UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 15 (d) OF
THE SECURITIES EXCHANGE ACT 1934
For the Fiscal Year Ended August 31, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d)
OF THE SECURITIES AND EXCHANGE ACT OF 1934
For the transition period from _____________ to ____________
Commission file number 1-3789
New Century Energies, Inc. Employee Investment Plan for Bargaining Unit
Employees and Former Non-Bargaining Unit Employees
(Title of plan)
NEW CENTURY ENERGIES, INC.
(Name of issuer of the securities held pursuant to the plan)
1225 17th Street
Denver, Colorado 80202
(Address of principal executive offices)
NEW CENTURY ENERGIES, INC. EMPLOYEE INVESTMENT PLAN FOR BARGAINING UNIT
EMPLOYEES AND FORMER NON-BARGAINING UNIT EMPLOYEES
INDEX TO FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
Page
Report of Independent Public Accountants 1
Financial Statements and Supplemental Schedules:
Statements of Net Assets Available for Plan Benefits
as of August 31, 1998 and 1997 2
Statements of Changes in Net Assets Available for Plan Benefits
for the Years Ended August 31, 1998 and 1997 3
Notes to Financial Statements 5
Supplemental Schedules:
Item 27a - Schedule of Assets Held for Investment Purposes as of
August 31, 1998 (Schedule 1) 10
Item 27b - Schedule of Loans or Fixed-Income Obligations in
Default or Uncollectible as of August 31, 1998
(Schedule 2) 11
Item 27c - Schedule of Leases in Default or Uncollectible
as of August 31, 1998 (Schedule 2) 11
Item 27d - Schedule of Reportable Transactions for the Year
Ended August 31, 1998 (Schedule 3) 12
Items 27e and 27f - Schedule of Nonexempt Transactions with
Parties-in-Interest for the Year Ended
August 31, 1998 (Schedule 4) 13
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the New Century Energies, Inc. ERISA Committee:
We have audited the accompanying statements of net assets available for plan
benefits of New Century Energies, Inc. Employee Investment Plan for Bargaining
Unit Employees and Former Non-Bargaining Unit Employees (the "Plan"), formerly
known as the Southwestern Public Service Company Employee Investment Plan, as of
August 31, 1998 and 1997, 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
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 August 31, 1998 and 1997, 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 assets held
for investment purposes, loans or fixed-income obligations in default or
uncollectible, leases in default or uncollectible, reportable transactions and
nonexempt transactions with parties-in-interest 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. The Fund Information in the statements
of changes in net assets available for plan benefits is presented for purposes
of additional analysis rather than to present the changes in net assets
available for plan benefits 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
Denver, Colorado
January 8, 1999
NEW CENTURY ENERGIES, INC. EMPLOYEE INVESTMENT PLAN FOR BARGAINING
UNIT EMPLOYEES AND FORMER NON-BARGAINING UNIT EMPLOYEES
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
AS OF AUGUST 31, 1998 AND 1997
ASSETS: 1998 1997
---- ----
Investments, at Fair Value:
Company Common Stock Fund (Notes 1 and 6)
Participant Directed $37,938,424 $11,484,530
Non-Participant Directed 10,289,615 74,427,804
Investments in Registered Investment
Companies (Note 6)
American Century Value Fund 1,327,794 -
Europacific Growth Fund 407,129 -
Bond Market Fund 249,745 -
Index 500 Fund 39,536 -
PRIMECAP Fund 18,712 -
Wellington Fund 3,593 -
SMALLCAP World Fund 2,418 -
Fidelity Value Fund - 3,027,877
T Rowe Price International Stock Fund - 775,935
Strong Government Securities Fund - 445,796
Investment in Common/Collective Trust (Note 6)
Vanguard Retirement Savings Trust Fund 224,254 -
Boatmen's Short-Term Investment Fund (Note 6) - 283,871
-------- ----------
Total Investments 50,501,220 90,445,813
Receivables:
Employer contributions (Note 1) 210,383 77,801
Participant contributions (Note 1) - 259,408
Accrued interest and dividends
(Notes 2 and 3) - 1,071,131
--------- ---------
Total Receivables 210,383 1,408,340
Total Assets 50,711,603 91,854,153
---------- ----------
LIABILITIES: - -
-------- ---------
Net Assets Available for Plan Benefits $50,711,603 $91,854,153
=========== ===========
The accompanying notes to financial statements are an integral part of these
financial statements.
