SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________________________________________________________
FORM 11-K
FOR ANNUAL REPORTS OF EMPLOYEE STOCK PURCHASE, SAVINGS
AND SIMILAR PLANS PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
_________________________________________________________________
(Mark one)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 [Fee Required]
FOR FISCAL YEAR ENDED DECEMBER 31, 1994
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [No fee required]
For the transition period from ____________ to ____________
_________________________________________________________________
COMMISSION FILE NUMBER 0-17605
A. Full title of the plan and the address of the plan, if
different from that of the issuer named below:
YANKEE ENERGY SYSTEM, INC.
401(k) EMPLOYEE STOCK OWNERSHIP PLAN
B. Name of issuer of the securities held pursuant to the plan
and the address of its principal executive office:
YANKEE ENERGY SYSTEM, INC.
599 Research Parkway
Meriden, CT 06450
YANKEE ENERGY SYSTEM, INC.
401(k) EMPLOYEE STOCK OWNERSHIP PLAN
TABLE OF CONTENTS
Page
Report of Independent Public Accountants 1
Statements of Net Assets Available for Plan
Benefits as of December 31, 1994 and 1993 2
Statements of Changes in Net Assets Available
for Plan Benefits for the Years Ended
December 31, 1994 and 1993 4
Notes to Financial Statements 6
Item 27a - Schedule of Assets Held for Investment Purposes
as of December 31, 1994 12
Item 27d - Schedule of Reportable Transactions for the
Year Ended December 31, 1994 13
All schedules, except as set forth above,
are omitted as not applicable or not required.
[Letterhead of Arthur Andersen & Co. appears here}
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Plan Administrator of the
Yankee Energy System, Inc.
401(k) Employee Stock Ownership Plan:
We have audited the accompanying statements of net assets
available for plan benefits including the schedule of assets held
for investment purposes of Yankee Energy System, Inc. 401(k)
Employee Stock Ownership Plan (the Plan) as of December 31, 1994
and 1993, and the related statements of changes in net assets
available for plan 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 the Plan's 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, the financial statements referred to above
present fairly, in all material respects, the net assets
available for plan benefits of the Plan as of December 31, 1994
and 1993, and the changes in net assets available for plan
benefits for the years then ended in conformity with generally
accepted accounting principles.
Our audits were performed for the purpose of forming an opinion
on the basic financial statements taken as a whole. The
supplemental schedules of reportable transactions and assets held
for investment purposes are presented for purposes 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. The Fund Information in the statement of net assets
available for benefits and the statement of changes in net assets
available for benefits is presented for purposes of additional
analysis rather than to present the net assets available for plan
benefits and changes in net assets available for plan beneifts of
each fund. The supplemental schedules and fund information have
been subjected to the auditing procedures applied in the audit of
the basic financial statements and, in our opinion, are fairly
stated in all material respects in relation to the basic
financial statements taken as a whole.
Arthur Andersen LLP
Hartford, Connecticut
May 12, 1995
-2-
YANKEE ENERGY SYSTEM, INC.
401(k) EMPLOYEE STOCK OWNERSHIP PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
AS OF DECEMBER 31, 1994
Fleet Employee
Stable Contribution
Asset Fund Fund
ASSETS:
Cash $ - $ 133
Short-term investments - -
Mutual funds - -
GIC Pooled Funds 8,141,375 -
Common stock - -
Employee contributions
receivable - 149,392
Accrued interest receivable 43,567 -
Accounts receivable - other 62,000 -
---------- ----------
Total assets 8,246,942 149,525
---------- ----------
LIABILITIES:
Note payable-long term - -
Note payable-current - -
Accounts payable 10,579 -
---------- ----------
Total liabilities 10,579 -
---------- ----------
NET ASSETS AVAILABLE FOR
PLAN BENEFITS $ 8,236,363 $ 149,525
=========== ==========
Employee
Stock Company Galaxy Equity
Match Fund Growth Fund
ASSETS:
Cash $ - $ 203
Short-term investments - 21,038
Mutual funds - 2,619,421
GIC Pooled Funds - -
Common stock 3,172,123 -
Employee contributions
receivable - -
Accrued interest receivable - -
Accounts receivable - other 32,246 -
------------ ----------
Total assets 3,204,369 2,640,662
------------ ----------
LIABILITIES:
Note payable-long term - -
Note payable-current - -
Accounts payable 5,389 -
------------ ----------
Total liabilities 5,389 -
------------ ----------
NET ASSETS AVAILABLE FOR
PLAN BENEFITS $3,198,980 $ 2,640,662
============ ==========
The accompanying notes are an integral part of these
financial statements.
