-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, MvxH0lL5NpbfYBBUwbyBmKMov1jpM60GD4X1MJfky3oANiMlXU1PRWS2NFF9KCnj s0MQ1FzPpfztPJN/JmSuog== 0000893220-99-000780.txt : 19990630 0000893220-99-000780.hdr.sgml : 19990630 ACCESSION NUMBER: 0000893220-99-000780 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19981231 FILED AS OF DATE: 19990629 FILER: COMPANY DATA: COMPANY CONFORMED NAME: GENERAL INSTRUMENT CORP CENTRAL INDEX KEY: 0001035881 STANDARD INDUSTRIAL CLASSIFICATION: RADIO & TV BROADCASTING & COMMUNICATIONS EQUIPMENT [3663] IRS NUMBER: 364134221 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 11-K SEC ACT: SEC FILE NUMBER: 001-12925 FILM NUMBER: 99655064 BUSINESS ADDRESS: STREET 1: 101 TOURNAMENT DRIVE CITY: HORSHAM STATE: PA ZIP: 19044 BUSINESS PHONE: 2153231000 MAIL ADDRESS: STREET 1: 101 TOURNAMENT DRIVE CITY: HORSHAM STATE: PA ZIP: 19044 FORMER COMPANY: FORMER CONFORMED NAME: NEXTLEVEL SYSTEMS INC DATE OF NAME CHANGE: 19970314 11-K 1 FORM 11-K GENERAL INSTRUMENT CORPORATION SAVINGS 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 11-K (Mark One) [ X ] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended: December 31, 1998 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _______ to _______ Commission file number: 001-12925 A. Full title of the plan and the address of the plan, if different from that of the issuer named below: GENERAL INSTRUMENT CORPORATION SAVINGS PLAN B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: GENERAL INSTRUMENT CORPORATION (Exact name of registrant as specified in its charter) 101 Tournament Drive, Horsham, Pennsylvania 19044 (Address of principal executive offices) (Zip Code) 2 - ------------------------------------------------------------------------------- GENERAL INSTRUMENT CORPORATION SAVINGS PLAN Financial Statements as of December 31, 1998 and 1997 and for the Year Ended December 31, 1998 and the Period July 31, 1997 (Inception of the Plan) Through December 31, 1997, and Supplemental Schedules as of December 31, 1998, and for the Year Ended December 31, 1998, and Independent Auditors' Report 3 GENERAL INSTRUMENT CORPORATION SAVINGS PLAN TABLE OF CONTENTS
- ----------------------------------------------------------------------------------------- PAGE ---- INDEPENDENT AUDITORS' REPORT 1 FINANCIAL STATEMENTS: Statements of Net Assets Available for Benefits as of December 31, 1998 and 1997 with Supplemental Fund Information 2-3 Statements of Changes in Net Assets Available for Benefits for the Year Ended December 31, 1998 and the Period July 31, 1997 (Inception of the Plan) through December 31, 1997, with Supplemental Fund Information 4-5 Notes to Financial Statements 6-12 SUPPLEMENTAL SCHEDULES: Item 27(a) - Schedule of Assets Held for Investment Purposes as of December 31, 1998 13 Item 27(d) - Schedule of Reportable Transactions for the Year Ended December 31, 1998 14
Note: Supplemental Schedules are included for filing with the Annual Return on Form 5500. Supplemental Schedules not included herein are omitted due to the absence of conditions under which they would be required. 4 INDEPENDENT AUDITORS' REPORT Administrative Committee General Instrument Corporation Savings Plan We have audited the accompanying statements of net assets available for benefits of General Instrument Corporation Savings Plan (the "Plan") as of December 31, 1998 and 1997, and the related statements of changes in net assets available for benefits for the year ended December 31, 1998 and for the period July 31, 1997 (inception of the Plan) through December 31, 1997. These financial statements are the responsibility of the Plan's Administrative Committee. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, such financial statements present fairly, in all material respects, the net assets available for benefits of the Plan as of December 31, 1998 and 1997, and the changes in net assets available for benefits for the year ended December 31, 1998 and for the period July 31, 1997 (inception of Plan) through December 31, 1997, in conformity with generally accepted accounting principles. Our audits were conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules listed in the Table of Contents 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. The supplemental information by fund as of December 31, 1998 and 1997 and for the year ended December 31, 1998 and for the period July 31, 1997 (inception of Plan) through December 31, 1997, is presented for the purpose of additional analysis of the basic financial statements rather than to present information regarding the net assets available for benefits and changes in net assets available for benefits of the individual funds. The supplemental schedules and fund information are the responsibility of the Plan's Administrative Committee. Such supplemental schedules and supplemental information by fund have been subjected to the auditing procedures applied in our audits of the basic financial statements and, in our opinion, are fairly stated in all material respects when considered in relation to the basic financial statements taken as a whole. /s/ DELOITTE & TOUCHE LLP - ------------------------------- DELOITTE & TOUCHE LLP Parsippany, New Jersey June 15, 1999 5 GENERAL INSTRUMENT CORPORATION SAVINGS PLAN STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH SUPPLEMENTAL FUND INFORMATION AS OF DECEMBER 31, 1998 - --------------------------------------------------------------------------------
