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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 11-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the Fiscal Year Ended December 31, 2000
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 1-3187
A. Full title of the plan and address of the plan, if different from that of the
issuer named below:
RELIANT ENERGY, INCORPORATED
SAVINGS PLAN
B. Name of issuer of the securities held pursuant to the plan and the address of
its principal executive office:
RELIANT ENERGY, INCORPORATED
1111 LOUISIANA STREET
HOUSTON, TEXAS 77002
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TABLE OF CONTENTS
Independent Auditors' Report Page 1
Financial Statements:
Statement of Net Assets Available for Plan Benefits, December 31, 2000 Page 2
Statement of Net Assets Available for Plan Benefits, December 31, 1999 Page 3
Statement of Changes in Net Assets Available for Plan Benefits for the
Year Ended December 31, 2000 Page 4
Notes to Financial Statements for the Year Ended December 31, 2000 Page 5
Supplemental Schedules:
Supplemental Schedule of Investments, December 31, 2000 Page 13
Supplemental Schedule of 5% Reportable Transactions for the Year
Ended December 31, 2000 Page 14
Pursuant to Item 4 of Form 11-K, the financial statements and schedules referred
to above have been prepared in accordance with regulations of the Employee
Retirement Income Security Act of 1974.
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INDEPENDENT AUDITORS' REPORT
Reliant Energy, Incorporated Savings Plan:
We have audited the accompanying statements of net assets available for plan
benefits of the Reliant Energy, Incorporated Savings Plan (the Plan) as of
December 31, 2000 and 1999 and the related statement of changes in net assets
available for plan benefits for the year ended December 31, 2000. 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 auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, such financial statements present fairly, in all material
respects, the net assets available for plan benefits of the Plan as of December
31, 2000 and 1999, and the changes in net assets available for plan benefits for
the year ended December 31, 2000 in conformity with accounting principles
generally accepted in the United States of America.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The accompanying supplemental schedules,
listed in the Table of Contents, are presented for the purpose of additional
analysis and are not a required part of the basic financial statements, but are
supplementary information required by the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. These supplemental schedules are the responsibility of the
Plan's management. Such supplemental schedules have been subjected to the
auditing procedures applied in our 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.
DELOITTE & TOUCHE LLP
Houston, Texas
June 21, 2001
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RELIANT ENERGY, INCORPORATED SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
DECEMBER 31, 2000
PARTICIPANT- NONPARTICIPANT- NONPARTICIPANT-
DIRECTED DIRECTED DIRECTED
INVESTMENT ALLOCATED UNALLOCATED
FUNDS ESOP ESOP TOTAL
-------------- -------------- -------------- --------------
ASSETS
Investments $1,483,043,980 $ 335,864,985 $ 377,238,636 $2,196,147,601
Participant loans 47,377,117 -- -- 47,377,117
Receivables:
Dividends and interest 809,558 15,358 13,444 838,360
Loan repayments 409,352 -- -- 409,352
Discretionary contributions -- 18,532,110 (18,532,110) --
Participant contributions 1,221,554 -- -- 1,221,554
-------------- -------------- -------------- --------------
Total receivables 2,440,464 18,547,468 (18,518,666) 2,469,266
-------------- -------------- -------------- --------------
Total Assets 1,532,861,561 354,412,453 358,719,970 2,245,993,984
-------------- -------------- -------------- --------------
LIABILITIES
Accrued expenses 18,284 3,826 -- 22,110
Interest on ESOP loans from Company -- -- 868,821 868,821
ESOP loans from Company -- -- 170,424,905 170,424,905
-------------- -------------- -------------- --------------
Total Liabilities 18,284 3,826 171,293,726 171,315,836
-------------- -------------- -------------- --------------
NET ASSETS AVAILABLE FOR PLAN BENEFITS $1,532,843,277 $ 354,408,627 $ 187,426,244 $2,074,678,148
============== ============== ============== ==============
See Notes to Plan's Financial Statements.