2
NEW CENTURY ENERGIES, INC. EMPLOYEE INVESTMENT PLAN FOR BARGAINING
UNIT EMPLOYEES AND FORMER NON-BARGAINING UNIT EMPLOYEES
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
FOR THE YEAR ENDED AUGUST 31, 1998
(WITH FUND INFORMATION)
----------------------------------------------------------------------
Company American Euro-
Common Century SMALLCAP pacific Welling-
Stock Fund Value Index 500 Primecap World Growth ton
(Notes 1 & 2) Fund Fund Fund Fund Fund Fund
------------- ---- ---- ---- ---- ---- ----
Net Investment Income:
Interest and dividend income $ 4,269,920 $ 72,347 $ - $ - $ - $ 28,317 $ -
Net appreciation(depreciation)in
in fair value of investments 11,741,379 37,783 (8,297) (4,353) (648) 9,682 (349)
---------- ------ ------ ------ ----- ----- -----
16,011,299 110,130 (8,297) (4,353) (648) 37,999 (349)
Contributions:
Employer contributions 1,989,147 54,359 582 510 105 18,881 162
Participant contributions 4,666,568 258,235 2,044 1,411 405 90,995 637
Rollover contributions 59,992 - - - - - -
------ ----- ----- ----- ----- ------ -----
6,715,707 312,594 2,626 1,921 510 109,876 799
Transfers:
Transfers from the plan (Note 1) (47,079,390) (3,005,224) - - - (602,060) -
Transfers to the plan (Note 1) - - - - - - -
Interfund transfers, net (1,007,028) 4,045,065 45,207 21,144 2,556 900,783 3,143
---------- --------- ------ ------ ----- ------- -----
(48,086,418) 1,039,841 45,207 21,144 2,556 298,723 3,143
Withdrawals and Distributions:
Distributions to participants-
cash & common stock (7,797,299) (134,771) - - - (39,469) -
Dividends paid to participants (5,716,669) - - - - - -
Administrative expenses (7,560) - - - - - -
------ ----- ----- ----- ----- ----- -----
(13,521,528) (134,771) - - - (39,469) -
---------- --------- ------ ------ ----- ------ -----
Net Increase (Decrease) (38,880,940) 1,327,794 39,536 18,712 2,418 407,129 3,593
Net Assets Available for Plan
Benefits, Beginning of Year 87,319,362 - - - - - -
---------- ----- ----- ----- ----- ----- -----
Net Assets Available for Plan
Benefits, End of Year $48,438,422 $1,327,794 $ 39,536 $ 18,712 $ 2,418 $407,129 $ 3,593
=========== ========== ======== ======== ======== ======== ========
The accompanying notes to financial statements are an integral part of these
financial statements.