GENERAL INSTRUMENT GENERAL CORPORATION SEMICONDUCTOR, (THE FORMER INC. NEXTLEVEL (THE DISTRIBUTING COMMSCOPE, VANGUARD SYSTEMS, INC.) COMPANY) INC. RETIREMENT COMMON COMMON COMMON SAVINGS STOCK FUND STOCK FUND STOCK FUND TRUST ASSETS: Investments, at fair value: Company common stock $30,210,292 $ -- $ -- $ -- Other common stock -- 671,314 1,980,027 -- Common/collective trust -- -- -- 3,933,010 Shares of registered investment company -- -- -- -- Participant loans -- -- -- -- Contributions receivable: Employee 88,709 -- -- 34,933 Employer 305,881 -- -- -- ----------- ----------- ----------- ----------- NET ASSETS AVAILABLE FOR BENEFITS $30,604,882 $ 671,314 $ 1,980,027 $ 3,967,943 =========== =========== =========== ===========
VANGUARD FEDERAL VANGUARD/ VANGUARD MONEY VANGUARD WELLINGTON 500 INDEX MARKET GNMA FUND FUND FUND FUND ASSETS: Investments, at fair value: Company common stock $ -- $ -- $ -- $ -- Other common stock -- -- -- -- Common/collective trust -- -- -- -- Shares of registered investment company 14,213,754 24,662,190 6,204,754 4,157,068 Participant loans -- -- -- -- Contributions receivable: Employee 127,422 241,434 35,413 36,209 Employer -- -- -- -- ----------- ----------- ----------- ------------ NET ASSETS AVAILABLE FOR BENEFITS $14,341,176 $24,903,624 $ 6,240,167 $ 4,193,277 =========== =========== =========== ============
VANGUARD VANGUARD VANGUARD U.S. INTERNATIONAL STAR GROWTH GROWTH LOAN FUND FUND FUND FUND TOTAL ASSETS: Investments, at fair value: Company common stock $ -- $ -- $ -- $ -- $ 30,210,292 Other common stock -- -- -- -- 2,651,341 Common/collective trust -- -- -- -- 3,933,010 Shares of registered investment company 4,288,479 10,837,939 4,043,461 -- 68,407,645 Participant loans -- -- -- 2,106,577 2,106,577 Contributions receivable: Employee 64,783 143,623 59,237 -- 831,763 Employer -- -- -- -- 305,881 ------------ ------------ ------------ ------------ ------------ NET ASSETS AVAILABLE FOR BENEFITS $ 4,353,262 $ 10,981,562 $ 4,102,698 $ 2,106,577 $108,446,509 ============ ============ ============ ============ ============
See notes to financial statements. -2- 6 GENERAL INSTRUMENT CORPORATION SAVINGS PLAN STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH SUPPLEMENTAL FUND INFORMATION AS OF DECEMBER 31, 1997
- ---------------------------------------------------------------------------------------------------- GENERAL INSTRUMENT GENERAL CORPORATION SEMICONDUCTOR, (THE FORMER INC. NEXTLEVEL (THE DISTRIBUTING COMMSCOPE, VANGUARD SYSTEMS, INC.) COMPANY) INC. RETIREMENT COMMON COMMON COMMON SAVINGS STOCK FUND STOCK FUND STOCK FUND TRUST ASSETS: Investments, at fair value: Company common stock $14,748,982 $ -- $ -- $ -- Other common stock -- 1,294,591 2,130,598 -- Common/collective trust -- -- -- 3,459,683 Shares of registered investment company -- -- -- -- Participant loans -- -- -- -- Loans receivable 8,468 -- -- 4,775 Contributions receivable: Employee 78,090 -- -- 32,492 Employer 263,429 -- -- -- ----------- ----------- ----------- ----------- NET ASSETS AVAILABLE FOR BENEFITS $15,098,969 $ 1,294,591 $ 2,130,598 $ 3,496,950 =========== =========== =========== ===========
VANGUARD FEDERAL VANGUARD/ VANGUARD MONEY VANGUARD WELLINGTON 500 INDEX MARKET GNMA FUND FUND FUND FUND ASSETS: Investments, at fair value: Company common stock $ -- $ -- $ -- $ -- Other common stock -- -- -- -- Common/collective trust -- -- -- -- Shares of registered investment company 12,044,163 17,869,948 4,983,817 3,242,331 Participant loans -- -- -- -- Loans receivable 8,077 9,478 4,106 1,746 Contributions receivable: Employee 113,969 192,841 33,721 30,460 Employer -- -- -- -- ----------- ----------- ----------- ----------- NET ASSETS AVAILABLE FOR BENEFITS $12,166,209 $18,072,267 $ 5,021,644 $ 3,274,537 =========== =========== =========== ===========
VANGUARD VANGUARD VANGUARD U.S. INTERNATIONAL STAR GROWTH GROWTH LOAN FUND FUND FUND FUND TOTAL ASSETS: Investments, at fair value: Company common stock $ -- $ -- $ -- $ -- $14,748,982 Other common stock -- -- -- -- 3,425,189 Common/collective trust -- -- -- -- 3,459,683 Shares of registered investment company 3,286,202 6,115,692 3,279,886 -- 50,822,039 Participant loans -- -- -- 1,860,152 1,860,152 Loans receivable 1,949 3,900 3,143 -- 45,642 Contributions receivable: Employee 53,864 113,307 60,119 -- 708,863 Employer -- -- -- -- 263,429 ----------- ----------- ----------- ----------- ----------- NET ASSETS AVAILABLE FOR BENEFITS $ 3,342,015 $ 6,232,899 $ 3,343,148 $ 1,860,152 $75,333,979 =========== =========== =========== =========== ===========
See notes to financial statements. -3- 7 GENERAL INSTRUMENT CORPORATION SAVINGS PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS, WITH SUPPLEMENTAL FUND INFORMATION YEAR ENDED DECEMBER 31, 1998 - --------------------------------------------------------------------------------