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RELIANT ENERGY, INCORPORATED SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
DECEMBER 31, 1999
PARTICIPANT- NONPARTICIPANT- NONPARTICIPANT-
DIRECTED DIRECTED DIRECTED
INVESTMENT ALLOCATED UNALLOCATED
FUNDS ESOP ESOP TOTAL
-------------- -------------- -------------- --------------
ASSETS
Investments $1,193,051,411 $ 141,873,191 $ 252,082,170 $1,587,006,772
Participant loans 45,484,069 -- -- 45,484,069
Receivables:
Dividends and interest 825,401 23,120 33,087 881,608
Discretionary contributions -- 12,695,167 (12,695,167) --
-------------- -------------- -------------- --------------
Total receivables 825,401 12,718,287 (12,662,080) 881,608
-------------- -------------- -------------- --------------
Total Assets 1,239,360,881 154,591,478 239,420,090 1,633,372,449
-------------- -------------- -------------- --------------
LIABILITIES
Accrued expenses 12,489 1,774 -- 14,263
Interest on ESOP loans from Company -- -- 11,520,248 11,520,248
ESOP loans from Company -- -- 218,321,975 218,321,975
-------------- -------------- -------------- --------------
Total Liabilities 12,489 1,774 229,842,223 229,856,486
-------------- -------------- -------------- --------------
NET ASSETS AVAILABLE FOR PLAN BENEFITS $1,239,348,392 $ 154,589,704 $ 9,577,867 $1,403,515,963
============== ============== ============== ==============
See Notes to Plan's Financial Statements.
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RELIANT ENERGY, INCORPORATED SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 2000
PARTICIPANT- NONPARTICIPANT- NONPARTICIPANT-
DIRECTED DIRECTED DIRECTED
INVESTMENT ALLOCATED UNALLOCATED
FUNDS ESOP ESOP TOTAL
--------------- --------------- --------------- ---------------
INVESTMENT INCOME:
Dividends $ 35,926,305 $ 10,610,664 $ 14,138,369 $ 60,675,338
Interest 8,945,279 105,636 141,032 9,191,947
Net appreciation of investments 288,135,684 151,370,587 185,679,683 625,185,954
--------------- --------------- --------------- ---------------
Total investment income 333,007,268 162,086,887 199,959,084 695,053,239
--------------- --------------- --------------- ---------------
CONTRIBUTIONS:
Participant contributions 62,474,577 -- -- 62,474,577
Employer contributions -- 631,879 43,089,716 43,721,595
Accrued discretionary matching contributions -- 18,532,110 (18,532,110) --
Allocation of ESOP stock -- 43,106,121 (43,106,121) --
--------------- --------------- --------------- ---------------
Total contributions 62,474,577 62,270,110 (18,548,515) 106,196,172
--------------- --------------- --------------- ---------------
Transfer of net assets from merged plans 252,290 -- -- 252,290
Fund transfers, net 481,515 (14,935,142) 14,453,627 --
Administrative expenses (155,083) (129,151) -- (284,234)
Benefit payments (102,565,682) (9,473,781) -- (112,039,463)
Interest on ESOP loans from Company -- -- (18,015,819) (18,015,819)
--------------- --------------- --------------- ---------------
CHANGE IN NET ASSETS AVAILABLE FOR PLAN BENEFITS 293,494,885 199,818,923 177,848,377 671,162,185
NET ASSETS AVAILABLE FOR PLAN BENEFITS
BEGINNING OF PERIOD 1,239,348,392 154,589,704 9,577,867 1,403,515,963
--------------- --------------- --------------- ---------------
END OF PERIOD $ 1,532,843,277 $ 354,408,627 $ 187,426,244 $ 2,074,678,148
=============== =============== =============== ===============
See Notes to Plan's Financial Statements.
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RELIANT ENERGY, INCORPORATED SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
FOR THE YEAR ENDED DECEMBER 31, 2000
1. ACCOUNTING POLICIES
In accordance with the provisions of the Reliant Energy, Incorporated
Savings Plan (the Plan), the financial records of the Plan are kept and
the valuations of participating employees' (Participants) accounts are
determined on the accrual basis.
The Plan recognizes net appreciation or depreciation in the fair value
of its investments. Investments are reflected at fair value in the
financial statements. The fair value of nonparticipant-directed
investments are based on quoted market prices in an active market. Fair
value for mutual and institutional funds are determined using net asset
value of each such individual fund as of the financial statement dates.
Security transactions are recorded as of the trade date. Participant
loans are valued at cost which approximates fair value.
The preparation of financial statements in conformity with generally
accepted accounting principles requires estimates and assumptions that
affect the reported amounts as well as certain disclosures. The Plan's
financial statements include amounts that are based on management's
best estimates and judgments. Actual results could differ from those
estimates.
