-----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, OvJyAhcd3NBDYbaskJbeK94ggoe3uDQLoSyrXo2C8u1SNO2s95RAxbKQFuSWGq3F V2Fx+BPUBohOfDaWp4RCbQ== 0000931763-97-001081.txt : 19970630 0000931763-97-001081.hdr.sgml : 19970630 ACCESSION NUMBER: 0000931763-97-001081 CONFORMED SUBMISSION TYPE: 11-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19961231 FILED AS OF DATE: 19970627 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: SCIENTIFIC ATLANTA INC CENTRAL INDEX KEY: 0000087777 STANDARD INDUSTRIAL CLASSIFICATION: RADIO & TV BROADCASTING & COMMUNICATIONS EQUIPMENT [3663] IRS NUMBER: 580612397 STATE OF INCORPORATION: GA FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 11-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-05517 FILM NUMBER: 97631176 BUSINESS ADDRESS: STREET 1: ONE TECHNOLOGY PKWY S CITY: NORCROSS STATE: GA ZIP: 30092-2967 BUSINESS PHONE: 7709035000 MAIL ADDRESS: STREET 1: ONE TECHNOLOGY PKWY S CITY: NORCROSS STATE: GA ZIP: 30092-2967 FORMER COMPANY: FORMER CONFORMED NAME: SCIENTIFIC ASSOCIATES INC DATE OF NAME CHANGE: 19671024 11-K 1 FORM 11-K SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ________________________________ FORM 11-K ANNUAL REPORT PURSUANT TO SECTION 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 (MARK ONE) [X] ANNUAL REPORT PURSUANT TO SECTION 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED, EFFECTIVE OCTOBER 7, 1996]. For the fiscal year ended: December 31, 1996 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]. For the transition period from ________ to ________ Commission file number: 1-5517 ------ A. Full title of the plan and the address of the plan, if different from that of the issuer named below: Scientific-Atlanta, Inc. Voluntary Employee Retirement and Investment Plan and Trust B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: Scientific-Atlanta, Inc. One Technology Parkway, South Norcross, Georgia 30092. REQUIRED INFORMATION EXHIBITS The following exhibit is filed as part of this report: EX-23 Consent of Arthur Andersen LLP. SIGNATURES 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 on its behalf by the undersigned hereunto duly authorized. Scientific-Atlanta, Inc. Voluntary Employee Retirement and Investment Plan and Trust Date: June 26, 1997 By: Scientific-Atlanta, Inc. Employee Benefit Committee By: /s/ Brian C. Koenig ------------------- Name: Brian C. Koenig Title: Senior Vice President, Human Resources SCIENTIFIC-ATLANTA, INC. VOLUNTARY EMPLOYEE RETIREMENT AND INVESTMENT PLAN AND TRUST FINANCIAL STATEMENTS AND SCHEDULES AS OF DECEMBER 31, 1996 AND 1995 TOGETHER WITH AUDITORS' REPORT SCIENTIFIC-ATLANTA, INC. VOLUNTARY EMPLOYEE RETIREMENT AND INVESTMENT PLAN AND TRUST FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES DECEMBER 31, 1996 AND 1995 TABLE OF CONTENTS _____________________________________________________ REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS FINANCIAL STATEMENTS: Statements of Net Assets Available for Plan Benefits, December 31, 1996 and 1995 Statement of Changes in Net Assets Available for Plan Benefits with Fund Information for the Year Ended December 31, 1996 NOTES TO FINANCIAL STATEMENTS AND SCHEDULES SUPPLEMENTAL SCHEDULES: Schedule Number ------ I. Item 27a - Schedule of Assets Held for Investment Purposes, December 31, 1996 II. Item 27d - Schedule of Reportable Transactions for the Year Ended December 31, 1996 REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS To the Employee Benefit Committee of the Scientific-Atlanta, Inc. Voluntary Employee Retirement and Investment Plan and Trust: We have audited the accompanying statements of net assets available for plan benefits of the SCIENTIFIC-ATLANTA, INC. VOLUNTARY EMPLOYEE RETIREMENT AND INVESTMENT PLAN AND TRUST as of December 31, 1996 and 1995, and the related statement of changes in net assets available for plan benefits with fund information for the year ended December 31, 1996. These financial statements and the schedules referred to below