e11vk
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
FOR ANNUAL REPORTS OF EMPLOYEE STOCK PURCHASE, SAVINGS
AND SIMILAR PLANS PURSUANT TO SECTION 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
(Mark One)
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ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. |
For the fiscal year ended December 31, 2007
OR
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TRANSITION REPORT PURSUANT TO 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. |
For the transition period from to
Commission file number 1-8962
The Pinnacle West Capital Corporation Savings Plan
(Full title of the plan)
Pinnacle West Capital Corporation
(Name of issuer)
400 North Fifth Street
P.O. Box 53999
Phoenix, Arizona 85072-3999
(Address of issuers principal executive office)
THE PINNACLE WEST CAPITAL CORPORATION SAVINGS PLAN
TABLE OF CONTENTS
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PAGE |
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1 |
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FINANCIAL STATEMENTS: |
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2 |
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3 |
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4-18 |
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SUPPLEMENTAL SCHEDULE: |
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19-23 |
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Exhibit 23.1 |
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24 |
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EX-23.1 |
NOTE: Supplemental schedules required by section 2520.103-10 of the Department of Labors Rules
and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of
1974, other than the schedules listed above, are omitted because of the absence of the conditions
under which they are required.
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Trustees and Participants of
The Pinnacle West Capital Corporation Savings Plan
Phoenix, AZ
We have audited the accompanying statements of net assets available for benefits of The Pinnacle
West Capital Corporation Savings Plan (the Plan) as of December 31, 2007 and 2006, and the
related statement of changes in net assets available for benefits for the year ended December 31,
2007. These financial statements are the responsibility of the Plans management. Our
responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits 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. The
Plan is not required to have, nor were we engaged to perform, an audit of its internal control over
financial reporting. Our audits included consideration of internal control over financial reporting
as a basis for designing audit procedures that are appropriate in the circumstances, but not for
the purpose of expressing an opinion on the effectiveness of the Plans internal control over
financial reporting. Accordingly, we express no such opinion. An audit also 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, 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, 2007 and 2006, and the changes in net assets
available for benefits for the year ended December 31, 2007, 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 at end of year) as of December 31,
2007, is presented for the purpose of additional analysis and is not a required part of the basic
financial statements, but is supplementary information required by the Department of Labors Rules
and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. This schedule is the responsibility of the Plans management. Such schedule has been
subjected to the auditing procedures applied in our audit of the basic 2007 financial statements
and, in our opinion, is fairly stated in all material respects when considered in relation to the
basic financial statements taken as a whole.
DELOITTE & TOUCHE LLP
Phoenix, AZ
June 25, 2008
THE PINNACLE WEST CAPITAL CORPORATION SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 2007 AND 2006
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2007 |
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2006 |
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ASSETS: |
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Investments at fair value (Notes 2, 4 & 5) |
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$ |
872,595,656 |
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$ |
833,989,830 |
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Interest and other receivables |
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1,617,900 |
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1,113,433 |
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Total assets |
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874,213,556 |
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835,103,263 |
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LIABILITIES: |
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Accrued administrative expenses |
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197,425 |
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Securities purchased, net |
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58,101 |
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Total liabilities |
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197,425 |
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58,101 |
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NET ASSETS AVAILABLE FOR BENEFITS
AT FAIR VALUE |
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874,016,131 |
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835,045,162 |
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Adjustment from fair value to contract value
for fully benefit-responsive investment
contracts |
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655,873 |
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1,512,371 |
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NET ASSETS AVAILABLE FOR BENEFITS |
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$ |
874,672,004 |
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$ |
836,557,533 |
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See Notes to Financial Statements.
2
THE PINNACLE WEST CAPITAL CORPORATION SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 2007
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ADDITIONS TO NET ASSETS ATTRIBUTED TO: |
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Contributions (Note 1): |
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Employer |
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$ |
15,849,199 |
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Participants |
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49,440,470 |
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Total contributions |
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65,289,669 |
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Investment income (Note 2): |
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Dividend, interest and other income |
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46,349,557 |
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Net realized/unrealized depreciation in fair value of
investments (Note 5) |
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(16,578,456 |
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Total investment income |
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29,771,101 |
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Total additions |
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95,060,770 |
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DEDUCTIONS FROM NET ASSETS ATTRIBUTED TO: |
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Benefit payments |
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56,300,345 |
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Administrative expenses |
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645,954 |
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Total deductions |
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56,946,299 |
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Increase in net assets |
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38,114,471 |
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NET ASSETS AVAILABLE FOR BENEFITS: |
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Beginning of year |
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836,557,533 |
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End of year |
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$ |
874,672,004 |
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See Notes to Financial Statements.
3
THE PINNACLE WEST CAPITAL CORPORATION SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
1. DESCRIPTION OF THE PLAN
The following description of The Pinnacle West Capital Corporation Savings Plan (the Plan)
provides only general information. Participants should refer to the Plan document for a more
complete description of the Plans provisions.
General
The Plan is a defined contribution plan sponsored by Pinnacle West Capital Corporation
(Pinnacle West or the Company). The Plan is made up of two component plans, a profit sharing
component with cash or deferred features and a stock bonus component which constitutes an Employee
Stock Ownership Plan (ESOP). The ESOP component of the Plan consists of Plan assets invested in
the Pinnacle West Stock Fund and the balance of all Plan assets constitutes the profit sharing
component. The Plan is administered by a committee appointed by the Pinnacle West Board of
Directors. The Plan is subject to the provisions of the Employee Retirement Income Security Act of
1974, as amended (ERISA). State Street Bank and Trust Company (Trustee) serves as Trustee of
the Plan. Wells Fargo Bank, Minnesota, N.A. served as the Trustee of the Plan until March 28, 2007.
State Street Global Advisors is the appointed investment manager under the Plan to (1) manage
the liquidity of the Pinnacle West Stock Fund, and (2) review and direct the Trustee on voting
proxies received for shares of Pinnacle West common stock (except for those shares for which the
Trustee receives participant directions) and nine mutual funds held in the Plan.
Eligibility
Generally, most active full-time employees of Pinnacle West and its subsidiaries, including
Arizona Public Service Company, APS Energy Services Company, Inc., El Dorado Investment Company and
the active salaried employees of SunCor Development Company (collectively, the Employer), are
eligible to participate in (1) the pre-tax, Roth 401(k) and after-tax features of the Plan
immediately upon employment or, if later, their attainment of age 18 (prior to April 1, 2007,
participants were eligible to participate in the pre-tax and after-tax features of the Plan on the
first day of the month following their attainment of age 18 and
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completion of thirty-one consecutive days of employment) and (2) the matching feature on the
first day of the month following their attainment of age 18 and completion of six months of
service. Eligible employees hired in a classification other than regular full-time are eligible to
participate upon attainment of age 18 and completion of 1,000 hours of service during a 12-month
period of employment beginning on their date of hire or an anniversary of that date. The Plan
provides credit for periods of employment with an affiliate of Pinnacle West as if the service was
performed for the Employer.
Contributions
The Plan allows participants to contribute up to 50% of their base pay as pre-tax, Roth 401(k)
or after-tax contributions (prior to April 1, 2007, pre-tax and after-tax contributions), provided
that in no event can the combined total contributions made by any participant in any year exceed
50% of their base pay. Effective April 1, 2007, eligible employees who do not affirmatively elect
to participate or opt out of the Plan are automatically enrolled as soon as administratively
possible after sixty days of employment. Employees automatically enrolled contribute 3% of their
base pay as pre-tax contributions. The Plan also allows participants attaining the age of 50
before the end of the calendar year to make catch-up contributions in accordance with the
provisions of the Economic Growth and Tax Relief Reconciliation Act of 2001. The maximum allowable
pre-tax contribution ($15,500 for 2007) and catchup contribution ($5,000 for 2007) may increase
in future years based on the cost of living index. Effective April 1, 2007, participants may elect
to set their pre-tax contributions to increase automatically on an annual basis based on the
percent increase and effective date designated by the participant, up to the maximum limits
permitted under the Plan and the Internal Revenue Code.