The Plan provides for investments in Reliant Energy, Incorporated's
(the Company) common stock, various mutual funds and other investments.
Investments, in general, are exposed to various risks, such as interest
rate, credit and overall market volatility risk. Due to the level of
risk associated with certain investments, it is reasonably possible
that changes in the values of investments will occur in the near term
and that such changes could materially affect the amounts reported in
the statements of net assets available for plan benefits and
participant account balances. As of December 31, 2000 and 1999, an
aggregate of 33,437,216 and 34,111,957 shares of the Company's common
stock was held by the Plan which represented 66.0% and 49.2% of the
Plan's investments, respectively. Given the concentration of the Plan's
investments in the Company's common stock, there is vulnerability to
volatility of the Company's common stock. Rates of return will vary,
and returns will depend on the market value of the Company's common
stock.
Subsequent to December 31, 2000, the Plan's investments in the
Company's common stock have been subject to substantial volatility.
From January 1, 2001 through June 21, 2001, the aggregate fair value of
33,437,216 shares of the Company's common stock held by the Plan as of
December 31, 2000 has declined approximately $410 million from the fair
value reported in the financial statements as of December 31, 2000.
2. SUMMARY OF THE PLAN
Description of the Plan
The following description of the Plan provides only general
information. Participants should refer to the Plan document for a more
complete description of the Plan's provisions. In the case of any
discrepancy between this summary and the Plan document, the Plan's
provisions will control.
General
The Plan is a defined contribution plan covering all employees of the
Company and those subsidiaries and affiliates of the Company that have
adopted the Plan except (a) building trades workers under a
construction industry collective bargaining agreement, (b) leased
employees, (c) independent contractors or (d) non-resident aliens who
receive no U.S. sourced income. The Plan is subject to the provisions
of the Employee Retirement Income Security Act of 1974 (ERISA).
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Participant Accounts
Each Participant's account is credited with the Participant's
contributions and with allocations of the Company contributions and
Plan earnings. Each Participant's account is also charged with an
allocation of administrative expenses. Allocations are based on
Participant account balances, as defined. A Participant is entitled to
their vested account balance.
Investment Program
The Plan has nine investment fund (Funds), as follows:
Company Common Stock Fund: Invested primarily in shares of the Company.
A small portion of the fund remains in cash or invested in short-term
investments pending the execution of trades and to meet fund liquidity
needs. Participants actually own a percentage of the fund which
includes Company common stock and cash, rather than specific shares of
Company common stock.
Large Company Growth Fund: Directly or indirectly invested in stocks of
large companies with potential for above-average growth and limited
emphasis on current income from dividends. Effective October 1, 2000,
the investment fund changed its name from the Capital Appreciation
Equity Fund to the Large Company Growth Fund.
Large Company Value Fund: Directly or indirectly invested in stocks of
large growing companies and companies that have a history of paying
dividends. Effective October 1, 2000, the investment fund changed its
name from the Growth and Income Equity Fund to the Large Company Value
Fund.
International Equity Fund: Directly or indirectly invested in stocks of
companies that have their principal business activities and interests
outside of the United States and which show potential for long-term
growth of capital.
Balanced Fund: Directly or indirectly invested in both stocks and
bonds. The equity and fixed income components are broadly diversified
across all segments of the global markets. The target allocation for
stocks is 70%, but the actual allocation may differ from the target
percentage.
Fixed Income Fund: Invested directly or indirectly in high-quality
government bonds, corporate bonds and mortgages with modest investments
in other fixed income securities such as lower quality and non-U.S.
bonds. The average maturity of this fund is expected to be between 4
and 7 years.
Money Market Fund: Invested in a money market fund which invests in
high-quality government and corporate fixed income securities with
maturities of less than one year.
S&P 500 Index Fund: Invested in a stock fund that seeks to track the
investment performance of the Standard & Poor's 500 Composite Stock
Price Index, which emphasizes stocks of large U.S. companies.
Mid-Sized and Small Company Fund: Directly or indirectly invested in
stocks of companies that are small or medium sized and have potential
for above-average growth of capital with limited emphasis on current
income from dividends. The Mid-Sized and Small Company Fund was added
as a new investment option effective October 1, 2000.
Pending the acquisition of an investment for the Funds, the trustee may
temporarily hold funds uninvested or in short-term investments.
