SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
ANNUAL REPORT
Pursuant to Section 15(d) of the
Securities Exchange Act of 1934
For the fiscal year ended December 31, 1995
A. Full title of the Plan:
THE CINCINNATI GAS & ELECTRIC COMPANY
SAVINGS INCENTIVE PLAN
B. Name of issuer of the securities held pursuant to the
Plan and the address of its principal executive office:
Cinergy Corp.
139 East Fourth Street
Cincinnati, Ohio 45202 - 4003
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Members of the Savings Incentive Plan Committee have duly caused this annual
report to be signed by the undersigned hereunto duly authorized.
THE CINCINNATI GAS & ELECTRIC COMPANY
SAVINGS INCENTIVE PLAN
(Name of Plan)
By /s/GEORGE H. STINSON
Chairman, Savings
Incentive Plan Committee
June 27, 1996
THE CINCINNATI GAS & ELECTRIC COMPANY
SAVINGS INCENTIVE PLAN
STATEMENT OF FINANCIAL CONDITION WITH FUND INFORMATION
DECEMBER 31, 1995
Participant Directed
Cinergy Fidelity Fidelity
Common Magellan Equity-Income
Total Stock Fund Fund* Fund
INVESTMENTS, at market
Common Stock of Cinergy Corp. -
(Notes 3 and 7)
shares: 4,187,387 $128,238,728 $90,506,792 $ - $ -
Fidelity Magellan Fund* -
shares: 34,594 2,974,415 - 2,974,415 -
Fidelity Equity-Income Fund -
shares: 205,435 7,792,161 - - 7,792,161
Fidelity Intermediate Bond Fund -
shares: 118,437 1,232,925 - - -
PNC Money Market Fund - 1,265,780 - - -
141,504,009 90,506,792 2,974,415 7,792,161
OTHER ASSETS
Cash 262,905 185,558 - -
Contribution Receivable 1,464,996 191,692 20,070 23,743
Dividend Receivable 49,345 - - 49,345
Realized Gain Receivable 222,053 - - 222,053
Accrued Income 648 457 - -
Loans Receivable from Participants 4,558,730 - - -
PARTICIPANTS' EQUITY $148,062,686 $90,884,499 $2,994,485 $8,087,302
<FN>
The accompanying notes are an integral part of this statement.
* Fidelity Magellan Fund is a growth fund seeking long-term
capital appreciation by investing primarily in common stock
and securities convertible into common stock. As of March
31, 1996, the Fund had over $56 billion in net assets,
consisting of the following classes: common stock and
preferred stock, 70.7%; corporate bonds, 19.2%; other
securities, 10.1%.
THE CINCINNATI GAS & ELECTRIC COMPANY
SAVINGS INCENTIVE PLAN
STATEMENT OF FINANCIAL CONDITION WITH FUND INFORMATION
DECEMBER 31, 1995
(CONTINUED)
Non-Participant
Participant Directed Directed
Fidelity PNC Money Cinergy
Intermediate Market Loan Common
Bond Fund Fund Fund Stock Fund
INVESTMENTS, at market
Common Stock of Cinergy Corp. -
(Notes 3 and 7)
shares: 4,187,387 $ - $ - $ - $37,731,936
Fidelity Magellan Fund* -
shares: 34,594 - - - -
Fidelity Equity-Income Fund -
shares: 205,435 - - - -
Fidelity Intermediate Bond Fund -
shares: 118,437 1,232,925 - - -
PNC Money Market Fund - - 1,265,780 - -
1,232,925 1,265,780 - 37,731,936
OTHER ASSETS
Cash - - - 77,347
Contribution Receivable 4,992 11,190 - 1,213,309
Dividend Receivable - - - -
Realized Gain Receivable - - - -
Accrued Income - - - 191
Loans Receivable from Participants - - 4,558,730 -
PARTICIPANTS' EQUITY $1,237,917 $1,276,970 $4,558,730 $39,022,783
<FN>
The accompanying notes are an integral part of this statement.
* Fidelity Magellan Fund is a growth fund seeking long-term
capital appreciation by investing primarily in common stock
and securities convertible into common stock. As of March
31, 1996, the Fund had over $56 billion in net assets,
consisting of the following classes: common stock and
preferred stock, 70.7%; corporate bonds, 19.2%; other
securities, 10.1%.
