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
For the fiscal year ended December 31, 1996 Commission File
Number
A. Full title of the plan and the address of the plan, if
different from that of the issuer named below:
Atlantic Electric 401(K) Savings and Investment Plan - B
6801 Black Horse Pike
Egg Harbor Twp., N.J. 08234-4130
B. Name of issuer of the securities held pursuant to the plan
and the address of its principal executive office:
Custom Stable Value Fund Equity Index Fund
T. Rowe Price, Inc. T. Rowe Price, Inc.
100 East Pratt Street 100 East Pratt Street
Baltimore, MD 21202 Baltimore, MD 21202
Equity Income Fund Spectrum Growth Fund
T. Rowe Price, Inc. T. Rowe Price, Inc.
100 East Pratt Street 100 East Pratt Street
Baltimore, MD 21202 Baltimore, MD 21202
International Stock Fund Atlantic Energy, Inc. Common Stock
T. Rowe Price, Inc. Atlantic Energy, Inc.
100 East Pratt Street 6801 Black Horse Pike
Baltimore, MD 21202 Egg Harbor Twp., NJ 08234-4130
TABLE OF CONTENTS
Page
Independent Auditors' Report 2
Atlantic Electric
401(K) Savings and Investment Plan - B
Financial Statements as of December 31, 1996 and 1995
and For The Year Ended December 31, 1996:
Statements of Net Assets Available for Benefits 3
Statement of Changes in Net Assets
Available for Benefits 4
Notes to Financial Statements 5
Supplemental Schedules:
I: Schedule of Reportable Transactions -
Form 5500, Item 27d 15
II: Schedule of Assets Held for Investment
Purposes, December 31, 1996 - Form 5500, Item 27a 16
*****
<PAGE>
INDEPENDENT AUDITORS' REPORT
Atlantic Electric
401(K) Savings and Investment Plan - B
We have audited the accompanying statements of net assets
available for benefits of Atlantic Electric 401(K) Savings and
Investment Plan-B as of December 31, 1996 and 1995 and the
related statement of changes in net assets available for benefits
for the year ended December 31, 1996. 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
Atlantic Electric 401(k) Savings and Investment Plan-B as of
December 31, 1996 and 1995, and changes in net assets available
for benefits for the year ended December 31, 1996 in conformity
with generally accepted accounting principles.
Our audits were conducted for the purpose of forming an opinion
on the basic financial statements taken as a whole. The
supplemental schedules listed in the Table of Contents are
presented for the purpose of additional analysis and are not a
required part of the basic financial statements, but are
supplementary information required by the Department of Labor's
Rules and Regulations for Reporting and Disclosure under the
Employee Retirement Income Security Act of 1974. These schedules
are the responsibility of the Plan's management. Such schedules
have been subjected to the auditing procedures applied in the
audit of the basic 1996 financial statements and, in our opinion,
are fairly stated in all material respects when considered in
relation to the basic financial statements taken as a whole.
/s/ Deloitte & Touche LLP
Deloitte & Touche LLP
Parsippany, New Jersey
June 26, 1997
ATLANTIC ELECTRIC
401(K) SAVINGS AND INVESTMENT PLAN - B
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1996 AND 1995
ASSETS 1996 1995
Investments at fair value:
Common Collective Trust $12,784,415 $13,858,871
Mutual fund accounts 14,009,030 8,697,433
Participant Loans 1,072,374 654,692
Atlantic Energy, Inc. Common Stock 79,922 -0-
Contributions receivable:
Atlantic City Electric Company 14,726 13,444
Participants 41,068 36,690
NET ASSETS AVAILABLE FOR BENEFITS $28,001,535 $23,261,130
See notes to financial statements.
<PAGE>
ATLANTIC ELECTRIC
401(K) SAVINGS AND INVESTMENT PLAN - B
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEAR ENDED DECEMBER 31, 1996
1996
Additions to assets:
Investment income:
Interest - GIC $ 802,305
Interest - Participant Loans 71,817
Dividends 709,430
Net appreciation
of investments 1,499,869
3,083,421
Contributions:
Participants' 2,024,990
Employers' 729,779
2,754,769
Total additions 5,838,190
Deductions from Assets:
Benefits paid to participants 1,093,735
Administrative Fees 4,050
Total deductions 1,097,785
Increase in net assets
available for benefits 4,740,405
Net assets available for benefits,
at beginning of year 23,261,130
Net assets available for benefits,
at end of year $28,001,535
See notes to financial statements.
