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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934
For the year ended Dec. 31, 2002
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
Commission file number: 1-3034
XCEL ENERGY
401(K) SAVINGS PLAN
XCEL ENERGY INC. (the "Company")
800 NICOLLET MALL
MINNEAPOLIS, MINNESOTA 55402
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INDEX
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PAGE
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Financial Statements:
Statements of Net Assets Available for Benefits as of Dec. 31, 2002 and 2001 3
Statement of Changes in Net Assets Available for Benefits for the Year Ended Dec. 31, 2002 4
Notes to Financial Statements 5
Supplemental Schedules:
Schedule H - Line 4(i) - Schedule of Assets Held for Investment Purposes at Dec. 31, 2002 8
Schedule H - Line 4(j) - Schedule of Reportable Transactions for the Year Ended 9
Dec. 31, 2002
Independent Auditors' Report 10
Signature 11
Exhibit 23.01: Independent Auditors' Consent 12
Exhibit 99.01: Officer Certification 13
Page 2
XCEL ENERGY INC.
401(K) SAVINGS PLAN
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STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
AS OF DEC. 31, 2002 AND 2001
2002 2001
------------ ------------
Assets
Receivables:
Employer contributions $ 10,854,411 $ 11,638,038
Participant contributions 1,196,089 339,256
Dividend 2,660,375 1,349,940
Interest -- 49,799
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Total receivables 14,710,875 13,377,033
Xcel Energy Common Stock Fund:
Participant directed 22,584,718 31,020,022
Non-participant directed 673,510 68,839,515
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Total Xcel Energy Common Stock Fund 23,258,228 99,859,537
Non-interest-bearing cash -- 880,002
General investments:
ESOP Stock Fund 132,817,141 --
Interest-bearing cash 31,442,824 51,783,765
Loans to participants 8,104,622 9,905,765
Value of interest in registered investment companies 483,661,320 552,753,108
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Total general investments 656,025,907 614,442,638
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Total assets $693,995,010 $728,559,210
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Liabilities
Pending securities deliverable and other $ -- $ --
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Total liabilities $ -- $ --
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Net assets available for benefits $693,995,010 $728,559,210
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See accompanying notes to financial statements.
Page 3
XCEL ENERGY INC.
401(K) SAVINGS PLAN
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STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DEC. 31, 2002
Additions
Contributions:
Employer $ 12,142,834
Participants 48,818,612
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Total contributions 60,961,446
Earnings on investments:
Investment income
Interest 568,315
Dividends 26,928,772
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Total investment income 27,497,087
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Other additions 60,237
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Total additions 88,518,770
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Deductions
Realized loss on sale of assets 37,460,269
Unrealized depreciation on investments 247,234,429
Benefits paid to participants 62,224,818
Administrative expenses 59,581
Other deductions 335,620
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Total deductions 347,314,717
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Net decrease before transfers (258,795,947)
Transfers (see Note 2):
To this plan 246,283,114
From this plan (22,051,367)
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Net transfers 224,231,747
Net decrease in net assets available for benefits (34,564,200)
Net assets available for benefits:
Beginning of year 728,559,210
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End of year $ 693,995,010
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See accompanying notes to financial statements.
Page 4
XCEL ENERGY INC.
401(K) SAVINGS PLAN
(EIN: 41-0448030 PN: 003)
NOTES TO FINANCIAL STATEMENTS
Xcel Energy Inc.
401(k) Savings Plan
(EIN: 41-0448030 PN:003)
1. Summary of Significant Accounting Policies
BASIS OF ACCOUNTING - The financial statements and supplemental schedules
of the Plan have been prepared in accordance with the Department of Labor's
Rules and Regulations for reporting and disclosure under the Employee
Retirement Income Security Act of 1974 and accounting principles generally
accepted in the United States of America.
INVESTMENT VALUATION - Investments are stated at fair value. Unrealized
gains (appreciation) and losses (depreciation) are recorded for the net
change in the fair value of investments during the year. Dividend income is
accrued on the ex-dividend date.