The assets of the Plan are held in trust by The Northern Trust Company
(Trustee). The Benefits Committee of Reliant Energy, Incorporated
(Committee), appointed by the Board of Directors of the Company, is the
plan administrator. The Committee retains an independent investment
consultant to provide investment advice with respect to the Funds. The
fees charged by the Trustee and the investment consultant are paid by
the Trustee out of the Funds.
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A Participant has the right to direct the Trustee to invest their
contributions, but not matching contributions made by the Company
(Employer Contributions), in 1% increments in any or all of the Funds.
All Employer Contributions to the Plan were invested in the employee
stock ownership component of the Plan (ESOP).
Employee Stock Ownership Plan
The ESOP is a funding mechanism for a portion of the Employer
Contributions to the Plan. In connection with the ESOP, the Company was
party to an ESOP Trust Agreement between the Company and State Street
Bank (Prior ESOP Trustee). The Prior ESOP Trustee purchased shares of
the Company's common stock in open market transactions with funds
provided by loans (Loans) from the Company. The Prior ESOP Trustee
completed the purchases of shares of the Company's common stock in
December 1991 after purchasing 18,762,184 shares at a cost of $350
million. At December 31, 2000 and 1999, the total balance of the Loans
was $170 million and $218 million, respectively. The Loans bear
interest at a fixed rate of 9.783% and must be repaid in full by
January 2, 2011. Accrued interest on the Loans was $1 million and $12
million at December 31, 2000 and 1999, respectively. At December 31,
2000 and 1999, the fair value of the ESOP Loans including accrued
interest was $174 million and $230 million, respectively. Fair value is
estimated based on the present value of required principal and interest
payments revalued at current interest rates using the formula specified
in the Loans agreement to establish the fixed rate. For the purposes of
estimating the ESOP Loans fair value, the principal and interest
payments are reflected during 2006 through 2011 in accordance with the
ESOP Loans repayment schedule.
The Company makes periodic cash contributions (ESOP Contributions) to
the portion of the ESOP trust which has not been allocated to
Participants (Unallocated ESOP). The ESOP Contributions, the earnings
received on the investments included in the Unallocated ESOP and the
dividend income from the Unallocated ESOP and the portion of the ESOP
trust which has been allocated to Participants (Allocated ESOP) are
used to pay principal and interest on the Loans. The dividend income
from the Allocated ESOP that is used to pay debt service on the Loans
is replaced with released shares of the Company's common stock. As debt
service payments on the Loans are made, the Company releases shares of
common stock from the pledge securing the Loans and such shares are
available for allocation to Participants' accounts as Employer
Contributions. Unallocated ESOP stock serves as collateral for the
Loans. All released shares must be allocated to Participants' accounts
at year-end. No allocated shares serve as collateral for the Loans.
In addition to the ESOP Contributions, the Company may elect to make
Employer Contributions to the Allocated ESOP in the form of cash which
may be used to purchase shares of the Company's common stock in the
open market. Dividend income received on shares of the Company's common
stock that were purchased in the open market and placed in the
Allocated ESOP is not available for debt service payments.
Funding
Participants may make contributions to the Plan through (a) payroll
deductions on a pre-tax (Pre-tax Contributions) or an after-tax
(After-tax Contributions) basis, (b) a combination of Pre-tax and
After-tax Contributions or (c) a rollover of pre-tax contributions from
another qualified plan.
Contributions to the Plan are made by Participants and by the Company.
Each Participant may contribute to the Plan annually an amount equal to
any whole percentage up to and including 6% of their total eligible
compensation known as the Participant's "Matched Contributions". This
amount could be made up of Pre-tax and/or After-tax Contributions. The
Employer Contribution is 75% of the Participant's Matched
Contributions. In addition, the Company may make a discretionary
matching contribution up to an additional 50 cents for every $1 of
eligible Participant's Matched Contributions. Eligible Participants for
the discretionary matching contribution are active employees as of the
end of the applicable year or terminated employees during such year who
meet certain requirements under the Plan. A discretionary matching
contribution based on the Company's performance for the previous year,
if any, is determined by the Chairman of the Committee and will be
communicated to Participants within 90 days following the end of the
applicable year. The Company will make any discretionary matching
contributions as soon as practicable after performance for the previous
year is measured. During March 2001, discretionary matching
contributions of approximately $19 million were made
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through the allocation of ESOP stock to Participant accounts for year
2000. Such discretionary matching contributions were accrued in the
financial statements for the year ended December 31, 2000 as a
reclassification between the Unallocated and Allocated ESOP.