THE CINCINNATI GAS & ELECTRIC COMPANY
SAVINGS INCENTIVE PLAN
STATEMENT OF FINANCIAL CONDITION WITH FUND INFORMATION
DECEMBER 31, 1994
Participant Directed
Cinergy Fidelity Fidelity
Common Magellan Equity-Income
Total Stock Fund Fund* Fund
INVESTMENTS, at market
Common Stock of Cinergy Corp. -
(Notes 3 and 7)
shares: 3,816,073 $89,677,716 $63,795,421 $ - $ -
Fidelity Magellan Fund* -
shares: 27,297 1,823,440 - 1,823,440 -
Fidelity Equity-Income Fund -
shares: 203,060 6,233,933 - - 6,233,933
Fidelity Intermediate Bond Fund -
shares: 108,305 1,064,640 - - -
PNC Money Market Fund -
1,073,488 - - -
99,873,217 63,795,421 1,823,440 6,233,933
OTHER ASSETS
Cash 193,410 139,255 - -
Contribution Receivable 339,561 205,346 19,006 23,530
Accrued Income 780 562 - -
Loans Receivable from Participants 3,460,562 - - -
PARTICIPANTS' EQUITY $103,867,530 $64,140,584 $1,842,446 $6,257,463
<FN>
The accompanying notes are an integral part of this statement.
* Fidelity Magellan Fund is a growth fund seeking long-term
capital appreciation by investing primarily in common stock
and securities convertible into common stock. As of March
31, 1995, the Fund had over $39 billion in net assets,
consisting of the following classes: common stock and
preferred stock, 96.8%;convertible preferred stocks and
bonds, .2%; corporate bonds, .6%; other securities, 2.4%.
THE CINCINNATI GAS & ELECTRIC COMPANY
SAVINGS INCENTIVE PLAN
STATEMENT OF FINANCIAL CONDITION WITH FUND INFORMATION
DECEMBER 31, 1994
(CONTINUED)
Non-Participant
Participant Directed Directed
Fidelity PNC Money Cinergy
Intermediate Market Loan Common
Bond Fund Fund Fund Stock Fund
INVESTMENTS, at market
Common Stock of Cinergy Corp. -
(Notes 3 and 7)
shares: 3,816,073 $ - $ - $ - $25,882,295
Fidelity Magellan Fund* -
shares: 27,297 - - - -
Fidelity Equity-Income Fund -
shares: 203,060 - - - -
Fidelity Intermediate Bond Fund -
shares: 108,305 1,064,640 - - -
PNC Money Market Fund -
- 1,073,488 - -
1,064,640 1,073,488 - 25,882,295
OTHER ASSETS
Cash - - - 54,155
Contribution Receivable 5,076 6,746 - 79,857
Accrued Income - - - 218
Loans Receivable from Participants - - 3,460,562 -
PARTICIPANTS' EQUITY $1,069,716 $1,080,234 $3,460,562 $26,016,525
<FN>
The accompanying notes are an integral part of this statement.
* Fidelity Magellan Fund is a growth fund seeking long-term
capital appreciation by investing primarily in common stock
and securities convertible into common stock. As of March
31, 1995, the Fund had over $39 billion in net assets,
consisting of the following classes: common stock and
preferred stock, 96.8%;convertible preferred stocks and
bonds, .2%; corporate bonds, .6%; other securities, 2.4%.
THE CINCINNATI GAS & ELECTRIC COMPANY
SAVINGS INCENTIVE PLAN
STATEMENT OF CHANGES IN PARTICIPANTS' EQUITY WITH FUND INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 1995
Participant Directed
Cinergy Fidelity Fidelity
Common Magellan Equity-Income
Total Stock Fund Fund* Fund
PARTICIPANTS' EQUITY
beginning of year $103,867,530 $64,140,584 $1,842,446 $6,257,463
CHANGES DURING PERIOD
Assets transferred between plans (Note 2) (343,279) (127,641) (29,522) (51,383)
Contributions (Note 5) 10,111,002 5,017,174 500,005 616,928
Dividend Income 7,165,997 4,823,975 17,790 196,552
Interest Income 291,074 228,970 15,446 31,316
Distributions to Participants (Note 6) (4,369,324) (3,085,012) (94,604) (192,496)
Net realized and unrealized appreciation/
(depreciation) in market value of investments 31,339,686 20,430,682 702,512 1,759,998
Investment Transfers (Note 3) - 276,801 111,646 (312,939)
Loans granted to Participants, net of repayments - (821,034) (71,234) (218,137)
Net change during period 44,195,156 26,743,915 1,152,039 1,829,839
PARTICIPANTS' EQUITY
end of year $148,062,686 $90,884,499 $2,994,485 $8,087,302
UNITS OF PARTICIPATION
December 31, 1995 (including units to be
distributed to Participants)
Number of units
Number of shares (Notes 3 and 7) 2,955,324 34,594 205,435
Value per unit, at market
Market price per share
(New York Stock Exchange - Composite) $30.63 $85.98 $37.93
NUMBER OF EMPLOYEES PARTICIPATING
December 31, 1995 2,937 472 842
<FN>
The accompanying notes are an integral part of this statement.
