Form 11-K CMP Employee Savings and Investment Plan for Union Employees

 

 



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 OF 1934

     For the fiscal year ended December 31, 2004

OR

    TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934

     For the transition period from             to
             

Commission file number 1-14766


Full title of the plan and the address of the plan, if different from
that of the issuer named below:

Central Maine Power Company
   Employee Savings and Investment Plan for Union Employees
83 Edison Drive
Augusta, Maine 04336


Name of issuer of the securities held pursuant to the plan
and the address of its principal executive office:

Energy East Corporation
52 Farm View Drive
New Gloucester, Maine 04260-5116


REQUIRED INFORMATION

The Central Maine Power Company Employee Savings and Investment Plan for Union Employees (Plan) is subject to the Employee Retirement Income Security Act of 1974 (ERISA). Therefore, in lieu of the requirements of Items 1-3 of Form 11-K, the financial statements of the Plan for the two fiscal years ended December 31, 2004 and 2003 and supplemental schedules, which have been prepared in accordance with the financial reporting requirements of ERISA, are attached hereto as Appendix 1 and incorporated herein by reference.

 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Committee to administer the Central Maine Power Company Employee Savings and Investment Plan for Union Employees has duly caused this Annual Report to be signed by the undersigned hereunto duly authorized.

 

Central Maine Power Company Employee Savings
and Investment Plan for Union Employees

 

Date:  June 29, 2005

By    /s/Richard R. Benson                                 
            Richard R. Benson 
            Committee Member


Date:  June 29, 2005

By    /s/R. Scott Mahoney                                   
            R. Scott Mahoney 
            Committee Member


Date:  June 29, 2005

By    /s/Robert D. Kump                                    
            Robert D. Kump      
            Committee Member 


 

 

APPENDIX 1

CENTRAL MAINE POWER COMPANY
EMPLOYEE SAVINGS AND INVESTMENT PLAN FOR UNION EMPLOYEES

 

FINANCIAL STATEMENTS AS OF AND
FOR THE YEARS ENDED DECEMBER 31, 2004 and 2003
SUPPLEMENTAL SCHEDULES AS OF DECEMBER 31, 2004
AND REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 


 

 

Central Maine Power Company
Employee Savings and Investment Plan For Union Employees
Index to Financial Statements and Supplemental Schedules

 

Report of Independent Registered Public Accounting Firm - Baker Newman &    Noyes, LLC

1

   

Report of Independent Registered Public Accounting Firm -    PricewaterhouseCoopers, LLP

2

   

Financial Statements:

     Statements of Net Assets Available for Benefits -
       December 31, 2004 and 2003




3

   

     Statements of Changes in Net Assets Available for Benefits -
       Years ended December 31, 2004 and 2003


4

   

     Notes to Financial Statements

5

   

Supplemental Schedules*

 
   

     Schedule H, line 4i - Schedule of Assets (Held at End of Year)

9

   

     Schedule H, line 4j - Schedule of Reportable Transactions

10

   

     Schedule G, Part I: Schedule of Loans or Fixed Income Obligations in Default      or Classified as Uncollectible

11

   

Consent of Independent Registered Public Accounting Firm - Baker Newman &    Noyes, LLC

Exhibit 23.1

   

Consent of Independent Registered Public Accounting Firm -    PricewaterhouseCoopers, LLP

Exhibit 23.2




*Other supplemental schedules required by Section 2520.103-10 of the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974 have been omitted because they are not applicable.


REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Participants and Administrative Committee of the
Central Maine Power Company
   Employee Savings and Investment Plan for Union Employees

We have audited the accompanying statement of net assets available for benefits of the Central Maine Power Company Employee Savings and Investment Plan for Union Employees (the Plan) as of December 31, 2004, and the related statement of changes in net assets available for benefits for the year ended December 31, 2004. 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 audit.

We conducted our audit in accordance with the auditing standards of the Public Company Accounting Oversight Board (United States). 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 audit provides 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 benefits of the Central Maine Power Company Employee Savings and Investment Plan for Union Employees as of December 31, 2004, and the changes in its net assets available for benefits for the year ended December 31, 2004, in conformity with accounting principles generally accepted in the United States of America.