Employer contributions are fixed at 75% of the first 6% of base pay for combined pre-tax
and/or Roth 401(k) participant contributions (excluding catch-up contributions) for non-SunCor
Development Company employees hired on or after January 1, 2003, for active salaried employees of
SunCor Development Company hired on or after January 1, 2006 and for employees electing the
Retirement Account Balance feature of the Pinnacle West Capital
Corporation Retirement Plan. Participants hired prior to January 1, 2003, and active salaried
employees of SunCor Development Company hired prior to January 1, 2006, not electing to participate
in the Retirement Account Balance feature of the Pinnacle West Capital
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Corporation Retirement Plan receive an Employer match of 50% on the first 6% of base pay
contributed, in combination, as pre-tax and/or Roth 401(k) participant contributions (excluding
catch-up contributions).
While the Employer contributions may be in cash, common stock, or other property acceptable to
the Trustee, from January 1, 2007 through mid-March 2007, Employer contributions were in cash and
were allocated to the Pinnacle West Stock Fund. Subsequent to mid-March 2007, Employer
contributions are invested in the same investment funds as participants elect for their participant
contributions. Non-cash contributions are recorded at fair value.
The Plan allows rollover contributions from other eligible retirement plans including 401(k)
or other qualified plans (including after-tax dollars), governmental 457(b) plans, Roth 401(k)
accounts, 403(b) annuities (including after-tax dollars) or IRAs
(excluding after-tax dollars) (prior to April 1, 2007,
pre-tax dollars from qualified plans) subject to certain criteria.
Participants may elect to receive dividends on Pinnacle West stock in their account in the
form of cash. If a participant does not elect to receive the dividend in the form of cash prior to
the dividend payable date for that dividend, it is automatically reinvested in the Pinnacle West
Stock Fund.
Participant Accounts
Individual accounts are maintained for each Plan participant. Allocations of earnings and
losses are based on participant account balances. Each participant has separate accounts (sources
of money) that are credited with the participants pre-tax, Roth 401(k) (effective April 1, 2007)
and after-tax contributions, rollover contributions (if any), Roth 401(k) rollover contributions
(if any, effective April 1, 2007), the Employers matching contributions and an allocation of Plan
earnings. Each participants account is charged with withdrawals, an allocation of Plan losses
and, effective April 1, 2007, explicit record-keeping and administrative fees (see Note 2). A
dollar amount is deducted quarterly from each participants account for the explicit record-keeping
and administrative fees (effective April 1, 2007). The benefit to which a participant is entitled
is the portion of the participants account that has vested, as defined below.
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Investment Choices
Participants direct their contributions into one or more of the following: risk-based
investment options which include Conservative, Moderate and Aggressive LifeStyle Funds; core
investment options which include Fixed Income Fund, Intermediate Bond Fund, Large Cap Value Fund,
S&P 500 Index Fund, Large Cap Growth Fund, Mid Cap Core Fund, Small Cap Core Fund, International
Fund; and the Pinnacle West Stock Fund (collectively, the Funds). Employer contributions were
automatically invested in the Pinnacle West Stock Fund through March 2007. Effective March 29,
2007, Employer contributions are invested in the same investment funds as the participant elects
for their participant contributions. Effective April 2007: 1) in lieu of making their own
investment elections, participants may choose to have an investment allocation set for them through
the Plans personal asset manager program, which is a personalized mix of the Plans core
investment options; 2) contributions by participants automatically enrolled are invested in the
default fund which for approximately four to six weeks is the Conservative LifeStyle Fund and then,
once established for them, the personal asset management program; 3) participants may establish a
self-directed brokerage account (SDA) to invest up to 90% of their vested account balance in
permitted investments of the SDA (which excludes the Funds); and 4) participants may elect to have
their investment mix of Funds automatically rebalanced according to their future investment
elections on a quarterly, semi-annual or annual basis. Effective January 1, 2007, the Plan permits
all participants to transfer amounts in their Employer contributions account or Employer transfer
account from the Pinnacle West Stock Fund to one or more of the other investment options available
under the Plan. See Note 6 for additional information.
Loan Feature
Participants and, effective April 1, 2007, former participants may borrow money from their
pre-tax contributions account, Roth 401(k) contributions account (effective April 1, 2007), vested
Employer contributions account, rollover contributions account (if any) and Roth 401(k) rollover
contributions account (if any, effective April 1, 2007). Participants may not borrow against their
Employer transfer account or their after-tax contributions account.
The minimum participant loan allowed is $1,000. The maximum participant loan allowed is 50% of
the participants vested account balance, up to $50,000 reduced by the participants highest
outstanding loan balance in the 12-month period ending on the day before the loan is
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made. Only one loan per participant may be outstanding at any one time. Loan terms are up to
five years, or up to 15 years for the purchase of the participants principal residence. An
administrative fee is charged to the participants account for each loan. Participants with an
outstanding loan may continue to make loan repayments upon termination of employment with the
Employer, unless they receive a full distribution of their account balance.
The interest rate is determined at the time the loan is requested and is fixed for the life of
the loan. The interest rate shall be at least as great as the interest rate charged by the Trustee
to its individual clients for an unsecured loan on the date the loan is made. The Trustee
currently charges interest at the prime interest rate plus one percent, determined as of the first
business day of the month in which the loan is issued. Interest rates for loans issued during 2007
ranged from 8.50% to 9.25%. Interest rates for outstanding loans as of December 31, 2007 and 2006
ranged from 5% to 10.5%.
Loans are treated as an investment of the participants accounts. To fund the loan, transfers
are made from the participants investment funds on a pro-rata basis. Amounts credited to a
participants SDA are not available for a loan. Loan repayments are invested in the participants
investment funds based on the participants current investment election (or, effective April 1,
2007, in the Conservative Lifestyle Fund or personal asset manager
program, as applicable, if the participant does not have a current investment
election in place). Loan repayments, including interest, are generally made through irrevocable
payroll deductions. Loan repayments for former participants are made through the automated
clearing house (ACH) system. Loans are secured by the participants account balance.
Vesting
Each participant is automatically fully vested in the participants pre-tax, Roth 401(k)
(effective April 1, 2007), after-tax, rollover (if any) and Roth 401(k) rollover (if any, effective
April 1, 2007) contribution accounts (consisting of the participants contributions and related
income and appreciation or depreciation), Employer transfer account and Employer contributions
account (consisting of Employer contributions and related income and appreciation or depreciation).
Former participants who terminated employment prior to April 1, 2006 were fully vested in their
Employer contributions account if their termination was due to death or disability, or was after
attaining age 65 or, if later, completing five years of participation in the
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Plan. Otherwise, those former participants vested in graduated amounts with 100% vesting
after five years of service, beginning with the employees credited vesting date.
Withdrawals and Distributions
A participant may at any time make a full or partial withdrawal of the balance in the
participants after-tax contributions account, rollover contributions account (if any) and Roth
401(k) rollover contributions account (if any, effective April 1, 2007). No withdrawals prior to
termination of employment are permitted from a participants Employer transfer account. No
withdrawals prior to termination of employment are permitted from the participants pre-tax
contributions account and Roth 401(k) contributions account (effective April 1, 2007), except under
certain limited circumstances relating to financial hardship or after attaining age 59-1/2. If an
employee withdraws pre-tax or Roth 401(k) contributions due to financial hardship, the only
earnings on pre-tax contributions that can be withdrawn are those credited prior to January 1, 1989
and no earnings on Roth 401(k) contributions can be withdrawn. Participants who have participated
in the Plan for five complete plan years may withdraw the amount in their Employer contributions
account. Participants who are at least age 59-1/2 may withdraw any portion of their pre-tax
contributions account, Roth 401(k) contributions account (effective April 1, 2007), rollover
contributions account (if any) or Roth 401(k) rollover contributions account (if any, effective
April 1, 2007) while employed with no restrictions on the reason for withdrawal and penalties do
not apply. Prior to April 1, 2007, age 59-1/2 withdrawals were restricted to two per year.