Northeast
Utilities
Stock Russell Fixed
Fund Income Fund
ASSETS:
Cash $ 48,511 $ 146
Short-term investments - 25,000
Mutual funds - 898,174
GIC Pooled Funds - -
Common stock 3,007,400 -
Employee contributions
receivable - -
Accrued interest receivable - -
Accounts receivable - other 7,516 -
------------ ----------
Total assets 3,063,427 923,320
------------ ----------
LIABILITIES:
Note payable-long term - -
Note payable-current - -
Accounts payable 30,184 -
---------- ----------
Total liabilities 30,184 -
---------- ----------
NET ASSETS AVAILABLE FOR
PLAN BENEFITS $3,033,243 $ 923,320
========== ==========
YES Share
Russell 1000 Voluntary
Index Fund Fund
ASSETS:
Cash $ 111 $ 155
Short-term investments 22,203 25,518
Mutual funds 1,320,492 -
GIC Pooled Funds - -
Common stock - 1,347,326
Employee contributions
receivable - -
Accrued interest receivable - -
Accounts receivable - other - -
------------ ----------
Total assets 1,342,806 1,372,999
------------ ----------
LIABILITIES:
Note payable-long term - -
Note payable-current - -
Accounts payable - -
----------- ----------
Total liabilities - -
----------- ----------
NET ASSETS AVAILABLE FOR
PLAN BENEFITS $ 1,342,806 $1,372,999
============ ==========
Employer Stock Loan
Match Fund Fund
ASSETS:
Cash $ 15 $ 23
Short-term investments - 46,766
Mutual funds - -
GIC Pooled Funds - -
Common stock - 2,727,624
Employee contributions
receivable - -
Accrued interest receivable - -
Accounts receivable - other - -
------------ ----------
Total assets 15 2,774,413
------------ ----------
LIABILITIES:
Note payable-long term - 1,400,000
Note payable-current - 400,000
Accounts payable - -
----------- ---------
Total liabilities - $1,800,000
----------- ----------
NET ASSETS AVAILABLE FOR
PLAN BENEFITS $ 15 $ 974,413
============ ==========
The accompanying notes are an integral part of these
financial statements.
1994
Total
ASSETS:
Cash $ 49,297
Short-term investments 140,525
Mutual funds 4,838,087
GIC Pooled Funds 8,141,375
Common stock 10,254,473
Employee contributions
receivable 149,392
Accrued interest receivable 43,567
Accrued interest - other 101,762
------------
Total assets 23,718,478
------------
LIABILITIES:
Note payable-long term 1,400,000
Note payable-current 400,000
Accounts payable 46,152
------------
Total liabilities 1,846,152
------------
NET ASSETS AVAILABLE FOR
PLAN BENEFITS $21,872,326
===========
The accompanying notes are an integral part of these
financial statements.
-3-
YANKEE ENERGY SYSTEM, INC.
401(k) EMPLOYEE STOCK OWNERSHIP PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
AS OF DECEMBER 31, 1993
Employee
Fleet Stable Contribution
Asset Fund Fund
ASSETS:
Cash $ 1,109 $ 49
Short-term investments 3,436,493 31
Mutual funds - -
GIC Pooled Funds 6,130,127 -
Common stock - -
Employee contributions
receivable - 132,133
Accrued interest receivable 29,518 -
Accounts receivable - other - -
----------- ----------
Total assets 9,597,247 132,213
----------- ----------
LIABILITIES:
Note payable-long term - -
Note payable-current - -
Accounts payable 167,952 -
------------ ----------
Total liabilities 167,952 -
------------ ----------
NET ASSETS AVAILABLE FOR
PLAN BENEFITS $9,429,295 $ 132,213
============ ==========
The accompanying notes are an integral part of these
financial statements.