<PAGE>
ATLANTIC ELECTRIC
401(K) SAVINGS AND INVESTMENT PLAN - B
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1996 AND 1995
1. SIGNIFICANT ACCOUNTING POLICIES
Plan Description
The Atlantic Electric 401(K) Savings and Investment Plan - B (the
"Plan") is a defined contribution savings plan designed to comply
with the requirements of the Employee Retirement Income Security
Act of 1974 and with the requirements for qualifications under
Section 401(k) of the Internal Revenue Code. The Plan is
administered by the Benefits/Trusts Investment Committee appointed
by the Board of Directors of Atlantic Energy, Inc., parent holding
Company of Atlantic City Electric Company. Employee contributions
to the Plan are remitted to T. Rowe Price Trust Company and
invested as directed by Plan participants. Employer contributions
are invested in the Custom Stable Value Fund Common Collective
Trust.
All full-time bargaining unit employees of the Atlantic City
Electric Company and its wholly-owned subsidiary, Deepwater
Operating Company (together referred to as the "Company"), are
eligible to participate in the Plan. Additionally, any Employee
who is not a regular full time employee shall be eligible to
participate upon completion of 1000 hours of service. Employees
may contribute up to 10% of base pay. Upon enrollment in the Plan,
a participant may direct employee contributions in any of six
investment options. Options available to the employee are the
Custom Stable Value Fund, Atlantic Energy, Inc. Common Stock
(effective January 1, 1996), Equity Index Fund, Equity Income Fund,
International Stock Fund, and Spectrum Growth Fund. The tax
savings portion of participant contributions (up to 6% of an
employee's base pay) is matched by the Company at a rate of 50% not
to exceed 3% of the Employee's compensation. Federal Income taxes
on these contributions and the related income are deferred until
withdrawn. Benefits from the tax savings portion of the Plan can
be withdrawn upon the attainment of age 59 1/2, retirement,
separation from service, death or in special financial hardship
situations. In addition, employees may contribute up to an
additional 10% of base pay on an after-tax basis to the
supplemental savings portion of the Plan, which also earns income
that is not subject to Federal income tax until withdrawn. These
contributions may be withdrawn once a quarter subject to the
provisions of the Internal Revenue Code.
Tax Status
The Plan obtained its latest determination letter on March 23,
1995, in which the Internal Revenue Service stated that the Plan
was in compliance with the applicable requirements of the Internal
Revenue Code. The Plan administrator and the Plan's tax counsel
believe that the Plan is currently designed and being operated in
compliance with the applicable requirements of the Internal Revenue
Code. Therefore, no provision for income taxes has been included
in the Plan's financial statements.
Participant Accounts
Participants' contributions are recorded in the period of the
related payroll deductions. The Company's matching contributions
are recorded in the period of the related participants'
contributions. Income is recorded as earned. Distributions to
participants are recorded in the period in which distributions are
made. Participants are fully vested in employee and employer
contributions in their respective accounts at all times.
Plan Termination
Although it has not expressed any intent to do so, the Company has
the right under the Plan to discontinue its contributions at any
time subject to the provisions of ERISA. In the event of Plan
termination, participants remain 100 percent vested in their
accounts.
Administration Costs
Certain professional fees and administrative expenses incurred in
connection with the Plan are paid by the Company. The facilities
of the Company are used by the Plan at no charge. Loan processing
fees are paid by the participants and deducted from Plan assets.
Participant Loans Receivable
The Plan began to make Participant loans effective April 1, 1995.
Participants may borrow from their fund accounts a minimum of
$1,000 up to a maximum equal to the lesser of $50,000 or 50 percent
of their account balance. Loan transactions are treated as a
transfer from the investment fund to the participant Loan fund.
Loan terms range from 1-5 years or up to 15 years for the purchase
of a primary residence. The loans are secured by the balance in
the participant's account and bear interest at a rate commensurate
with local prevailing rates as determined quarterly by the plan
administrator. The interest rate for 1996 and 1995 was 9%.
Principal and interest is paid ratably through weekly payroll
deductions.
Investments
The investment options available to plan participants have the
following objectives:
(i) Custom Stable Value Fund - to provide principal stability
and a high level of monthly income;
(ii) Equity Income Fund - to provide substantial dividend
income and secondarily, long-term capital
appreciations;
(iii) Equity Index Fund - to match the performance of the
Standard & Poor's Stock Index;
(iv) International Stock Fund - to provide the diversifications
of an international fund as well as the opportunity for
long-term capital growth;
(v) Spectrum Growth Fund - to provide long-term growth of
capital;
(vi) Atlantic Energy Company Stock - to provide maximum capital
appreciation and dividend income form Atlantic Energy
Common Shares.
The investments in Mutual Funds are stated at fair value as
determined by quoted market prices. The investments in the Common
Collective Trust are stated at contract value (which approximates
fair value) which is the aggregate of contributions and income
earned on such contributions, less participants' withdrawals.
