SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 11-K
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the year ended December 31, 2001
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission file number 1-3551
EQUITABLE RESOURCES, INC. SAVINGS AND PROTECTION PLAN
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(Full title of the Plan and address of the Plan,
if different from that of the issuer named below)
EQUITABLE RESOURCES, INC.
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One Oxford Centre, Suite 3300, 301 Grant Street
Pittsburgh, Pennsylvania 15219
(Name of issuer of the securities held pursuant to the
Plan and the address of principal executive office)
CONTENTS
Page
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REPORT OF INDEPENDENT AUDITORS 2
FINANCIAL STATEMENTS
Statements of net assets available for benefits 3
Statements of changes in net assets available for benefits 4
Notes to financial statements 5 - 9
SUPPLEMENTARY INFORMATION
Schedule H:
Line 4i-Schedule of Assets (Held at End of Year) 10
Line 4j-Schedule of Reportable Transactions 11
SIGNATURE 12
INDEX TO EXHIBITS 13
1
REPORT OF INDEPENDENT AUDITORS
Benefits Administration Committee
Equitable Resources, Inc. Savings and Protection Plan
We have audited the accompanying statements of net assets available for
benefits of the Equitable Resources, Inc. Savings and Protection Plan as of
December 31, 2001 and 2000, 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. 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 benefits of the
Plan as of December 31, 2001 and 2000, and the changes in its net assets
available for benefits for the years then ended in conformity with accounting
principles generally accepted in the United States.
Our audits were performed for the purpose of forming an opinion on the
financial statements taken as a whole. The accompanying supplemental schedules
of assets held at end of year as of December 31, 2001 and reportable
transactions for the year then ended are presented for purposes of additional
analysis and are not a required part of the 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 our audits of the financial statements and, in
our opinion, are fairly stated in all material respects in relation to the
financial statements taken as a whole.
/s/ Ernst & Young LLP
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Pittsburgh, Pennsylvania
June 17, 2002
2
EQUITABLE RESOURCES, INC.
SAVINGS AND PROTECTION PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31
2001 2000
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Investments, at fair value:
Mutual funds $ 8,458,231 $11,006,277
Common/collective trusts 2,540,736 2,338,628
Employer Stock Fund 913,197 736,741
Participant loans 440,241 407,501
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Net assets available for benefits $12,352,405 $14,489,147
=======================================
SEE ACCOMPANYING NOTES
3
EQUITABLE RESOURCES, INC.
SAVINGS AND PROTECTION PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEAR ENDED DECEMBER 31
2001 2000
-------------------------------------
Additions:
Investment income:
Interest and dividends $ 431,338 $ 896,120
Interest on participant loans 36,546 27,681
-------------------------------------
Total investment income 467,884 923,801
Net depreciation in fair value of investments (1,515,503) (1,031,229)
Transfer into Plan - 373,818
Contributions:
Matching 93,649 77,169
Contract 983,878 1,091,422
-------------------------------------
Total contributions 1,077,527 1,168,591
-------------------------------------
Total additions 29,908 1,434,981
Deductions:
Withdrawals by participants 2,242,491 1,489,698
Expenses 3,544 5,739
Transfers to affiliated plan (79,385) 155,139
-------------------------------------
Total deductions 2,166,650 1,650,576
-------------------------------------
Net decrease in net assets available for benefits (2,136,742) (215,595)
Net assets available for benefits:
At beginning of year 14,489,147 14,704,742
-------------------------------------
At end of year $ 12,352,405 $ 14,489,147
=====================================
SEE ACCOMPANYING NOTES
4
EQUITABLE RESOURCES, INC.
SAVINGS AND PROTECTION PLAN
NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED
DECEMBER 31, 2001
1. DESCRIPTION OF PLAN
The following description of the Equitable Resources, Inc. Savings and
Protection Plan (Plan) provides only general information. Participants
should refer to the summary plan description for a more complete
description of the Plan's provisions.
GENERAL
The Plan is a defined contribution profit sharing and savings plan, with
a 401(k) salary reduction feature, implemented on September 1, 1987, by
Equitable Resources, Inc. and certain subsidiaries (the Company or
Companies).
All regular, full-time employees of the Companies who are covered by a
collective bargaining agreement are eligible to participate. The Plan is
subject to the provisions of the Employee Retirement Income Security Act
of 1974 (ERISA).