Our audit was made for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules of loans or fixed income obligations in default or classified as uncollectible, assets (held at end of year) and reportable transactions as of or for the year ended December 31, 2004, 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 United States Department of Labor Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The supplemental schedules are the responsibility of the Plan's management. The supplemental schedules 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.

The schedule of reportable transactions that accompanies the Plan's financial statements does not disclose the historical cost and net gain or loss on certain transactions. Disclosure of this information is required by the United States Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974.

 

/s/ Baker Newman & Noyes         
Limited Liability Company

Portland, Maine
June 28, 2005

 

 

 

 

 

Report of Independent Registered Public Accounting Firm

 

 

 

To the Participants and Administrative Committee of the
Central Maine Power Company Employee Savings and
   Investment Plan for Union Employees

In our opinion, the accompanying statement of net assets available for benefits and the related statement of changes in net assets available for benefits present fairly, in all material respects, the net assets available for benefits of the Central Maine Power Company Employee Savings and Investment Plan for Union Employees (the "Plan") at December 31, 2003, and the changes in net assets available for benefits for the year then ended in conformity with accounting principles generally accepted in the United States of America. 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 audit. We conducted our audit of these statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). 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, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

 

 

 

 

/s/PricewaterhouseCoopers LLP

New York, New York
June 24, 2004


Central Maine Power Company
Employee Savings and Investment Plan for Union Employees
Statements of Net Assets Available for Benefits
December 31, 2004 and 2003

 

2004   

2003     

Assets:

   

  Investments, at fair value:

   

    Registered Investment Companies

$     36,662,240

$     32,285,533

    Common/Collective Trust

6,944,436

7,719,066

    Energy East Corporation Stock Fund

5,798,451

4,232,187

    Participant loans

1,211,790

1,035,145

 

50,616,917

45,271,931


  Receivables:

   

    Due from broker for securities sold

-     

348

    Contributions Receivable

71,263

-     

 

71,263

348

Net Assets available for benefits

$     50,688,180

$     45,272,279

 

See notes to financial statements.


Central Maine Power Company
Employee Savings and Investment Plan for Union Employees
Statements of Changes in Net Assets Available for Benefits
Years Ended December 31, 2004 and 2003


 

2004     

2003     

Additions:

   

  Investment income:

   

    Net appreciation in fair value of investments

$     4,097,791

$     6,300,181

    Interest and dividends

798,015

545,784

 

4,895,806

6,845,965


  Contributions:

   

    Participant

2,261,482

2,320,239

    Employer

791,014

811,311

    Contributions Receivable - Employers

16,170

-      

    Contributions Receivable - Employees

55,093

-      

    Transfer from other qualified plans

34,070

64

 

3,157,829

3,131,614


           Total additions


8,053,635


9,977,579


Deductions:

 


  Benefits paid to participants

2,637,734

1, 341,167

  Transfer to other qualified plans

-      

567,903


           Total deductions


2,637,734


1,909,070


Net increase


5,415,901


8,068,509


Net assets available for benefits:
  Beginning of year



45,272,279



37,203,770


  End of year


$     50,688,180


$     45,272,279

 

See notes to financial statements.


Central Maine Power Company
Employee Savings and Investment Plan for Union Employees
Notes to Financial Statements
December 31, 2004 and 2003


1.   DESCRIPTION OF THE PLAN

The following description of the Central Maine Power Company (Company) Employee Savings and Investment Plan for Union Employees (Plan) is provided for general information purposes only. Participants should refer to the Plan document for a more complete description of the Plan's provisions.

General

The Plan was established by the Company on November 15, 1984, and became effective January 1, 1985, under the provisions of Section 401(a) of the Internal Revenue Code (Code), and it includes a qualified cash or deferred arrangement as described in Section 401(k) of the Code for the benefit of eligible employees of the Company. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974. The Plan Administrator is the Company and an Administrative Committee has been appointed to serve as manager of the Plan.