<PAGE>
The following table represents the fair value of investments by
issuer comprising 5 percent or more of the Plan's assets:
December 31,
Investments at Fair Value: 1996 1995
Custom Stable Value Fund $12,784,415 $13,858,871
Equity Index Fund 4,878,462 2,935,161
Equity Income Fund 7,501,536 4,923,465
$25,164,413 $21,717,497
The net appreciation in fair value of each significant type of
investment is as follows:
December 31,
1996 1995
Custom Stable Value Fund $ -0- $ -0-
Equity Index Fund $651,264 $583,191
Equity Income Fund 724,012 843,308
$1,375,276 $1,426,499
The Custom Stable Value Fund invests funds in various term
guaranteed insurance contracts and maintains a cash reserve balance
with all excess funds. The average yield and the weighted average
crediting interest rate are based on the underlying contract.
For the years ended December 31, 1996 and 1995 the guaranteed
insurance contracts of the Custom Stable Value Fund, in aggregate,
had an average yield of 6.36% and 6.31% respectively.
At December 31, 1996 and 1995, the fund had a weighted average
crediting interest rate of 6.93% and 6.77%, respectively.
Distributions
At December 31, 1996 and 1995, there were no benefits payable to
plan participants.
<PAGE>
<TABLE>
2. PARTICIPANT-DIRECTED INVESTMENT FUNDS AS OF DECEMBER 31, 1996 AND 1995
Net assets available for plan benefits, and changes therein, are presented below for each
participant-directed investment fund for the year ended December 31, 1996:
(In Dollars)
Net Assets available for Plan Benefits as of December 31, 1996
<CAPTION>
Custom Stable Equity Equity Spectrum
Value Fund Index Fund Income Fund Growth Fund
<S> <C> <C> <C> <C>
Investments
Common Collective
Trust $12,784,415 $ $ $
Mutual Fund
Accounts 4,878,462 7,501,536 1,172,193
Atlantic Energy, Inc.
Common Stock
Contributions Receivable
Employee 13,920 9,940 13,337 2,739
Employer 14,726
Participant Loans __________ _________ _________ _________
Net Assets Available $12,813,061 $4,888,402 $7,514,873 $1,174,932
for Plan Benefits
</TABLE>
<PAGE>
<TABLE>
Net Asset available for Plan Benefits as of December 31, 1996 (continued)
<CAPTION>
Int'l Loan Atlantic Energy
Stock Fund Fund Stock Total
<S> <C> <C> <C> <C>
Investments
Common Collective
Trust $ $ $ $12,784,415
Mutual Fund
Accounts 456,839 14,009,030
Atlantic Energy, Inc.
Common Stock 79,922 79,922
Contributions Receivable
Employee 1,093 39 41,068
Employer 14,726
Participant Loans 1,072,374 1,072,374
__________ _________
Net Assets Available
for Plan benefits $ 457,932 $1,072,374 $ 79,961 $28,001,535
</TABLE>
<TABLE>
Changes in Net Assets available for Benefits for the year ended December 31, 1996
<CAPTION>
Custom Stable Equity Equity Spectrum
Value Fund Index Fund Income Fund Growth Fund
<S> <C> <C> <C>
Additions:
Employer $ 729,779 $ $ $
Employee 745,191 463,230 639,587 117,187
Investment Income
Interest - GIC 802,305
Interest-Loans 27,184 17,842 17,434 6,354
Dividends 154,786 456,017 81,647
Net Appreciation
of Investments 651,264 724,012 80,605
Interfund
transfers (2,555,268) 724,208 868,530 240,981
TOTAL ADDITIONS (250,809) 2,011,330 2,705,580 526,774
Deductions
Distributions
to Participant (822,487) (65,201) (123,936) (2,531)
Administrative Fees
(1,827) (713) (1,226) (252)
TOTAL DEDUCTIONS (824,314) (65,914) (125,162) (2,783)
Increase in
net assets (1,075,123) 1,945,416 2,580,418 523,991
Net assets available
for plan benefits,
1/1/96 13,888,184 2,942,986 4,934,455 650,941
Net assets available
for plan benefits,
12/31/96 $12,813,061 $4,888,402 $7,514,873 $1,174,932
/TABLE
<PAGE>
<TABLE>
Changes in Net Assets available for Benefits for the year ended December 31, 1996 (continued)
<CAPTION>
Int'l Loan Atlantic Energy
Stock Fund Fund Stock Total
<S> <C> <C> <C>
Additions:
Employer $ $ $ $ 729,779
Employee 57,793 2,002 2,024,990
Investment Income
Interest - GIC 802,305
Interest-Loans 2,061 751 191 71,817
Dividends 12,204 4,776 709,430
Net Appreciation
of Investments 48,599 (4,611) 1,499,869
Interfund