GENERAL INSTRUMENT GENERAL CORPORATION SEMICONDUCTOR, (THE FORMER INC. NEXTLEVEL (THE DISTRIBUTING COMMSCOPE, VANGUARD SYSTEMS, INC.) COMPANY) INC. RETIREMENT COMMON COMMON COMMON SAVINGS STOCK FUND STOCK FUND STOCK FUND TRUST CONTRIBUTIONS: Employees $ 1,152,883 $ -- $ -- $ 510,659 Employer 3,656,520 -- -- -- ------------ ------------ ------------ ------------ Net contributions 4,809,403 -- -- 510,659 ------------ ------------ ------------ ------------ INVESTMENT INCOME: Interest and dividends -- -- -- 215,961 Net gain (loss) on investments 14,257,895 (298,779) 458,655 -- ------------ ------------ ------------ ------------ Net investment income (loss) 14,257,895 (298,779) 458,655 215,961 ------------ ------------ ------------ ------------ Total additions 19,067,298 (298,779) 458,655 726,620 ------------ ------------ ------------ ------------ DISTRIBUTIONS 1,908,983 83,977 163,799 521,841 ADMINISTRATIVE EXPENSES 15,271 611 1,120 1,995 ------------ ------------ ------------ ------------ Total deductions 1,924,254 84,588 164,919 523,836 ------------ ------------ ------------ ------------ TRANSFER FROM (TO) OTHER FUNDS (1,637,131) (239,910) (444,307) 268,209 ------------ ------------ ------------ ------------ NET INCREASE (DECREASE) 15,505,913 (623,277) (150,571) 470,993 NET ASSETS AVAILABLE FOR BENEFITS, BEGINNING OF YEAR 15,098,969 1,294,591 2,130,598 3,496,950 ------------ ------------ ------------ ------------ NET ASSETS AVAILABLE FOR BENEFITS, END OF YEAR $ 30,604,882 $ 671,314 $ 1,980,027 $ 3,967,943 ============ ============ ============ ============
VANGUARD FEDERAL VANGUARD/ VANGUARD MONEY VANGUARD WELLINGTON 500 INDEX MARKET GNMA FUND FUND FUND FUND CONTRIBUTIONS: Employees $ 1,966,528 $ 3,694,372 $ 488,470 $ 455,044 Employer -- -- -- -- ------------ ------------ ------------ ------------ Net contributions 1,966,528 3,694,372 488,470 455,044 ------------ ------------ ------------ ------------ INVESTMENT INCOME: Interest and dividends 1,544,844 372,958 295,991 238,652 Net gain (loss) on investments (95,559) 4,904,322 -- 5,493 ------------ ------------ ------------ ------------ Net investment income (loss) 1,449,285 5,277,280 295,991 244,145 ------------ ------------ ------------ ------------ Total additions 3,415,813 8,971,652 784,461 699,189 ------------ ------------ ------------ ------------ DISTRIBUTIONS 1,131,529 2,526,158 543,668 265,810 ADMINISTRATIVE EXPENSES 6,357 10,546 19,618 1,730 ------------ ------------ ------------ ------------ Total deductions 1,137,886 2,536,704 563,286 267,540 ------------ ------------ ------------ ------------ TRANSFER FROM (TO) OTHER FUNDS (102,960) 396,409 997,348 487,091 ------------ ------------ ------------ ------------ NET INCREASE (DECREASE) 2,174,967 6,831,357 1,218,523 918,740 NET ASSETS AVAILABLE FOR BENEFITS, BEGINNING OF YEAR 12,166,209 18,072,267 5,021,644 3,274,537 ------------ ------------ ------------ ------------ NET ASSETS AVAILABLE FOR BENEFITS, END OF YEAR $ 14,341,176 $ 24,903,624 $ 6,240,167 $ 4,193,277 ============ ============ ============ ============
VANGUARD VANGUARD VANGUARD U.S. INTERNATIONAL STAR GROWTH GROWTH LOAN FUND FUND FUND FUND TOTAL CONTRIBUTIONS: Employees $ 861,620 $ 2,316,878 $ 871,522 $ -- $ 12,317,976 Employer -- -- -- -- 3,656,520 ------------ ------------ ------------ ------------ ------------ Net contributions 861,620 2,316,878 871,522 -- 15,974,496 ------------ ------------ ------------ ------------ ------------ INVESTMENT INCOME: Interest and dividends 344,975 661,270 80,969 152,046 3,907,666 Net gain (loss) on investments 86,986 2,130,907 486,102 -- 21,936,022 ------------ ------------ ------------ ------------ ------------ Net investment income (loss) 431,961 2,792,177 567,071 152,046 25,843,688 ------------ ------------ ------------ ------------ ------------ Total additions 1,293,581 5,109,055 1,438,593 152,046 41,818,184 ------------ ------------ ------------ ------------ ------------ DISTRIBUTIONS 352,961 736,300 323,790 77,783 8,636,599 ADMINISTRATIVE EXPENSES 2,942 6,331 2,534 -- 69,055 ------------ ------------ ------------ ------------ ------------ Total deductions 355,903 742,631 326,324 77,783 8,705,654 ------------ ------------ ------------ ------------ ------------ TRANSFER FROM (TO) OTHER FUNDS 73,569 382,239 (352,719) 172,162 -- ------------ ------------ ------------ ------------ ------------ NET INCREASE (DECREASE) 1,011,247 4,748,663 759,550 246,425 33,112,530 NET ASSETS AVAILABLE FOR BENEFITS, BEGINNING OF YEAR 3,342,015 6,232,899 3,343,148 1,860,152 75,333,979 ------------ ------------ ------------ ------------ ------------ NET ASSETS AVAILABLE FOR BENEFITS, END OF YEAR $ 4,353,262 $ 10,981,562 $ 4,102,698 $ 2,106,577 $108,446,509 ============ ============ ============ ============ ============
See notes to financial statements. -4- 8 GENERAL INSTRUMENT CORPORATION SAVINGS PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS, WITH SUPPLEMENTAL FUND INFORMATION PERIOD JULY 31, 1997 (INCEPTION OF PLAN) THROUGH DECEMBER 31, 1997
- ------------------------------------------------------------------------------------------------------------------ GENERAL INSTRUMENT GENERAL CORPORATION SEMICONDUCTOR, (THE FORMER INC. NEXTLEVEL (THE DISTRIBUTING COMMSCOPE, VANGUARD SYSTEMS, INC.) COMPANY) INC. RETIREMENT COMMON COMMON COMMON SAVINGS STOCK FUND STOCK FUND STOCK FUND TRUST CONTRIBUTIONS: Employees $ 567,822 $ -- $ -- $ 252,178 Employer 1,768,818 -- -- -- ------------ ------------ ------------ ------------ Net contributions 2,336,640 -- -- 252,178 ------------ ------------ ------------ ------------ INVESTMENT INCOME: Interest and dividends -- -- -- 85,379 Net (loss) gain on investments (1,012,797) (588,398) (586,433) -- ------------ ------------ ------------ ------------ Net investment income (loss) (1,012,797) (588,398) (586,433) 85,379 ------------ ------------ ------------ ------------ Total additions 1,323,843 (588,398) (586,433) 337,557 ------------ ------------ ------------ ------------ DISTRIBUTIONS 517,966 36,497 52,195 71,017 ADMINISTRATIVE EXPENSES 6,986 896 1,339 1,373 ------------ ------------ ------------ ------------ Total deductions 524,952 37,393 53,534 72,390 ------------ ------------ ------------ ------------ TRANSFER FROM (TO) OTHER FUNDS 808,694 (659,847) (838,890) (37,261) ------------ ------------ ------------ ------------ NET INCREASE (DECREASE) 1,607,585 (1,285,638) (1,478,857) 227,906 TRANSFER OF ASSETS FROM GENERAL SEMICONDUCTOR, INC SAVINGS PLAN 13,491,384 2,580,229 3,609,455 3,269,044 ------------ ------------ ------------ ------------ NET ASSETS AVAILABLE FOR BENEFITS, END OF PERIOD $ 15,098,969 $ 1,294,591 $ 2,130,598 $ 3,496,950 ============ ============ ============ ============
VANGUARD FEDERAL VANGUARD/ VANGUARD MONEY VANGUARD WELLINGTON 500 INDEX MARKET GNMA FUND FUND FUND FUND CONTRIBUTIONS: Employees $ 869,188 $ 1,458,893 $ 463,865 $ 255,490 Employer -- -- -- -- ------------ ------------ ------------ ------------ Net contributions 869,188 1,458,893 463,865 255,490 ------------ ------------ ------------ ------------ INVESTMENT INCOME: Interest and dividends 872,267 260,840 107,990 89,491 Net (loss) gain on investments (527,828) 145,418 -- 18,502 ------------ ------------ ------------ ------------ Net investment income (loss) 344,439 406,258 107,990 107,993 ------------ ------------ ------------ ------------ Total additions 1,213,627 1,865,151 571,855 363,483 ------------ ------------ ------------ ------------ DISTRIBUTIONS 423,199 739,378 117,999 111,034 ADMINISTRATIVE EXPENSES 4,330 6,494 1,852 1,177 ------------ ------------ ------------ ------------ Total deductions 427,529 745,872 119,851 112,211 ------------ ------------ ------------ ------------ TRANSFER FROM (TO) OTHER FUNDS 122,947 663,647 (173,390) 39,056 ------------ ------------ ------------ ------------ NET INCREASE (DECREASE) 909,045 1,782,926 278,614 290,328 TRANSFER OF ASSETS FROM GENERAL SEMICONDUCTOR, INC SAVINGS PLAN 11,257,164 16,289,341 4,743,030 2,984,209 ------------ ------------ ------------ ------------ NET ASSETS AVAILABLE FOR BENEFITS, END OF PERIOD $ 12,166,209 $ 18,072,267 $ 5,021,644 $ 3,274,537 ============ ============ ============ ============
VANGUARD VANGUARD VANGUARD U.S. INTERNATIONAL STAR GROWTH GROWTH LOAN FUND FUND FUND FUND TOTAL CONTRIBUTIONS: Employees $ 465,179 $ 893,779 $ 468,363 $ -- $ 5,694,757 Employer -- -- -- -- 1,768,818 ------------ ------------ ------------ ------------ ------------ Net contributions 465,179 893,779 468,363 -- 7,463,575 ------------ ------------ ------------ ------------ ------------ INVESTMENT INCOME: Interest and dividends 269,250 240,631 141,297 68,859 2,136,004 Net (loss) gain on investments (170,896) (207,985) (630,286) -- (3,560,703) ------------ ------------ ------------ ------------ ------------ Net investment income (loss) 98,354 32,646 (488,989) 68,859 (1,424,699) ------------ ------------ ------------ ------------ ------------ Total additions 563,533 926,425 (20,626) 68,859 6,038,876 ------------ ------------ ------------ ------------ ------------ DISTRIBUTIONS 56,171 205,098 104,066 82,412 2,517,032 ADMINISTRATIVE EXPENSES 1,661 3,272 1,633 -- 31,013 ------------ ------------ ------------ ------------ ------------ Total deductions 57,832 208,370 105,699 82,412 2,548,045 ------------ ------------ ------------ ------------ ------------ TRANSFER FROM (TO) OTHER FUNDS 121,632 61,384 (22,386) (85,586) -- ------------ ------------ ------------ ------------ ------------ NET INCREASE (DECREASE) 627,333 779,439 (148,711) (99,139) 3,490,831 TRANSFER OF ASSETS FROM GENERAL SEMICONDUCTOR, INC SAVINGS PLAN 2,714,682 5,453,460 3,491,859 1,959,291 71,843,148 ------------ ------------ ------------ ------------ ------------ NET ASSETS AVAILABLE FOR BENEFITS, END OF PERIOD $ 3,342,015 $ 6,232,899 $ 3,343,148 $ 1,860,152 $ 75,333,979 ============ ============ ============ ============ ============
See notes to financial statements. -5- 9 GENERAL INSTRUMENT CORPORATION SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS YEARS ENDED DECEMBER 31, 1998 AND 1997 - -------------------------------------------------------------------------------- 1. DESCRIPTION OF THE PLAN The following description of the General Instrument Corporation Savings Plan (the "Plan") provides only general information. Participants should refer to the Plan document for a more complete description of the Plan's provisions. The Plan Sponsor is General Instrument Corporation (the former NextLevel Systems, Inc.) (the "Company"). a. General - The Company was formerly the Communications Business of the former General Instrument Corporation (the "Distributing Company"). In a transaction that was consummated on July 28, 1997, the Distributing Company: (i) transferred all the assets and liabilities, at the distributing Company's historical cost, relating to the manufacture and sale of broadband communications products used in the cable television, satellite and telecommunications industries to the Company (then a wholly-owned subsidiary of the Distributing Company) and all the assets and liabilities relating to the manufacture and sale of the coaxial, fiber optic and other electrical cable used in the cable television, satellite and other industries