The Plan is a defined contribution plan covering union employees of the Company, as well as employees of Energy East Corporation's (Energy East) family of companies that elect to participate under the Plan provisions. Energy East, the parent corporation of the Company, through its subsidiaries, delivers electricity and natural gas to retail customers and provides electricity, natural gas, energy management and other services to retail and wholesale customers in the Northeast.

Eligibility

Each employee of the Company or an affiliated employer who is in a unit of employees covered by a collective bargaining agreement is eligible to join the Plan after completing one year of service during which the employee has worked at least 1,000 hours.

Contributions

Each participant elects a salary reduction percentage to be contributed to the Plan. Participants may elect to make contributions in amounts equal to 2% to 50% (in multiples of 1%) of their base compensation to the Plan through salary reduction agreements. As of January 1, 2002, participants age 50 or over by the end of the Plan year can make an additional contribution to the Plan in accordance with and subject to the limitations of Section 414(v) of the Code. The maximum additional contribution in 2003 was $2,000 and increases by $1,000 a year until the additional contribution reaches a maximum of $5,000 in 2006.

As of April 1, 2002, the Plan accepts rollovers from other qualified plans, as well as 403(b) and government 457 plans, traditional Individual Retirement Accounts (IRAs), conduit IRAs (but not Roth IRAs), after-tax distributions from employer retirement plans and spousal death benefit payments.

For employees that were hired prior to May 1, 2000, the Company contributes to the Plan an amount equal to 60% of the first 5% of the salary reduction plus 50% of the next 2% for


Central Maine Power Company
Employee Savings and Investment Plan for Union Employees
Notes to Financial Statements
December 31, 2004 and 2003


1.   DESCRIPTION OF THE PLAN  (Continued)

Contributions (Continued)

a possible total match of 4% on a 7% salary reduction amount, provided, however, that the total contribution that the Company is obligated to make for any year does not exceed the maximum amount deductible from the Company's gross income under applicable provisions of the Code. Effective January 1, 2001, the Company contributes to the Plan on behalf of each participant hired on or after May 1, 2000, a matching contribution in an amount equal to 100% of each participant's contribution up to 4% of compensation. The Company's matching contribution is made simultaneously with the payroll cycle. As of January 1, 2002, the Energy East Stock Fund was converted to an Employee Stock Ownership Plan (ESOP). Dividends from the ESOP may be reinvested or taken in cash.

Benefit Payments

On termination of service a participant may elect either a lump sum amount equal to the value of the interest in the participant's account, or installments over a period permissible under the Code. Distributions made from the funds occur as a result of termination of employment, death, retirement or permanent disability no later than 60 days after the end of the Plan year, unless under certain circumstances participants elect otherwise.

A participant may elect to make a regular withdrawal of up to 100% of the value of the participant's contributions under certain conditions and earnings thereon are treated as pre-tax contributions. Only one regular withdrawal may be made in any year. The minimum withdrawal was increased to $1,000, effective May 1, 2000.

Other withdrawals with respect to contributions made subsequent to July 1, 1985, may be made only for reasons of hardship. With the consent of the Company's Savings and Investment Plan Committee for Union Employees, a participant may elect to make a hardship withdrawal, as determined in accordance with the Plan provisions, of up to 100% of the participant's account.

Vesting

Participants are 100% vested in their account balances. Each participant's account consists of the participant's contributions and any rollover money, the matching Company contribution and any net earnings thereon.

Participant Loans

Participants may, in general, borrow in the aggregate not more than 50% of their account balances, subject to a minimum loan of $1,000 and a maximum loan of $50,000. Loan interest rates are set by the Committee in accordance with prevailing rates charged by local banks. The interest rate on loans outstanding at year end was 7.25% for 2004 and 2003. The maximum term of the loans is generally five years, or longer for mortgages, with borrowed funds being repaid through payroll deductions.


Central Maine Power Company
Employee Savings and Investment Plan for Union Employees
Notes to Financial Statements
December 31, 2004 and 2003

1.   DESCRIPTION OF THE PLAN  (Continued)

Participant Loans (Continued)

If a participant's employment terminates for any reason, the loan will become immediately due and payable and must be paid within 90 days from the date of termination.