Stock Company Galaxy Equity
Match Fund Growth Fund
ASSETS:
Cash $ 237 $ 32,340
Short-term investments 246 23,931
Mutual funds - 2,635,627
GIC Pooled Funds - -
Common stock 3,157,467 -
Employee contributions
receivable - -
Accrued interest receivable - -
Accounts receivable - other - 140,000
------------ ----------
Total assets 3,157,950 2,831,898
------------ ----------
LIABILITIES:
Note payable-long term - -
Note payable-current - -
Accounts payable - -
------------ ----------
Total liabilities - -
------------ ----------
NET ASSETS AVAILABLE FOR
PLAN BENEFITS $ 3,157,950 $2,831,898
============ ==========
The accompanying notes are an integral part of these
financial statements.
Northeast
Utilities
Stock Employer
Fund Match Fund
ASSETS:
Cash $ 19 $ 6
Short-term investments 114,090 7
Mutual funds - -
GIC Pooled Funds - -
Common stock 3,993,006 -
Employee contributions
receivable - -
Accrued interest receivable - -
Accounts receivable - other 924,725 -
------------ ----------
Total assets 5,031,840 13
------------ ----------
LIABILITIES:
Note payable-long term - -
Note payable-current - -
Accounts payable 87,419 -
---------- ----------
Total liabilities 87,419 -
---------- ----------
NET ASSETS AVAILABLE FOR
PLAN BENEFITS $ 4,944,421 $ 13
=========== ==========
The accompanying notes are an integral part of these
financial statements.
Stock Loan
Fund 1993 Total
ASSETS:
Cash $ 14 $ 33,774
Short-term investments 52,533 3,627,331
Mutual funds - 2,635,627
GIC Pooled Funds - 6,130,127
Common stock 3,773,215 10,923,688
Employee contributions
receivable - 132,133
Accrued interest receivable - 29,518
Accounts receivable - other - 1,064,725
------------ ----------
Total assets 3,825,762 24,576,923
------------ ----------
LIABILITIES:
Note payable-long term 1,800,000 1,800,000
Note payable-current 400,000 400,000
Accounts payable - 255,371
------------ ----------
Total liabilities 2,200,000 2,455,371
------------ ----------
NET ASSETS AVAILABLE FOR
PLAN BENEFITS $ 1,625,762 $22,121,552
=========== ===========
The accompanying notes are an integral part of these
financial statements.
-4-
YANKEE ENERGY SYSTEM, INC.
401(k) EMPLOYEE STOCK OWNERSHIP PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1994
Employee
Fleet Stable Contribution
Asset Fund Fund
ADDITIONS:
Employee contributions
and rollovers $ 28,284 $1,567,735
Employer contributions - -
Interfund transfers in 922,510 -
Earnings -
Interest 472,810 975
Dividends - -
Reimbursement Income/Other - -
Realized gain (loss) 1,425,245 31
Unrealized gain (loss) (1,425,245) (31)
------------- ------------
Total additions 1,423,604 1,568,710
------------ ------------
DEDUCTIONS:
Interfund transfers out 1,804,831 1,551,398
Benefit payments 811,705 -
Interest expense - -
------------ ----------
Total deductions 2,616,536 1,551,398
------------ ----------
Net increase (decrease) in
net assets available for
plan benefits (1,192,932) 17,312
NET ASSETS AVAILABLE FOR PLAN
BENEFITS AT BEGINNING OF YEAR 9,429,295 132,213
------------ ----------
NET ASSETS AVAILABLE FOR PLAN
BENEFITS AT END OF YEAR $ 8,236,363 $ 149,525
=========== ==========
The accompanying notes are an integral part of these
financial statements.
Employee
Stock Company Galaxy Equity
Match Fund Growth Fund
ADDITIONS:
Employee contributions
and rollovers $ - $ 16,152
Employer contributions 252,171 -
Interfund transfers in 605,065 355,599
Earnings -
Interest 3,011 1,058
Dividends 147,827 84,259
Reimbursement Income/Other - 878
Realized gain (loss) (367,948) (49,786)
Unrealized gain (loss) 14,410 (19,099)
------------ -----------
Total additions 654,536 389,061
------------ -----------
DEDUCTIONS:
Interfund transfers out 400,000 287,477
Benefit payments 213,506 292,820
Interest expense - -
------------ ----------
Total deductions 613,506 580,297
------------ ----------
Net increase (decrease) in
net assets available for
plan benefits 41,030 (191,236)
NET ASSETS AVAILABLE FOR PLAN
BENEFITS AT BEGINNING OF YEAR 3,157,950 2,831,898
------------ -----------
NET ASSETS AVAILABLE FOR PLAN
BENEFITS AT END OF YEAR $ 3,198,980 $2,640,662
============ ===========
The accompanying notes are an integral part of these
financial statements.
