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 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 THRIFT AND TAX-DEFERRED
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.
Equities Growth Fund A
TWENTIETH CENTURY INVESTORS, INC. PROVIDENT NATIONAL ASSURANCE COMPANY
4500 MAIN STREET FOUNTAIN SQUARE
P.O. BOX 419200 CHATTANOOGA, TENNESSEE 37402
KANSAS CITY, MISSOURI 64141-6200
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 AIG LIFE INSURANCE COMPANY
ONE ALICO PLAZA
Stable Value Fund C P.O. BOX 667
THE PRUDENTIAL LIFE INSURANCE COMPANY WILMINGTON, DELAWARE 19899
OF AMERICA
PRUDENTIAL PLAZA Enterprise Common Stock Fund D
NEWARK, NEW JERSEY 07101 and ESOP Fund
PUBLIC SERVICE ENTERPRISE GROUP
INCORPORATED
METROPOLITAN LIFE INSURANCE COMPANY 80 PARK PLAZA
ONE MADISON AVENUE NEWARK, NEW JERSEY 07101-1171
NEW YORK, NEW YORK 10010-3690
Large Company Stock Index Fund E
BANKERS TRUST COMPANY
PRINCIPAL MUTUAL LIFE INSURANCE 280 PARK AVENUE
COMPANY NEW YORK, NEW YORK 10017
THE PRINCIPAL FINANCIAL GROUP
DES MOINES, IOWA 50392-0001 Utilities Equities Fund F
FIDELITY PORTFOLIOS
82 DEVONSHIRE STREET
JOHN HANCOCK MUTUAL LIFE COMPANY BOSTON, MASSACHUSETTS 02109
JOHN HANCOCK PLACE
P. O. BOX 111 Intermediate Government Securities G
BOSTON, MASSACHUSETTS 02117 Fund G
VOYAGEUR FUND MANAGERS INC.
90 SOUTH SEVENTH STREET
SUITE 4400
ALLSTATE LIFE INSURANCE COMPANY MINNEAPOLIS, MINNESOTA 55402
ALLSTATE PLAZA WEST
3100 SANDERS ROAD International Stock Fund H
NORTHBROOK, ILLINOIS 60062 T. ROWE PRICE INC.
100 EAST PRATT STREET
TRANSAMERICA OCCIDENTAL LIFE INS. BALTIMORE, MARYLAND 2120
1150 SOUTH OLIVE
LOS ANGELES, CALIFORNIA 90015 Mid/Small Company Stock Fund
PUTNAM INVESTMENTS
FIRST ALLMERICA FINANCIAL LIFE P.O. BOX 41203
INSURANCE COMPANY PROVIDENCE, RHODE ISLAND 02940
440 LINCOLN STREET
WORCESTER, MASSACHUSETTS 01653
J.P.MORGAN
60 WALL STREET
NEW YORK, NEW YORK 10260
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
THRIFT AND TAX-DEFERRED SAVINGS PLAN
INDEX
PAGE
----
INDEPENDENT AUDITORS' REPORT........................................ 4
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF DECEMBER 31, 1996 AND 1995.................................. 5 -10
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEARS ENDED DECEMBER 31, 1996 and 1995.................... 11-16
NOTES TO FINANCIAL STATEMENTS....................................... 17-27
SIGNATURES.......................................................... 28
EXHIBIT INDEX....................................................... 29
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 Thrift and Tax- Deferred Savings
Plan (the "Plan") as of December 31, 1996 and 1995, 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 audits 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, 1996
and 1995, and the changes in net assets available for benefits for 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. This
information is the responsibility of the Plan's management. Such information has
been subjected to the auditing procedures applied in our audits of the basic
financial statements and, in our opinion, is 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 25, 1997
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
THRIFT AND TAX-DEFERRED SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
As of December 31, 1996
(Supplemental Information by Fund)
Equities Enterprise
Growth Balanced Stable Value Common Stock
Total Fund A Fund B Fund C Fund D
---------------------------------------------------------------------
ASSETS
Investments, at fair value
Plan interest in PSE&G Company $449,181,673 $ - $ - $ 231,052,943 $ 42,281,519
Master Employee Benefit Plan Trust
Receivables-Interest
and Dividends 1,273,044 - - 1,258,680 13,873
---------------------------------------------------------------------
Total Assets $450,454,717 $ - $ - $ 232,311,623 $ 42,295,392
=====================================================================
LIABILITIES
Accounts Payable $ 195,199 $ - $ - $ 143,307 $ 38,569
Transfer to/from PSE&G Company
Employee Savings Plan 181,176 - - 168,771 -
Forfeitures 4,303 - - - 598
---------------------------------------------------------------------
Total Liabilities 380,678 - - 312,078 39,167
---------------------------------------------------------------------
Net Assets Available for Benefits $450,074,039 $ - $ - $ 231,999,545 $ 42,256,225
=====================================================================
<FN>
SEE NOTES TO FINANCIAL STATEMENTS
</FN>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
THRIFT AND TAX-DEFERRED SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
As of December 31, 1996
(Supplemental Information by Fund (Continued))
Intermediate
Large Company Utilities Government International Mid/Small
Stock Index Equities Securities Stock Company
Fund E Fund F Fund G Fund H Stock Fund
--------------------------------------------------------------------
ASSETS
Investments, at fair value
Plan interest in PSE&G Company
Master Employee Benefit Plan Trust $75,429,866 $ - $5,411,340 $19,716,058 $15,217,008
Receivables-Interest
and Dividends - - - - -
--------------------------------------------------------------------
Total Assets $75,429,866 $ - $5,411,340 $19,716,058 $15,217,008
====================================================================
LIABILITIES
Accounts Payable $ 90,219 $ - $ 2,804 $ (12,800) $ (151,503)
Transfer to/from PSE&G Company
Employee Savings Plan - - - - -
Forfeitures 1,885 - 21 304 1,091
--------------------------------------------------------------------
Total Liabilities 92,104 - 2,825 (12,496) (150,412)
--------------------------------------------------------------------
Net Assets Available for Benefits $75,337,762 $ - $5,408,515 $19,728,554 $15,367,420
====================================================================
<FN>
SEE NOTES TO FINANCIAL STATEMENTS
</FN>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
THRIFT AND TAX-DEFERRED SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
As of December 31, 1996
(Supplemental Information by Fund (Continued))
Conservative Moderate Aggressive
Pre-Mix Pre-Mix Pre-Mix Holding Trust
Portfolio Portfolio Portfolio ESOP Account Loan Fund