are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements and schedules 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, the financial statements referred to above present fairly, in all material respects, the net assets available for plan benefits of the Scientific-Atlanta, Inc. Voluntary Employee Retirement and Investment Plan and Trust as of December 31, 1996 and 1995, and the changes in its net assets available for plan benefits for the year ended December 31, 1996, in conformity with generally accepted accounting principles. Our audits were made for the purpose of forming an opinion on the financial statements taken as a whole. The supplemental schedules of assets held for investment purposes and reportable transactions are presented for the purpose of additional analysis and are not a required part of the basic financial statements but are supplementary information required by the Department of Labor Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The fund information in the statement of changes in net assets available for plan benefits is presented for purposes of additional analysis rather than to present the changes in net assets available for plan benefits of each fund. The supplemental schedules and fund information have been subjected to the auditing procedures applied in the audit of the basic financial statements and, in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole. ARTHUR ANDERSEN LLP Atlanta, Georgia June 16, 1997 SCIENTIFIC-ATLANTA, INC. VOLUNTARY EMPLOYEE RETIREMENT AND INVESTMENT PLAN AND TRUST STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS DECEMBER 31, 1996 AND 1995 ______________________________________________
1996 1995 ----------- ---------- ASSETS: PARTICIPANT DIRECTED INVESTMENTS, AT FAIR VALUE (NOTES 1 & 2): FIDELITY RETIREMENT MONEY MARKET FUND $ 11,977,188 $ 9,764,728 FIDELITY INTERMEDIATE BOND FUND 6,614,492 6,407,083 FIDELITY EQUITY INCOME FUND 21,421,219 16,657,805 FIDELITY U.S. EQUITY INDEX FUND 9,618,477 5,187,095 FIDELITY MAGELLAN FUND 21,120,256 21,792,084 FIDELITY PURITAN FUND 1,039,006 178,526 FIDELITY OVERSEAS FUND 1,027,250 178,456 FIDELITY LOW-PRICED STOCK FUND 2,914,749 477,076 FIDELITY SCIENTIFIC-ATLANTA COMMON STOCK FUND 31,775,725 28,885,142 PARTICIPANT LOANS RECEIVABLE 2,448,583 0 --------------- ---------- TOTAL INVESTMENTS 109,956,945 89,527,995 RECEIVABLES: EMPLOYER'S CONTRIBUTION 1,148,962 0 PARTICIPANTS' CONTRIBUTION 341,604 0 --------------- ---------- TOTAL ASSETS 111,447,511 89,527,995 LIABILITIES 0 0 NET ASSETS AVAILABLE FOR PLAN BENEFITS $111,447,511 $89,527,995 ============== ===========
The accompanying notes are an integral part of these statements. Page 1 of 2 SCIENTIFIC-ATLANTA, INC. VOLUNTARY EMPLOYEE RETIREMENT AND INVESTMENT PLAN AND TRUST STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS WITH FUND INFORMATION FOR THE YEAR ENDED DECEMBER 31, 1996 ___________________________________________________________
PARTICIPANT DIRECTED INVESTMENTS ---------------------------------------------------------------------------------- RETIREMENT INTER- U.S. MONEY MEDIATE EQUITY EQUITY MARKET BOND INCOME INDEX MAGELLAN PURITAN ---------------------------------------------------------------------------------- INVESTMENT INCOME: Net (depreciation) appreciation in fair value of investments $ 0 $ (207,375) $ 2,241,717 $1,266,741 $(1,534,108) $ 3,450 Dividends and Interest 541,947 434,872 1,358,165 211,037 3,840,919 89,082 ----------- ---------- ----------- ---------- ----------- ---------- 541,947 227,497 3,599,882 1,477,778 2,306,811 92,532 ----------- ---------- ----------- ---------- ----------- ---------- CONTRIBUTIONS: Participants 1,042,459 795,706 2,098,497 1,189,188 3,563,745 168,744 Employer 0 0 0 0 0 0 Rollover deposits 195,560 186,159 262,057 305,295 386,016 80,392 ----------- ---------- ----------- ---------- ----------- ---------- 1,238,019 981,865 2,360,554 1,494,483 3,949,761 249,136 ----------- ---------- ----------- ---------- ----------- ---------- TOTAL