3
NEW CENTURY ENERGIES, INC. EMPLOYEE INVESTMENT PLAN FOR BARGAINING
UNIT EMPLOYEES AND FORMER NON-BARGAINING UNIT EMPLOYEES
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
FOR THE YEAR ENDED AUGUST 31, 1998
(WITH FUND INFORMATION)
Participant Directed
-------------------------------------------------------------------------------
Retirement T Rowe Price Strong
Bond Savings Fidelity International Government Short-Term QPS Trust
Market Trust Value Stock Securities Investment Funds
Fund Fund Fund Fund Fund Fund (Notes 5 & 6)
---- ---- ---- ---- ---- ---- -------------
Net Investment Income:
Interest and dividend income $ 16,299 $ 9,999 $ 23,308 $ 10,744 $ 14,010 $ 6,741 $ 450
Net appreciation (depreciation)in
fair value of investments 2,133 - 33,408 27,554 11,778 - (736)
----- ------ ------ ------ ------ ----- ----
18,432 9,999 56,716 38,298 25,788 6,741 (286)
Contributions:
Employer contirbutions 8,212 4,631 69,071 24,201 11,182 6,158 5,512
Participants contributions 38,873 22,084 230,226 80,669 37,274 20,527 7,746
Rollover contributions - - 5,471 - - - 8,319
---- ----- ----- ----- ----- ----- -----
47,085 26,715 304,768 104,870 48,456 26,685 21,577
Transfers:
Transfers from the plan (Note 1) (399,147) (145,230) - - - - (27,643)
Transfers to the plan (Note 1) - - - - - - 15,725
Interfund transfers, net 595,777 349,456 (3,260,276) (896,016) (492,354) (307,457) -
------- ------- ---------- -------- -------- -------- -----
196,630 204,226 (3,260,276) (896,016) (492,354) (307,457) (11,918)
Withdrawls and Distributions:
Distributions to participants-
cash & common stock (12,168) (16,530) (129,085) (23,087) (27,686) (11,152) (9,373)
Dividends paid to participants - - - - - - -
Administrative expenses (234) (156) - - - - -
---- ---- ----- ----- ----- ------- ------
(12,402) (16,686) (129,085) (23,087) (27,686) (11,152) (9,373)
------- ------- ---------- ------- -------- --------- -----
Net Increase(Decrease) 249,745 224,254 (3,027,877) (775,935) (445,796) (285,183) -
Net Assets Available for Plan
Benefits, Beginning of Year - - 3,027,877 775,935 445,796 285,183 -
------ ----- --------- ------- ------- ------- ------
Net Assets Available for Plan
Benefits, End of Year $ 249,745 $ 224,254 $ - $ - $ - $ - $ -
========= ========= ========== ======== ======= ======== ======
The accompanying notes to financial statements are an integral part of these
financial statements.
3
NEW CENTURY ENERGIES, INC. EMPLOYEE INVESTMENT PLAN FOR BARGAINING
UNIT EMPLOYEES AND FORMER NON-BARGAINING UNIT EMPLOYEES
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
FOR THE YEAR ENDED AUGUST 31, 1998
(WITH FUND INFORMATION)
Total
-----
Net Investment Income:
Interest and dividend income $ 4,452,135
Net appreciation(depreciation)in
in fair value of investments 11,849,334
----------
16,301,469
Contributions:
Employer contributions 2,192,713
Participant contributions 5,457,694
Rollover contributions 73,782
------
7,724,189
Transfers:
Transfers from the plan (Note 1) (51,258,694)
Transfers to the plan (Note 1) 15,725
Interfund transfers, net -
-----
(51,242,969)
Withdrawals and Distributions:
Distributions to participants-
cash & common stock (8,200,620)
Dividends paid to participants (5,716,669)
Administrative expenses (7,950)
------
(13,925,239)
----------
Net Increase (Decrease) (41,142,550)
Net Assets Available for Plan
Benefits, Beginning of Year 91,854,153
----------
Net Assets Available for Plan
Benefits, End of Year $50,711,603
===========
The accompanying notes to financial statements are an integral part of these
financial statements.