THE CINCINNATI GAS & ELECTRIC COMPANY
SAVINGS INCENTIVE PLAN
STATEMENT OF CHANGES IN PARTICIPANTS' EQUITY WITH FUND INFORMATION
FOR THE YEAR ENDED DECEMBER 31, 1995
(CONTINUED)
Non-Participant
Participant Directed Directed
Fidelity PNC Money Cinergy
Intermediate Market Loan Common
Bond Fund Fund Fund Stock Fund
PARTICIPANTS' EQUITY
beginning of year $1,069,716 $1,080,234 $3,460,562 $26,016,525
CHANGES DURING PERIOD
Assets transferred between plans (Note 2) (2,163) (209) (29,240) (103,121)
Contributions (Note 5) 133,553 264,347 - 3,578,995
Dividend Income 71,569 66,562 - 1,989,549
Interest Income 8,326 7,016 - -
Distributions to Participants (Note 6) (13,991) (45,053) (98,228) (839,940)
Net realized and unrealized appreciation/
(depreciation) in market value of investments 65,719 - - 8,380,775
Investment Transfers (Note 3) (38,733) (36,775) - -
Loans granted to Participants, net of repayments (56,079) (59,152) 1,225,636 -
Net change during period 168,201 196,736 1,098,168 13,006,258
PARTICIPANTS' EQUITY
end of year $1,237,917 $1,276,970 $4,558,730 $39,022,783
UNITS OF PARTICIPATION
December 31, 1995 (including units to be
distributed to Participants)
Number of units 1,265,780 4,558,730
Number of shares (Notes 3 and 7) 118,437 1,232,063
Value per unit, at market $1.00 $1.00
Market price per share
(New York Stock Exchange - Composite) $10.41 $30.63
NUMBER OF EMPLOYEES PARTICIPATING
December 31, 1995 373 432 837 2,937
<FN>
The accompanying notes are an integral part of this statement.
THE CINCINNATI GAS & ELECTRIC COMPANY
SAVINGS INCENTIVE PLAN
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1995 and 1994
(1) Description of The Cincinnati Gas & Electric Company Savings Incentive
Plan (SIP or the Plan) - The following is a brief description of the
Plan. Reference is made to the Plan and the related Trust Agreement,
including the defined terms, for complete information.
All weekly or hourly paid employees of The Cincinnati Gas & Electric
Company (CG&E), The Union Light, Heat and Power Company, and Lawrenceburg
Gas Company are eligible to participate in the Plan upon completion of
one year of service (effective January 1, 1996, employees are eligible to
participate in the Plan upon employment). Under the Plan, participants
may defer, pursuant to Section 401(k) of the Internal Revenue Code
(Code), up to 15% of base pay with a maximum of $9,240 for the year 1995.
In addition, a participant may make optional contributions to the Plan
which, when combined with salary deferrals, may not exceed 15% of base
pay. Salary deferrals and optional contributions may be further limited
for certain highly compensated employees by the requirements of Code
Sections 401(k), 401(m), and 415. The salary deferrals and optional
contributions are invested by the trustee, as directed by each
participant, in one or more investment funds, including a Cinergy Common
Stock Fund.
The participant's employer makes a matching contribution of 55% of the
amount (50% prior to July 1, 1994), not exceeding 5% of base pay,
contributed by each participant. In 1995, the Plan was amended to
provide for incentive matching contributions. These incentive matching
contributions range from $.10 to $.30 per dollar contributed by the
participant up to 4% of base pay, depending on incentive goals attained
by Cinergy Corp., CG&E's parent company. For those employees who do not
contribute to the Plan, the employers contribute an incentive match
assuming the participant contributed 1% of base pay. The accompanying
financial statements reflect accrued incentive matching contributions of
$1,119,000 for 1995. All employer matching contributions must be
invested by the trustee in the Cinergy Common Stock Fund. Participants
are immediately vested in their salary deferrals and optional
contributions. Participants are vested in the employer matching
contributions after five years of vesting service, or upon death or
disability. Effective January 1, 1996, the Plan was amended to provide
that participants would be immediately vested in the employer matching
contributions.