---------------------------------------------------------------------------------
ASSETS
Investments, at fair value
Plan interest in PSE&G Company
Master Employee Benefit Plan Trust $8,453,723 $20,189,441 $14,165,616 $5,339,552 $89,921 $11,834,686
Receivables-Interest
and Dividends - - - 93 398 -
---------------------------------------------------------------------------------
Total Assets $8,453,723 $20,189,441 $14,165,616 $5,339,645 $90,319 $11,834,686
=================================================================================
LIABILITIES
Accounts Payable $ 9,114 $ 75,319 $ (16,376) $ 9,686 $43,210 $ (36,350)
Transfer to/from PSE&G Company
Employee Savings Plan 6,190 6,215 - - - -
Forfeitures 43 87 274 - - -
---------------------------------------------------------------------------------
Total Liabilities 15,347 81,621 (16,102) 9,686 43,210 (36,350)
---------------------------------------------------------------------------------
Net Assets Available for Benefits $8,438,376 $20,107,820 $14,181,718 $5,329,959 $47,109 $11,871,036
=================================================================================
<FN>
SEE NOTES TO FINANCIAL STATEMENTS
</FN>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
THRIFT AND TAX-DEFERRED SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
As of December 31, 1995
(Supplemental Information by Fund)
Equities Fixed Enterprise
Growth Balanced Income Common Stock
Total Fund A Fund B Fund C Fund D
---------------------------------------------------------------------------
ASSETS
Investments
Enterprise Common Stock $ 65,343,084 $ - $ - $ - $57,979,587
Equities Growth Fund 23,362,801 23,362,801 - - -
Balanced Fund 12,096,913 - 12,096,913 - -
Insurance Annuity Contracts (GICs ) 227,071,949 - - 227,071,949 -
Stock Index Equities Fund 52,506,341 - - - -
Utilities Equities Fund 12,524,247 - - - -
Government Securities Fund 6,535,810 - - - -
International Stock Fund 10,913,105 - - - -
---------------------------------------------------------------------------
Total Investments 410,354,250 23,362,801 12,096,913 227,071,949 57,979,587
---------------------------------------------------------------------------
Participant Loans Receivable 13,154,101 - - - -
Receivables-Interest
and Dividends 3,051,675 91,252 (86) 1,299,563 1,018,887
Cash and Temporary Cash
Investments 4,483,854 - - 3,556,107 265,618
---------------------------------------------------------------------------
Total Assets $431,043,880 $23,454,053 $12,096,827 $231,927,619 $59,264,092
===========================================================================
LIABILITIES
Accounts Payable $ 1,591,802 $ 96,698 $ (3,140) $ 272,992 $ 35,405
Purchases of Securities 1,007,474 - - - 1,007,474
Forfeitures 100,450 - - - -
Other (45,570) (5,765) 487 (34,433) 825
---------------------------------------------------------------------------
Total Liabilities 2,654,156 90,933 (2,653) 238,559 1,043,704
---------------------------------------------------------------------------
Net Assets Available for Benefits $428,389,724 $23,363,120 $12,099,480 $231,689,060 $58,220,388
===========================================================================
<FN>
SEE NOTES TO FINANCIAL STATEMENTS
</FN>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
THRIFT AND TAX-DEFERRED SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
As of December 31, 1995
(Supplemental Information by Fund (Continued))
Stock Index Utilities Government T.Rowe Price
Equities Equities Securities Internat.Stock
Fund E Fund F Fund G Fund H ESOP Fund
-------------------------------------------------------------------------
ASSETS
Investments
Enterprise Common Stock $ - $ - $ - $ - $7,363,497
Equities Growth Fund - - - - -
Balanced Fund - - - - -
Insurance Annuity Contracts (GICs) - - - - -
Stock Index Equities Fund 52,506,341 - - - -
Utilities Equities Fund - 12,524,247 - - -
Government Securities Fund - - 6,535,810 - -
International Stock Fund - - - 10,913,105 -
-------------------------------------------------------------------------
Total Investments 52,506,341 12,524,247 6,535,810 10,913,105 7,363,497
-------------------------------------------------------------------------
Participant Loans Receivable - - - - -
Receivables-Interest
and Dividends 498,935 (10,121) 43,863 4,514 -
Cash and Temporary Cash
Investments 99,598 - 47 104 56
-------------------------------------------------------------------------
Total Assets $53,104,874 $12,514,126 $6,579,720 $ 10,917,723 $7,363,553
=========================================================================
LIABILITIES
Accounts Payable $ 603,860 $ (12,269) $ 33,454 $ 4,593 44,350
Purchases of Securities - - - - -
Forfeitures - - - - -
Other (6,684) - - - -
-------------------------------------------------------------------------
Total Liabilities 597,176 (12,269) 33,454 4,593 44,350
-------------------------------------------------------------------------
Net Assets Available for Benefits $52,507,698 $12,526,395 $6,546,266 $ 10,913,130 $7,319,203
=========================================================================
<FN>
SEE NOTES TO FINANCIAL STATEMENTS
</FN>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
THRIFT AND TAX-DEFERRED SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
As of December 31, 1995
(Supplemental Information by Fund (Concluded))
Holding Trust
Account Loan Fund
----------------------------
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 - 13,154,101
Receivables-Interest
and Dividends 104,868 -
Cash and Temporary Cash
Investments 562,324 -
----------------------------
Total Assets $ 667,192 $13,154,101
============================
LIABILITIES
Accounts Payable $ 515,859 $ -
Purchases of Securities - -
Forfeitures 100,450 -
Other - -
----------------------------
Total Liabilities 616,309 -
----------------------------
Net Assets Available for Benefits $ 50,883 $13,154,101
============================
<FN>
SEE NOTES TO FINANCIAL STATEMENTS
</FN>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
THRIFT AND TAX-DEFERRED SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS
AVAILABLE FOR BENEFITS
For the Year Ended December 31, 1996
(Supplemental Information by Fund)
Equities Enterprise
Growth Balanced Stable Value Common Stock