3
NEW CENTURY ENERGIES, INC. EMPLOYEE INVESTMENT PLAN FOR BARGAINING
UNIT EMPLOYEES AND FORMER NON-BARGAINING UNIT EMPLOYEES
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
FOR THE YEAR ENDED AUGUST 31, 1997
(WITH FUND INFORMATION)
Participant Directed
-----------------------------------------------------------
Company T Rowe Price Strong
Common Fidelity International Government Short-Term
Stock Value Stock Securities Investment
Fund (Note 1,2) Fund Fund Fund Fund Total
--------------- ---- ---- ---- ---- -----
Net Investment Income:
Interest and dividend income $ 4,948,951 $ 28,142 $ 12,763 $ 19,243 $ 10,092 $ 5,019,191
Net appreciation in in fair
value of investments 12,863,034 573,482 42,715 12,735 - 13,491,966
---------- -------- -------- -------- -------- -----------
17,811,985 601,624 55,478 31,978 10,092 18,511,157
Contributions:
Employer contributions 2,339,824 186,705 63,632 34,884 17,978 2,643,023
Participant contributions 5,722,772 622,651 212,091 116,268 59,923 6,733,705
--------- ------- -------- -------- -------- ----------
8,062,596 809,356 275,723 151,152 77,901 9,376,728
Transfers:
Interfund transfers, net and
rollovers (649,189) 511,707 95,756 14,505 94,173 66,952
Withdrawals and Distributions:
Distributions to participants-
cash & common stock (10,457,022) - - - - (10,457,022)
Dividends paid to participants (4,936,292) (39,169) (8,718) - - (4,984,179)
---------- ------- ------ -------- ------ -----------
(15,393,314) (39,169) (8,718) - - (15,441,201)
------------ ------- ------ -------- ------ -----------
Net Increase in Net Assets
Available for Plan Benefits 9,832,078 1,883,518 418,239 197,635 182,166 12,513,636
Net Assets Available for Plan
Benefits, Beginning of Year 77,487,284 1,144,359 357,696 248,161 103,017 79,340,517
------------ --------- ------- -------- ------- ----------
Net Assets Available for Plan
Benefits, End of Year $ 87,319,362 $ 3,027,877 $ 775,935 $ 445,796 $ 285,183 $ 91,854,153
============ =========== ========= ========= ======== ============
The accompanying notes to financial statements are an integral part of
these financial statements.
4
NEW CENTURY ENERGIES, INC. EMPLOYEE INVESTMENT PLAN FOR BARGAINING UNIT
EMPLOYEES AND FORMER NON-BARGAINING UNIT EMPLOYEES NOTES TO FINANCIAL STATEMENTS
FOR THE YEARS ENDED AUGUST 31, 1998 and 1997
1. DESCRIPTION OF PLAN
The following description of the New Century Energies, Inc. Employee
Investment Plan for Bargaining Unit Employees and Former Non-Bargaining Unit
Employees (the "Plan"), formerly known as the Southwestern Public Service
Company Employee Investment Plan, provides general information about the
Plan. Participants should refer to the Plan agreement and to the "Propectus
and Supplemental Summary Plan Description Report" for a more complete
description of the Plan's provisions.
Company Merger - Effective August 1, 1997, Southwestern Public Service
Company ("SPS") merged with Public Service Company of Colorado ("PSCo") to
form and become wholly owned subsidiaries of New Century Energies, Inc.
("NCE"). As a result, each outstanding share of SPS company common stock was
cancelled and converted into the right to receive 0.95 of one share of NCE
common stock in accordance with the terms of the merger agreement. Company
Common Stock, referred to in these financial statements, may consist of
either NCE or SPS common stock.
General - The Plan is a defined contribution plan covering certain full-time
employees of NCE and participating subsidiaries, who have completed one year
of service, as defined. It is subject to the provisions of the Employee
Retirement Income Security Act of 1974 ("ERISA"). The Plan is administered
by a committee appointed by NCE's Board of Directors.
Participation - Beginning July 1, 1998, active employees of SPS/NCE, who are
covered by a collective bargaining agreement that specificly provides that
its members are eligible for this Plan, shall be eligible to participate in
the Plan following the date the employee completes one year of service.
Employees are eligible to participate in the Plan on the June 1, September
1, December 1 or March 1 following the date the employee completes one year
of service.
On July 1, 1998, participants who were eligible to participate on June 30,
1998 and were not covered by a collective bargaining agreement, were
transferred into a new plan, to form the New Century Energies, Inc. Employee
Savings and Stock Ownership Plan for Non-Bargaining Unit Employees. The net
investment balances of the participants' accounts, which were transferred to
the new plan, totaled $51,258,694.