CONTRIBUTIONS
Participants can elect to contribute between 1% and 15% of eligible
earnings to the Plan, subject to Internal Revenue Code limitations. These
contributions are referred to as contract contributions. Matching
contributions are subject to the respective collective bargaining
agreements. Prior to January 1, 1999, the matching contribution followed
the participant's contract contribution. Effective January 1, 1999, the
matching contribution will be invested in the employer stock fund until
the participant is 100% vested. After the participant is 100% vested, the
matching contribution will follow the participant's contract investment
election(s).
ROLLOVER CONTRIBUTIONS
Participants are allowed to make rollover contributions (contributions
transferred to the Plan from other qualified retirement plans), subject
to certain requirements.
VESTING
Participants are 100% vested in the value of contract contributions made,
and any rollover contributions.
5
1. DESCRIPTION OF PLAN (Continued)
VESTING (Continued)
If employment is terminated for any reason other than retirement, death,
or total and permanent disability, a participant is entitled to receive
the vested value of any matching contributions, as determined in
accordance with the following schedule:
Years of Continuous Service Vested Interest
--------------------------- ---------------
Less than five years 0%
Five years or more 100%
Amounts forfeited by participants upon termination will be used to reduce
the amount of the Company's future matching contributions to the Plan.
Upon retirement, death, total and permanent disability or termination of
the Plan, a participant is entitled to receive the full value of any
matching contributions, regardless of years of continuous service.
WITHDRAWALS BY PARTICIPANTS
Payments to participants are made in one of the following ways, subject
to certain limitation: a single sum payment, a single life annuity with
substantially equal monthly installments, a single life or joint and
survivor annuity with a minimum guaranteed number of monthly benefits, or
substantially equal annual installments payable over a period not to
exceed the life expectancy or joint life expectancies of the participant
or of the participant and his designated beneficiary.
LOANS TO PARTICIPANTS
A participant may borrow money from the Plan in amounts up to the lesser
of $50,000, or 50% of the vested balance of a participant's account.
ADMINISTRATIVE EXPENSES
The plan sponsor pays administrative expenses associated with the Plan
except for investment management fees which are paid by the Plan.
6
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
INVESTMENTS
The Employer Stock Fund consisting of Equitable Resources, Inc. common
stock (Company common stock) is valued at market price as quoted on the
New York Stock Exchange. Contracts included in the Putnam Stable Value
Fund are valued at face value, which approximates market. Other
investments are valued at market. There were 26,804 and 11,037 shares of
Company common stock at December 31, 2001 and 2000, respectively.
USE OF ESTIMATES
The preparation of financial statements in conformity with accounting
principles generally accepted in the United States requires management to
make estimates that affect the amounts reported in the financial
statements and accompanying notes. Actual results could differ from those
estimates.
3. INVESTMENTS
Investments that represent 5% or more of fair value of the Plan's net
assets are as follows:
DECEMBER 31
2001 2000
-------------------------------------
The George Putnam Fund of Boston $1,259,491 $1,551,464
The Putnam Fund for Growth & Income 2,820,411 3,753,518
Putnam Voyager Fund 2,491,965 3,721,505
Putnam International Growth Fund - 866,922
Employer Stock Fund* 913,197 736,741
Putnam Stable Value Fund 2,401,442 2,326,684
*Nonparticipant-directed
7
3. INVESTMENTS (Continued)
The Plan's investments (including investments purchased, sold as well as
held during the year) (depreciated) appreciated in fair value as
determined by quoted market prices as follows:
NET CHANGES IN FAIR VALUE FOR
THE YEAR ENDED DECEMBER 31
2001 2000
-------------------------------------
Investments at fair value as determined by quoted market prices:
Registered investment companies $(1,493,551) $(1,345,309)
Company stock (23,760) 314,080
Common/collective trusts 1,808 -
-------------------------------------
$(1,515,503) $(1,031,229)
=====================================
Information about the net assets and significant components of the
changes in net assets related to the nonparticipant-directed investment
is as follows:
DECEMBER 31
2001 2000
-----------------------------------
Net asset:
Employer Stock Fund $913,197 $736,741
-----------------------------------
Changes in net assets:
Dividend and interest income $ 16,911 $ 11,504
Net (depreciation) appreciation in fair value of investment (23,760) 314,080
Employer contributions 22,665 19,744
Employee contributions 49,771 30,463
Withdrawals by participants (31,619) (10,706)
Expenses (80) (159)
Interfund transfers 129,202 138,834
Other 13,366 (5,311)
-----------------------------------
Net increase $176,456 $498,449
===================================
4. PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the
right under the Plan to discontinue its contributions at any time and to
terminate the Plan subject to the provisions of ERISA. In the event of
Plan termination, the interests of all affected participants will become
fully vested.