Total Fund A Fund B Fund C Fund D
-----------------------------------------------------------------------------------
ADDITIONS
Participant Deposits $ 28,928,457 $ 2,934,890 $ 1,318,684 $ 11,817,518 $ 2,769,588
Employers Contributions 7,724,863 742,012 335,692 3,280,090 798,778
Interfund Transfers - net - (29,036,498) (13,312,480) 862,747 (12,640,657)
-----------------------------------------------------------------------------------
Total Deposits and Contributions 36,653,320 (25,359,596) (11,658,104) 15,960,355 (9,072,291)
-----------------------------------------------------------------------------------
Plan Interest in Master Trust
Investment Income 34,518,823 3,544,014 776,735 15,263,104 (2,279,879)
-----------------------------------------------------------------------------------
Total Additions 71,172,143 (21,815,582) (10,881,369) 31,223,459 (11,352,170)
-----------------------------------------------------------------------------------
DEDUCTIONS
Withdrawals 48,892,615 1,593,537 1,232,029 30,536,100 4,567,152
Dividends Paid 460,678 - - - -
Forfeitures 145,221 24,050 7,723 26,591 14,901
Transfer to/(from) PSE&G Company
Employee Savings Plan (10,686) (70,049) (21,641) 350,283 29,940
-----------------------------------------------------------------------------------
Total Deductions 49,487,828 1,547,538 1,218,111 30,912,974 4,611,993
-----------------------------------------------------------------------------------
INCREASE (DECREASE) IN NET
ASSETS AVAILABLE FOR BENEFITS 21,684,315 (23,363,120) (12,099,480) 310,485 (15,964,163)
NET ASSETS AVAILABLE FOR
BENEFITS - BEGINNING OF YEAR 428,389,724 23,363,120 12,099,480 231,689,060 58,220,388
-----------------------------------------------------------------------------------
NET ASSETS AVAILABLE
FOR BENEFITS - END OF YEAR $450,074,039 $ - $ - $231,999,545 $42,256,225
===================================================================================
<FN>
SEE NOTES TO FINANCIAL STATEMENTS
</FN>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
THRIFT AND TAX-DEFERRED SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS
AVAILABLE FOR BENEFITS
For the Year Ended December 31, 1996
(Supplemental Information by Fund (Continued))
Intermediate
Large Company Utilities Government International Mid/Small
Stock Index Equities Securities Stock Company
Fund E Fund F Fund G Fund H Stock Fund
--------------------------------------------------------------------------
ADDITIONS
Participant Deposits $ 5,247,928 $ 1,009,102 $ 568,171 $ 1,911,492 $ 364,252
Employers Contributions 1,334,628 256,733 149,824 460,294 100,243
Interfund Transfers - net 8,094,861 (13,211,523) (1,356,553) 6,103,664 14,945,307
--------------------------------------------------------------------------
Total Deposits and Contributions 14,677,417 (11,945,688) (638,558) 8,475,450 15,409,802
--------------------------------------------------------------------------
Plan Interest in Master Trust
Investment Income 13,410,802 479,587 133,502 2,462,033 2,161
--------------------------------------------------------------------------
Total Additions 28,088,219 (11,466,101) (505,056) 10,937,483 15,411,963
--------------------------------------------------------------------------
DEDUCTIONS
Withdrawals 5,410,105 1,077,617 625,992 2,127,678 42,832
Dividends Paid - - - - -
Forfeitures 34,030 8,440 8,581 16,493 1,711
Transfer to/(from) PSE&G Company
Employee Savings Plan (185,980) (25,763) (1,878) (22,112) -
--------------------------------------------------------------------------
Total Deductions 5,258,155 1,060,294 632,695 2,122,059 44,543
--------------------------------------------------------------------------
INCREASE (DECREASE) IN NET
ASSETS AVAILABLE FOR BENEFITS 22,830,064 (12,526,395) (1,137,751) 8,815,424 15,367,420
NET ASSETS AVAILABLE FOR
BENEFITS - BEGINNING OF YEAR 52,507,698 12,526,395 6,546,266 10,913,130 -
--------------------------------------------------------------------------
NET ASSETS AVAILABLE
FOR BENEFITS - END OF YEAR $ 75,337,762 $ - $5,408,515 $19,728,554 $15,367,420
==========================================================================
<FN>
SEE NOTES TO FINANCIAL STATEMENTS
</FN>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
THRIFT AND TAX-DEFERRED SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS
AVAILABLE FOR BENEFITS
For the Year Ended December 31, 1996
(Supplemental Information by Fund (Concluded))
Conservative Moderate Aggressive
Pre-Mix Pre-Mix Pre-Mix Holding Trust
Portfolio Portfolio Portfolio ESOP Account Loan Fund
-------------------------------------------------------------------------
ADDITIONS
Participant Deposits $ 117,400 $ 450,068 $ 419,364 $ - $ - $ -
Employers Contributions 33,228 110,232 123,109 - - -
Interfund Transfers - net 8,213,054 19,092,946 13,270,165 (704,973) - (320,060)
-------------------------------------------------------------------------
Total Deposits and Contributions 8,363,682 19,653,246 13,812,638 (704,973) - (320,060)
-------------------------------------------------------------------------
Plan Interest in Master Trust
Investment Income 183,442 541,475 435,380 (451,671) (3,774) 21,912
-------------------------------------------------------------------------
Total Additions 8,547,124 20,194,721 14,248,018 (1,156,644) (3,774) (298,148)
-------------------------------------------------------------------------
DEDUCTIONS
Withdrawals 108,705 86,814 63,729 376,876 - 1,043,449
Dividends Paid - - - 460,678 - -
Forfeitures 43 87 2,571 - - -
Transfer to/(from) PSE&G Company
Employee Savings Plan - - - (4,954) - (58,532)
-------------------------------------------------------------------------
Total Deductions 108,748 86,901 66,300 832,600 - 984,917
-------------------------------------------------------------------------
INCREASE (DECREASE) IN NET
ASSETS AVAILABLE FOR BENEFITS 8,438,376 20,107,820 14,181,718 (1,989,244) (3,774) (1,283,065)
NET ASSETS AVAILABLE FOR
BENEFITS - BEGINNING OF YEAR - - - 7,319,203 50,883 13,154,101
-------------------------------------------------------------------------
NET ASSETS AVAILABLE
FOR BENEFITS - END OF YEAR $8,438,376 $20,107,820 $14,181,718 $5,329,959 $ 47,109 $11,871,036
=========================================================================