Contributions - Participants may elect to contribute up to 15 percent of
their pre-tax annual compensation, as defined in the Plan. The Employer, at
its descretion, may make matching contributions and/or additional
contributions to the Plan each Plan quarter in cash or shares of the
Company's common stock. Employer contributions are subject to certain
limitations. For years ended August 31, 1998 and 1997, SPS/NCE contributed
to the Plan amounts in accordance with the plan agreement. These
contributions were calculated based on the common stock dividends paid to
participants on shares of Company Common Stock and the tax savings resulting
from these dividends, Company matching contribution and any discretionary
contributions to the Plan. For the year ended August 31, 1997, the
employer's contribution was reduced by administrative and investment
expenses of $148,649, as salary match, deferral match and optional employer
contributions.
Change in Trustee and Recordkeepers - Effective February 1, 1998, The
Vanguard Fiduciary Trust Company ("Vanguard" or the "Trustee") was selected,
by the Board of Directors of NCE, to be the trustee
5
and recordkeeper of the Plan. Boatmen's National Bank of Amarillo
("Boatmen's") and KPMG Peat Marwick were the former trustee and
recordkeeper, respectively, for the period prior to February 1, 1998. In
connection with these changes, plan assets held by Boatmen's were
transferred to Vanguard.
Investment Options - Participants may direct up to 25 percent of their
contributions and the Employer matching contributions. Effective with the
change in trustees and recordkeepers, participants may direct their
contributions, the Employer contributions and any rollovers into any or all
of nine available investment options (see Note 6). Any dividends and
interest earned on investments directed by participants will be reinvested
in each of those same investments automatically. If participants did not
select one of the investment options, all of their contributions were
invested in shares of the Company's common stock.
Allocations - The Employer deferral match and optional contributions are
allocated in the proportion each participant's contribution to the Plan
bears to the contributions of all participants. The Employer salary match is
allocated in the proportion each participant's salary bears to the salaries
of all participants.
Vesting - Employees are fully vested in their contributions and in their
allocated amount of the Company's contributions.
Distributions - Beginning July 1, 1998, upon termination of employment for
any reason, distributions of benefits to participants, which are less than
$5,000 ($3,500 for periods prior to July 1, 1998), are to be made within a
reasonable period of time, generally not to exceed 60 days following the
close of the plan year in which such termination occurs. Distributions of
benefits to participants which exceed $5,000 are generally made when the
participant reaches age 65. However, terminated participants may provide a
written request to the administrative committee to receive benefits at an
earlier date. The Plan provides for hardship withdrawls under certain
conditions. Distributions are made in full shares of Company common stock
and cash for any partial shares. The balance of the account is paid in cash.
Termination of the Plan - While NCE expects to continue the Plan, NCE may
terminate the Plan at any time. In the event of termination, NCE shall
direct the Trustee to distribute the assets remaining in the Plan to
participants and beneficiaries in proportion to their respective account
balances, as defined in the Plan agreement.
Administrative Expenses - The Plan provides that administrative expenses may
be paid by the Plan; however, administrative expenses and fees incurred in
connection with the investment of funds for the Plan have been paid by the
Company in 1998 and 1997. Such amounts have reduced the amount of the
Employer contributions to the Plan for the year-end August 31, 1997.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting - The accompanying financial statements of the Plan have
been prepared under the accrual method of accounting.
Use of Estimates - The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date
of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ from those
estimates.
Investment Valuation and Income Recognition - The Plan's investments are
stated at fair value. Shares of registered investment companies are valued
at quoted market prices, which represent the net asset value of shares held
by the Plan at year-end. The Company's common stock is valued at its quoted
market price. The change in the difference between fair value and the cost
of investments, including realized gains and
6
losses and unrealized appreciation (depreciation) are reflected in the
statement of changes in net assets available for plan benefits. During
1998, the Plan invested in a common/collective trust fund, which invests
mainly in guaranteed investment contracts and alternative investment
contracts. These contracts are carried in the common/collective trust
fund's audited financial statements at fair value, which approximates
contract value. The investment in the common/collective trust fund in the
accompanying financial statements is valued at the Plan's proportionate
interest in the fund as of the financial statement date. Interest rates
earned on the investment change daily. In general, the investments in this
fund are of a high credit quality and short-term average maturities.