Participants are generally eligible to receive distributions of vested
assets from the Plan upon termination of employment (including
retirement), death, or disability. Distributions are paid in a lump sum
for vested benefits of $3,500 or less. Distributions are paid in a lump
sum or five annual installments (at the election of the participant) for
vested benefits greater than $3,500. Active participants are also
eligible to apply to the Plan administrator for "hardship" withdrawals
from their salary-deferral account in accordance with Plan provisions.
Subject to certain limitations, employees may apply for loans from their
salary-deferral account balances. Such loans are reflected in the Loan
Fund in the accompanying financial statements. Loans bear interest at
the prime rate of the trustee plus 1/2%, and are repaid within five years
through regular payroll deductions.
The Plan is administered by the Savings Incentive Plan Committee and
trusteed by PNC Bank, Ohio, N.A. Effective February 1, 1996, Fidelity
Management Trust Company became the trustee. Generally, administrative
expenses of the Plan are paid by the employer and are not included in the
accompanying financial statements.
The Plan is generally subject to the provisions of the Employee Retirement
Income Security Act of 1974 (ERISA). In particular, the Plan is subject
to the reporting, disclosure, participation, vesting, fiduciary
responsibility, administration, and enforcement provisions of Title I and
the termination and liability provisions of Title IV of ERISA.
The funding provisions of Title I and the provisions relating to the
Pension Benefit Guaranty Corporation of Title IV are not applicable to
this type of defined contribution plan.
CG&E expects to continue the Plan indefinitely, but its Board of Directors
reserves the right to amend or terminate the Plan at any time. No
amendment shall reduce retroactively the rights of participants or permit
the return to the employer of any part of the common stock or other
securities, obligations, deposits, or cash held by the trustee, or permit
their use or diversion for any purpose other than the exclusive benefit of
the participants or their beneficiaries. Forfeitures of participants'
non-vested account balances are used to reduce CG&E's matching
contributions in accordance with Plan provisions.
(2) Significant Accounting Policies - Investments are stated at market value
as determined by the trustee by reference to published market data at
December 31, 1995 and 1994. The market value of the Plan's investments
are subject to price fluctuations in the applicable investment markets.
Unrealized valuation gains and losses are reflected in the Statement of
Changes in Participants' Equity. The statements are prepared on the
accrual basis of accounting.
Transfers of assets between the SIP and the CG&E Deferred Compensation and
Investment Plan occur as a result of changes in Employee status between
the weekly and hourly paid classification and the executive, supervisory,
administrative, and professional classification.
The preparation of financial statements in conformity with generally
accepted accounting principles requires the Plan Committee to make
estimates and assumptions that affect the reported amounts of
participants' equity at the date of the financial statements, and the
reported amounts of changes in participants' equity during the reporting
period. Actual results could differ from those estimates.
(3) Investments - All contributions are paid to the trustee under the Plan. A
participant may elect or change investment funds and/or the percentages in
which contributions will be allocated once each quarter.
All employer matching contributions are invested in the Cinergy Common
Stock Fund. Participant contributions and employer matching contributions
are made each pay period and immediately invested in the designated fund.
See Note (7) for the discussion of the conversion of CG&E Common Stock
held by the Plan, to Cinergy Corp. common stock pursuant to CG&E's merger
with PSI Resources, Inc.
The following investments exceed 5% of total net assets available for
benefits at December 31, 1995 and 1994:
1995 1994
Cinergy Common Stock Fund $128,238,728 $89,677,716
Fidelity Equity Income Fund 7,792,161 6,233,933
(4) Federal Income Tax Status - The Plan obtained its most recent
determination letter in January 1995, in which the Internal Revenue
Service stated that the Plan, as designed, was in compliance with the
applicable requirements of the Internal Revenue Code. The determination
letter covers the amendments made to the Plan for purposes of complying
with the requirements of the Tax Reform Act of 1986. Participating
employees are not subject to tax on Plan income or amounts contributed by
the employer until such time as such amounts are distributed to them.
(5) Contributions - Contributions made by participants and amounts contributed
by the employers during the years ended December 31, 1995 and 1994 are as
follows:
1995 1994
Participants $ 562,619 $ 627,051
Employers 9,548,383 7,917,893
$10,111,002 $8,544,944
Participant contributions include optional contributions, while employer
contributions include salary deferrals and employer matching
contributions.