<FN>
SEE NOTES TO FINANCIAL STATEMENTS
</FN>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
THRIFT AND TAX-DEFERRED SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS
AVAILABLE FOR BENEFITS
For the Year Ended December 31, 1995
(Supplemental Information by Fund)
Equities Fixed Enterprise
Growth Balanced Income Common Stock
Total Fund A Fund B Fund C Fund D
--------------------------------------------------------------------
ADDITIONS
Participant Deposits $ 27,430,459 $ 2,636,045 $ 1,259,883 $ 13,440,286 $ 3,514,341
Employers Contributions 8,586,992 798,319 386,678 4,278,454 1,162,496
Interfund Transfers - net - 5,039,266 1,992,320 (2,391,755) (11,873,357)
--------------------------------------------------------------------
Total Deposits and Contributions 36,017,451 8,473,630 3,638,881 15,326,985 (7,196,520)
--------------------------------------------------------------------
Income
Interest 15,238,679 - - 15,198,811 29,144
Dividends 11,438,768 3,294,388 911,623 - 4,246,390
Loan Interest Income - 67,557 36,663 466,996 130,067
--------------------------------------------------------------------
Total Income 26,677,447 3,361,945 948,286 15,665,807 4,405,601
--------------------------------------------------------------------
Appreciation(Depreciation) of Investments 24,045,742 (854,855) 950,542 43,710 8,121,182
--------------------------------------------------------------------
Total Additions 86,740,640 10,980,720 5,537,709 31,036,502 5,330,263
--------------------------------------------------------------------
DEDUCTIONS
Withdrawals 27,714,601 712,581 566,824 18,712,599 3,457,371
Dividends Paid 544,112 - - - -
Forfeitures 100,431 21,072 6,704 40,972 9,561
Transfer to/(from) PSE&G Company
Employee Savings Plan 469,847 4,661 (41,453) 269,130 243,817
--------------------------------------------------------------------
Total Deductions 28,828,991 738,314 532,075 19,022,701 3,710,749
--------------------------------------------------------------------
INCREASE (DECREASE) IN NET
ASSETS AVAILABLE FOR BENEFITS 57,911,649 10,242,406 5,005,634 12,013,801 1,619,514
NET ASSETS AVAILABLE FOR
BENEFITS - BEGINNING OF YEAR 370,478,075 13,120,714 7,093,846 219,675,259 56,600,874
--------------------------------------------------------------------
NET ASSETS AVAILABLE
FOR BENEFITS - END OF YEAR $428,389,724 $23,363,120 $12,099,480 $231,689,060 $58,220,388
====================================================================
<FN>
SEE NOTES TO FINANCIAL STATEMENTS
</FN>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
THRIFT AND TAX-DEFERRED SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS
AVAILABLE FOR BENEFITS
For the Year Ended December 31, 1995
(Supplemental Information by Fund (Continued))
Stock Index Utilities Government T.Rowe Price
Equities Equities Securities Internat.Stock
Fund E Fund F Fund G Fund H ESOP Fund
--------------------------------------------------------------------------------
ADDITIONS
Participant Deposits $ 3,638,339 $ 920,075 $ 565,616 $ 1,455,874 $ -
Employers Contributions 1,092,008 291,584 168,475 408,978 -
Interfund Transfers - net 5,829,324 3,135,243 (307,337) (584,566) (430,315)
--------------------------------------------------------------------------------
Total Deposits and Contributions 10,559,671 4,346,902 426,754 1,280,286 (430,315)
--------------------------------------------------------------------------------
Income
Interest - - - 163 8
Dividends 1,232,411 527,187 345,580 337,076 544,113
Loan Interest Income 99,598 28,435 13,927 37,783 -
--------------------------------------------------------------------------------
Total Income 1,332,009 555,622 359,507 375,022 544,121
--------------------------------------------------------------------------------
Appreciation(Depreciation) of Investments 11,453,890 1,757,616 679,124 746,505 1,053,740
--------------------------------------------------------------------------------
Total Additions 23,345,570 6,660,140 1,465,385 2,401,813 1,167,546
--------------------------------------------------------------------------------
DEDUCTIONS
Withdrawals 2,273,899 653,635 276,340 823,621 536,937
Dividends Paid - - - - 544,112
Forfeitures 13,454 4,296 1,691 2,681 -
Transfer to/(from) PSE&G Company
Employee Savings Plan (27,346) (7,698) (16,339) (16,048) (173)
--------------------------------------------------------------------------------
Total Deductions 2,260,007 650,233 261,692 810,254 1,080,876
--------------------------------------------------------------------------------
INCREASE (DECREASE) IN NET
ASSETS AVAILABLE FOR BENEFITS 21,085,563 6,009,907 1,203,693 1,591,559 86,670
NET ASSETS AVAILABLE FOR
BENEFITS - BEGINNING OF YEAR 31,422,135 6,516,488 5,342,573 9,321,571 7,232,533
--------------------------------------------------------------------------------
NET ASSETS AVAILABLE
FOR BENEFITS - END OF YEAR $ 52,507,698 $12,526,395 $ 6,546,266 $ 10,913,130 $ 7,319,203
================================================================================
<FN>
SEE NOTES TO FINANCIAL STATEMENTS
</FN>
PUBLIC SERVICE ELECTRIC AND GAS COMPANY
THRIFT AND TAX-DEFERRED SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS
AVAILABLE FOR BENEFITS
For the Year Ended December 31, 1995
(Supplemental Information by Fund (Concluded))
Holding Trust
Account Loan Fund
---------------------------
ADDITIONS
Participant Deposits $ - $ -
Employers Contributions - -
Interfund Transfers - net - (408,823)
---------------------------
Total Deposits and Contributions - (408,823)
---------------------------
Income
Interest 10,553 -
Dividends - -
Loan Interest Income - (881,026)
---------------------------
Total Income 10,553 (881,026)
---------------------------
Appreciation(Depreciation) of Investments 59,997 34,291
---------------------------
Total Additions 70,550 (1,255,558)
---------------------------
DEDUCTIONS
Withdrawals 30,685 (329,891)
Dividends Paid - -
Forfeitures - -
Transfer to/(from) PSE&G Company
Employee Savings Plan - 61,296
---------------------------
Total Deductions 30,685 (268,595)
---------------------------
INCREASE (DECREASE) IN NET
ASSETS AVAILABLE FOR BENEFITS 39,865 (986,963)
NET ASSETS AVAILABLE FOR
BENEFITS - BEGINNING OF YEAR 11,018 14,141,064