Each Participant may also make additional Pre-tax and/or After-tax
Contributions annually to the Plan in an amount equal to any whole
percentage greater than 6% but not more than 16% of their total
eligible compensation. This amount is referred to as the Participant's
"Unmatched Contributions". The Company does not match Unmatched
Contributions.
Pre-tax Contributions made to the Plan decrease a Participant's income
for federal income tax purposes by the amount of such Participant's
Pre-tax Contributions. Pre-tax Contributions are, however, subject to
the Federal Insurance Contributions Act withholding tax.
The maximum amount that a Participant may elect to defer as a Pre-tax
Contribution for any taxable year under all cash or deferred
arrangements (such as the Plan) in which the Participant participates
was limited to $10,500 in 2000. Such amount may be adjusted thereafter
for inflation. If the total amount of Pre-tax Contributions exceeds the
maximum limit during any calendar year, such excess will be included in
the Participant's gross income for the year to which the deferrals
relate, and will be returned to the Participant, plus any income or
minus any loss allocable thereto, by April 15 of the following year.
Participation
Any eligible employee may participate in the Plan as soon as is
practicable after employment commences. Ineligible employees include
building trades workers under a construction industry collective
bargaining agreement, leased employees, independent contractors or
non-resident aliens who receive no U.S. sourced income. Former
Participants who are reemployed by the Company may recommence
participation in the Plan as soon as practicable after reemployment.
Their vesting service will be reinstated and any portion of their
interest in the Employer Contributions that was forfeited will be
reinstated in accordance with the terms of the Plan.
Distributions and Forfeitures
A terminated Participant or the beneficiary of a deceased Participant
is entitled to a distribution of the value of the Participant's entire
account in case of death, disability or retirement. Retirement is
termination of service at the later of (a) Participant's attainment of
age 65 or (b) the fifth anniversary of the Participant's commencement
of participation in the Plan. In case of termination of service for any
other reason, a Participant is entitled to a distribution of the entire
value of their Participant contribution account plus the vested portion
of their Employer Contribution account. Vesting is determined by
vesting service years in accordance with the schedule detailed below:
VESTING SERVICE YEARS* VESTED PERCENTAGE
- --------------------- -----------------
Less than two........................................ 0%
Two but less than three.............................. 25%
Three but less than four............................. 50%
Four but less than five.............................. 75%
Five and more........................................ 100%
-----------
* Generally, vesting service years are based on all years, months
and days of active employment with the Company and its
subsidiaries and affiliates based on the anniversary date of a
Participant's hire date.
Any portion of the value of Employer Contributions not vested will be
forfeited. The amount forfeited by a Participant is applied to
reinstate previously forfeited balances of former Participants who are
reemployed by the Company and/or pay incidental Plan expenses with any
remaining forfeitures used to reduce the respective Company's
subsequent contribution to the Plan. Employee forfeitures for the year
ended December 31, 2000 were not significant to the Plan.
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A terminated Participant whose account exceeds $5,000 may elect upon
written request at any time to receive distribution of their Plan
account in a single lump sum payment or fixed monthly, quarterly,
semi-annually or annual installments over a period of 10 years or less.
The Participant may have the above selected distribution option paid in
the form of cash, Company common stock or a combination of both.
To the extent a Participant has not requested a distribution by the
time he reaches age 70 1/2, required minimum distributions will be sent
to the last known address beginning no later than April 1st of the
calendar year following the calendar year the Participant attains age
70 1/2. If a Participant terminates employment after age 70 1/2,
required minimum distributions will start no later than April 1st of
the calendar year following the calendar year in which the Participant
terminated employment.
Immediate lump sum distributions are made for accounts which do not
exceed $5,000.
Participant Withdrawals
A Participant who is under age 59 1/2 may make a withdrawal from
amounts attributable to their After-tax Contributions and, if
applicable, their rollover contributions in the Plan and associated
earnings. A Participant who is under age 59 1/2 and has less than five
years of service who withdraws Matched After-tax Contributions will be
suspended from Plan participation for six months.
A Participant who is age 59 1/2 or older may make unlimited withdrawals
from their Pre-tax Contributions, After-tax Contributions, vested
portion of prior Plan accounts, rollover account and the associated
earnings.
