law, members of the Committee, directors and
Employees of an Employer and all such former members, directors
and Employees, for any and all expenses, liabilities or losses
arising out of any act or omission relating to the rendition of
services for or the management and administration of the Plan.
(e) No member of the Committee nor any of its delegates shall be
personally liable by virtue of any contract, agreement or other
instrument made or executed by him or her or on his or her
behalf in such capacity.
SECTION 15.3. CONTROL AND MANAGEMENT OF ASSETS. The assets of the
Plan shall be held by the Trustee, in trust, and shall be managed by the
Trustee and/or one or more Investment Managers appointed from time to time
by the Committee; provided, however, that the Committee shall have
investment authority with respect to loans approved pursuant to SECTION
11.12, and may, from time to time, determine that the Trustee shall be
subject to the direction of the Committee with respect to certain other
investments, in which case the Trustee shall be subject to proper
directions of the Committee which are in accordance with the terms of the
Plan and which are not contrary to applicable law.
SECTION 15.4. BENEFITS TO BE PAID FROM TRUST. Benefits under the
Plan shall be payable only from the Trust Fund and only to the extent that
such Trust Fund shall suffice therefore and each Participant assumes all
risk connected with any decrease in market price of any securities in the
respective Funds. Neither the Company nor any Affiliate shall have any
liability to make or continue from its own funds the payment of any
benefits under the Plan.
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SECTION 15.5. EXPENSES. There shall be paid from the Trust Fund all
expenses incurred in connection with the administration of the Plan,
including but not limited to the compensation of the Trustee, the
reasonable fees of counsel for the Trustee for legal services rendered to
the Trustee and the fees of Investment Managers appointed with respect to
the investment and reinvestment of the Trust Fund, except to the extent
that such expenses and fees are paid by the Employer. There shall be paid
from the Trust Fund all taxes of any and all kinds whatsoever that may be
levied or assessed under existing or future laws upon or in respect of the
Trust Fund or any property of any kind forming a part thereof, and all
expenses including brokerage costs and transfer taxes incurred in
connection with the investment and reinvestment of the Trust Fund.
ARTICLE XVI
CLAIMS PROCEDURE
SECTION 16.1. FILING OF CLAIMS. Claims for benefits under the Plan
shall be filed in writing on such form or forms as may be prescribed by the
Committee with the General Manager.
SECTION 16.2. APPEAL OF CLAIMS. Written notice shall be given to the
claiming Participant or beneficiary of the disposition of such claim,
setting forth specific reasons for any denial of such claim in whole or in
part. If a claim is denied in whole or in part, the notice shall state
that such Participant or beneficiary may, within sixty days of the receipt
of such denial, request in writing that the decision denying the claim be
reviewed by the Committee and provide the Committee with information in
support of his or her position by submitting such information in writing
to the Secretary of the Committee.
SECTION 16.3. REVIEW OF APPEALS. The Committee shall review each
claim for benefits which has been denied in whole or in part and for which
such review has been requested and shall notify, in writing, the affected
Participant or beneficiary of its decision and of the reasons therefor.
All decisions of the Committee shall be final and binding upon all of the
parties involved.
ARTICLE XVII
MERGER OR CONSOLIDATION
SECTION 17.1. MERGER OR CONSOLIDATION. In the case of any merger or
consolidation of the Plan with, or transfer of assets or liabilities to,
any other plan, each Participant or beneficiary shall be entitled to
receive a benefit immediately after the merger, consolidation or transfer
(if the Plan had been terminated) which is equal to or greater than the
benefit he or she would have been entitled to receive immediately before
the merger, consolidation or transfer (if the Plan had then terminated).
A merger or consolidation of the Plan with, or transfer of assets or
liabilities to, any other plan shall not be deemed to be a termination or
discontinuance of deposits and contributions having the effect of such
termination of the Plan.
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ARTICLE XVIII
NON-ALIENATION OF BENEFITS
SECTION 18.1. NON-ALIENATION OF BENEFITS. Except as provided under
SECTIONS 11.12 and 22.1, no benefit or right under the Plan shall in any
manner or to any extent be assigned, alienated or transferred by any
Participant or beneficiary under the Plan or be subject to attachment,
garnishment or other legal process.