ADDITIONS 1,779,966 1,209,362 5,960,436 2,972,261 6,256,572 341,668 PAYMENTS TO PARTICIPANTS (1,722,930) (403,684) (1,465,232) (450,435) (2,167,962) (17,974) ADMINISTRATIVE EXPENSES (3,370) (1,948) (5,766) (1,962) (7,905) (408) INTERFUND TRANSFERS 2,158,794 (596,321) 273,976 1,911,518 (4,752,533) 537,194 ----------- ---------- ----------- ---------- ----------- ---------- NET INCREASE (DECREASE) 2,212,460 207,409 4,763,414 4,431,382 (671,828) 860,480 NET ASSETS AVAILABLE FOR PLAN BENEFITS, BEGINNING OF YEAR 9,764,728 6,407,083 16,657,805 5,187,095 21,792,084 178,526 ----------- ---------- ----------- ---------- ----------- ---------- NET ASSETS AVAILABLE FOR PLAN BENEFITS, END OF YEAR $11,977,188 $6,614,492 $21,421,219 $9,618,477 $21,120,256 $1,039,006 =========== ========== =========== ========== =========== ==========
The accompanying notes are an integral part of this statement. Page 2 of 2 SCIENTIFIC-ATLANTA, INC. VOLUNTARY EMPLOYEE RETIREMENT AND INVESTMENT PLAN AND TRUST STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS WITH FUND INFORMATION FOR THE YEAR ENDED DECEMBER 31, 1996 _________________________________________________________ PARTICIPANT DIRECTED INVESTMENTS --------------------------------
SCIENTIFIC- LOW- ATLANTA PARTICIPANT PRICED COMMON LOAN TOTAL OVERSEAS STOCK STOCK OTHER RECEIVABLE 1996 ------------------------------------------------------------------------------------ INVESTMENT INCOME: Net appreciation (depreciation) in fair value of investments $ 14,794 $ 218,134 $ 2,052,831 $ 0 $ 0 $ 4,056,184 Dividends and Interest 61,163 194,958 0 0 63,328 6,795,471 ---------- ---------- ----------- ---------- ---------- ------------ 75,957 413,092 2,052,831 0 63,328 10,851,655 ---------- ---------- ----------- ---------- ---------- ------------ CONTRIBUTIONS: Participants 201,664 389,756 1,254,219 341,604 0 11,045,582 Employer 0 0 4,524,574 1,148,962 0 5,673,536 Rollover deposits 59,374 88,181 306,954 0 0 1,869,988 ---------- ---------- ----------- ---------- ---------- ------------ 261,038 477,937 6,085,747 1,490,566 0 18,589,106 ---------- ---------- ----------- ---------- ---------- ------------ TOTAL ADDITIONS 336,995 891,029 8,138,578 1,490,566 63,328 29,440,761 PAYMENTS TO PARTICIPANTS (23,115) (45,481) (1,131,009) 0 (17,500) (7,445,322) ADMINISTRATIVE EXPENSES (169) (4,192) (50,203) 0 0 (75,923) INTERFUND TRANSFERS 535,083 1,596,317 (4,066,783) 0 2,402,755 0 ---------- ---------- ----------- ---------- ---------- ------------ NET INCREASE 848,794 2,437,673 2,890,583 1,490,566 2,448,583 21,919,516 NET ASSETS AVAILABLE FOR PLAN BENEFITS, BEGINNING OF YEAR 178,456 477,076 28,885,142 0 0 89,527,995 ---------- ---------- ----------- ---------- ---------- ------------ NET ASSETS AVAILABLE FOR PLAN BENEFITS, END OF YEAR $1,027,250 $2,914,749 $31,775,725 $1,490,566 $2,448,583 $111,447,511 ========== ========== =========== ========== ========== ============
The accompanying notes are an integral part of this statement. SCIENTIFIC-ATLANTA, INC. VOLUNTARY EMPLOYEE RETIREMENT AND INVESTMENT PLAN AND TRUST NOTES TO FINANCIAL STATEMENTS AND SCHEDULES DECEMBER 31, 1996 AND 1995 _________________________________________________________ 1. PLAN DESCRIPTION: Effective January 1, 1986, Scientific-Atlanta, Inc. (the "Company") established the Scientific-Atlanta, Inc. Voluntary Employee Retirement and Investment Plan and Trust (the "Plan"). The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974 ("ERISA"). A description of the Plan's provisions has been published in a summary Plan description available to all participants and beneficiaries. The following nine investment funds have been established by the Plan for investing participants' contributions. All investment elections are participant directed. Participants may change their investment elections daily. The Plan has specific guidelines and limitations as to the type of securities eligible for investment by each fund. Fidelity Retirement Money Market Fund - This is a fixed income