Amounts credited to a participants SDA are not available for a withdrawal until transferred back
into the Funds. When the participants employment with the Employer is terminated, the participant
can elect to receive a full or, effective April 1, 2007, a partial distribution, as soon as
administratively possible, of the vested portion of their Employer contributions account together
with the participants contributions accounts and Employer transfer account.
Forfeitures
Forfeitures of nonvested Employer contributions will occur upon the earlier of full
distribution following termination of employment with the Employer or the end of the fifth calendar
year following the calendar year in which the participant terminated employment. If a former
participant who received a distribution becomes re-employed prior to the end of the fifth calendar
year following the calendar year in which the participants earlier termination of
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employment occurred, the forfeited Employer contributions will be restored to the
participants Employer contribution account; however, the forfeiture is restored only if the
participant repays the full amount previously distributed to them within five years of their date
of re-employment or, if earlier, the last day of the fifth calendar year following the calendar
year in which the distribution occurred. At December 31, 2007 and 2006, forfeited nonvested
accounts were immaterial. Forfeitures are used to reduce future Employer contributions to the
Plan. During the year ended December 31, 2007, Employer contributions were reduced by an
immaterial amount due to forfeited nonvested accounts.
Termination of the Plan
It is the Companys present expectation that the Plan and the payment of Employer
contributions will be continued indefinitely. However, continuance of any feature of the Plan is
not assumed as a contractual obligation. The Company, at its discretion, may terminate the Plan
and distribute net assets, subject to the provisions set forth in ERISA and the Internal Revenue
Code, or discontinue contributions. In this event, the balance credited to the accounts of
participants at the date of termination or discontinuance shall be fully vested and nonforfeitable.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Accounting
The accompanying financial statements have been prepared in accordance with accounting
principles generally accepted in the United States of America.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally
accepted in the United States of America requires Plan management to make estimates and assumptions
that affect the reported amounts of net assets available for benefits and changes therein. Actual
results could differ from those estimates.
Risks and Uncertainties
The Plan utilizes various investment instruments including: mutual funds, common and
collective trust funds, guaranteed investment contracts, stocks and bonds. Investment securities,
in general, are exposed to various risks, such as interest rate risk, credit risk, liquidity risk,
and overall market volatility. Due to the level of risk associated with certain investment
securities, it is reasonably possible that changes in the values of investment securities will
occur in the near
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term and that such changes could materially affect the amounts reported in the financial
statements.
Investments
The Plans investments are stated at fair value. Benefit-responsive investment contracts are
stated at fair value and then adjusted to contract value (see Note 4). Fair value for such
contracts is calculated by discounting the related cash flows based on current yields of similar
instruments with comparable durations. Shares of mutual funds are valued at quoted market prices,
which represent the net asset value of shares held by the Plan at year-end. Common and collective
funds are valued at fair value, as determined by the Trustee, based on market prices of the
underlying securities. Participant loans are valued at the outstanding loan balances. Quoted
market prices are used to value all other investments. Management fees and operating expenses
charged to the Plan for investments in the mutual funds are deducted from income earned on a daily
basis and are not separately reflected. Consequently, management fees are reflected as a reduction
of investment return for such investments.
In September 2006, the Financial Accounting Standards Board issued Statement of Financial
Accounting Standards No. 157, Fair Value Measurements. This guidance establishes a framework for
measuring fair value and expands disclosures about fair value measurements. The Statement is
effective for the Plan on January 1, 2008. This new guidance is currently being evaluated but is
not expected to have a material impact on the Plans financial statements.
Income Recognition
Investment transactions are recorded as of the trade date. Interest income is recorded on the
accrual basis. Dividend income is recorded as of the ex-dividend date.
Administrative Expenses
Participants pay explicit Plan record-keeping and administrative fees less any implicit fees
paid to the recordkeeper through revenue-sharing arrangements with certain mutual funds (effective
April 1, 2007) and explicit administrative fees for loans. Participants pay investment, sales,
record-keeping and administrative expenses charged by funds, which are deducted from income and
reflected as a reduction of investment return for the fund, and redemption fees for certain funds
when not held for the required period of investment. Certain mutual funds have entered into
revenue-sharing agreements to pay a portion of the mutual funds record-keeping,
11
administrative and/or sales fees to the Plans record keeper to largely offset record-keeping
and administrative fees for the Plan as a whole. The mutual funds that pay a portion of their
expense ratios and/or investment fees to the record keeper are held in the: S&P 500 Index Fund
(0.07%), Large Cap Growth Fund (0.40%), Large Cap Value Fund (0.10%), Mid Cap Core Fund (0.10%),
Small Cap Core Fund (0.20%) and International Equity Fund (0.05%). The percentage of each funds
revenue share is shown in parentheses and is expressed as a percentage of the funds net asset
value. As of March 29, 2007, the revenue share amounts for the Large Cap Growth Fund, Mid Cap Core
Fund and Small Cap Core Fund changed to 0.35%, 0.25% and 0.25% respectively, and the S&P 500 Index
Funds revenue sharing arrangement was eliminated. As of October 1, 2007, the revenue share amount
for the Mid Cap Core Fund changed back to 0.10%. Pinnacle West pays the remaining Plan
administration expenses such as legal expenses of the Plan. Effective January 1, 2006 and ending
April 1, 2007, participants accounts were charged an administrative fee for all withdrawals and
distributions.
Payment of Benefits
Benefit payments to participants are recorded upon distribution.
3. FEDERAL INCOME TAX STATUS
The Internal Revenue Service has determined and informed the Company by a letter dated
December 21, 2007, that the Plan was designed in accordance with applicable regulations of the
Internal Revenue Code. The Company and Plan management believe that the Plan is currently designed
and operated in compliance with the applicable requirements of the Internal Revenue Code and the
Plan and related trust continue to be tax-exempt. Accordingly, no provision for income taxes has
been included in the Plans financial statements.
4. GUARANTEED INVESTMENT CONTRACTS
The Plan invests in conventional Guaranteed Investment Contracts (GICs) and Synthetic
Investment Contracts, which are held in the Fixed Income Fund. All investment contracts held by
the Plan are considered fully benefit-responsive and are recorded at fair value and adjusted to
contract value.
Synthetic investment contracts are comprised of both investment and contractual components.
The investment component consists of securities or shares of units of a portfolio of fixed income
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securities, referred to as the underlying investments. This investment component is wrapped
by contracts issued by third-party financial institutions. These wrap contracts provide
participants the ability for benefit withdrawals and investment exchanges at the full contract
value of the synthetic investment contracts (i.e. principal plus accrued interest) notwithstanding
the actual market value of the underlying investments (i.e. fair value of security plus accrued
interest). In this manner, wrap contracts are designed to smooth out the impact of normal market
fluctuations associated with the performance of the underlying investments.
Wrap contract issuers place restrictions on minimum/maximum portfolio durations and on the
minimum credit quality of the underlying investments.
Most of the investments underlying the synthetic contracts have expected average lives, that
is, they have a target maturity date that is subject to change depending on market conditions.
Should the expected average life of the investments shorten or extend, the crediting rate on the
contract is normally reset to reflect the investments net yield to maturity. If the underlying
investments prepay prior to their expected maturity, the cash flows from the investments are
typically reinvested in new investments.