---------------------------
NET ASSETS AVAILABLE
FOR BENEFITS - END OF YEAR $ 50,883 $13,154,101
===========================
<FN>
SEE NOTES TO FINANCIAL STATEMENTS
</FN>
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 PSE&G Thrift and Tax-Deferred Savings Plan (Plan) to
encourage thrift and savings by eligible employees (Eligible Employees). It was
first offered to Eligible Employees in 1981. Effective January 1, 1996, the
Trust that held the Plan assets became the PSE&G Master Employee Benefit Plan
Trust, (Master Trust), a Master Trust covering this Plan and the PSE&G Employee
Savings Plan (Savings Plan). (See Note 4. Investment in Master Trust.) The Plan
was last amended December 16, 1996, effective December 16, 1996, except for
changes listed below, which are effective as of January 1, 1997. The Plan
amendments made during 1996 provide the following, effective October 1, 1996:
Equities Growth Fund A, Balanced Fund B, and Utilities Equities Fund F were
discontinued; Mid/Small Company Stock Fund, Conservative Pre-Mix Portfolio,
Moderate Pre-Mix Portfolio, and Aggressive Pre-Mix Portfolio were added; Fund C
was renamed Stable Value Fund rather than Fixed Income Fund, Fund E was renamed
Large Company Stock Index Fund rather than Stock Index Equities Fund, and Fund G
was renamed Intermediate Government Securities Fund rather than Government
Securities Fund. Additionally, the Plan merged with U.S. Energy Partners' 401(k)
Plan. The Plan accepted balances from U.S. Energy Partners' Plan with graded
vesting for its employer match. Participation with respect to the U.S. Energy
Partners' accounts became effective December 16, 1996. An employee may
participate in the Plan from the date of hire. Matching Company Contributions
begin when an employee has completed one Year of Service. Any Employee who, at
the time he/she becomes employed by the Company, is a participant in the
Employee Savings Plan, shall automatically be enrolled in the Plan and all
balances in the Employee Savings Plan shall be transferred to the Plan and all
contribution and investment elections in effect for the Employee Savings Plan
shall remain in effect. Participation in the Plan is entirely voluntary, except
with respect to those employees who participated in the Employee Stock Ownership
Plan (ESOP) Fund as a result of their participation in the PSE&G Tax Reduction
Act Employee Stock Ownership Plan (TRASOP) and/or the PSE&G Payroll-Based
Employee Stock Ownership Plan (PAYSOP), which plans were merged into this Plan
in 1988. Eligible Employees are those employees not covered by a collective
bargaining agreement and who were hired by PSE&G or any affiliate of PSE&G
participating in the Plan (together hereafter each called an "Employer" or
collectively "Employers"). Certain Eligible Employees may also elect to have a
distribution from another qualified corporate plan contributed as a rollover
contribution with the approval of the Employee Benefits Committee of PSE&G
(Committee), the Plan Administrator.
The following changes were effective January 1, 1997:
1. to allow Basic Deposits in any integral multiple of 1% of Compensation to a
total of 8%, rather than 6%;
2. to allow Supplemental Deposits in any integral multiple of 1% of Compensation
to a total of 17%, rather than 19%;
3. all administrative expenses as well as taxes and brokerage costs will be
deducted from the Trust Fund, rather than paid directly by the Company and
its Participating Affiliates;
Under the Plan, each participating Employee (Participant) may elect to make
basic deposits to Investment Funds of such Participant's choosing within the
Thrift Account Fund of 1% - 8% of his/her compensation (Basic Deposits), and
his/her respective Employer will contribute an amount equal to 50% thereof,
subject to certain exceptions and limitations (Employer Contributions). Employer
Contributions with respect to Basic Deposits in excess of 6% of compensation are
made in shares of the Common Stock of Public Service Enterprise Group
Incorporated (Enterprise), the parent of the Company, and are not available for
transfer to any other Fund or withdrawal from the Plan prior to the
Participant's termination of employment. In addition, a Participant may elect to
make supplemental deposits to such Funds in increments of 1% of Compensation up
NOTES TO FINANCIAL STATEMENTS - (Continued)
to an additional 17% of Compensation (Supplemental Deposits), subject to
certain limitations, without any corresponding matching Employer Contribution. A
Participant may designate such Basic and/or Supplemental Deposits as Nondeferred
(post-income tax contributions) or Deferred (pre-income tax contributions).
Also, 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 Thrift
Account may have to be limited to less than 25% 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 Thrift Account Deferred
Deposits is reduced, then all Deferred Deposits in excess of such percentage
will automatically be treated as Nondeferred Deposits. This will result in
taxable income to the affected Participants for Deferred Deposits in excess of
any limit so established. The Committee will attempt to assure that any such
limitation will apply only to future contributions, but it is possible that, in
order to meet requirements of the IRC, the limitation will, in some
circumstances, have to be applied retroactively. Deferred Deposits may not
generally be withdrawn until age 59-1/2. Nondeferred Deposits, on the other
hand, may be withdrawn at any time subject to certain penalties and
restrictions.
Thrift Account Deposits are made through payroll deductions by the Participant's
Employer, rollover contributions from other qualified plans and Additional Lump
Sum Deposits. Deposits by Participants and contributions by their respective
Employers are transferred to a Trustee and separately held in the Plan's Thrift
Account Fund of the Trust Fund for investment and other transactions, as
directed by Participants. Participants are entitled to choose which funds to
invest Deposits and Employer Contributions in from among the Investment Funds
offered under the Plan.
Bankers Trust Company is the Trustee of the Master Trust established pursuant to
the Plan.