ARTICLE XIX
AMENDMENTS
SECTION 19.1. AMENDMENT PROCESS. The Company reserves the right, by
action of the Board of Directors, but subject to applicable law, at any
time and from time to time, to modify, suspend or amend in whole or in part
any or all of the provisions of the Plan, provided that no modification,
suspension or amendment shall make it possible to deprive any Participant
or beneficiary of a previously acquired right; and provided further that
no such modification, suspension or amendment shall make it possible for
any part of the assets of the Plan to be used for or diverted to purposes
other than for the exclusive benefit of Participants and their
beneficiaries under the Plan and for the payment of expenses of the Plan.
ARTICLE XX
TERMINATION
SECTION 20.1. AUTHORITY TO TERMINATE. The Plan may, subject to
collective bargaining, be terminated in whole or in part at any time by the
Board of Directors, but only upon condition that such action is taken as
shall render it impossible for any part of the corpus or income of the
Trust Fund to be used for or diverted to purposes other than for the
exclusive benefit of the Participants or their beneficiaries and for the
payment of expenses of the Plan.
SECTION 20.2. DISTRIBUTION UPON TERMINATION. Upon termination or
partial termination of the Plan or upon the complete discontinuance of
Deposits and Employer Contributions under the Plan, the assets of the Trust
Fund shall be administered and distributed to the Participants or their
beneficiaries at such time or times and in such nondiscriminatory manner
as is determined by the Committee. Upon termination or partial termination
of the Plan or upon the complete discontinuance of Deposits and Employer
Contributions under the Plan, the rights of all affected Participants as
of the date of such termination, partial termination or discontinuance of
Deposits and Employer Contributions shall be nonforfeitable.
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ARTICLE XXI
PLAN CONFERS NO RIGHT TO EMPLOYMENT
SECTION 21.1. NO RIGHT TO EMPLOYMENT. Nothing contained in the Plan
shall be construed as conferring any legal rights upon any Employee for a
continuation of employment or shall interfere with the rights of the
Company or an Affiliate to discharge any Employee or otherwise to treat him
or her without regard to the effect which such treatment might have upon
such Employee with respect to the Plan, except as may be limited by
applicable law.
ARTICLE XXII
ALTERNATE PAYEES
SECTION 22.1. ALTERNATE PAYEES UNDER QDROS. In the event that a
domestic relations order of any State is received by the Plan and
thereafter determined to be a Qualified Domestic Relations Order (QDRO)
within the meaning of Code section 414p, the vested portion of the Account
of the Participant to which such QDRO is directed shall be apportioned as
specified in such QDRO, valued as of the Accounting Period preceding the
date specified in such QDRO. Upon notice to the Committee that a QDRO is
being sought with respect to a Participant's Account, no distribution or
loan shall be made to a Participant until such time as the status of the
QDRO is determined. The alternate payee of the Participant's Account shall
thereafter participate in the Plan in accordance with its terms, except
such person shall not have the rights or benefits provided in Article IV,
Article V and in SECTION 11.12. If a QDRO is issued and the amount awarded
the alternate payee exceeds the value of the Participant's Account less the
outstanding loan balance, such loan shall be deemed to be in default and
the Participant shall immediately repay the loan. Notwithstanding the
provisions of this Article, the Plan may, without the consent of any such
alternate payee, pay to such alternate payee the value of his or her
respective share of the apportioned Account of the Participant, if the
value thereof as so determined is $3,500.00 or less. If a QDRO so
provides, benefits may be paid to an alternate payee before they would
otherwise be distributable under the Plan, and no such distribution to an
alternate payee shall be treated as a withdrawal by the Participant for
purposes of Article XI.
ARTICLE XXIII
CONSTRUCTION
SECTION 23.1. GOVERNING LAW. The Plan shall be governed by and
construed and administered under the laws of the State of New Jersey,
except to the extent superseded by ERISA.
SECTION 23.2. HEADINGS. The headings are for reference only. In the
event of a conflict between a heading and the content of an article or
Section, the content shall control.
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Exhibit 2
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration Statements
Nos. 33-18417 and 33-44582 on Forms S-8 of Public Service Enterprise Group
Incorporated of our report dated June 23, 1995 appearing in this Annual
Report on Form 11-K of the Public Service Electric and Gas Company Employee
Savings Plan for the year ended December 31, 1994.
DELOITTE & TOUCHE LLP
Parsippany, New Jersey
June 30, 1995