Investment contracts can be structured as non-participating, participating or a combination
therein. Conventional GICs issued by insurance companies are primarily non-participating, wherein
the contract holder does not participate in any gains and losses incurred due to performance of the
underlying fixed-income portfolio relative to the book value at times of withdrawals. Conversely,
Synthetic Investment Contracts, or wrap contracts, issued by insurance companies or banks, are
primarily participating, wherein the contract holder participates in gains and losses incurred due
to the performance of the underlying fixed-income portfolio relative to book value at times of
withdrawals. Gains and losses are amortized through future crediting rate re-sets. Participating
structures are the most common structure utilized in the Fixed Income Fund.
GIC contracts are typically issued with a fixed crediting rate and a fixed maturity that does
not change over the life of the contract. Wrap contracts typically re-set on a monthly or
quarterly basis as negotiated with the wrap issuer and do not have a final stated maturity date.
The wrap contracts in the Fixed Income Fund are predominately re-set on a monthly basis with a
one-month look back for the portfolio statistics. The investment contract issuer guarantees a
minimum 0% crediting rate although a wrap does not absorb any loss for credit defaults in an
underlying portfolio.
13
The gross crediting rate formula is negotiated in the wrap contract and is typically
represented as:
CR = (MV/BV)^(1/D)*(1+YTM)-1 where:
|
|
|
MV = market value of the portfolio |
|
|
|
|
BV = book value of the portfolio |
|
|
|
|
D = weighted average duration of the portfolio |
|
|
|
|
YTM = annualized dollar or duration weighted yield to maturity of the portfolio |
The net crediting rate is equal to the gross crediting rate minus the wrap fee due the
contract issuer. Crediting rates reflect the amortization of realized and unrealized gains and
losses in the underlying portfolio over the duration of the portfolio and, in consequence, may not
reflect the actual returns achieved in the portfolio. From time to time the crediting rate may be
significantly greater or less than current market interest rates.
There are a number of factors that can influence future crediting rates. Such factors may
include but are not limited to: portfolio cash flows, performance of the underlying fixed-income
portfolio, current market interest rates for reinvestment, duration posture, credit downgrades, the
unexpected receipt of principal and interest payments, extraordinary withdrawals and certain wrap
contract terms.
The average yield earned by the Fixed Income Fund for all fully benefit-responsive investment
contracts was 5.05% and 5.32% for the years ended December 31, 2007 and 2006, respectively. The
average yield earned by the Fixed Income Fund for all fully benefit-responsive investment
contracts, adjusted to reflect the actual interest rate credited to participants, was 5.02% and
4.92% for the years ended December 31, 2007 and 2006, respectively.
Market value events may limit the ability of the Fixed Income Fund to transact at contract
value with the issuer. Market value events are events or conditions, the occurrence of which are
outside the normal operation of the Fixed Income Fund and leads to Fixed Income Fund disbursements
that have or will have a material adverse affect on the operations of the Fixed Income Fund and a
financial effect on the investment contract or wrap issuers interest hereunder. Such events may
include, but are not limited to: Plan amendments or changes, company mergers or consolidations,
participant investment election changes, group terminations or layoffs, implementation of an early
retirement program, termination or partial termination of the Plan, failure to meet certain tax
qualifications, participant communication that is designed to influence
14
participants not to invest in the Fixed Income Fund, transfers to competing options without
meeting the equity wash provisions of the Fixed Income Fund, Plan sponsor withdrawals without the
appropriate notice to the Fixed Income Funds investment manager and/or investment contract
issuers, any changes in laws or regulations that would result in substantial withdrawals from the
Plan, and default by the Plan sponsor in honoring its credit obligations, insolvency or bankruptcy
if such events could result in withdrawals. The probability of the occurrence of any of these
events is considered to be remote.
In the normal course of business, such events or conditions would not limit the ability of the
Fixed Income Fund to transact at contract value with the participants in the Fixed Income Fund.
The Fixed Income Fund is managed to maintain a certain amount of liquidity to provide for the
day-to-day liquidity needs of participants as well as the occasional market value event.
An issuer can terminate an investment contract upon the event of default by the contract
holder, investment manager, or Trustee if the issuer determines in its reasonable discretion, such
event has had, or is likely to have a material adverse effect on the issuers interest with respect
to the contract. Such events may include but are not limited to: management of the portfolio not
in accordance with investment guidelines, breach of any material obligation under the wrap
agreement, any representation or warranty made by the contract holder becomes untrue in any
material way, replacement of the investment manager without prior consent of the issuer, the Plan
is terminated or no longer meets the appropriate tax qualifications, or the wrap becomes a
prohibited transaction within the meaning of Section 406 of ERISA.
5. INVESTMENTS AND UNITS OF PARTICIPATION
In accordance with the provisions of the Plan, the Trustee maintains separate units of
participation in the Plan and related net asset value per unit for each Fund. Upon transfer from
Wells Fargo to State Street Bank as Trustee, there was a unit accounting conversion on the Pinnacle
West Stock Fund. The number of units and the related value of the Plans assets as of December 31,
2007 and 2006 are as follows:
15
2007
|
|
|
|
|
|
|
|
|
|
|
Investment |
|