to its wholly-owned subsidiary, CommScope, Inc. ("CommScope"), at the Distributing Company's historical cost, and (ii) distributed all of its outstanding shares of capital stock of each of the Company and CommScope to its stockholders on a pro rata basis as a dividend. Approximately 147.3 million shares of the Company's Common Stock, based on a ratio of one for one, were distributed to the Distributing Company's stockholders of record on July 25, 1997 (the "Communications Distribution"). On July 28, 1997, approximately 49.1 million shares of CommScope Common Stock, based on a ratio of one for three, were distributed to the Company's stockholders of record on that date (the "CommScope Distribution" and, together with the Communications Distribution, the "Distributions"). On July 28, 1997, the Company and CommScope began operating as independent entities with publicly traded common stock, and the Distributing Company retained no ownership interest in either the Company or CommScope. Additionally, immediately following the Communications Distribution, the Distributing Company was renamed General Semiconductor, Inc. ("General Semiconductor") and effected a one for four reverse stock split. The General Instrument Corporation Savings Plan (the "Plan") was established on July 1, 1997. The Plan is a defined contribution plan which was established to encourage long-term savings by eligible employees of General Instrument Corporation through a systematic program of salary deductions. The Plan began its operation on July 31, 1997 when it received a transfer of assets from the General Semiconductor, Inc. Savings Plan (the former General Instrument Corporation Savings Plan). The assets transferred into the Plan on July 31, 1997 of $71,843,148 represented the fair value of the participant accounts of the employees of General Instrument Corporation on that date. b. Contributions - Each eligible employee may elect to have compensation reduced by, and authorize the Company to contribute to the Plan on his or her behalf, a Matched Participant Contribution of 1% to 6% of compensation for each payroll period. Compensation represents the participant's base salary or wages, without reduction for his or her Matched or Unmatched Participant Contributions to the Plan and Internal Revenue Code Section 125 contributions for health care -6- 10 coverage, and excluding any other form of additional compensation such as overtime pay, commissions, incentive pay or severance pay, which are additions to the participant's yearly base salary. Each month, the Company contributes to the Plan, on behalf of the employee, a Matching Employer Contribution equal to 50% of the employee's Matched Participant Contribution. In addition, an employee who has elected a Matched Participant Contribution rate of 6% may elect to further reduce compensation, and authorize the Company to contribute to the Plan on his or her behalf, an Unmatched Participant Contribution of 1% to 4% of the employee's compensation for each payroll period. In addition, an active participant, who is not a Highly Compensated Employee for the relevant year, may elect an Unmatched Participant Contribution of 0%, 50% or 100% of the employee's annual formula-based profit sharing bonus payable pursuant to the Company's profit sharing bonus program. Total annual contributions may not exceed maximum allowable contributions as prescribed by the Internal Revenue Service. A participant may also contribute to the Plan a Rollover Amount or Trust to Trust Amount, provided the Administrative Committee of the Plan is satisfied that the amount to be rolled over to the Plan constitutes a Rollover Amount or Trust to Trust Amount under federal tax regulations. c. Eligibility - All persons employed by the Company (including officers and directors who are employees) as of July 1, 1997 or at any time thereafter without satisfying any minimum period of qualifying employment are eligible to participate in the Plan. Employees subject to collective bargaining agreements which do not provide for participation of such employees in the Plan are not eligible to participate in the Plan. d. Vesting - A participant's interest in his or her Participant Contributions Account and any Rollover Account or Trust to Trust Account (including all earnings on contributions to such accounts) are immediately and fully vested at all times and not subject to forfeiture. Effective July 1, 1997, a participant's interest in his or her Employer Contributions Account (including all earnings on such account) will be 50% vested upon commencing employment, 75% vested upon completing one year of employment, and 100% vested upon completing two years of employment. Such years of employment need not be consecutive. Notwithstanding the foregoing, an active participant becomes fully vested in his or her Employer Contributions Account upon the earlier of: (i) obtaining normal retirement age; (ii) total disability or (iii) termination of employment by way of death. A participant will also be fully vested in the event of a liquidation or dissolution of the Company, or upon termination of the Plan. e. Conditions of Distribution and Withdrawal - Distributions under the Plan may be made upon a participant's death, total disability, retirement or other termination of employment. A participant who has not reached age 65 upon termination of employment