Securities transactions are recognized on the trade date (the date the order
to buy or sell is executed). Dividend income is recorded on the ex-dividend
date.
Payment of Benefits - Benefits are recorded when paid.
Statement of Changes in Net Assets - The net changes reported for the
Company Common Stock Fund represent both the participant and non-participant
directed amounts.
Accrued interest and dividends - For the year ended August 31, 1997, accrued
interest & dividends totaling $1,069,819 is for the Company Common Stock
Fund and accrued interest & dividends totaling $1,312 is for the Boatmen's
Short-term Investment Fund.
Reclassifications - Certain prior year amounts have been reclassified to
conform with the current year presentation.
3. DIVIDENDS PAYABLE
Dividends received on shares of Company common stock are distributed to
participants. Prior to the end of the 1998 Plan year, dividends were
declared July 24, 1998 and paid to participants August 15, 1998. Dividends
declared prior to the end of the 1997 plan year, but not received until
after the Plan's year-end, totaled approximately $1,062,085, were
distributed in accordance with the Plan provisions in fiscal year 1998.
4. FEDERAL INCOME TAX STATUS
The Internal Revenue Service has determined and informed the Company by a
letter dated March 12, 1998 that the Plan and related trust are designed in
accordance with applicable sections of the Internal Revenue Code ("IRC").
The Plan has been amended since receiving the determination letter. However,
the Plan administrator believes that the Plan is designed and is currently
being operated in compliance with the applicable provisions of the IRC.
5. PLAN AMENDMENTS
SPS, PSCo and the Board of Directors of NCE approved an amendment to the
Plan on March 25, 1997. In summary, this amendment allowed former employees
of SPS, who were transferred to NCE or a subsidiary company of NCE, to
continue to be eligible to participate in the Plan until July 1, 1998. On
October 15, 1997, the SPS Board of Directors approved an amendment to the
Plan to merge the Quixx Power Services, Inc. 401(k) Plan ("QPS Plan") net
assets into the Plan. On December 16, 1997, the NCE Board of Directors
approved the spin-off of the assets and accrued benefits for
actively-employed participants, who are not covered by a collective
bargaining agreement, to create a separate defined contribution savings
plan. This separate plan was established July 1, 1998, as discussed in Note
1. The Plan will be amended from time to time, as required, to comply with
legal requirements upon the advice of the Plan's legal counsel.
7
6. INVESTMENTS
The Plan assets, including all investment funds available at August 31, 1998
and August 31, 1997, are summarized below:
Company Common Stock Fund:
Investments in Company Common Stock, at August 31, 1998 and August 31, 1997,
comprise 95.1% and 93.5%, respectively, of Net Assets Available for Plan
Benefits.
Registered Investment Companies:
American Century Value Fund (Growth & Income Stock Fund) - invested in
equity securities.
Europacific Growth Fund (International Stock Fund) - invested in companies
outside the U.S., which offer above average growth potential.
Bond Market Fund (Bond Fund) - invested in U.S. government and corporate
bonds and mortgage-backed securities.
Index 500 Fund (Growth & Income Stock Fund) - invested in all stocks in the
Standard & Poor's 500 Index.
PRIMECAP Fund (Growth Stock Fund) - invested in common stocks with the
emphasis on growth.
Wellington Fund (Balanced Fund) - invested in common stocks and bonds.
SMALLCAP World Fund (Growth Stock Fund) - invested in common stocks of
smaller companies in the U.S. and around the world.
Fidelity Value Fund (Growth Stock Fund, Boatmen's) - invested in common
stocks of companies believed to be undervalued in relation to the companies'
assets, earnings or growth potential.
T Rowe Price International Stock Fund (Growth & Income Stock Fund,
Boatmen's) invested in a diversified portfolio of established non-U.S.
stocks with a emphasis on long-term growth of capital and income.
Strong Government Securities Fund (Bond Fund, Boatmen's) - invested in a
diversified portfolio of securities issued or guaranteed as to principal and
interest by the U.S.
Government and its agencies or instrumentalities.