Loan Provisions
The Trustee may, subject to the approval of PSE&G's Director, Performance and
Rewards, lend a Participant who is employed by an Employer an amount up to 50%
of the value of the vested portion of such Participant's Thrift Account and ESOP
Fund, but no more than the aggregate value of such Participant's Thrift Account
or $ 50,000, whichever is less. Any Participant loan must be for a principal
amount of $ 1,000 or more and no Participant may have more than two loans
outstanding at any time. All loans, including interest thereon, must be repaid
by payroll deductions in equal monthly installments over a period of 12 to 60
months as selected by the Participant. However, a Participant may prepay any
such loan in full or in part in a lump sum in accordance with such rules as 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 Thrift Account and repayments of principal of any loan
together with interest thereon, are invested in the Thrift Account Investment
Funds of the Plan in accordance with the Participant's then-current investment
direction for Deposits and Employer Contributions.
Each loan bears interest at a rate fixed from time to time by the Committee
taking into consideration the then-current interest rates being charged. The
rate of interest applicable to any loan at its inception remains in effect for
the duration of such loan. During 1996, the rate of interest on loans granted to
Participants, by quarter and starting with the first quarter, was 8-1/2%,
8-1/4%, 8-1/4%, and 8-1/4%. (See Note 2. SIGNIFICANT ACCOUNTING POLICIES -
Loans.)
NOTES TO FINANCIAL STATEMENTS - (Continued)
2. SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting
The financial statements of the Plan have been prepared in accordance with
generally accepted accounting principles.
Use of Estimates
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
Dividends and Interest
Dividends, interest, and other income attributable to each Investment Fund of
the Plan are reinvested in that Investment Fund to the extent not used to pay
direct expenses of that Fund. (See Expenses of Plan, below.) All Deposits and
Employer Contributions in the Stable Value Fund C are invested in either
traditional Guaranteed Investment Contracts (traditional GICs) issued by
insurance companies, or Benefit Responsive Agreements (Synthetic GICs) which are
similar to traditional GICs in terms of their ability to preserve principal and
provide a stable rate of return. Synthetic GICs are different in that they are
backed or secured by a separate portfolio of high-quality fixed income
securities that are directly owned by the Fund. The portfolio is wrapped by a
"book value wrapper", usually a financial institution other than the manager of
the Synthetic GIC, which provides a crediting rate and which guarantees that
benefit repayments will be made at book value. Deposits and Employer
Contributions earn interest at the composite rate of all GICs in which the
assets of such fund are then invested. Such rate varies as such Traditional and
Synthetic GICs mature or are entered into, and as Deposits and Employer
Contributions are made to and withdrawn from such contracts. Under the contracts
in effect during 1996, the composite rate of interest earned by such assets so
invested was not less than 6.73%. ESOP Fund Participants receive quarterly
payments directly from the Trustee equal to the dividends paid to the Trustee on
the shares of Enterprise Common Stock held for their ESOP Fund.
Reclassifications
Certain reclassifications of prior year data have been made to conform with the
current presentation.
Valuation of Investments
Investments of Equities Growth Fund A, Balanced Fund B, Enterprise Common Stock
Fund D, Large Company Stock Index Fund E, Utilities Equities Fund F,
Intermediate 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 value of Stable Value Fund C is based on the contract value
of all GICs in which the assets of the fund are invested. The contracts are
included in the financial statements at contract value, which approximates fair
value. Temporary investments are valued at cost which approximates fair market
value. Securities transactions are accounted for on the trade date.
The Plan's financial statements have been prepared in accordance with the
financial reporting requirements of the Employee Retirement Income Security Act
of 1974, as amended (ERISA), as permitted by 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
NOTES TO FINANCIAL STATEMENTS - (Continued)
(DOL) Rules and Regulations for Reporting and Disclosure. The adjusted cost is
the fair value of the security at the beginning of the Plan year, or cost if
acquired since that date. Unrealized gains and losses on securities held for
investment are computed on the basis of the change in fair value between the
beginning and end of the Plan year.
Expenses of Plan
Effective January 1, 1997, all expenses incurred with the administration of the
Plan, including taxes and brokerage costs, will be deducted from the Trust Fund.
However, in 1996 and 1995, 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 and
its Participating Affiliates.
The assets of Common Stock Fund D and 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. 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 NY Stock
Exchange. In such case, no brokerage commissions are charged on the transaction.
Otherwise, 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
transfer taxes are paid by the Trust Fund.
Loans
A loan to a Participant is considered an investment of such Participant's Thrift
Account and the principal amount of the loan is treated as a separate investment
within the various sub-accounts of the Participant's Thrift Account. Repayments
of the principal amount of the loan are credited to each such sub-account, and
repayments of principal along with any accrued interest thereon are invested in
the 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 Thrift Account in the following
order:
(a) Deferred Deposits
(b) Unmatured Vested Employer Contributions
(c) Matured Vested Employer Contributions
(d) Rollover Contributions
(e) Unmatured Post-1986 Nondeferred Deposits
(f) Matured Post-1986 Nondeferred Deposits
(g) Pre-1987 Nondeferred Deposits
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 Thrift Account
Participants are permitted to transfer all, but not less than all, shares from
their ESOP Funds to their Thrift 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 Thrift Account Funds designated by the Participant. The cash
value of each share of Enterprise Common Stock 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.
NOTES TO FINANCIAL STATEMENTS - (Continued)
Holding Account
The Holding Account is a vehicle to record the transactions from either one fund
to another fund or to an outside source. Daily balances which remain in the
account are invested in temporary cash accounts until disbursement. Activity
within the Holding Account includes inflows and outflows of cash related to fund
transfers, employee and employer contributions, withdrawals, receipts of
dividends and interest, benefit payments and loan transactions.
Vesting
Employer Contributions to a Participant's Thrift Account are immediately vested
upon a Participant's completion of five years of service with the Employer, or
when a Participant is eligible for retirement, is disabled, laid off or dies. A
Participant will become vested in the value of his or her U.S. Energy Partners
Employer Contribution Subaccount according to the following schedule:
Years of Service Vested Percentage
- ---------------- -----------------
Less than one 0%
One 20%
Two 40%
Three 60%
Four 80%
Five or More 100%
All amounts credited to a Participant's ESOP Fund are fully vested.