Certain Participants who were former participants in the NorAm Employee
Savings and Investment Plan or the Minnegasco Division Employees'
Retirement Savings Plan may make unlimited withdrawals from the vested
portion of their employer contribution accounts under either of such
prior plans.
Participant Loans
A Participant may borrow against their vested account balances. The
maximum amount that a Participant may borrow from their vested account
is the lesser of (a) $50,000, reduced by the excess, if any, of the
highest outstanding balance of loans to the Participant from all plans
maintained by the Company or an affiliated entity during the one-year
period ending on the day before the date on which such loan is made
over the outstanding balance of loans from the Plan on the date on
which such loan is made or (b) 50% of the value of the Participant's
vested account balance under the Plan.
The loans are to be secured by the pledge of a portion of the
Participant's right, title and value of the Participant's vested
account balance under the Plan as determined immediately after the
loans are made. Loans may be repaid over a period of up to five years
and are subject to a $25 origination fee. No loan will be made for a
sum of less than $500. Interest rates are fixed at the prime rate
listed in The Wall Street Journal for the first of each month in which
the loan is requested plus one percent.
Loan transactions are treated as a transfer to (from) the investment
fund from (to) the Participant loans fund.
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Diversification of Investments
Employer matching and discretionary matching contributions are invested
in the ESOP. Once a Participant attains age 55 and has participated in
the Plan for at least 10 years, they have the option to diversify their
investment of Employer Contributions (Diversification Election). A
Participant may transfer up to 25% of the balance of the Employer
Contribution account for the first 5 years they are eligible and 50% of
the balance of the Employer Contribution account beginning in the 6th
year of eligibility (in each case less any dollar amount already
diversified) from the ESOP to any or all of the other funds available
under the Plan as of such date.
Diversification Elections must be made during the first quarter of each
plan year. The transfer is effective as of the day the Participant
makes the election using that day's valuation date.
Termination of the Plan
Although it has not expressed any intent to do so, the Company may
terminate the Plan at any time subject to the provisions of ERISA and
must give written notice to the Trustee. In the event of termination of
the Plan, the assets held by the Trustee under the Plan will be valued
and each Participant will become fully vested in their account.
3. MERGER OF THE INSYNC INTERNET SERVICES, INC. 401(k) PLAN
Effective July 1, 2000, the Insync Internet Services, Inc. 401(k) Plan
was merged into the Plan. Net assets available for Plan benefits of
approximately $252,000 were transferred into the Plan on August 1,
2000. The Plan's management believes that the merger was a tax-exempt
transaction under the applicable provisions of the Internal Revenue
Code.
4. INVESTMENTS
The following presents investments that represent 5 percent or more of
the Plan's net assets available for plan benefits.
DECEMBER 31,
----------------------------
2000 1999
------------ ------------
Company Common Stock Fund - Reliant Energy, Incorporated common
stock, 17,072,555 and 17,465,309 shares, respectively $739,455,038 $399,518,943
Allocated ESOP - Reliant Energy, Incorporated common stock,
7,725,776 and 5,967,159 shares, respectively * 334,622,673 136,498,762
Unallocated ESOP - Reliant Energy, Incorporated common stock,
8,638,885 and 10,679,489 shares, respectively * 374,171,707 244,293,311
Jennison Institutional Growth Equity Fund, 128,819,056 shares 106,531,122 --
Barclays Global Investors Equity Index Fund, 6,045,819 shares 105,015,861 --
Acorn Fund, 5,867,739 shares -- 108,729,205
Harbor Capital Fund - Capital Appreciation U.S. Equities, 1,920,421
shares -- 97,269,346
Janus Fund, 2,322,969 shares -- 102,326,790
Vanguard Institutional Index Fund, 790,576 shares -- 105,945,123
Northern Trust Collective Short-term Investment Fund, 92,055,992
and 92,018,206 shares, respectively 92,055,992 92,018,206
Northern Trust Collective Short-term Investment Fund, 4,309,241
and 13,163,288 shares, respectively* 4,309,241 13,163,288
- ------------
* Non-participant directed investments
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During 2000, the Plan's investments (including gains and losses on
investments bought and sold, as well as held during the year)
appreciated (depreciated) in value as follows:
Mutual and institutional funds $ (62,834,517)
Company common stock 688,020,471
--------------
$ 625,185,954
==============
5. NONPARTICIPANT-DIRECTED INVESTMENTS
Information relating to the nonparticpant-directed investments is as
follows:
DECEMBER 31,
---------------------------------
2000 1999
------------ ------------
Cash and cash equivalents $ 4,309,241 $ 13,163,288
Company common stock 708,794,380 380,792,073
6. FEDERAL INCOME TAXES
The Internal Revenue Service (IRS) determined and informed the Company
by letter dated April 2, 2001 that the Plan, as amended and restated
effective April 1, 1999 and as thereafter amended, was qualified and
the trust fund (Trust) established is tax-exempt under the appropriate
sections of the Internal Revenue Code of 1986, as amended (Code). As a
result, the Participant's Pre-tax Contributions, up to a specified
maximum amount each calendar year, and the Employer Contributions to
the Trust on behalf of a Participant are not currently taxable to a
Participant when made, and income from any source accruing to a
Participant's account is not taxable when realized by the Trust. The
After-tax Contributions made by a Participant will not be deductible by
the Participant. The continued status of the Trust as a tax-exempt
trust and the Plan as a qualified plan are contingent upon the
continuing operation of the Trust and the Plan in accordance with
applicable provisions of the Code.