Common/Collective Investment Trust:
Vanguard Retirement Savings Trust Fund - invested in various investment
contracts issued and backed by financial institutions. It also invests in
"alternative" contracts backed by high quality bonds and bond mutual funds
owned by the Trust.
Boatmen's Short-Term Investment Fund - invested in a diversified portfolio
of money market instruments such as U.S. Treasury Bills, certificates of
deposit, commercial paper and demand notes.
8
The Fund seeks to preserve investment capital and as a secondary objective,
seeks to provide a reasonable level of current income.
QSP Trust Funds - These investments were held solely by participants in the
former QSP Plan which was merged ($15,725) into the Plan in October 1997 and
subsequently transferred ($27,643) to a separate defined contribution
savings plan on July 1, 1998 (see Note 5). These funds consisted of
collective investments held by the Amarillo National Bank in money market,
bond and equity investments.
7. RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500
The following is a reconciliation of net assets available for benefits per
the financial statements to the Form 5500 for the plan year ending August
31, 1998 and 1997:
August 31, 1998 August 31, 1997
Net assets available for benefits per the
financial statements $50,711,603 $ 91,854,153
Amounts allocated to withdrawing
participants - (34,281)
---------- ------------
Net assets available for benefits per the
Form 5500 $50,711,603 $ 91,819,872
=========== ============
The following is a reconciliation of benefits paid to participants per the
financial statements to the Form 5500 for the year-end:
August 31, 1998 August 31, 1997
Benefits paid to participants per the
financial statements $13,917,289 $ 15,441,201
Add: Amounts allocated to withdrawing
participants at end of year - 34,281
Less: Amounts allocated to withdrawing
participants at beginning of year 34,281 -
----------- -----
Benefits paid to participants per the
Form 5500 $13,883,008 $ 15,475,482
=========== ============
8. RELATED PARTY TRANSACTIONS
Certain Plan investments are shares of Company Common Stock. Certain Plan
investments are shares of registered investment companies, common/collective
trust funds and short-term investments managed by Boatmen's during the
period September 1, 1997 to January 31, 1998 and by Vanguard during the
period February 1, 1998 to August 31, 1998. Vanguard and Boatmen's are the
trustees as defined by the Plan and therefore these transactions qualify as
party-in-interest. Fees incurred for investment management services are paid
by the Company on behalf of the Plan.
9. RISKS AND UNCERTAINTIES
The Plan provides for investment in a variety of investment funds general
investment fund. 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 the investments will occur in the
near term and that such changes could materially affect participants'
account balances and the amounts reported in the statements of net assets
available for plan benefits.
9
NEW CENTURY ENERGIES, INC. EMPLOYEE Schedule 1
INVESTMENT PLAN FOR BARGAINING UNIT
EMPLOYEES AND FORMER NON-BARGAINING
UNIT EMPLOYEES
ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
AS OF AUGUST 31, 1998
Identity of Issue Number of Cost Fair Value
Shares
- --------------------------------------------------------------------------------
Company Common Stock Fund(1) 1,045,594 $31,027,262 $ 48,228,039
Registered Investment
Companies:
American Century Value Fund 215,551 1,504,576 1,327,794
Europacific Growth Fund 16,227 446,530 407,129
Bond Market Fund 24,294 246,542 249,745
Index 500 Fund 444 47,833 39,536
PRIMECAP Fund 514 23,065 18,712
Wellington Fund 125 3,942 3,593
SMALLCAP World Fund 112 3,065 2,418
Common/ Collective Trust
Vanguard Retirement 224,254 224,254 224,254
Savings Trust Fund (1) ----------- -----------
Total Assets Held for
Investment Purposes $33,527,069 $50,501,220
=========== ===========
(1)Represents transaction with party-in-interest (Note 8)
The accompanying notes to financial statements are an integral part
of this schedule.