Description |
|
Number of Units |
|
|
Value |
|
|
|
|
|
|
|
|
|
|
|
|
Fixed Income Fund |
|
Fixed Income Fund |
|
|
11,369,713 |
|
|
$ |
171,203,783 |
** |
PIMCO Total Return Fund Inst. |
|
Intermediate Bond Fund |
|
|
2,236,587 |
|
|
|
23,755,146 |
|
Vanguard Lifestrategy Conservative
Growth Fund Inst. |
|
Conservative LifeStyle Fund |
|
|
1,101,850 |
|
|
|
18,984,235 |
|
Vanguard Lifestrategy Moderate
Growth Fund Inst. |
|
Moderate LifeStyle Fund |
|
|
1,652,717 |
|
|
|
35,045,310 |
|
Vanguard Lifestrategy
Growth Fund Inst. |
|
Aggressive LifeStyle Fund |
|
|
1,692,381 |
|
|
|
42,415,808 |
|
SSgA
S&P 500 Flgshp Sec Lndg Ser
Fund Cl A |
|
S&P 500 Index Fund |
|
|
2,959,648 |
|
|
|
141,909,751 |
* |
T. Rowe Price Equity Income Fund |
|
Large Cap Value Fund |
|
|
1,705,770 |
|
|
|
47,898,878 |
* |
Putnam Voyager Fund Cl A |
|
Large Cap Growth Fund |
|
|
2,064,002 |
|
|
|
39,866,328 |
|
AIM Mid Cap Core Equity Fund Cl I |
|
Mid Cap Core Fund |
|
|
1,047,300 |
|
|
|
25,556,362 |
|
BlackRock Value Opportunities
Fund C1 I |
|
Small Cap Core Fund |
|
|
2,757,875 |
|
|
|
56,418,010 |
* |
American FDS EuroPacific Growth
Fund R5 |
|
International Fund |
|
|
2,146,871 |
|
|
|
109,348,038 |
* |
Pinnacle West Common Stock |
|
Pinnacle West Stock Fund |
|
|
12,147,863 |
|
|
|
127,240,822 |
* |
Participant Loans |
|
Participant Loans |
|
|
|
|
|
|
21,922,985 |
|
Self-Directed Account |
|
Self-Directed Account |
|
|
|
|
|
|
11,030,200 |
|
|
|
|
|
|
|
|
|
|
|
Total at fair value |
|
|
|
|
|
|
|
|
872,595,656 |
|
Adjustment from fair value to
contract value for fully benefit-responsive investment
contracts |
|
|
|
|
|
|
|
|
655,873 |
|
|
|
|
|
|
|
|
|
|
|
Total at contract value |
|
|
|
|
|
|
|
$ |
873,251,529 |
|
|
|
|
|
|
|
|
|
|
|
2006
|
|
|
|
|
|
|
|
|
|
|
Investment |
|
Description |
|
Number of Units |
|
|
Value |
|
|
|
|
|
|
|
|
|
|
|
|
Fixed Income Fund |
|
Fixed Income Fund |
|
|
11,312,587 |
|
|
$ |
161,983,011 |
** |
PIMCO Total Return Fund Inst. |
|
Intermediate Bond Fund |
|
|
1,407,045 |
|
|
|
14,657,142 |
|
Vanguard Lifestrategy Conservative
Growth Fund Inst. |
|
Conservative LifeStyle Fund |
|
|
785,674 |
|
|
|
13,031,887 |
|
Vanguard Lifestrategy Moderate
Growth Fund Inst. |
|
Moderate LifeStyle Fund |
|
|
1,417,289 |
|
|
|
28,880,077 |
|
Vanguard Lifestrategy
Growth Fund Inst. |
|
Aggressive LifeStyle Fund |
|
|
1,491,161 |
|
|
|
35,616,294 |
|
Wells Fargo
S&P 500 Index Fund
Cl G |
|
S&P 500 Index Fund |
|
|
2,999,078 |
|
|
|
136,429,483 |
* |
T. Rowe Price Equity Income Fund |
|
Large Cap Value Fund |
|
|
1,481,870 |
|
|
|
43,921,103 |
* |
Putnam Voyager Fund, Cl A |
|
Large Cap Growth Fund |
|
|
2,548,821 |
|
|
|
46,665,515 |
* |
AIM Mid Cap Core Equity Fund Cl I |
|
Mid Cap Core Fund |
|
|
718,755 |
|
|
|
19,268,045 |
|
Black Rock Value Opportunities
Fund Cl I |
|
Small Cap Core Fund |
|
|
3,056,261 |
|
|
|
74,872,264 |
* |
American FDS EuroPacific Growth
Fund R5 |
|
International Fund |
|
|
1,557,435 |
|
|
|
72,585,776 |
* |
Pinnacle West Common Stock |
|
Pinnacle West Stock Fund |
|
|
3,197,437 |
|
|
|
164,757,900 |
* |
Participant Loans |
|
Participant Loans |
|
|
|
|
|
|
21,321,333 |
|
|
|
|
|
|
|
|
|
|
|
Total at fair value |
|
|
|
|
|
|
|
|
833,989,830 |
|
Adjustment from fair value to
contract value for fully benefit-responsive investment
contracts |
|
|
|
|
|
|
|
|
1,512,371 |
|
|
|
|
|
|
|
|
|
|
|
Total at contract value |
|
|
|
|
|
|
|
$ |
835,502,201 |
|
|
|
|
|
|
|
|
|
|
|
16
|
|
|
* |
|
These investments represent 5 percent or more of the Plans Net Assets Available for Benefits. |
|
** |
|
See supplemental schedule for underlying investments. No individual underlying investment exceeds 5 percent
of net assets available for benefits. |
The Plans investments (including gains and losses on investments purchased and sold, as well
as held during the year) appreciated (depreciated) in value for the year ended December 31, 2007 as
follows:
|
|
|
|
|
Common and Collective Trusts |
|
$ |
9,030,845 |
|
Mutual Funds |
|
|
(325,564 |
) |
Pinnacle West Stock Fund |
|
|
(25,283,737 |
) |
|
|
|
|
Net realized/unrealized depreciation
in fair value of investments |
|
$ |
(16,578,456 |
) |
|
|
|
|
6. NON-PARTICIPANT DIRECTED INVESTMENTS
Through
mid-March 2007, Employer contributions were allocated to the Pinnacle West Stock Fund.
The Pinnacle West Stock Fund non-participant directed portion of net assets was $102,281,408 at
January 1, 2007. Employer contributions allocated to the Pinnacle West Stock Fund for the period
January through mid-March 2007 were $3,193,602.
Subsequent to mid-March 2007, Employer contributions are invested in the same investment funds as
the participants elect for their future contributions; therefore, there are no additions to the
non-participant portion of net assets in the Pinnacle West Stock Fund.
17
7. EXEMPT RELATED PARTY TRANSACTIONS
Certain Plan investments include shares of the State Street Government Securities Short Term
Investment Fund and the State Street Global Advisors S&P 500 Flagship Securities Lending Series
Fund Class A that were managed by the Trustee. These transactions qualified as exempt
party-in-interest transactions. In addition, certain Plan investments consist of Pinnacle West
common stock. These transactions qualified as exempt party-in-interest transactions. At December
31, 2007 and 2006, the Plan held 12,147,863 and 3,197,437 units, respectively, of common stock of
Pinnacle West, the sponsoring employer (See Note 5). During the year ended December 31, 2007, the Plan recorded dividend
income from Pinnacle West common stock of $6,410,255.
8. SUBSEQUENT EVENTS
In 2007 new features were added to the Plan in reliance on the Pension Protection Act of 2006
(PPA). In late 2007, the IRS issued proposed regulations with regards to the PPA in which
administratively, certain features were not consistent with the initial PPA guidance. In March
2008, the Plan was amended to comply with the proposed PPA regulations. The effect of this
amendment was not material to the Plans financial statements.
On May 22, 2008, the Investment Management Committee approved a new investment manager for one
of the investment funds. The conversion to the new manager will be implemented in the third
quarter of 2008.