Northeast
Utilities
Stock Russell Fixed
Fund Income Fund
ADDITIONS:
Employee contributions
and rollovers $ - $ 1,601
Employer contributions - -
Interfund transfers in 67 1,024,387
Earnings -
Interest 842 928
Dividends 255,163 -
Reimbursement Income/Other - -
Realized gain 632,074 -
Unrealized gain (loss) (1,099,696) (27,379)
------------ ----------
Total additions (211,550) 999,537
------------ ----------
DEDUCTIONS:
Interfund transfers out 1,205,268 71,630
Benefit payments 494,360 4,587
Interest expense - -
------------ ----------
Total deductions 1,699,628 76,217
------------ ----------
Net increase (decrease) in
net assets available for
plan benefits (1,911,178) 923,320
NET ASSETS AVAILABLE FOR PLAN
BENEFITS AT BEGINNING OF YEAR 4,944,421 -
------------ ----------
NET ASSETS AVAILABLE FOR PLAN
BENEFITS AT END OF YEAR $ 3,033,243 $ 923,320
============ ==========
The accompanying notes are an integral part of these
financial statements.
YES Share
Russell 1000 Voluntary
Index Fund Fund
ADDITIONS:
Employee contributions
and rollovers $ 8,670 $ 20,060
Employer contributions - -
Interfund transfers in 1,395,674 1,466,684
Earnings -
Interest 1,675 4,055
Dividends - 61,081
Reimbursement Income/Other - -
Realized gain - 6,166
Unrealized gain (loss) 9,748 (116,029)
------------ -----------
Total additions 1,415,767 1,442,017
------------ -----------
DEDUCTIONS:
Interfund transfers out 58,974 8,193
Benefit payments 13,987 60,825
Interest expense - -
------------ ----------
Total deductions 72,961 69,018
------------ ----------
Net increase (decrease) in
net assets available for
plan benefits 1,342,806 1,372,999
NET ASSETS AVAILABLE FOR PLAN
BENEFITS AT BEGINNING OF YEAR - -
------------ ----------
NET ASSETS AVAILABLE FOR PLAN
BENEFITS AT END OF YEAR $ 1,342,806 $1,372,999
============ ==========
The accompanying notes are an integral part of these
financial statements.
Employer Stock Loan
Match Fund Fund
ADDITIONS:
Employee contributions
and rollovers $ - $ -
Employer contributions 177,033 336,528
Interfund transfers in - 400,000
Earnings -
Interest 121 129
Dividends - 184,638
Reimbursement Income/Other - -
Realized gain 7 325,919
Unrealized gain (loss) (7) (1,051,358)
------------ -----------
Total additions 177,154 195,856
------------ -----------
DEDUCTIONS:
Interfund transfers out 177,152 605,063
Benefit payments - -
Interest expense - 242,142
------------ ----------
Total deductions 177,152 847,205
------------ ----------
Net increase (decrease) in
net assets available for
plan benefits 2 (651,349)
NET ASSETS AVAILABLE FOR
PLAN AT BEGINNING OF YEAR 13 1,625,762
------------ ----------
NET ASSETS AVAILABLE FOR
PLAN AT END OF YEAR $ 15 974,413
============ ==========
The accompanying notes are an integral part of these
financial statements.
1994 Total
ADDITIONS:
Employee contributions
and rollovers $ 1,642,502
Employer contributions 765,732
Interfund transfers in 6,169,986
Earnings -
Interest 485,604
Dividends 732,968
Reimbursement Income/Other 878
Realized gain 1,971,708
Unrealized gain (loss) (3,714,686)
------------
Total additions 8,054,692
------------
DEDUCTIONS:
Interfund transfers out 6,169,986
Benefit payments 1,891,790
Interest expense 242,142
------------
Total deductions 8,303,918
------------
Net increase (decrease) in
net assets available for
plan benefits (249,226)
NET ASSETS AVAILABLE FOR
PLAN AT BEGINNING OF YEAR 22,121,552
-------------
NET ASSETS AVAILABLE FOR
PLAN AT END OF YEAR $ 21,872,326
=============
The accompanying notes are an integral part of these
financial statements.