Penalties Upon Withdrawal
If a Participant withdraws vested Employer Contributions and/or Deposits before
they have been in the Plan for twenty-four months, such Participant 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's Record Keeper. Nondeferred Deposits may be withdrawn
at any time but certain penalties may apply. Deferred Deposits may not be
withdrawn during employment prior to age 59-1/2 except for reasons of
extraordinary financial hardship and to the extent permitted by the IRC.
Distributions to Participants of approved hardship withdrawals are made as soon
as practicable after such approval.
Benefits Payable
As of December 31, 1996 and 1995, the net assets available for benefits included
benefits due to Participants who elected to withdraw from the Plan in the amount
of $700,450 and $365,707, respectively. Such amounts are not reflected as
liabilities in the financial statements of the Plan.
3. INVESTMENTS
The financial statements of the Plan include the following:
a. Thrift Account Investment Funds
(1) Effective October, 1996, the Equities Growth Fund A was
discontinued. Prior to that date, the assets of
Equities Growth Fund A were invested in the capital
stock of the Twentieth Century Investors Inc. Growth
Fund (the "Twentieth Century Growth Fund"), a no-load,
open-ended mutual fund. The prospectus for the
Twentieth Century Growth Fund indicated that such fund
invests primarily in the common stock of companies
considered by its investment manager to have above
average potential for capital appreciation.
NOTES TO FINANCIAL STATEMENTS - (Continued)
(2) Effective October, 1996, the Balanced Fund B was
discontinued. Prior to that date, the assets of
Balanced Fund B were invested in the capital stock of
Phoenix Balanced Fund, a no-load, open-ended mutual
fund. The prospectus for the Phoenix Balanced Fund
indicated 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.
(3) The assets of Stable Value Fund C are invested in
GICs and similar investment instruments issued by
insurance companies or other financial institutions
which contractually provide for a guarantee of
principal and interest for the respective contract
periods. All contract values approximate fair values.
The following Traditional GICs are continuing in
effect:
(i) A four and one half year contract expiring June
30, 1997 and two five year contracts expiring
December 31, 1997 and December 31 1998,
respectively, with Provident National Assurance
Company, effective interest rates of 6.67% and
6.81%, and 5.85% respectively, contract values
of $19,420,500, $24,478,147, and $18,866,187,
respectively;
(ii) A five year and a four and one-half year
contract with Metropolitan Life Insurance
Company, expiring June 30, 1998 and December
31, 1999, respectively, effective interest
rates of 5.70% and 8.17%, respectively,
contract values of $17,537,177 and $13,779,635,
respectively;
(iii) A five year contract with Allstate Life
Insurance Company, expiring June 30, 1998,
effective interest rate of 6.00%, contract
value of $18,371,532;
(iv) A five year contract with the Principal Mutual
Life Insurance Company, expiring on December
31, 1999, effective interest rate of 8.15%,
contract value of $15,198,841;
(v) A four and one-half year contract with
Transamerica Occidental Life Insurance Company,
expiring January 1, 1997, and effective
interest rate of 6.72%, contract value of
$7,535,772;
(vi) A five year contract with First Allmerica
Financial Life Insurance Company, formerly with
State Mutual Life Insurance Company, expiring
January 4, 1999, effective interest rate of
5.66%, contract value of $18,864,933; and
(vii) A five year contract with New York Life
Insurance Company, expiring June 30, 1999,
effective interest rate of 7.07%, contract
value of $31,314,213.
The following Synthetic GIC is continuing in effect:
An open-ended contract with J.P. Morgan as the book
value wrapper and Pacific Investment Management
Company managing the underlying portfolio providing an
effective credit rate, as of December 31, 1996, of
7.15% and a contract value of $35,580,299. The credit
rate for the Synthetic GIC effective January 1, 1997
through March 31, 1997 was 7.22%.
NOTES TO FINANCIAL STATEMENTS - (Continued)
(4) The assets of Enterprise Common Stock Fund D are
invested by the Trustee in Enterprise Common Stock.
(5) The assets of Large Company Stock Index Fund E are
invested by the Trustee in Bankers Trust
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 Index.
(6) Effective October, 1996, the Utilities Equities Fund
F was discontinued. Prior to that date, the assets of
Utilities Equities Fund F were invested in the
capital stock of Fidelity Utilities Income Fund (the
"Fidelity Utilities Fund"), a no-load, open-ended
mutual fund. The prospectus for the Fidelity
Utilities Fund indicated 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 Intermediate Government Securities Fund
G are invested in the capital stock of Voyageur U.S.
Government Securities Fund (the "Voyageur U.S.
Government Securities Fund"), an open-end diversified
mutual fund. The prospectus of the Voyageur U.S.
Government Securities Fund indicates that such fund
invests primarily in U.S. Treasury bills, notes,
bonds and other obligations issued or unconditionally
guaranteed by the U.S. Government, or otherwise
backed by the full faith and credit of the U.S.
Government, and repurchase agreements fully secured
by such obligations.
(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 mutual fund. The
prospectus for the T. Rowe Price International Stock
Fund indicates that such fund invests primarily in
common stocks of established, non-U.S. companies.
(9) The assets of Mid/Small Company Stock Fund, a new
investment option in 1996, are invested in the Putnam
Vista Fund, an open-ended, diversified management
investment company mutual fund. The prospectus for
the Putnam Vista Fund indicates that such fund
invests in a diversified portfolio of common stocks
which may include widely-traded common stocks of
larger companies as well as common stocks of smaller,
less well-known companies.
(10) The assets of the Conservative Pre-Mix Portfolio, a
new investment option in 1996, are invested in
specific percentages within a mix of five existing
funds: 40% Stable Value, 20% Intermediate Government
Securities, 20% Large Company Stock Index, 10%
International Stock, and 10% Mid/Small Company Stock.
Every quarter the Trustee re-aligns this portfolio to
match its conservative (risk and return) investment
strategy of 60% in bonds and 40% in stocks.