18
THE PINNACLE WEST CAPITAL CORPORATION SAVINGS PLAN
FORM 5500, SCHEDULE H: PART IV, LINE 4i
SCHEDULE OF ASSETS (HELD AT END OF YEAR)
DECEMBER 31, 2007
|
|
|
|
|
|
|
|
|
|
|
Identity of Issuer, Borrower, |
|
|
|
|
|
|
|
|
Lessor or Similar Party |
|
Description |
|
Cost |
|
Current Value |
|
|
|
|
|
|
|
|
|
|
|
|
Common and Collective Trusts |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
*State Street Gov Sec ST Inv Fund |
|
Short-Term Investments*** |
|
|
* |
* |
|
$ |
8,430,365 |
|
*SSgA
S&P 500 Flgshp Sec Lndg Ser Fund Cl A |
|
S&P 500 Index Fund |
|
|
* |
* |
|
|
141,909,751 |
|
|
|
|
|
|
|
|
|
|
|
Total common and collective trusts |
|
|
|
|
|
|
|
|
150,340,116 |
|
|
|
|
|
|
|
|
|
|
|
|
Mutual Funds |
|
|
|
|
|
|
|
|
|
|
Putnam Voyager Fund Cl A |
|
Large Cap Growth Fund |
|
|
* |
* |
|
|
39,866,328 |
|
Vanguard Lifestrategy Conservative Growth
Fund Inst |
|
Conservative LifeStyle Fund |
|
|
* |
* |
|
|
18,984,235 |
|
Vanguard Lifestrategy Moderate Growth Fund Inst |
|
Moderate LifeStyle Fund |
|
|
* |
* |
|
|
35,045,310 |
|
Vanguard Lifestrategy Growth Fund Inst |
|
Aggressive LifeStyle Fund |
|
|
* |
* |
|
|
42,415,808 |
|
Black Rock Value Opportunities Fund Cl I |
|
Small Cap Core Fund |
|
|
* |
* |
|
|
56,418,010 |
|
AIM Mid Cap Core Equity Fund Cl I |
|
Mid Cap Core Fund |
|
|
* |
* |
|
|
25,556,362 |
|
PIMCO Total Return Fund Inst |
|
Intermediate Bond Fund |
|
|
* |
* |
|
|
23,755,146 |
|
T. Rowe Price Equity Income Fund |
|
Large Cap Value Fund |
|
|
* |
* |
|
|
47,898,878 |
|
American FDS EuroPacific Growth Fund R5 |
|
International Equity Fund |
|
|
* |
* |
|
|
109,348,038 |
|
|
|
|
|
|
|
|
|
|
|
Total mutual funds |
|
|
|
|
|
|
|
|
399,288,115 |
|
|
|
|
|
|
|
|
|
|
|
|
Synthetic Investment Contracts |
|
Fixed Income Fund |
|
|
|
|
|
|
|
|
Bank of America N.A. Wrap maturity date 3/15/16, yield 4.51% |
|
|
|
|
|
|
60,857 |
|
T 4.95% maturity date 1/15/13 |
|
|
|
|
* |
* |
|
|
1,501,080 |
|
CWL 2005-3 AF4 maturity date
8/25/13 |
|
|
|
|
* |
* |
|
|
999,982 |
|
CXHE 2005-B AF4 maturity date
2/25/14 |
|
|
|
|
* |
* |
|
|
978,845 |
|
FHR 2798 JP maturity date 11/15/12 |
|
|
|
|
* |
* |
|
|
954,599 |
|
FHR 2828 YA maturity date 1/15/13 |
|
|
|
|
* |
* |
|
|
1,274,538 |
|
FHR 2934 MA maturity date 2/15/16 |
|
|
|
|
* |
* |
|
|
1,063,507 |
|
FHR 3087 NA maturity date 7/15/17 |
|
|
|
|
* |
* |
|
|
764,937 |
|
FNR 2006-69 GC maturity date
6/25/17 |
|
|
|
|
* |
* |
|
|
1,592,046 |
|
FHR 3170 EC maturity date 6/15/16 |
|
|
|
|
* |
* |
|
|
1,169,952 |
|
GMACC 2004-C3 A3 maturity date
7/10/11 |
|
|
|
|
* |
* |
|
|
1,495,430 |
|
GMACM 2007-HEI A4 maturity date
7/25/12 |
|
|
|
|
* |
* |
|
|
1,999,946 |
|
GE 4.25% maturity date 1/15/08 |
|
|
|
|
* |
* |
|
|
2,023,660 |
|
GNW 5.65% maturity date 6/15/12 |
|
|
|
|
* |
* |
|
|
991,810 |
|
GCCFC 2004-GG1 A3 maturity date
3/10/09 |
|
|
|
|
* |
* |
|
|
971,944 |
|
MER 4.75% maturity date 11/20/09 |
|
|
|
|
* |
* |
|
|
1,515,510 |
|
MET 4.25% maturity date 7/30/09 |
|
|
|
|
* |
* |
|
|
1,016,870 |
|
MG Fund 3.9% maturity date 6/15/09 |
|
|
|
|
* |
* |
|
|
956,970 |
|
MSC 2004-IQ8 A2 maturity date
6/15/09 |
|
|
|
|
* |
* |
|
|
635,319 |
|
WBCMT 2006-C29 A2 maturity date
12/15/11 |
|
|
|
|
* |
* |
|
|
1,507,454 |
|
19
THE PINNACLE WEST CAPITAL CORPORATION SAVINGS PLAN
FORM 5500, SCHEDULE H: PART IV, LINE 4i
SCHEDULE OF ASSETS (HELD AT END OF YEAR)
DECEMBER 31, 2007
|
|
|
|
|
|
|
|
|
|
|
Identity of Issuer, Borrower, |
|
|
|
|
|
|
|
|
Lessor or Similar Party |
|
Description |
|
Cost |
|
Current Value |
|
AIG Financial Products Wrap maturity date 4/15/20, yield 4.77% |
|
|
|
|
|
|
58,521 |
|
BACM 2005-1 A3 maturity date
4/10/11 |
|
|
|
|
* |
* |
|
|
1,941,875 |
|
BACM 2005-2 AAB maturity date
12/10/14 |
|
|
|
|
* |
* |
|
|
1,502,344 |
|
BAC 7.40% maturity date 1/15/11 |
|
|
|
|
* |
* |
|
|
2,319,700 |
|
CWL 2005 - 10 AF3 maturity date
9/25/14 |
|
|
|
|
* |
* |
|
|
1,499,970 |
|
FGG11751 maturity date 1/15/20 |
|
|
|
|
* |
* |
|
|
1,067,563 |
|
FGG11810 maturity date 10/15/19 |
|
|
|
|
* |
* |
|
|
1,031,845 |
|
FN255891 maturity date 5/25/20 |
|
|
|
|
* |
* |
|
|
804,163 |
|
FNR 2003-75 NB maturity date
1/25/12 |
|
|
|
|
* |
* |
|
|
775,446 |
|
FNR 2003-109 CX maturity date
10/25/12 |
|
|
|
|
* |
* |
|
|
1,062,809 |
|
FHR 2808 YA maturity date 8/15/12 |
|
|
|
|
* |
* |
|
|
1,143,435 |
|
FHR 3178 A maturity date 3/15/18 |
|
|
|
|
* |
* |
|
|
1,616,625 |
|
FHR 3262 ME maturity date 11/15/24 |
|
|
|
|
* |
* |
|
|
998,065 |
|
HSBC 5.25 maturity date 1/14/11 |
|
|
|
|
* |
* |
|
|
1,496,715 |
|
RFMS2 2006-HI2 A3 maturity date
4/25/12 |
|
|
|
|
* |
* |
|
|
749,809 |
|
JNJ 5.15% maturity date 8/15/12 |
|
|
|
|
* |
* |
|
|
1,498,110 |
|
LLY 5.2% maturity date 3/15/17 |
|
|
|
|
* |
* |
|
|
1,978,840 |
|
MSDWC 2001-TOP1 A2 maturity date
1/15/08 |
|
|
|
|
* |
* |
|
|
25,988 |
|
T 5.0% maturity date 7/31/08 |
|
|
|
|
* |
* |
|
|
1,002,578 |
|
|
|
|
|
|
|
|
|
|
|
|
UBS A.G. Wrap maturity date 11/15/19, yield 4.18% |
|
|
|
|
|
|
56,726 |
|
CD 2007-CD4 A3 maturity date 2/11/14 |
|
|
|
|
* |
* |
|
|
1,909,414 |