may defer payment of his or her distribution (unless such distribution would be $5,000 or less) until any time up to age 70-1/2. Prior to termination of employment, the participant may make withdrawals from his or her accounts in the following sequence: (i) All or a portion of the balance in the Rollover Account or Trust to Trust Account (subject to certain limitations), including investment income thereon. -7- 11 (ii) All or a portion of the vested Employer Contributions Account, including investment income thereon earned before January 1, 1991 (subject to certain limitations). (iii) When the Participant attains age 59-1/2, all or a portion of the vested Employer Contribution Account, the Matched Participant Contribution Account and the Unmatched Participant Contribution Account. In the case of hardship, the Participant may withdraw all or a portion of his or her vested Employer Contribution Account and his Matched Participant Contribution Account and Unmatched Participant Contribution Account, excluding investment income thereon. The Plan Administrator has sole discretion to approve the amount needed to be withdrawn from the Participant Contribution Account to alleviate the immediate hardship. Withdrawals prior to termination of employment are subject to the following conditions: (i) no more than one request for a withdrawal may be made during any six-month period, except in the case of a financial hardship withdrawal and (ii) the amount withdrawn shall not be less than $200 or the amount of the participant's vested accrued benefit. Effective January 1, 1987, the Tax Reform Act of 1986 imposed an additional 10% tax on the amount of any distribution from the Plan made to or in respect of a participant before the participant attains age 59-1/2 except: (i) any portion of the distribution which was rolled over to a qualified successor benefit plan; or (ii) if the distribution is on account of death, disability or retirement after age 55. Upon withdrawal from the Plan or after termination of employment, the nonvested portion of a participant's account will be forfeited. The forfeiture may be used to reduce future employer contributions. Forfeited nonvested accounts totaled $64,665 for the year ended December 31, 1998 and $24,595 for the period July 31, 1997 through December 31, 1997. f. Loans - A participant is eligible to receive loans under the Plan without a required period of prior participation in the Plan. A participant may not have more than one loan from the Plan outstanding at any one time. The amount of a loan may not exceed the following amount: (i) The lesser of 50% of the vested value of the participant's accounts or $50,000. (ii) Notwithstanding anything in (i) to the contrary, no loan shall be made in a principal amount of less than $1,000 and the principal amount must be in increments of $100. Interest is paid on the outstanding principal amount of each loan at a fixed per annum rate equal to the prime lending rate as published in the Wall Street Journal on the first business day of each month plus 1-1/2%. This rate applies during the full term of the loan and is not modified. Interest paid by a participant is credited to his or her applicable account. The term of the loan is fixed by the Administrative Committee at the time the loan is made and may not be extended. All loans are for a minimum term of one year and are in one year increments. Any loan which is to be used to acquire a dwelling unit which is to be used as the principal residence of the borrowing participant within a reasonable time (a "residence loan") must -8- 12 be repaid within the earlier of fifteen years or disposition of such principal residence. Any other loan will be treated as a "nonresidence loan" and must be repaid within a maximum of five years. Regardless of its original maturity, the outstanding principal amount of any loan and accrued interest thereon becomes immediately due and payable sixty days following the date a participant's employment with the Company terminates for any reason whatsoever, except that for a participant who receives periodic severance payments from which the loan repayments continue to be deducted, the loan becomes immediately due and payable sixty days following the final periodic severance payment. A loan, including interest thereon, is repaid by payroll deductions under a fixed schedule which provides for interest and amortization of principal in substantially level payments over the term of the loan. A participant may repay all, but not part, of any loan at any time without penalty by payment of the outstanding principal amount thereof, plus unpaid accrued interest to the date of repayment. As collateral for repayment of each loan made to a participant, such participant must pledge 50% of his or her vested accrued benefit and such additional collateral as the Plan administrator may require. g. Investment Funds - Vanguard Fiduciary Trust Company ("Vanguard") is the trustee, investment manager and recordkeeper of the Plan. A participant may elect to invest all Participant Contributions, Rollover Amounts or Trust to Trust amounts in one or any combination of the funds described below, in whole multiples of 5% of the aggregate amount of such contributions. A participant may elect to transfer once each day, all or any part of the aggregate value in his or her account or his or her interest in one