-5-
YANKEE ENERGY SYSTEM, INC.
401(k) EMPLOYEE STOCK OWNERSHIP PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1993
Employee
Fleet Stable Contribution
Asset Fund Fund
ADDITIONS:
Employee contributions
and rollovers $ 14,174 $1,420,083
Employer contributions - -
Interfund transfers in 1,215,155 -
Earnings -
Interest 580,020 279
Dividends - -
Realized gain (loss) (766,889) 40
Unrealized gain (loss) 766,889 (40)
------------ -----------
Total additions 1,809,349 1,420,362
------------ -----------
DEDUCTIONS:
Interfund transfers out 88,101 1,396,738
Benefit payments 518,305 -
Interest expense - -
------------ ----------
Total deductions 606,406 1,396,738
------------ ----------
Net increase (decrease) in
net assets available for
plan benefits 1,202,943 23,624
NET ASSETS AVAILABLE FOR PLAN
BENEFITS AT BEGINNING OF YEAR 8,226,352 108,589
------------ ----------
NET ASSETS AVAILABLE FOR PLAN
BENEFITS AT END OF YEAR $ 9,429,295 $ 132,213
============ ==========
The accompanying notes are an integral part of these
financial statements.
Stock Company Galaxy Equity
Match Fund Growth Fund
ADDITIONS:
Employee contributions
and rollovers $ - $ 11,957
Employer contributions 303,485 -
Interfund transfers in 685,043 575,013
Earnings -
Interest 1,536 851
Dividends 116,635 77,864
Realized gain (loss) (595,280) (349,299)
Unrealized gain (loss) 1,066,205 450,393
------------ -----------
Total additions 1,577,624 766,779
------------ -----------
DEDUCTIONS:
Interfund transfers out 400,000 -
Benefit payments 91,213 144,050
Interest expense - -
------------ ----------
Total deductions 491,213 144,050
------------ ----------
Net increase (decrease) in
net assets available for
plan benefits 1,086,411 $ 622,729
NET ASSETS AVAILABLE FOR PLAN
BENEFITS AT BEGINNING OF YEAR 2,071,539 2,209,169
------------ ----------
NET ASSETS AVAILABLE FOR PLAN
BENEFITS AT END OF YEAR $ 3,157,950 $2,831,898
============ ==========
The accompanying notes are an integral part of these
financial statements.
Northeast
Utilities
Stock Employer
Fund Match Fund
ADDITIONS:
Employee contributions
and rollovers $ - $ -
Employer contributions - 147,794
Interfund transfers in - -
Earnings -
Interest 52 37
Dividends 347,412 -
Realized gain 830,044 1
Unrealized gain (loss) (1,193,597) (1)
------------- -----------
Total additions (16,089) 147,831
------------ -----------
DEDUCTIONS:
Interfund transfers out 157,502 147,827
Benefit payments 182,935 -
Interest expense - -
----------- ----------
Total deductions 340,437 147,827
----------- ----------
Net increase (decrease) in
net assets available for
plan benefits (356,526) 4
NET ASSETS AVAILABLE FOR
PLAN AT BEGINNING OF YEAR 5,300,947 9
------------ ----------
NET ASSETS AVAILABLE FOR
PLAN AT END OF YEAR $ 4,944,421 $ 13
============ ==========
The accompanying notes are an integral part of these
financial statements.
Stock Loan
Fund 1993 Total
ADDITIONS:
Employee contributions
and rollovers $ - $1,446,214
Employer contributions 227,507 678,786
Interfund transfers in 400,000 2,875,211
Earnings -
Interest 85 582,860
Dividends 207,600 749,511
Realized gain 533,533 (347,850)
Unrealized gain (loss) 147,559 1,237,408
------------ -----------
Total additions 1,516,284 7,222,140
------------ -----------
DEDUCTIONS:
Interfund transfers out 685,043 2,875,211
Benefit payments - 936,503
Interest expense 284,239 284,239
------------ ----------
Total deductions 969,282 4,095,953
------------ ----------
Net increase (decrease) in
net assets available for
plan benefits 547,002 $3,126,187
NET ASSETS AVAILABLE FOR
PLAN AT BEGINNING OF YEAR 1,078,760 18,995,365
------------ ----------
NET ASSETS AVAILABLE FOR
PLAN AT END OF YEAR $ 1,625,762 $22,121,552
============ ===========
The accompanying notes are an integral part of these
financial statements.