7. RELATED PARTY TRANSACTIONS
During 2000, the Plan purchased and sold shares of the Company's common
stock and units of short-term investment funds managed by the Trustee
as temporary investments (party-in-interest transactions) as shown
below:
2000
-------------
Purchases Company common stock $ 33,088,641
Short-term funds 386,906,700
Sales Company common stock $ 39,602,819
Short-term funds 395,921,013
11
14
8. SUBSEQUENT EVENT
Effective March 1, 2001, the Plan was amended for certain participants
who are employees of Reliant Resources, Inc. and subsidiaries and
Reliant Energy Tegco, Inc. (collectively, Resources Participants).
Associated with this amendment, the Plan provisions were changed to
increase the employer matching contribution percentage from 75% to 100%
of the Participant's Matched Contributions up to the first 6% of
eligible compensation, to discontinue eligibility for the discretionary
matching contributions for such employees, to allow immediate vesting
for future employer matching contributions, to fully vest the accounts
of such employees and to change the employer matching contribution to
be in cash instead of Company stock.
In addition, discretionary profit sharing features were added to the
Plan for Resources Participants. Beginning March 1, 2001, the Company
has elected to make Employer Contributions of 2% each pay period in
cash on the first $85,000 of eligible compensation during calendar year
2001 and provide for discretionary one-time payments up to 3% of
eligible compensation in cash, in Reliant Resources, Inc. common stock
or both after the end of each year, subject to Reliant Resources, Inc.
and its subsidiaries' performance.
12
15
RELIANT ENERGY, INCORPORATED SAVINGS PLAN
SUPPLEMENTAL SCHEDULE OF INVESTMENTS
ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 2000
SHARES COST CURRENT VALUE
-------------- -------------- --------------
COMPANY COMMON STOCK FUND
Reliant Energy, Incorporated Common Stock* 17,072,555 $ 295,490,262 $ 739,455,038
Northern Trust Collective Short-term Investment Fund* 4,124,852 4,124,852 4,124,852
-------------- --------------
TOTAL COMPANY COMMON STOCK FUND INVESTMENTS 299,615,114 743,579,890
-------------- --------------
ALLOCATED ESOP
Reliant Energy, Incorporated Common Stock* 7,725,776 146,235,602 334,622,673
Northern Trust Collective Short-term Investment Fund* 1,242,312 1,242,312 1,242,312
-------------- --------------
TOTAL ALLOCATED ESOP INVESTMENTS 147,477,914 335,864,985
-------------- --------------
LARGE COMPANY GROWTH FUND
Barclays Global Investors Russell 1000 Growth Index Fund 6,215,787 72,154,127 57,744,658
Janus Fund 2,754,921 106,487,429 91,711,295
Jennison Institutional Growth Equity Fund 114,255,180 113,060,150 94,487,050
Northern Trust Collective Short-term Investment Fund* 1,067 1,067 1,067
-------------- --------------
TOTAL LARGE COMPANY GROWTH FUND INVESTMENTS 291,702,773 243,944,070
-------------- --------------
LARGE COMPANY VALUE FUND
Barclays Global Investors Russell 1000 Value Index Fund 3,348,684 33,040,316 34,223,543
ICAP Mutual Fund Equity Portfolio 1,175,113 44,901,677 51,305,404
Selected American Shares Fund 1,375,730 52,317,757 48,604,519
-------------- --------------
TOTAL LARGE COMPANY VALUE FUND INVESTMENTS 130,259,750 134,133,466
-------------- --------------
INTERNATIONAL EQUITY FUND