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NEW CENTURY ENERGIES, INC. EMPLOYEE Schedule 2
INVESTMENT PLAN FOR BARGAINING UNIT
EMPLOYEES AND FORMER NON-BARGAINING
UNIT EMPLOYEES
ITEM 27b - SCHEDULE OF LOANS OR FIXED-INCOME OBLIGATIONS IN DEFAULT
OR UNCOLLECTIBLE
ITEM 27c - SCHEDULE OF LEASES IN DEFAULT OR UNCOLLECTIBLE
AS OF AUGUST 31, 1998
A schedule of loans or fixed-income obligations in default or classified as
uncollectible and a schedule of leases in default or classified as
uncollectible were not presented because there were no loans, fixed-income
obligations or leases which are in default or classified as uncollectible as
of August 31, 1998.
11
NEW CENTURY ENERGIES, INC. EMPLOYEE INVESTMENT PLAN Schedule 3
FOR BARGAINING UNIT EMPLOYEES AND FORMER
NON-BARGAINING UNIT EMPLOYEES
ITEM 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED AUGUST 31, 1998
Current
Value of
Asset on Net
Identity of Party Purchase Selling Cost of Transaction Gain
Involved Description of Asset Price Price Asset Date (Loss)
Boatmen's Trust Co. * Purchase- Short-Term $ 6,897,047 $ - $ 6,897,047 $ 6,897,047 $ -
Investment Company
Prime Portfolio
Boatmen's Trust Co. * Sale- Short-Term - 8,417,389 8,417,389 8,417,389 -
Investment Company
Prime Portfolio
The Vanguard Group * NCE Common Stock 97,194,700 - - 97,194,700 -
The Vanguard Group * NCE Common Stock - 50,033,039 32,061,803 50,033,039 17,971,236
*Represents transaction with party-in-interest (Note 8)
The accompanying notes to financial statements are
an integral part of this schedule.
12
NEW CENTURY ENERGIES, INC. EMPLOYEE Schedule 4
INVESTMENT PLAN FOR BARGAINING UNIT
EMPLOYEES AND FORMER NON-BARGAINING
UNIT EMPLOYEES
ITEM 27e & f - SCHEDULE OF NONEXEMPT TRANSACTIONS WITH PARTIES-IN-INTEREST FOR
THE YEAR ENDED AUGUST 31, 1998
A schedule of nonexempt transactions with parties-in-interest has not been
presented because there were no nonexempt transactions which are prohibited by
ERISA Section 406 and for which there is no statutory or administrative
exemption for the year ended August 31, 1998.
13
NEW CENTURY ENERGIES, INC.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
New Century Energies, Inc. ERISA Committee has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized on the 25th
day of February, 1999.
NEW CENTURY ENERGIES, INC. EMPLOYEE INVESTMENT
PLAN FOR BARGAINING UNIT EMPLOYEES AND FORMER
NON-BARGAINING UNIT EMPLOYEES
(The Plan)
By /s/R. C. Kelly
---------------------------------
R. C. KELLY
Executive Vice President and
Chief Financial Officer of
New Century Energies, Inc. and
Member of the New Century Energies, Inc.
ERISA Committee
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Exhibit 23(a). Consent of Arthur Andersen LLP
Consent of Independent Public Accountant
As independent public accountants, we hereby consent to the incorporation by
reference of our report dated January 8, 1999, included in this Form 11-K, into
New Century Energies, Inc.'s previously filed Registration Statement (Form S-3,
File No. 333-28637) pertaining to the Dividend Reinvestment and Cash Payment
Plan; New Century Energies, Inc.'s Registration Statement (Form S-8, File No.
333-28639) pertaining to the Omnibus Incentive Plan; New Century Energies,
Inc.'s Registration Statements (Forms S-3, File Nos. 333-40361 and 333-64067)
pertaining to the registration of NCE Common Stock and New Century Energies,
Inc.'s Registration Statement (Form S-8, File No. 333-58117) pertaining to the
New Century Energies, Inc. Employee Investment Plan for Bargaining Unit
Employees and Former Non-Bargaining Unit Employees, and New Century Energies,
Inc. Employee's Savings and Stock Ownership Plan for Non-Bargaining Unit
Employees and to all references to our Firm included in this Form 11-K.
ARTHUR ANDERSEN LLP
Denver, Colorado
Feburary 25, 1999
15