transfers 203,206 440,733 77,610 -0-
_______ _______ ______ _________
TOTAL ADDITIONS 323,863 441,484 79,968 5,838,190
Deductions
Distributions
to Participant (55,778) (23,802) (1,093,735)
Administrative Fees (25) ________ (7) (4,050)
TOTAL DEDUCTIONS (55,803) (23,802) (7) (1,097,785)
Increase in
net assets 268,060 417,682 79,961 4,740,405
Net assets available
for plan benefits,
1/1/96 189,872 654,692 -0- 23,261,130
Net assets available
for plan benefits,
12/31/96 $457,932 $1,072,374 $ 79,961 $28,001,535
/TABLE
<PAGE>
<TABLE>
Net assets available for plan benefits, and changes therein, are presented below for each
participant-directed investment fund for the year ended December 31, 1995:
(In Dollars)
Net Assets available for Plan Benefits as of December 31, 1995
<CAPTION>
Custom Stable Equity Equity Spectrum
Value Fund Index Fund Income Fund Growth Fund
<S> <C> <C> <C>
Investments
Common Collective
Trust $13,858,871 $ $ $
Mutual Fund
Accounts 2,935,161 4,923,465 649,468
Contributions Receivable
Employee 15,869 7,825 10,990 1,473
Employer 13,444
Participant Loans ________ _________ _________ _________
Net Assets Available
for Plan benefits $13,888,184 $2,942,986 $4,934,455 $ 650,941
/TABLE
<PAGE>
<TABLE>
Net Assets available for Plan Benefits as of December 31, 1995 (continued)
<CAPTION>
Int'l Loan
Stock Fund Fund Total
<S> <C> <C> <C>
Investments
Common Collective
Trust $ $ $13,858,871
Mutual Fund
Accounts 189,339 8,697,433
Contributions Receivable
Employee 533 36,690
Employer 13,444
Participant Loans 654,692 654,692
__________ ________ _______
Net Assets Available
for Plan benefits $ 189,872 $ 654,692 $23,261,130
</TABLE>
<PAGE>
SCHEDULE I
ATLANTIC ELECTRIC
401(K) SAVINGS AND INVESTMENT PLAN - B
ITEM 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1996
Transactions or series of transactions in excess of 5% of the market value
of plan assets:
Units or Description of Market Net Gain
Shares Investment Cost Value or (Loss)
Purchases:
T. Rowe Price
Custom Stable
Value Fund $2,845,565
T. Rowe Price
Equity Index Fund 1,950,344
T. Rowe Price
Equity Income Fund 2,273,394
T. Rowe Price
International
Stock Fund 912,392
T. Rowe Price
Spectrum
Growth Fund 829,633
Sales:
T. Rowe Price
Custom Stable
Value Fund 3,920,021 $3,920,021 $ -0-
T. Rowe Price
Equity Index Fund 597,395 658,307 60,912
T. Rowe Price
Equity Income Fund 361,121 419,300 58,179
T. Rowe Price
International
Stock Fund 679,499 693,491 13,993
T. Rowe Price
Spectrum
Growth Fund 384,020 387,512 3,492
Schedule II
ATLANTIC ELECTRIC
401(K) SAVINGS AND INVESTMENT PLAN - B
ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 1996
Description of
Investment Cost Current Value
Custom Stable
Value Fund GIC $12,784,415 $12,784,415
Equity Index Fund Mutual Fund 3,811,100 4,878,462
Equity Income Fund Mutual Fund 6,205,543 7,501,536
Spectrum Growth Fund Mutual Fund 1,083,520 1,172,193
International
Stock Fund Mutual Fund 420,185 456,839
Atlantic Energy, Inc.
Stock* Common Stock 84,674 79,722
Participant Loans Various loans at
9%, maturing May
1997 through
November 2006 1,072,374 1,072,374
TOTAL ASSETS HELD FOR INVESTMENT $25,461,811 $27,945,541
*Represents a qualified investment in an Employee related security.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the trustees (or other persons who administer the employee
benefit plan) have duly caused this annual report to be signed on
its behalf by the undersigned thereunto duly authorized.
Date: June 26, 1997 /s/ L. M. Walters
L. M. Walters
Treasurer
<PAGE>
Exhibit Index
Exhibit No.
23 Independent Auditors' Consent
<PAGE>
Exhibit 23
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in the Registration
Statement No. 333-11683 on Form S-8 of Atlantic Energy, Inc. of
our report dated June 17, 1997, appearing in the Annual Report on
Form 11-K of Atlantic City Electric Company 401K Savings and
Investment Plan - B for the fiscal year ended December 31, 1996.
/s/ Deloitte & Touche LLP
Deloitte & Touche LLP
Parsippany, New Jersey
June 26, 1997