2.   SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The financial statements are prepared on an accrual basis and in conformity with accounting principles generally accepted in the United States of America, which 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. Estimates also affect the reported amounts of additions and deductions 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 the net asset value of shares held by the Plan at year end. Units of common/collective trust funds are valued at the net asset value of units held by the Plan at year end. The Energy East Stock Fund, comprised solely of Energy East common stock, is valued at its quoted market price at year end. Participant loans are valued at cost, which approximates fair value.

Purchases and sales of investments are recorded on a trade-date basis. Interest income is accrued when earned. Dividend income is recorded on the ex-dividend date.

Payments of Benefits

Benefits are recorded when paid.

Plan Termination

Although the Company has not expressed any intent to terminate the Plan, it has the right to discontinue contributions at any time and to terminate the Plan subject to the Company's collective bargaining agreement. In the event of termination of the Plan, the net assets of the Plan are set aside, first, for payment of all Plan expenses, and second, for distribution to participants based upon the balances in their individual accounts.

Risk and Uncertainties

The Plan provides for various investment options in any combination of stocks, fixed income securities, mutual funds, and other investment securities. Investment securities are exposed to various risks, such as interest rate, market and credit risk. Due to the level of risk associated with certain investment securities, it is at least reasonably possible that changes in risk in the near term could materially affect participants' account balances and the amounts reported in the Statements of Net Assets Available for Benefits and the Statements of Changes in Net Assets Available for Benefits.

Central Maine Power Company
Employee Savings and Investment Plan for Union Employees
Notes to Financial Statements
December 31, 2004 and 2003


3.   INVESTMENTS

The following presents investments that represent 5% or more of the Plan's net assets at December 31, 2004 and 2003:

 

2004     

2003     

Fidelity Magellan Fund

 

$   8,455,550 

Vanguard PRIMECAP Fund

-      

4,260,017 

Janus Advisor Balanced Fund

-      

3,369,870 

Putnam S & P 500 Index Fund

-      

7,719,066 

Neuberger & Berman Genesis Trust Fund

-      

2,764,466 

Putnam Money Market Fund

-      

7,507,196 

Energy East Corporation Stock

$    5,798,451

4,232,187 

J. P. Morgan Stable Value Fund

6,944,436

-      

T. Rowe Price Small Cap Value Fund

3,742,401

-      

Vanguard Institutional Index Fund

21,685,282

-      

Plan investments (including gains and losses on investments bought and sold, as well as held during the year) appreciated in value during 2004 and 2003 as follows:

 

2004     

2003     

Registered Investment Companies

$    2,500,501

$    4,432,019

Common/Collective Trust

733,182

1,744,471

Energy East Corporation Stock Fund

864,108

123,691

 

$    4,097,791

$    6,300,181

4.   INCOME TAX STATUS

The Internal Revenue Service determined and informed the Company sponsor by letter dated February 21, 2001, that the Plan is qualified and the related trust established under the Plan is tax-exempt, under the applicable sections of the Code. The Plan has been amended since receiving the determination letter. However, the Plan administrator and the Plan's management believe that the Plan is currently designed and being operated in compliance with the applicable requirements of the Code.

5.   RELATED PARTY TRANSACTIONS

Certain Plan investments are shares of registered investment companies which were managed by Putnam Fiduciary Trust Company (Putnam) through December 30, 2004 and by T. Rowe Price Retirement Plan Services (T. Rowe Price) as of December 31, 2004. Putnam was the trustee as defined by the Plan through December 30, 2004 and T. Rowe Price became the trustee as defined by the Plan effective December 31, 2004; therefore, these transactions qualify as party-in-interest transactions and are exempt from the prohibited transaction rules.

6. ADMINISTRATIVE EXPENSES

Substantially all administrative expenses are paid for by the Company.