USE OF ESTIMATES - The preparation of financial statements in conformity
with accounting principles generally accepted in the United States of
America requires management to make estimates and assumptions that affect
the reported amounts of assets, liabilities, and changes therein, and
disclosure of contingent assets and liabilities. Actual results could
differ from those estimates.
BENEFITS - Benefits are recorded as paid.
2. Description of Plan and Funding Policy
The following brief description of the Plan is provided for general
information purposes only.
On August 18, 2000 Northern States Power Co. (NSP) and New Century
Energies, Inc. (NCE) merged and formed Xcel Energy Inc. (Xcel Energy). The
New Century Energies, Inc. Employees' Savings and Stock Ownership Plan for
Non-Bargaining Unit Employees merged into the Xcel Energy Retirement
Savings Plan on December 31, 2001. The Plan was restated and renamed the
Xcel Energy 401(k) Savings Plan effective January 1, 2002. On May 6, 2002,
the Xcel Energy Employee Stock Ownership Plan (previously the Northern
States Power Company Employee Stock Ownership Plan) merged into this Plan.
All of the assets of the trust are available to pay benefits to both
bargaining and nonbargaining participants. Participants should refer to the
Plan document for more complete information.
ELIGIBILITY - The Plan is a defined contribution employee benefit plan,
which provides eligible employees of participating subsidiaries of Xcel
Energy (collectively the "Companies") with the opportunity to contribute to
a retirement savings plan.
PARTICIPANT PRE-TAX CONTRIBUTIONS - Individual participants may elect to
have amounts deducted from their pay on a pre-tax basis and contributed to
their individual accounts in the Plan. Employees can elect to start, stop
or change their contribution election at any time. The maximum pre-tax
contribution each year is 20 percent of annual base pay, not to exceed the
Internal Revenue Service maximum of $11,000 for 2002. Participants may
invest their contributions among the various investment funds offered by
the Plan. Income on a participant's investment in the fund is credited to
each participants' account based on the number of units in the
participants' investment in the fund and the funds' unit value.
PARTICIPANT AFTER-TAX CONTRIBUTIONS - The Plan also allows participants to
make after-tax contributions through payroll deductions. Bargaining
employees can make additional lump sum after tax cash contributions to the
Plan. After-tax contributions by payroll deduction or lump sum cash
payments are subject to an annual limit of 10 percent of base pay. Combined
pre-tax and after-tax contributions cannot exceed 20 percent of base pay in
any given year.
EMPLOYER CONTRIBUTIONS - Former NSP nonbargaining and bargaining employees
had the option to elect the Pension Equity Plan Benefit effective Jan. 1,
1999 and 2000, respectively. Subsequent to Jan. 1, 2000, bargaining
employees have the option to elect either the Pension Equity Plan Benefit
or the then existing pension benefit program through
Page 5
Xcel Energy Inc.
401(k) Savings Plan
(EIN: 41-0448030 PN:003)
2005. Former NCE nonbargaining employees had the option to elect the
Pension Equity Plan Benefit or remain a participant in the Account Balance
Plan effective January 1, 2002.
Employees covered by the Pension Equity Plan Benefit or the Account Balance
Plan Benefit (and nonbargaining employees of a participating employer not
covered by a company sponsored pension plan) are eligible to receive
matching contributions equal to 100 percent of the first 3 percent of pay
contributed on a pre-tax basis, plus 50 percent of the next 2 percent of
pay contributed on a pre-tax basis to the Plan during the plan year.
Nonbargaining employees and bargaining employees who elected the
traditional pension plan received up to $1,400 and $900, respectively, in
matching contributions from the Company.
The Companies may make an additional contribution to participants' accounts
at their discretion.
BENEFITS - Benefits are distributed after termination of employment,
disability, death or certain qualifying hardships upon request of the
participant (or the participant's beneficiary). Each participant is fully
vested in all contributions allocated to their account. Distributions may
be made in the form of a single lump sum, direct rollover, partial lump sum
or installments.
ADMINISTRATION - The Companies constitute a controlled group under Section
414(b) of the Internal Revenue Code. The parent corporation administers the
Plan. Administrative expenses of the Plan are paid by the Companies, except
for certain investment management fees.