or more investment fund or funds subject to rules restricting transfers related to the Vanguard Retirement Savings Trust. All Matching Employer Contributions and earnings thereon have been invested solely in the General Instrument Corporation (the former NextLevel Systems, Inc.) Common Stock Fund, which is also an investment option for participants. The descriptions of the investments have been obtained from the various fund prospectuses: General Instrument Corporation (the former NextLevel Systems, Inc.) Common Stock Fund - Consists of General Instrument Corporation common stock and temporary cash investments. General Semiconductor, Inc. (the Distributing Company) Common Stock Fund - Consists principally of General Semiconductor, Inc. common stock and temporary cash investments. This fund is not a current investment option for participants. The investment is held as the result of the spin-off transaction described in Note 1a. CommScope, Inc. Common Stock Fund - Consists principally of CommScope, Inc. common stock and temporary cash investments. This fund is not a current investment option for participants. The investment is held as the result of the spin-off transaction. Vanguard Retirement Savings Trust (Common/Collective Trusts) Consisting of one or more guaranteed investment contracts issued by insurance companies and banks. Vanguard/Wellington Fund (Registered Investment Company) Consisting of a portfolio of approximately 65% in common stocks and 35% in fixed income securities (including corporate and government bonds and money market instruments). -9- 13 Vanguard 500 Index Fund (Registered Investment Company) Consisting of a portfolio of the five-hundred stocks in the Standard & Poor's 500 Composite Stock Price Index, each individual stock being weighted relative to its total market value and parallel to its representation in the Index. Vanguard Federal Money Market Fund (Registered Investment Company) - Consisting of a portfolio of securities issued by the U.S. Treasury and agencies of the U.S. Government with maturities of one year or less. Vanguard GNMA Fund (Registered Investment Company) Consisting of a portfolio of fixed income securities guaranteed by the U.S. Government and approximately 80% of which is normally invested in Government National Mortgage Association ("GNMA") certificates; the balance being invested in temporary cash investments. Vanguard STAR Fund (Registered Investment Company) - Comprised of a portfolio investing 60-70% of its assets in seven Vanguard equity funds and approximately 30%-40% in three Vanguard fixed income funds. Vanguard U.S. Growth Fund (Registered Investment Company) Consisting of a portfolio investing primarily in common stock of United States corporations with above average growth potential. Vanguard International Growth Fund (Registered Investment Company) - Consisting of a portfolio of equity securities of corporations located outside the United States. Loan Fund - A separate loan fund has been established to account for loans made from each specified fund. As periodic principal and interest payments become due, they are reallocated to the specific funds from which the loan originated. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES a. Use of Estimates - The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. b. Investments - Investments are stated at fair or market values. The market values of General Instrument Corporation, General Semiconductor, Inc. and CommScope, Inc. common stock are based on the closing prices as quoted on the New York Stock Exchange. The investments in shares of the Vanguard funds are valued at the redemption prices established by Vanguard, based upon its determination of the market value of the underlying investments. c. Administrative Expenses - The Plan provides that all expenses shall be paid by the Plan unless the Company, at its sole discretion, elects to pay such expenses without reimbursement. During the year ended December 31, 1998 and the period July 31, 1997 through December 31, 1997, the Company elected to pay $40,940 and $35,977, respectively, of Plan expenses without reimbursement. -10- 14 d. Other - All security transactions are recorded on a trade date basis. Net gains and losses on the disposal of investments in each fund are computed using the average cost method based on the beginning market value as carried forward from the end of the prior plan year. Dividend income is recorded on the ex-dividend date. Income from other investments is recorded as earned on an accrual basis. e. Benefits Payable - As prescribed by the American Institute of Certified Public Accountants' Audit and Accounting Guide, "Audits of Employee Benefit Plans," benefit payments are recognized as reductions of Plan assets upon disbursement. Benefits payable to terminated employees who had elected to withdraw from the Plan as of December 31, 1998 and 1997 were $892,187 and $113,523, respectively. 3. INVESTMENTS Investments held by Vanguard at December 31, 1998 were as follows:
NAME OF ISSUER AND NUMBER OF FAIR TITLE OF ISSUES UNITS VALUE General Instrument Corporation (the former NextLevel Systems,Inc.) Common Stock Fund 1,699,117 $30,210,292 General Semiconductor, Inc. (the Distributing Company) Common Stock Fund 122,502 671,314 CommScope, Inc. Common Stock Fund 181,821 1,980,027 Vanguard: Retirement Savings Trust 3,933,010 3,933,010 Wellington Fund 484,285 14,213,754 500 Index Fund 216,430 24,662,190 Federal Money Market Fund 6,204,754 6,204,754 GNMA Fund 397,806 4,157,068 STAR Fund 238,779 4,288,479 U.S. Growth Fund 289,089 10,837,939 International Growth Fund 215,421 4,043,461