-6-
[CAPTION]
YANKEE ENERGY SYSTEM, INC.
401(k) EMPLOYEE STOCK OWNERSHIP PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1994 AND 1993
1. Establishment of The Plan:
The Yankee Energy System, Inc. 401(k) Employee Stock Ownership
Plan (the Plan) was established and effective on July 1, 1989
(the effective date) following the divestiture of the gas
business of the Connecticut Light and Power Company (CL&P), a
wholly owned subsidiary of Northeast Utilities (NU) and the
related creation of Yankee Energy System, Inc. (YES). Each
transferred gas employee participating in the Northeast Utilities
Tax Reduction Act Employee Stock Ownership Plan (TRAESOP),
Payroll Based Employee Stock Ownership Plan (PAYSOP) or
Supplemental Retirement Savings Plan became a participant in the
Plan effective July 1, 1989. Participant account balances and
$7,203,056 in assets were transferred to the Plan on the
effective date. The assets were comprised of NU common stock and
cash.
2. Plan Description:
The following description of the Plan provides only general
information. Participants should refer to the Plan agreement for
a more complete description of the Plan's provisions.
The Plan is a 401(k) Employee Stock Ownership Plan established to
provide benefits to eligible employees. Participation in the
Plan is voluntary. Union-employees become eligible to
participate on the first day of the month following the
completion of one year of service. Non-union employees become
eligible to participate on the first day of the month following
the completion of six months of service.
The Plan consists of ten funds as follows:
Fleet Stable Asset Fund -
Available for conservative investment in fixed rate
investmentcontracts with a small balance in money market funds.
Employee Contribution Fund -
Holding account for employee contributions prior to
investment.
Employee Stock Company Match Fund -
Holding account for employer non-union matching
contribution.
Galaxy Equity Growth Fund -
Available for investment in mutual funds.
Russell Fixed Income Fund -
Available for conservative investment in bonds
throughout several sectors of the fixed income market.
Russell 1000 Index Fund -
Available for conservative investment in an index fund
representing a broader market than covered by the S&P 500 Index.
YES Share Voluntary fund -
Available for investment in Yankee Energy System, Inc.
Common Stock.
-7-
Northeast Utilities Stock Fund -
Account maintains Northeast Utilities stock belonging
to transferred CL&P and Northeast Utilities Service Company
(NUSCO) employees formerly participating in the NU Supplemental
Retirement Savings Plan.
Employer Match Fund -
Holding account for employer union matching
contribution.
Stock Loan Fund -
Account maintains unallocated Company shares acquired
with the proceeds of note payable.
Participants contribute between 1% and 10% of compensation
subject to limitations set forth by the Plan. Investment of
employee contributions in the various funds is at the employees'
discretion. YES matches 100% of non-union employee pre-tax
contributions each month up to 3% of compensation and 50% of
union employee pre-tax contributions each month up to 5% of
compensation.
Unless a participant elects otherwise, benefit distributions are
made in a lump sum not later than sixty days following the end of
the Plan year following the later of the participant's 65th
birthday, the 10th anniversary of the date on which participation
commenced or the termination of employment. In the event of the
death of a participant prior to distribution, benefits will be
paid to a designated beneficiary in a lump sum. Distribution
will commence not later than 90 days following the Plan year end
in which the participant attains age 70 and one half years.
Non-union employees become 100% vested upon commencing
participation in the Plan. Union employees shall at all times be
fully vested in employee contributions and will vest in the
employer contributions in accordance with the following schedule:
Years of Service Vesting %
1 20%
2 40%
3 60%
4 80%
5 or more 100%
The account balances of union employees, as of June 3, 1989,
formerly participating in the NU Supplemental Retirement Savings
Plan and NU TRAESOP and PAYSOP became fully vested on July 1,
1989.
Not withstanding the foregoing, union participants shall be fully
vested in employer contributions upon reaching age 65 or in the
event of death or total disability. Any union employee
forfeitures will be used to reduce future employer contributions.
-8-
3. Summary of Significant Accounting Policies:
Basis of accounting -
The accompanying financial statements of the Plan have been
prepared on the accrual basis of accounting. Negative cash
balances have been reclassified to accounts payable in the
accompanying financial statements.