(11) The assets of the Moderate Pre-Mix Portfolio, a new
investment option in 1996, are invested in specific
percentages within a mix of five existing funds: 25%
Large Company Stock Index, 20% Stable Value, 20%
International Stock, 20% Intermediate Government
Securities, and 15% Mid/Small Company Stock. Every
quarter the trustee re-aligns this portfolio to match
its moderate (risk and return) investment strategy of
60% in stocks and 40% in bonds.
(12) The assets of the Aggressive Pre-Mix Portfolio, a new
investment option in 1996, are invested in specific
percentages within a mix of four existing funds: 30%
Large Company Stock Index, 25% International Stock,
25% Mid/Small Company Stock, and 20% Intermediate
Government Securities. Every quarter the Trustee
re-aligns this portfolio to match its aggressive
(risk and return) investment strategy of 80% in
stocks and 20% in bonds.
b. ESOP Fund
Shares of 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 non-bargaining
unit portions of PSE&G's former TRASOP and PAYSOP. No
additional contributions in or transfers into the ESOP Fund
are presently permitted or were allowed during 1996.
NOTES TO FINANCIAL STATEMENTS - (Continued)
c. PARTICIPANTS
Participants
As of December 31,
------------------
1996 1995
---- ----
Total Plan Participants 6,156 6,116
Participants by Fund
Equities Growth Fund A (1) -- 1,825
Balanced Fund B (1) -- 1,177
Stable Value Fund C 3,914 4,324
Enterprise Common Stock Fund D 2,099 2,672
Large Company Stock Index Fund E 2,622 2,407
Utilities Equities Fund F (1) -- 1,127
Interm. Government Securities Fund G 749 832
International Stock Fund H 1,495 936
Mid/Small Company Stock Fund (2) 1,091 --
Conservative Pre-Mix Portfolio (2) 435 --
Moderate Pre-Mix Portfolio (2) 930 --
Aggressive Pre-Mix Portfolio (2) 1,045 --
ESOP Fund 559 674
- ---------------------------------------
(1) Fund discontinued in 1996
(2) New Investment Fund in 1996
4. INVESTMENT IN MASTER TRUST
Effective January 1, 1996, the Plan's investments are included in the Master
Trust which was established for the investment of assets of the Plan and the
Savings Plan. Accordingly, a ratio is used to separate the Thrift Plan balances
from the Savings Plan balances based on the Statement of Net Assets Available
for Plan Benefits. The ratio is calculated by dividing individual fund totals
from one Plan by the Master Trust totals. Each percentage has been carried out
to the eighth decimal. As of December 31, 1996, the Plan's interest in the net
assets of the Master Trust was approximately 67%.
The following table presents the fair values of investments for the Master
Trust.
NOTES TO FINANCIAL STATEMENTS - (Continued)
December 31, 1996
-----------------
Investments at fair value:
Participant Loans $ 22,451,539
Cash and Cash equivalents 41,413,758
Common Stock of Public Service Enterprise Group 75,274,227
Mutual Funds 218,696,575
Guaranteed Insurance Contracts 308,079,794
-------------
$ 665,915,893
=============
Investment income for the Master Trust is as follows:
Net appreciation in fair value of Mutual Funds $ 30,374,351
Net depreciation in fair value of Common Stock
of Enterprise (11,569,069)
Interest from Mutual Funds 45,265
Interest from Common Stock of Enterprise Funds 154,745
Interest from Guaranteed Insurance Contracts 20,845,795
Dividends from Mutual Funds 2,148,761
Dividends from Common Stock of Enterprise 6,676,501
-------------
$ 48,676,349
=============
5. UNIT VALUE INFORMATION - THRIFT ACCOUNT INVESTMENT FUNDS
Unit values of the Investment Funds are 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 Thrift Account at the end of each
business day by dividing Deposits made by, or on behalf of, such Participant for
such business day and the related Employer Contributions, if any, together with
repayment of the principal amount of any loan to the Participant's Thrift
Account including interest earned thereon 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.
NOTES TO FINANCIAL STATEMENTS -(Continued)
The unit information of investments by Investment Fund as of the last business
day of each year is as follows:
Unit Value
Investment Fund Year (Dollars) Number of Units
- ---------------- ---- ----------- ---------------
Equities Growth Fund A (1) 1996 10.000000 ---
1995 19.390000 1,204,889.170
Equities Fund B (1) 1996 10.000000 ---
1995 16.800000 720,054.345
Stable Value Fund C 1996 12.154370 19,100,248.073
1995 11.387117 19,941,127.241
Enterprise Common Stock Fund D 1996 9.916231 4,264,794.978
1995 11.708390 4,951,969.229
Large Company Stock Index Fund E 1996 11.659470 6,461,508.254
1995 13.970000 3,758,506.872
Utilities Equities Fund F (1) 1996 10.000000 ---
1995 16.160000 775,015.285
Intermediate Government Securities
Fund G 1996 10.507339 514,736.944
1995 10.780339 606,271.287
International Stock Fund H 1996 10.966759 1,798,940.875
1995 12.230000 892,322.567
Mid/Small Company Stock Fund (2) 1996 9.984863 1,539,071.772
Conservative Pre-Mix Portfolio (2) 1996 10.316256 817,968.831
Moderate Pre-Mix Portfolio (2) 1996 10.369822 1,939,070.825
Aggressive Pre-Mix Portfolio (2) 1996 10.399420 1,364,886.881
- -----------------------------------
(1) Investment Fund discontinued in 1996
(2) New Investment Fund in 1996
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
the 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.
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 1996 $27.250 195,947
1995 $30.625 240,441
NOTES TO FINANCIAL STATEMENTS - (Concluded)
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 non-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,
dated December 29, 1995, was obtained from the Internal Revenue Service.
Participants are not taxed on Deferred Deposits, Employer Contributions or on
the earnings credited to their Thrift Account Fund, until distribution of such
Thrift Account Fund.
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.
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
Thrift and Tax-Deferred Savings Plan
-------------------------------------------------------
(Name of Plan)
By M. PETER MELLETT
---------------------------------------
M. PETER MELLETT
Chairman of the Employee
Benefits Committee
Date: June 30, 1997
EXHIBIT INDEX
Exhibit Number
- --------------
1 Public Service Electric and Gas Company Thrift
and Tax-Deferred Savings Plan, as amended as of
December 16, 1996, and effective December 16,
1996.
2 Independent Auditors' Consent.