-11- 15 Investments held by Vanguard at December 31, 1997 were as follows:
NAME OF ISSUER AND NUMBER OF FAIR TITLE OF ISSUES UNITS VALUE General Instrument Corporation (the former NextLevel Systems,Inc.) Common Stock Fund 1,565,709 $14,748,982 General Semiconductor, Inc. (the Distributing Company) Common Stock Fund 167,911 1,294,591 CommScope, Inc. Common Stock Fund 244,055 2,130,598 Vanguard: Retirement Savings Trust 3,459,683 3,459,683 Wellington Fund 408,970 12,044,163 Index Trust - 500 Portfolio 198,401 17,869,948 Money Market Reserves 4,983,817 4,983,817 Fixed Income Securities Fund 310,866 3,242,331 STAR Portfolio 189,079 3,286,202 U.S. Growth Portfolio 213,090 6,115,692 International Growth Portfolio 200,115 3,279,886
4. PLAN TERMINATION Although it has not expressed any interest 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 set forth in ERISA. 5. TAX STATUS The Plan is intended to be qualified under Section 401(a) of the Internal Revenue Code of 1986 (the "Code") and is intended to be exempt from taxation under Section 501(a) of the Code. The Plan has not yet received an IRS determination letter. The Plan administrator believes that the Plan is currently designed and being operated in compliance with the applicable requirements of the Code and the related trust is expected to be tax-exempt as of the financial statement date. Therefore, no provision for income taxes has been included in the Plan's financial statements. ****** -12- 16 SUPPLEMENTAL SCHEDULES 17 GENERAL INSTRUMENT CORPORATION SAVINGS PLAN ITEM 27(a) - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AS OF DECEMBER 31, 1998 - --------------------------------------------------------------------------------
DESCRIPTION NAME OF ISSUER OF NUMBER OF CURRENT AND TITLE OF ISSUE INVESTMENT UNITS COST VALUE * General Instrument Corporation Common Stock and (the former NextLevel Systems, Temporary Cash Inc.) Common Stock Fund Investments 1,699,117 $16,285,565 $30,210,292 General Semiconductor, Inc. Common Stock and (the Distributing Company) Temporary Cash Common Stock Fund Investments 122,502 1,005,386 671,314 CommScope, Inc. Common Common Stock and Stock Fund Temporary Cash Investments 181,821 1,460,219 1,980,027 Vanguard: Retirement Savings Trust Common/Collective Trust 3,933,010 3,933,010 3,933,010 Wellington Fund Shares of Registered Investment Company 484,285 12,318,604 14,213,754 500 Index Fund Shares of Registered Investment Company 216,430 15,168,075 24,662,190 Federal Money Market Fund Shares of Registered Investment Company 6,204,754 6,204,754 6,204,754 GNMA Fund Shares of Registered Investment Company 397,806 4,073,009 4,157,068 STAR Fund Shares of Registered Investment Company 238,779 4,010,795 4,288,479 U.S. Growth Fund Shares of Registered Investment Company 289,089 7,944,083 10,837,939 International Growth Shares of Registered Fund Investment Company 215,421 3,553,412 4,043,461
DESCRIPTION DESCRIPTION OF MATURITY Plan participant loans other than Through 8/30/13 mortgages, at various rates 7.5% - 12.0% of interest 2,106,577 2,106,577 ----------- ------------ TOTAL ASSETS HELD FOR INVESTMENT PURPOSES $78,063,489 $107,308,865 =========== ============ *Party-in-interest
-13- 18 GENERAL INSTRUMENT CORPORATION SAVINGS PLAN ITEM 27(d) - SCHEDULE OF REPORTABLE TRANSACTIONS YEAR ENDED DECEMBER 31, 1998
- ------------------------------------------------------------------------------------------------------------------ NUMBER PURCHASE NUMBER OF PRICE OR OF SELLING REALIZED INVESTMENT PURCHASES CONTRIBUTION SALES PRICE GAIN General Instrument Corporation (the former NextLevel Systems, Inc.) Common Stock Fund 181 $14,072,489 10,515,099 184 $12,869,074 $ 2,353,975 Vanguard: Wellington Fund 116 4,991,264 2,328,323 120 2,726,114 397,791 500 Index Fund 185 8,290,589 5,100,524 161 6,402,670 1,302,146 Federal Money Market Fund 202 6,826,388 5,605,450 152 5,605,450 -- GNMA Fund 152 3,336,428 2,415,193 98 2,427,183 11,990 U.S. Growth Fund 128 4,114,551 1,201,276 103 1,523,212 321,936
-14- 19 SIGNATURES The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934, the trustees (or other persons who administer the employee benefit plan) have duly caused this annual report to be signed by the undersigned hereunto duly authorized. General Instrument Corporation Savings Plan Date June 28, 1999 /s/ Scott A. Crum ------------- -------------------------------------------- Scott A. Crum Chairman of the General Instrument Corporation Employee Benefits Administrative Committee 20 INDEX TO EXHIBITS Exhibit Description - ------- ----------- 23 Independent Auditors' Consent EX-23 2 INDEPENDENT AUDITORS' CONSENT 1 Exhibit 23 INDEPENDENT AUDITORS' CONSENT We consent to the incorporation by reference in Registration Statement Nos. 333-29719 and 333-33399 of General Instrument Corporation on Forms S-8 of our report dated June 15, 1999 appearing in this Annual Report on Form 11-K of General Instrument Corporation Savings Plan for the year ended December 31, 1998. /s/ DELOITTE & TOUCHE LLP - ------------------------- DELOITTE & TOUCHE LLP Parsippany, New Jersey June 28, 1999 -----END PRIVACY-ENHANCED MESSAGE-----