|
CAT 4.35% maturity date 3/04/09 |
|
|
|
|
* |
* |
|
|
1,454,295 |
|
FGG11678 maturity date 9/15/19 |
|
|
|
|
* |
* |
|
|
695,029 |
|
FN254437 FNMA 7-yr 5% maturity
date 7/25/09 |
|
|
|
|
* |
* |
|
|
299,153 |
|
FN677680 maturity date 3/25/17 |
|
|
|
|
* |
* |
|
|
381,503 |
|
FHR 2611 KC maturity date 4/15/12 |
|
|
|
|
* |
* |
|
|
724,315 |
|
FNR 2005-121 AJ maturity date
6/25/18 |
|
|
|
|
* |
* |
|
|
1,518,405 |
|
FHR 3048 QA maturity date
12/15/17 |
|
|
|
|
* |
* |
|
|
1,550,548 |
|
FNCI 4.5% Pool 683124 maturity date
8/25/17 |
|
|
|
|
* |
* |
|
|
924,726 |
|
FN695871 maturity date 10/25/17 |
|
|
|
|
* |
* |
|
|
504,885 |
|
FORDO 2007-B A4A maturity date
1/15/11 |
|
|
|
|
* |
* |
|
|
499,901 |
|
MSC 2006-IQ11 A2 maturity date
4/15/11 |
|
|
|
|
* |
* |
|
|
1,996,875 |
|
MSDWC 2002-TOP7 A1 maturity date
11/15/10 |
|
|
|
|
* |
* |
|
|
249,586 |
|
PERF 2005-1 A4 maturity date
6/25/12 |
|
|
|
|
* |
* |
|
|
1,448,714 |
|
POPLR 2005-A AF3 maturity date
3/25/08 |
|
|
|
|
* |
* |
|
|
220,472 |
|
RFMS2 2004-HS1 AI4 maturity date
1/25/11 |
|
|
|
|
* |
* |
|
|
1,999,700 |
|
WBCMT 2005-C17 A2 maturity date
3/15/10 |
|
|
|
|
* |
* |
|
|
1,527,422 |
|
WBCMT 2004-C10 A2 maturity date
11/15/10 |
|
|
|
|
* |
* |
|
|
2,429,590 |
|
WFC 4.2 maturity date 1/15/10 |
|
|
|
|
* |
* |
|
|
585,240 |
|
WFC 5 1/4 maturity date 10/23/12 |
|
|
|
|
* |
* |
|
|
905,346 |
|
|
|
|
|
|
|
|
|
|
|
|
Monumental Life Insurance Co. Wrap maturity date 4/15/20, Yield 4.66% |
|
|
|
|
|
|
62,234 |
|
CWL 2005-12 1A4 maturity date
2/25/24 |
|
|
|
|
* |
* |
|
|
1,299,980 |
|
CHAIT 2005-A7 A7 maturity date
1/15/11 |
|
|
|
|
* |
* |
|
|
1,000,313 |
|
CHAIT 2007-A7 A maturity date
10/15/12 |
|
|
|
|
* |
* |
|
|
999,975 |
|
C 5.125 maturity date 2/14/11 |
|
|
|
|
* |
* |
|
|
1,971,440 |
|
CRMSI 2006-1 A3 maturity date
5/25/11 |
|
|
|
|
* |
* |
|
|
1,499,985 |
|
FGG18056 maturity date 1/15/20 |
|
|
|
|
* |
* |
|
|
710,924 |
|
20
THE PINNACLE WEST CAPITAL CORPORATION SAVINGS PLAN
FORM 5500, SCHEDULE H: PART IV, LINE 4i
SCHEDULE OF ASSETS (HELD AT END OF YEAR)
DECEMBER 31, 2007
|
|
|
|
|
|
|
|
|
|
|
Identity of Issuer, Borrower, |
|
|
|
|
|
|
|
|
Lessor or Similar Party |
|
Description |
|
Cost |
|
Current Value |
|
FGB11935 maturity date 6/15/18 |
|
|
|
|
* |
* |
|
|
1,190,404 |
|
FNR 2003-67 GN maturity date
8/25/09 |
|
|
|
|
* |
* |
|
|
926,123 |
|
FHR 2664 GA maturity date
8/15/12 |
|
|
|
|
* |
* |
|
|
981,659 |
|
FHR 3095 GB maturity date
2/15/18 |
|
|
|
|
* |
* |
|
|
819,308 |
|
GSMS 2006-GG6 A2 maturity date
3/10/11 |
|
|
|
|
* |
* |
|
|
2,032,422 |
|
JPM 5.375 maturity date
1/15/14 |
|
|
|
|
* |
* |
|
|
2,015,960 |
|
JPMCC 2001-CIB3 A2 maturity date
11/15/10 |
|
|
|
|
* |
* |
|
|
1,013,539 |
|
LBUBS 2004-C6 A3 maturity date
2/15/11 |
|
|
|
|
* |
* |
|
|
976,758 |
|
MLCFC 2006-1 A2 maturity date
3/12/11 |
|
|
|
|
* |
* |
|
|
1,206,582 |
|
MSC 2003-IQ5 A3 maturity date
7/15/09 |
|
|
|
|
* |
* |
|
|
2,038,672 |
|
RAMP 2004-RS6 AI4 maturity date
10/25/12 |
|
|
|
|
* |
* |
|
|
808,395 |
|
RASC 2004-KS2 AI6 maturity date
2/25/17 |
|
|
|
|
* |
* |
|
|
944,295 |
|
WBCMT 2006-C25 A2 maturity date
4/15/11 |
|
|
|
|
* |
* |
|
|
1,507,476 |
|
|
|
|
|
|
|
|
|
|
|
|
JP Morgan Bank Wrap maturity date 2/16/21, yield 4.49% |
|
|
|
|
|
|
58,876 |
|
SO 4.7 maturity date 12/1/10 |
|
|
|
|
* |
* |
|
|
1,467,060 |
|
AXP 4.875 maturity date 7/15/13 |
|
|
|
|
* |
* |
|
|
1,924,660 |
|
FGG11678 maturity date 9/19/19 |
|
|
|
|
* |
* |
|
|
1,017,393 |
|
FGG11850 maturity date 2/15/19 |
|
|
|
|
* |
* |
|
|
689,890 |
|
FHR 2378 A maturity date
1/15/09 |
|
|
|
|
* |
* |
|
|
127,946 |
|
FNMA Pool #254458 5% 8-1-1 maturity
date 12/25/16 |
|
|
|
|
* |
* |
|
|
801,840 |
|
FNR 2003-125 AM maturity
date 8/25/13 |
|
|
|
|
* |
* |
|
|
502,754 |
|
FNR 2003-109 CJ maturity
date 10/25/12 |
|
|
|
|
* |
* |
|
|
367,501 |
|
FHR 2685 DQ maturity date
2/15/18 |
|
|
|
|
* |
* |
|
|
1,106,331 |
|
FHR 2685 MX maturity date
11/15/12 |
|
|
|
|
* |
* |
|
|
1,378,534 |
|
FHR 2713 G maturity date
11/15/12 |
|
|
|
|
* |
* |
|
|
958,270 |
|
FHR 2901 CA maturity date
9/15/18 |
|
|
|
|
* |
* |
|
|
984,846 |
|
FHR 3002 YD maturity date
6/15/21 |
|
|
|
|
* |
* |
|
|
1,159,545 |
|
FHR 3152 LA maturity date
11/15/18 |
|
|
|
|
* |
* |
|
|
1,614,601 |
|
FNR 2007-27 MQ maturity date
2/25/21 |
|
|
|
|
* |
* |
|
|
1,904,400 |
|
FN695896 maturity date
11/25/17 |
|
|
|
|
* |
* |
|
|
510,426 |
|
GNR 2002-15 PG maturity date
4/20/15 |
|
|
|
|
* |
* |
|
|
71,732 |
|
MI 5.35 maturity date 4/1/11 |
|
|
|
|
* |
* |
|
|
1,673,242 |
|
MET 5.75% 144A maturity date
7/25/11 |
|
|
|
|
* |
* |
|
|
999,740 |
|
MSC 2004-HQ3 A2 maturity date
6/13/10 |
|
|
|
|
* |
* |
|
|
2,050,000 |
|
RAMP 2003-RS7 AI4 maturity date
12/25/09 |
|
|
|
|
* |
* |
|
|
613,993 |
|
RAMP 2004-RS10 AI4 maturity date
5/25/13 |
|
|
|
|
* |
* |
|
|
727,518 |
|
|
|
|
|
|
|
|
|
|
|
|
Rabobank Nederland N.V. Wrap maturity date 5/28/24, yield 4.32% |
|
|
|
|
|
|
62,062 |
|
AIG 4.95 maturity date 3/20/12 |
|
|
|
|
* |
* |
|
|
997,860 |
|
BK 4.95 maturity date 11/1/12 |
|
|
|
|
* |
* |
|
|
1,505,295 |