Administrative Expenses -
Per section 19.09 of the Plan all administrative expenses of the
Plan are paid from the Plan assets unless paid by the Company.
Administrative expenses of approximately $52,000 and $37,000 were
paid by the Company in 1994 and 1993, respectively.
Valuation of Investments -
The Plan's investments are stated at fair value. Securities
traded on the national securities exchange are valued at the last
reported sales price on the last business day of the plan year.
Investments traded in the over-the-counter market and listed
securities for which no sale was reported on that date are valued
at the last reported bid price. Guaranteed investment contracts
are valued at contract value.
Transactions within all funds are executed by the Plan trustee.
The accompanying Schedule of Investments reflects valuations as
of December 31, 1994.
Reclassifications -
Certain prior year amounts have been classified to conform with
current year classifications.
-9-
4. Investments:
The fair market value of individual investments that represent 5%
or more of the Plan's total net assets as of December 31, 1994
and 1993 are as follows:
1994 1993
Yankee Energy System, Inc. common stock $ 7,247,073 $6,930,682
Northeast Utilities common stock 3,007,400 3,993,006
Mutual Funds-Galaxy Equity Growth Class H 2,619,421 2,635,627
GIC Pooled Funds 8,141,375 6,130,127
Fleet Short-term investment funds --- 3,627,331
Mutual Funds - Russell Frank Investment
Company 1000 Index 1,320,492 ---
During 1994, the Plan's investments depreciated in fair value by
$3,714,686, as follows:
Net Appreciation
(Depreciation)
in Fair Value
During Year
----------------
Year Ended December 31, 1994:
Fair value as determined by quoted market value:
Short-term investments $ (3,559,527)
Mutual funds (33,837)
GIC Pooled Funds 2,011,248
YES, Inc. Common Stock (1,146,964)
NU Common Stock (985,606)
------------
$(3,714,686)
During 1993, the Plan's investments appreciated in fair value by
$1,237,408, as follows:
Net Appreciation
(Depreciation)
in Fair Value
During Year
----------------
Year Ended December 31, 1993
Fair value as determined by quoted market value:
Short-term investments $ 3,046,488
Annuity contracts (2,900,619)
Mutual funds 426,756
GIC Pooled Funds 673,414
YES, Inc. Common Stock 1,299,052
NU Common Stock (1,307,683)
------------
$ 1,237,408
-10-
5. Note Payable:
The Plan has secured a $4,000,000 loan from a commercial bank to
Fleet Bank, N.A., the trustee, the proceeds of which were used to
buy YES common stock for the Plan. YES has guaranteed the loan.
The loan will be repaid over a ten year period ending July 1,
1999 at $400,000 per year plus interest at a rate of 10.38%.
Employer non-union matching contributions are used to make annual
principal payments. Interest is paid from the earnings of the
stock loan fund. As the loan is paid down, an equivalent amount
of YES stock, which serves as collateral, is released and
allocated to participants.
6. Tax Status:
The Plan has received a favorable letter of determination from
the Internal Revenue Service (IRS) stating that it qualifies as
tax exempt under Section 501(a) of the Internal Revenue Code.
The Plan has been amended since receiving the letter of
determination in order to comply with subsequent legislation.
The Company believes that the Plan continues to qualify and to
operate as designed.
7. Voting Rights:
Each participant is entitled to excercise voting rights
attributable to the shares allocated to his account and is
notified by the Trustee prior to the time that such rights are to
be exercised. The Trustee is not permitted to vote any shares
for which instructions have not been given by a participant. The
Trustee is required, however, to vote any unallocated shares on
behalf of the collective best interest of plan particpants and
beneficiaries.
8. Termination of the Plan:
YES may suspend, terminate, or completely discontinue
contributions under the Plan with respect to its employees
subject to the provisions of ERISA relating to plan terminations.
Upon termination or partial termination of the Plan, the rights
of all affected participants to their accounts to the date of
such termination shall be fully vested to the extent funded.
9. Reconciliation to Form 5500:
As of December 31, 1994 and 1993, the Plan had approximately
$135,010 and $194,158, respectively, of pending distributions to
participants who elected to withdraw from the operation and
earnings of the Plan. These amounts are recorded as a liability
in the Plan's Form 5500; however, these amounts are not recorded
as a liability in accordance with generally accepted accounting
principles.