Central Maine Power Company
Employee Savings and Investment Plan for Union Employees
Schedule H, line 4i - Schedule of Assets (Held at End of Year)
December 31, 2004


 

         Identity of Issue

     Description of Investment

Current Value

       
 

Pimco Total Return Fund

Registered Investment Company

$      2,028,238

 

Domini Social Equity Class R

Registered Investment Company

38,387

*

T. Rowe Price Equity Income Fund

Registered Investment Company

771,244

 

Fidelity Diversified International Fund

Registered Investment Company

1,258,699

*

T. Rowe Price Growth Stock Fund

Registered Investment Company

289,113

 

J. P. Morgan Stable Value Fund

Common/Collective Trust

6,944,436

*

T. Rowe Price Retirement Income Fund

Registered Investment Company

145,349

*

T. Rowe Price Retirement 2005 Fund

Registered Investment Company

138,217

*

T. Rowe Price Retirement 2010 Fund

Registered Investment Company

1,654,282

*

T. Rowe Price Retirement 2015 Fund

Registered Investment Company

1,521,294

*

T. Rowe Price Retirement 2020 Fund

Registered Investment Company

1,275,469

*

T. Rowe Price Retirement 2025 Fund

Registered Investment Company

833,911

*

T. Rowe Price Retirement 2030 Fund

Registered Investment Company

553,111

*

T. Rowe Price Retirement 2035 Fund

Registered Investment Company

237,719

*

T. Rowe Price Retirement 2040 Fund

Registered Investment Company

122,433

*

T. Rowe Price Small-Cap Value Fund

Registered Investment Company

3,742,401

*

Vanguard Explorer

Registered Investment Company

367,091

 

Vanguard Institutional Index Fund

Registered Investment Company

21,685,282

 

Energy East Corporation Stock

Energy East Stock Fund

5,798,451

 

Loan Fund

Participant Loans (7.25%)

1,211,790

 

            Total assets held at end of year

 

$50,616,917

       

*

Party-in-interest

   

 

Central Maine Power Company
Employee Savings and Investment Plan for Union Employees
Schedule H, Line 4j - Schedule of Reportable Transactions
Year Ended December 31, 2004

(a)

Identity of
Party Involved

(b)
Description of Assets
(Include Interest Rate and
Maturity in Case of Loan)

(c)

Purchase
Price

(d)

Sales
Price

*Putnam Investments

Putnam Money Market Fund

$      -       

$      6,944,436   

*Putnam Investments

Putnam S&P 500 Index Fund

-       

7,998,171   

 Putnam Investments

Fidelity Magellan Fund

-       

8,188,081   

 Putnam Investments

Janus Advisor Balanced Fund

-       

3,544,097   

 Putnam Investments

Vanguard PRIMECAP Fund

-       

5,499,031   

 Putnam Investments

Neuberger & Berman Genesis Trust Fund

-       

3,742,402   

*T. Rowe Price

T. Rowe Price Small-Cap Value Fund

3,742,401

-        

 T. Rowe Price

J. P. Morgan Stable Value Fund

6,944,436

-        

 T. Rowe Price

Vanguard Institutional Index Fund

21,685,282

-        

 

 

(e)

Lease
Rental

(f)
Expense
Incurred with
Transaction

(g)

Cost
of Asset

(h)
Current Value
of Asset on
Transaction Date

(i)

Net Gain
or (Loss)

$       -              

$       -              

$       -              

$       6,944,436    

$       -              

-              

-              

-              

7,998,171    

-              

-              

-              

-              

8,188,081    

-              

-              

-              

-              

3,544,097    

-              

-              

-              

-              

5,499,031    

-              

-              

-              

-              

3,742,402    

-              

-              

-              

3,742,401       

3,742,401    

-              

-              

-              

6,944,436       

6,944,436    

-              

-              

-              

21,685,282       

21,685,282    

-              

 

*  Indicates party-in-interest.

Note: The above transactions represent mandated purchases and sales upon the change in trustee. All other transactions were participant-directed, and thus are not presented on this schedule.

Central Maine Power Company Employee
Savings and Investment Plan for Union Employees
Schedule G, Part I: Schedule of Loans or Fixed Income Obligations in Default or Classified as Uncollectible
As of December 31, 2004

 

 

(a)

Party in interest

(b)


Identity

(c)
Original amount
of loan

(f)
Unpaid balance at end of year

(g)


Description

 

Participant Loan

$1,482

$1,482

7.25% loan dated 1/2/04, matures 1/19/09