8
5. INCOME TAX STATUS
The Plan has received a determination letter from the Internal Revenue
Service dated April 22, 1999, stating that the Plan is qualified under
Section 401(a) of the Internal Revenue Code (the Code) and, therefore,
the related trust is exempt from taxation. The Plan has been amended
since the date of the determination letter. Once qualified, the Plan is
required to operate in conformity with the Code to maintain its
qualification. The plan administrator believes the Plan is being operated
in compliance with the applicable requirements of the Code and,
therefore, believes that the Plan is qualified and the related trust is
tax-exempt.
9
SUPPLEMENTARY INFORMATION
EQUITABLE RESOURCES, INC.
SAVINGS AND PROTECTION PLAN
PLAN NO. 206 EIN: 25-0464690
SCHEDULE H, LINE 4i-SCHEDULE OF ASSETS (HELD AT END OF YEAR)
DECEMBER 31, 2001
DESCRIPTION OF INVESTMENT INCLUDING
MATURITY DATE, RATE OF INTEREST,
IDENTITY OF ISSUE, BORROWER, LESSOR, OR COLLATERAL, PAR, OR MATURITY CURRENT
SIMILAR PARTY VALUE COST VALUE
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* Putnam Bond Index Fund Common/collective trust (a) $ 83,388
Alger Mid Cap Retirement Fund Mutual fund (a) 99,477
Pimco Total Return Administrative Fund Mutual fund (a) 46,822
Alger Small Cap Retirement Fund Mutual fund (a) 446
Neuberger Berman Genesis Trust Mutual fund (a) 184,396
* The George Putnam Fund of Boston Mutual fund (a) 1,259,491
* The Putnam Fund for Growth & Income Mutual fund (a) 2,820,411
* Putnam Investors Fund Mutual fund (a) 14,818
* Putnam Income Fund Mutual fund (a) 454,324
Putnam Global Growth Fund Mutual fund (a) 164
* Putnam Vista Fund Mutual fund (a) 56,883
* Putnam Voyager Fund Mutual fund (a) 2,491,965
* Putnam Growth Opportunities Fund Mutual fund (a) 21,635
* Putnam OTC & Emerging Growth Fund Mutual fund (a) 2,703
* Putnam Asset Allocation-Growth Portfolio Mutual fund (a) 136,939
* Putnam Asset Allocation-Balanced Portfolio Mutual fund (a) 168,988
* Putnam Asset Allocation-Conservative Portfolio Mutual fund (a) 104,631
* Putnam S&P 500 Index Fund Common/collective trust (a) 55,906
* Putnam International Growth Fund Mutual fund (a) 540,876
* Putnam Balanced Fund Mutual fund (a) 53,262
Loan Fund Participant loans, 6% to 10.5% (a) 440,241
* Equitable Resources Common Stock Fund Employer securities-common shares $772,539 913,197
* Putnam Stable Value Fund Common/collective trust (a) 2,401,442
---------------
$ 12,352,405
===============
(a) Cost information not required as per Special Rule for certain
participant-directed transactions.
*Party-in-interest to the Plan.
10
EQUITABLE RESOURCES, INC.
SAVINGS AND PROTECTION PLAN
PLAN NO. 206 EIN: 25-0464690
SCHEDULE H, LINE 4j-SCHEDULE OF REPORTABLE TRANSACTIONS
YEAR ENDED DECEMBER 31, 2001
CURRENT
VALUE OF
ASSET ON
DESCRIPTION OF PURCHASE SELLING COST OF TRANSACTION
IDENTITY OF PARTY INVOLVED INVESTMENT PRICE PRICE ASSET DATE NET GAIN
CATEGORY (iii)-SERIES OF TRANSACTIONS IN EXCESS OF 5% OF PLAN ASSETS
Equitable Resources, Inc. Employer Stock Fund $804,819 $ - $804,819 $804,819 $ -
Equitable Resources, Inc. Employer Stock Fund - 604,604 475,373 604,604 129,231
There were no category (i), (ii) or (iv) reportable transactions during 2001.
11
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the members of the Benefits Administration Committee of the Plan have duly
caused this Annual Report to be signed on its behalf by the undersigned hereunto
duly authorized.
EQUITABLE RESOURCES, INC.
SAVINGS AND PROTECTION PLAN
(Name of Plan)
By /s/ David L. Porges
------------------------------------
David L. Porges
Executive Vice President and
Chief Financial Officer
June 28, 2002
12
INDEX TO EXHIBITS
Exhibit No. Description Sequential Page No.
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23 Consent of Independent Auditors 14
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