|
BSCMS 2001-TOP4 A1 maturity
date 12/15/10 |
|
|
|
|
* |
* |
|
|
557,941 |
|
BSCMS 2006-TOP24 A2 maturity
date 10/12/11 |
|
|
|
|
* |
* |
|
|
1,508,211 |
|
FGB13150 maturity date 9/15/18 |
|
|
|
|
* |
* |
|
|
1,179,572 |
|
FN254486 maturity date 2/25/17 |
|
|
|
|
* |
* |
|
|
506,370 |
|
FNR 2003-14 AN maturity date
10/25/23 |
|
|
|
|
* |
* |
|
|
611,694 |
|
FNR 2003-57 NB maturity date
1/25/18 |
|
|
|
|
* |
* |
|
|
656,417 |
|
FNR 2005-85 AJ maturity date
10/25/17 |
|
|
|
|
* |
* |
|
|
1,401,658 |
|
FHR 2950 AB maturity date
2/15/19 |
|
|
|
|
* |
* |
|
|
681,380 |
|
21
THE PINNACLE WEST CAPITAL CORPORATION SAVINGS PLAN
FORM 5500, SCHEDULE H: PART IV, LINE 4i
SCHEDULE OF ASSETS (HELD AT END OF YEAR)
DECEMBER 31, 2007
|
|
|
|
|
|
|
|
|
|
|
Identity of Issuer, Borrower, |
|
|
|
|
|
|
|
|
Lessor or Similar Party |
|
Description |
|
Cost |
|
Current Value |
|
FNR 2007-43 MA maturity date
11/25/24 |
|
|
|
|
* |
* |
|
|
1,915,783 |
|
FN768658 maturity date 9/25/18 |
|
|
|
|
* |
* |
|
|
566,877 |
|
FN 900999 5.5 maturity date
5/25/21 |
|
|
|
|
* |
* |
|
|
1,372,112 |
|
LBUBS 2005-C5 A-2 maturity
date 8/15/10 |
|
|
|
|
* |
* |
|
|
978,945 |
|
LBUBS 2002-C7 A-3 maturity
date 8/15/12 |
|
|
|
|
* |
* |
|
|
1,890,017 |
|
LBUBS 2003-C5 A3 maturity
date 4/15/13 |
|
|
|
|
* |
* |
|
|
1,470,938 |
|
MBNAP 2005-2 A4 - 144A maturity
date 1/15/11 |
|
|
|
|
* |
* |
|
|
999,863 |
|
MWD 4.00 maturity date 1/15/10 |
|
|
|
|
* |
* |
|
|
1,480,575 |
|
MSDWC 2003-TOP9 A1 maturity
date 4/13/11 |
|
|
|
|
* |
* |
|
|
631,411 |
|
POPLR 2005-B AF4 maturity date
7/25/08 |
|
|
|
|
* |
* |
|
|
1,000,000 |
|
WB 5.35 maturity date 3/15/11 |
|
|
|
|
* |
* |
|
|
1,965,180 |
|
|
|
|
|
|
|
|
|
|
|
|
CDC Wraps maturity date 4/17/17, yield 4.66% |
|
|
|
|
|
|
61,088 |
|
BSCMS 2004-T14 A2 maturity
date 1/15/09 |
|
|
|
|
* |
* |
|
|
1,190,338 |
|
BSCMS 2002-TOP6 A1 maturity
date 12/15/10 |
|
|
|
|
* |
* |
|
|
1,217,531 |
|
CWL 2004-7 AF4 maturity date
8/25/09 |
|
|
|
|
* |
* |
|
|
466,016 |
|
CWL 2005-7 AF4 maturity date
10/25/20 |
|
|
|
|
* |
* |
|
|
999,982 |
|
CFAB 2004-2 1A4 maturity date
12/25/15 |
|
|
|
|
* |
* |
|
|
1,990,705 |
|
CWL 2006-S3 A4 maturity date
7/25/21 |
|
|
|
|
* |
* |
|
|
1,749,984 |
|
FGE91523 maturity date
3/15/17 |
|
|
|
|
* |
* |
|
|
1,221,291 |
|
FGG12809 maturity date
6/15/22 |
|
|
|
|
* |
* |
|
|
1,454,741 |
|
FNR 2003-112 AB maturity date
8/25/12 |
|
|
|
|
* |
* |
|
|
680,853 |
|
FHR 2770 QA maturity date
2/15/14 |
|
|
|
|
* |
* |
|
|
1,376,897 |
|
FHR 2849 AL maturity date
12/15/13 |
|
|
|
|
* |
* |
|
|
615,966 |
|
FHR 3211 MH maturity date
4/15/26 |
|
|
|
|
* |
* |
|
|
1,728,450 |
|
FN920197 maturity date
9/25/21 |
|
|
|
|
* |
* |
|
|
2,665,610 |
|
GMACC 2003-C3 A3 maturity
date 5/10/13 |
|
|
|
|
* |
* |
|
|
982,773 |
|
IBM 5.05 maturity date
10/22/12 |
|
|
|
|
* |
* |
|
|
1,009,450 |
|
LEH 5 3/4 maturity date
7/18/11 |
|
|
|
|
* |
* |
|
|
1,495,910 |
|
RAMP 2004-RS8 AI4 maturity
date 1/25/12 |
|
|
|
|
* |
* |
|
|
1,158,911 |
|
USB 5.3 maturity date
4/28/09 |
|
|
|
|
* |
* |
|
|
1,498,680 |
|
|
|
|
|
|
|
|
|
|
|
Total synthetic
investment contracts |
|
|
|
|
|
|
|
|
162,154,381 |
|
|
|
|
|
|
|
|
|
|
|
|
Guaranteed Investment Contracts |
|
Fixed Income Fund |
|
|
|
|
|
|
|
|
New York Life Insurance Company maturity date 3/31/09, yield 3.46% |
|
|
* |
* |
|
|
2,832,345 |
|
|
|
|
|
|
|
|
|
|
|
Total guaranteed
investment contracts |
|
|
|
|
|
|
|
|
2,832,345 |
|
|
|
|
|
|
|
|
|
|
|
|
Other Investments |
|
|
|
|
|
|
|
|
|
|
*Pinnacle West Common Stock |
|
Pinnacle West Stock Fund |
|
|
* |
* |
|
|
125,683,387 |
|
****Participant Loans |
|
Participant Loans |
|
|
* |
* |
|
|
21,922,985 |
|
Self-Directed Brokerage Account |
|
Self-Directed Brokerage Account |
|
|
|
|
|
|
11,030,200 |
|
|
|
|
|
|
|
|
|
|
|
Total other investments |
|
|
|
|
|
|
|
|
158,636,572 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Assets Held for Investment Purposes |
|
|
|
|
|
|
|
$ |
873,251,529 |
|
|
|
|
|
|
|
|
|
|
|
22
THE PINNACLE WEST CAPITAL CORPORATION SAVINGS PLAN
FORM 5500, SCHEDULE H: PART IV, LINE 4i
SCHEDULE OF ASSETS (HELD AT END OF YEAR)
DECEMBER 31, 2007
|
|
|
* |
|
Related Party |
|
** |
|
Cost information not provided as investments are participant-directed. |
|
*** |
|
Short-Term Investments represent $6,872,930 from the Fixed Income Fund and $1,557,435 from the
Pinnacle West Stock Fund. |
|
**** |
|
Interest rates for outstanding loans as of December 31, 2007 ranged from 5.0% to 10.5% with
maturity dates ranging from 2008 to 2022. |
23
Exhibits Filed
|
|
|
Exhibit No. |
|
Description |
|
|
|
23.1
|
|
Consent of Independent Registered Public Accounting Firm |
24
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Committee has duly
caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized.
|
|
|
|
|
|
THE PINNACLE WEST CAPITAL
CORPORATION SAVINGS PLAN
|
|
Date: June 25, 2008 |
By |
/s/
Lori
Sundberg
|
|
|
|
Lori Sundberg |
|
|
|
Chairman of the Administrative Committee |
|
|
|
and Vice President, Human Resources
Arizona Public Service Company |
|
25