PLAN TERMINATION - There is no specified term for the Plan, and the
employer has not expressed any intent to terminate the Plan. The employer
may terminate the Plan at any time in accordance with the provisions of the
Employee Retirement Income Security Act. Upon termination any remaining
participant account balances will be held in trust until distribution to
participants or transfer to another plan.
3. Information Certified by the Trustees
Investment information regarding the Plan, included in the Plan's financial
statements and the supplemental schedules, was prepared by U.S. Bank
National Association and Vanguard Fiduciary Trust Company, the trustees for
the Plan, and furnished to the Plan's administrator. The Plan's
administrator has obtained certification from the trustees that the
investment information is complete and accurate.
4. Participant Loans
The Plan allows participants to borrow against funds held in their
individual retirement savings account in any amount greater than $1,000 but
less than 50 percent of the participant's vested account balance. In no
event can a participant borrow more than $50,000 less the sum of any
principal payments made on Plan loans during the preceding 12 months. Loans
are for a period not to exceed 5 years for general purpose loans or 15
years for principal residential loans. The loans bear interest at a rate of
prime plus 1 percent which is determined on the first business day of the
month in which the loan is approved, and stays in effect until the loan is
repaid. A participant can only have one loan outstanding at a time.
Repayment of the loan plus interest is made through payroll deductions.
5. Significant Plan Assets
At Dec. 31, 2002 the market value of each of the following investments was
in excess of 5 percent of the Plan's net assets:
Xcel ESOP Stock Fund $132,817,141
Vanguard 500 Index Fund Investor Shares $128,930,848
Vanguard Total Bond Market Index Fund $128,341,407
Vanguard PRIMECAP Fund $ 53,519,877
Page 6
Xcel Energy Inc.
401(k) Savings Plan
(EIN: 41-0448030 PN:003)
6. Federal Income Tax Status
The Plan has received from the Internal Revenue Service a determination
letter stating the Plan is qualified under the applicable sections of the
Internal Revenue Code. On March 16, 1998, the Companies received a
favorable determination from the Internal Revenue Service that the Plan, as
amended, continues to qualify under the applicable sections of the Internal
Revenue Code (the "Code"). Although the Plan has been amended since
receiving the determination letter, the plan administrator believes that
the Plan is designed and is currently being operated in compliance with the
applicable requirements of the Code.
7. Related Party Transactions
Certain investments of the Plan are shares of Xcel Energy Common Stock.
Receivables include dividends on Company common stock declared and payable
to the Plan of $2,660,375 at Dec. 31, 2002.
Vanguard Fiduciary Trust manages certain investments of the Plan. Vanguard
is a trustee as defined by the Plan and, therefore, these transactions
qualify as party-in-interest.
8. Risks and Uncertainties
The Plan provides for investments in a variety of investment funds.
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 benefits.
Page 7
Xcel Energy Inc.
401(k) Savings Plan
(EIN: 41-0448030 PN:003)
SCHEDULE H - ITEM 4(i)- SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT END
OF YEAR
IDENTITY OF ISSUE NUMBER OF SHARES COST CURRENT VALUE
Xcel Energy Common Stock Fund:
Xcel Energy Common Stock (1) 2,114,384 $ 32,236,373 $ 23,258,228
Xcel Energy ESOP Stock Fund (1) 12,074,285 226,723,276 132,817,141
Registered Investment Companies:
Vanguard 500 Index Fund (1) 1,588,797 165,001,653 128,930,848
Vanguard Total Bond Market Index (1) 12,364,297 125,443,696 128,341,407
Vanguard PRIMECAP Fund (1) 1,384,373 70,083,307 53,519,877
Vanguard Wellington Fund (1) 1,391,568 37,628,481 34,176,906
Pimco Total Return Fund (1) 2,980,670 31,391,072 31,803,751
Vanguard Mid-Cap Index Fund (1) 2,857,210 33,239,015 28,229,234
Longleaf Partners Fund (1) 1,017,921 25,028,935 22,638,565
Wasatch Core Growth Fund (1) 759,503 26,240,613 20,263,535
Vanguard Small-Cap Index Fund (1) 1,280,590 25,095,693 20,054,041
Vanguard Inflation Protected Securities (1) 705,422 8,039,574 8,352,191
Vanguard Developing Market Index (1) 1,255,686 8,496,721 7,207,638
VGI Brokerage Option (1) 143,327 143,327 143,327
Interest-bearing Cash:
Vanguard Prime Money Market (1) 31,442,824 31,442,824 31,442,824
Outstanding Participant Loans 5.25% -
10.51%(1) 8,104,622 8,104,622
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Total $ 854,339,182 $ 679,284,135
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(1) Represents transaction with party-in-interest (Note 7)
The accompanying notes to financial statements are
an integral part of this schedule.