-11-
The following table reconciles net assets available for benefits
per the financial statements to the Form 5500 as filed by the
Company for the year ended December 31, 1994:
Benefits Net Assets
Payable to Benefits Available for
Participants Paid Plan Benefits
------------ -------- -------------
Per financial statements $ - $1,891,790 $21,872,326
Accrued benefit payments 135,010 135,010 (135,010)
Reversal of 1993 accrual
for benefit payments - (194,158) -
---------- --------- -----------
Per Form 5500 $ 135,010 $1,832,642 $21,737,316
========== ========== ===========
-12-
YANKEE ENERGY SYSTEM, INC.
401(k) EMPLOYEE STOCK OWNERSHIP PLAN
ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
AS OF DECEMBER 31, 1994
1994 1994
Cost Market
*Yankee Energy System, Inc. common stock $ 6,068,494 $ 7,247,073
Northeast Utilities common stock 2,681,016 3,007,400
----------- -----------
Total common stock 8,749,510 10,254,473
----------- -----------
*Mutual funds - Galaxy
Equity Growth Class H 2,280,551 2,619,421
*GIC Pooled Funds 8,141,375 8,141,375
Mutual funds - Russell Frank
Investment 1000 Index 1,310,745 1,320,492
----------- -----------
Total investments $20,482,181 22,335,761
=========== ===========
* Indicates a party in interest.
The accompanying notes are an integral part of this
schedule.
-13-
YANKEE ENERGY SYSTEM, INC.
401(k) EMPLOYEE STOCK OWNERSHIP PLAN
ITEM 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1994
Purchases
----------------------------------
Number of
Transactions Cost
*Fleet Short-Term Investment Fund 308 $7,911,557
*Yankee Energy System, Inc.common stock 23 1,479,626
Mutual Funds - Russell Frank Investment
Company 1000 Index 9 1,310,745
*GIC Pooled Funds 21 2,892,424
* Indicates a party of interest.
Sales
----------------------------------
Number of
Transactions Cost
*Fleet Short-Term Investment Fund 256 $11,398,563
*Yankee Energy System, Inc. Common Stock - -
Mutual Funds - Russell Frank Investment
Company 1000 Index - -
*GIC Pooled Funds 8 651,225
* Indicates a party in interest
Sales
----------------------------------
Selling
Price Net Gain
*Fleet Short-Term Investment Fund $11,398,563 $ -
*Yankee Energy System, Inc. Common Stock - -
Mutual Funds - Russell Frank Investment
Company 1000 Index - -
*GIC Pooled Funds 651,225 -
* Indicates a party in interest
Reportable transactions include:
(1) Individual transactions in excess of 5% of the market value
of the Plan assets (as
measured at December 31, 1993).
(2) Series of transactions involving securities of the same
issue that, in the aggregate,
exceed 5% of the market value of the Plan assets (as measured at
December 31, 1993).
(3) Individual transaction or series of transactions with a
person with whom a
transaction in excess of 5% of the market value of the Plan
assets (as measured at December 31, 1993) was made.
The accompanying notes are an integral part of this
schedule.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Form 11-K has been signed below by the following
persons in the capacities indicated.
Date Title Signature
June 27, 1995 Chairman /s/Philip T. Ashton
---------------------
Philip T. Ashton
President &
Chief Executive Officer /s Branko Terzic
-------------------
Branko Terzic
June 27, 1995 Vice President and Chief /s/Michael E. Bielonko
Chief Financial Officer ---------------------
Michael E. Bielonko
June 27, 1995 Controller /s/Nicholas A. Rinaldi
-----------------------
Nicholas A. Rinaldi
June 27, 1995 Director /s/ Sanford Cloud, Jr.
----------------------
Sanford Cloud, Jr.
June 27, 1995 Director /s/ Eileen S. Kraus
-----------------------
Eileen S. Kraus
June 27, 1995 Director /s/Frederick M. Lowther
-----------------------
Frederick M. Lowther
June 27, 1995 Director /s/ Thomas H. O'Brien
-----------------------
Thomas H. O'Brien
June 27, 1995 Director /s/ Leonard A. O'Connor
-----------------------
Leonard A. 'Connor
June 27, 1995 Director /s/ Emery G. Olcott
-----------------------
Emery G. Olcott
June 27, 1995 Director /s/ Nicholas L. Trivisonno
--------------------------
Nicholas L. Trivisonno