(6) Participant Withdrawals - Distributions which had been requested by
participants and approved but not yet paid as of December 31, 1994, are as
follows:
1994
Cinergy Common Stock Fund $393,672
Fidelity Equity-Income Fund 4,682
Fidelity Intermediate Bond Fund 488
Money Market Fund 217
Total $399,059
These amounts are classified in the accompanying Statements of Financial
Condition as of December 31, 1994, as a component of Participants' Equity.
There were no outstanding distributions as of December 31, 1995.
(7) Merger - On October 24, 1994, PSI Resources, Inc. was merged with and into
Cinergy Corp., and a subsidiary of Cinergy Corp. was merged with and into
CG&E. Each outstanding share of CG&E common stock held by the Plan at
October 24, 1994, was exchanged for one share of Cinergy common stock.
Report of Independent Public Accountants
To The Savings Incentive Plan Committee of
The Cincinnati Gas & Electric Company:
We have audited the accompanying statements of financial condition, with
fund information, of THE CINCINNATI GAS & ELECTRIC COMPANY SAVINGS INCENTIVE
PLAN (the Plan) as of December 31, 1995 and 1994, and the related statement of
changes in participants' equity, with fund information, for the year ended
December 31, 1995. These financial statements and the schedules referred to
below are the responsibility of the Savings Incentive Plan Committee. Our
responsibility is to express an opinion on these financial statements and
schedules based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial condition, with fund information, of
the Plan as of December 31, 1995 and 1994, and the changes in participants'
equity, with fund information, for the year ended December 31, 1995, 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
(Exhibits I and II) 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 statements of financial condition and the
statement of changes in participants' equity is presented for purposes of
additional analysis rather than to present the financial condition and changes
in participants' equity of each fund. The supplemental schedules and fund
information have been subjected to the auditing procedures applied in the
audits 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
Cincinnati, Ohio,
June 11, 1996
EXHIBIT I
The Cincinnati Gas & Electric Company
Savings Incentive Plan
Sponsor EIN: 31-0240030
Administrator EIN: 31-1070386
Plan Number: 002
Part I, Schedule G (Form 5500, Item 27a)
Schedule of Assets Held for Investment Purposes at December 31, 1995
--------------------------------------------------------------------
(a) (b) (c) (d) (e)
Description of
investment
including maturity
date, rate of
Identity of issue, interest,
borrower, lessor, collateral, par or Current
or similar party maturity value Cost value
- --- ------------------ ------------------ ---- -------
* Cinergy Common 4,187,387 shares; $73,368,869 $128,238,728
Stock Fund $0.01 par value;
$30.625 market
price per share
@ 12/31/95
Fidelity Magellan Mutual fund, 2,633,958 2,974,415
Fund primarily common
stock; 34,594
shares; $85.98 net
asset value
@ 12/31/95
Fidelity Mutual fund, 6,766,095 7,792,161
Equity-Income Fund primarily equity
securities; 205,435
shares; $37.93
net asset value
@ 12/31/95
Fidelity Mutual fund, 1,234,308 1,232,925
Intermediate primarily
Bond Fund fixed-income
obligations;
118,437 shares;
$10.41 net asset
value @ 12/31/95
** PNC Money Market Mutual fund, money 1,265,780 1,265,780
Fund market instruments;
1,265,780 units;
$1.00 net asset
value @ 12/31/95
Participant loans 8.25% - 9.50% 0 4,558,730
* The Cincinnati Gas & Electric Company, as employer having employees covered
by the plan, is a party-in-interest.
** PNC, as Trustee, is a party-in-interest.
Exhibit II
The Cincinnati Gas & Electric Company
Savings Incentive Plan
Sponsor EIN: 31-0240030
Administrator EIN: 31-1070386
Plan Number: 002
Part V, Schedule G (Form 5500, Item 27d)
Schedule of Reportable Transactions
For the Year Ended December 31, 1995
------------------------------------
Total Total Total Dollar Total Dollar
Identity of Number of Number Value of Value of Net Gain
Securities Purchases of Sales Purchases Sales on Sales
- ----------- --------- -------- ------------ ------------ --------
* Cinergy Corp.
Common Stock
Fund 162 174 $ 9,693,197 $6,758,972 $879,518
* Denotes a party-in-interest.
Exhibit 23
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference of our report dated June 11, 1996 included in this Annual Report
on Form 11-K for the year ended December 31, 1995 of The Cincinnati Gas &
Electric Company Savings Incentive Plan, into its previously filed Registration
Statement No. 33-55293.
ARTHUR ANDERSEN LLP
Cincinnati, Ohio,
June 11, 1996