Page 8
Xcel Energy Inc.
401(k) Savings Plan
(EIN: 41-0448030 PN:003)
SCHEDULE H - ITEM 4(j) - SCHEDULE OF REPORTABLE TRANSACTIONS (FOR THE YEAR ENDED
DEC. 31, 2002)
(h) Current
value of
asset on (i) Net
(a) Identity of (c) Purchase (d) Selling (g) Cost of transaction gain or
party involved (b) Description of asset price price asset date (loss)
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Single Transaction or Series of Transactions - Security of the Same Issue
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The Vanguard Group Vanguard 500 Index $29,407,863 $29,407,863
The Vanguard Group Vanguard 500 Index $50,790,895 $56,484,875 $50,790,895 $ (5,693,980)
The Vanguard Group Vanguard Prime Money $21,000,949 $21,000,949
Market
The Vanguard Group Vanguard Prime Money $19,027,721 $19,027,721 $19,027,721
Market
The Vanguard Group Vanguard Total Bond $24,800,677 $24,800,677
Market Index
The Vanguard Group Vanguard Total Bond $32,973,551 $32,921,121 $32,973,551 $ 52,430
Market Index
The Vanguard Group Xcel Energy Stock Fund $19,499,349 $19,499,349
The Vanguard Group Xcel Energy Stock Fund $81,498,890 $59,985,053 $81,498,890 $ 21,513,837
The Vanguard Group Xcel Energy ESOP Stock $307,717,942 $307,717,942
Fund
The Vanguard Group Xcel Energy ESOP Stock $10,493,041 $13,541,988 $10,493,041 $ (3,048,947)
Fund
The accompanying notes to financial statements
are an integral part of this schedule.
Page 9
Xcel Energy Inc.
401(k) Savings Plan
(EIN: 41-0448030 PN:003)
INDEPENDENT AUDITORS' REPORT
Xcel Energy 401(k) Savings Plan
We have audited the accompanying statements of net assets available for benefits
of Xcel Energy 401(k) Savings Plan as of December 31, 2002 and 2001, and the
related statements of changes in net assets available for 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 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 benefits of the Plan as of December 31,
2002 and 2001, and the changes in net assets available for benefits for the
years then ended 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 supplemental schedule of assets held
for investment purposes and schedule of reportable transactions 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 supplemental
schedules have been subjected to the auditing procedures applied in the audit of
the basic financial statements and, in our opinion, are fairly stated in all
material respects in relation to the basic financial statements taken as a
whole.
/s/ DELOITTE & TOUCHE LLP
---------------------------
DELOITTE & TOUCHE LLP
Minneapolis, MN
June 30, 2003
Page 10
Xcel Energy Inc.
401(k) Savings Plan
(EIN: 41-0448030 PN:003)
SIGNATURE
As permitted under Form 11-K rules, the Company's 401(k) Savings Plan is filing
plan financial statements and schedules prepared in accordance with the
financial reporting requirements of ERISA.
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Company's Plan Administrator has duly caused this annual report to be signed on
its behalf by the undersigned, thereunto duly authorized.
Xcel Energy
401(k) Savings Plan
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(Registrant)
By /s/ PARKER W. NEWCOMB
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Parker W. Newcomb
Vice President Total Compensation and
Human Resources Operations
June 30, 2003 Xcel Energy Inc.
Page 11