Lazard International Equity Portfolio 2,693,966 25,000,000 24,838,362
Capital Guardian International (Non-U.S.) Equity Fund 657,387 21,673,392 20,129,182
Northern Trust Collective Short-term Investment Fund* 894 894 894
-------------- --------------
TOTAL INTERNATIONAL EQUITY FUND INVESTMENTS 46,674,286 44,968,438
-------------- --------------
BALANCED FUND
Barclays Global Investors Equity Index Fund 729,577 13,640,324 12,672,747
Capital Guardian U.S. Small Capitalization Fund 1,000,000 10,000,000 8,360,000
Jennison Institutional Growth Equity Fund 14,563,876 14,400,000 12,044,072
Capital Guardian International (Non-U.S.) Equity Fund 435,177 14,400,000 13,325,113
Selected American Shares Fund 412,719 15,695,327 14,581,356
PIMCO Total Return Fund 2,905,775 29,321,860 30,191,002
Northern Trust Collective Short-term Investment Fund* 15,036 15,036 15,036
-------------- --------------
TOTAL BALANCED FUND INVESTMENTS 97,472,547 91,189,326
-------------- --------------
FIXED INCOME FUND
Loomis Sayles Fixed Income Fund 968,444 11,504,962 10,710,980
PIMCO Total Return Fund 2,473,693 25,010,653 25,701,664
Northern Trust Collective Short-term Investment Fund* 17,992 17,992 17,992
-------------- --------------
TOTAL FIXED INCOME FUND INVESTMENTS 36,533,607 36,430,636
-------------- --------------
MONEY MARKET FUND
Northern Trust Collective Short-term Investment Fund* 87,895,229 87,895,229 87,895,229
-------------- --------------
TOTAL MONEY MARKET FUND INVESTMENTS 87,895,229 87,895,229
-------------- --------------
S&P 500 INDEX FUND
Barclays Global Investors Equity Index Fund 5,316,242 99,970,388 92,343,114
Northern Trust Collective Short-term Investment Fund* 919 919 919
-------------- --------------
TOTAL S&P 500 INDEX FUND INVESTMENTS 99,971,307 92,344,033
-------------- --------------
MID-SIZED AND SMALL COMPANY FUND
Barclays Global Investors Russell 2000 Index Fund 751,439 8,568,720 8,558,889
Northern Trust Collective Short-term Investment Fund* 3 3 3
-------------- --------------
TOTAL MID-SIZED AND SMALL COMPANY FUND INVESTMENTS 8,568,723 8,558,892
-------------- --------------
TOTAL PARTICIPANT INVESTMENTS 1,246,171,250 1,818,908,965
-------------- --------------
UNALLOCATED ESOP
Reliant Energy, Incorporated Common Stock* 8,638,885 159,527,374 374,171,707
Northern Trust Collective Short-term Investment Fund* 3,066,929 3,066,929 3,066,929
-------------- --------------
TOTAL UNALLOCATED ESOP INVESTMENTS 162,594,303 377,238,636
-------------- --------------
TOTAL PLAN INVESTMENTS $1,408,765,553 $2,196,147,601
============== ==============
PARTICIPANT LOANS, INTEREST RATE AT PRIME PLUS 1% $ 47,377,117
==============
- -----------
*Party-in-interest
13
16
RELIANT ENERGY, INCORPORATED SAVINGS PLAN
SUPPLEMENTAL SCHEDULE OF 5% REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 2000
SINGLE TRANSACTIONS
None.
SERIES OF TRANSACTIONS - SAME
SECURITY
None.
14
17
SIGNATURE
THE PLAN. 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 on its behalf by the undersigned thereunto duly
authorized.
RELIANT ENERGY, INCORPORATED SAVINGS PLAN
By /s/ DAVID M. McCLANAHAN
---------------------------------------
(David M. McClanahan, Chairman of the
Benefits Committee of Reliant Energy,
Incorporated, Plan Administrator)
June 27, 2001
18
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION
- ------ -----------
23.1 Consent of Deloitte & Touche LLP