fund invested in short-term securities with the objective of current income that is designed to provide investors with a return that reflects current short-term money market rates. Fidelity Intermediate Bond Fund - This is a fixed income fund invested in U.S. Treasury bonds or other government bonds, and corporate bonds with a fixed interest rate. Fidelity Equity Income Fund - This is a fund containing a variety of corporate securities, with more investment risk than the Bond Fund and Money Market Fund, with the objective of both current income and capital appreciation. Fidelity U.S. Equity Index Fund - This is a fund that invests primarily in the common stocks of the 500 companies included in the S&P 500 Index. The objective is for both current income and long-term capital appreciation. Fidelity Magellan Fund - This fund is invested in securities of large United States and foreign corporations as well as smaller, lesser known companies with the objective of long-term capital appreciation. This fund offers more overall investment risks than the other funds currently offered under the Plan. Fidelity Puritan Fund - This fund invests in a broad list of high- yielding securities among a variety of companies and industries. The fund's objective is to obtain as much income as possible, consistent with the preservation of capital. Fidelity Overseas Fund - This fund is invested in securities of issuers whose principal activities are outside the United States. The fund seeks long-term capital appreciation as its objective. Fidelity Low-Priced Stock Fund - This fund seeks long-term capital appreciation and invests mainly in equity securities that are considered by the fund's management to be low-priced at the time of purchase. Fidelity Scientific-Atlanta Common Stock Fund - This fund is invested primarily in Scientific-Atlanta common stock with the balance in short- term money market investments. The objective of this fund is to give employees the opportunity to become shareholders of the Company and to share in the Company's performance. Employees have the option to redirect the Company's matching contribution, which is made only to this fund, to the other Fidelity funds. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: The financial statements are prepared on an accrual basis in accordance with generally accepted accounting principles. The preparation of the financial statements in conformity with generally accepted accounting principles requires the Plan's management to use estimates and assumptions that affect the accompanying financial statements and disclosures. Actual results could differ from these estimates. Realized gains and losses on investment transactions are determined for accounting purposes as of the trade date on a moving average cost basis. Net realized and unrealized appreciation (depreciation) is recorded in the accompanying Statement of Changes In Net Assets Available for Plan Benefits as net appreciation (depreciation) in fair value of investments. Investments are stated at market value (based on quoted market prices) in the accompanying Statements of Net Assets Available for Plan Benefits. 3. PLAN TERMINATION: Although it has not expressed any intent to do so, the Company has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA. 4. TAX STATUS: The Internal Revenue Service has determined and informed the Company by a letter dated September 29, 1995, that the Plan was designed in accordance with applicable sections of the Internal Revenue Code ("IRC"). Additionally, the plan administrator believes that the Plan is currently being operated in compliance with the applicable requirements of the IRC. Therefore, the plan administrator believes that the Plan was qualified and the related trust was tax-exempt as of the financial statement dates. 5. PARTICIPATION: Employees of the Company are eligible to participate in the Plan if they (a) are regular full-time employees or regular part-time employees scheduled to work at least 20 hours a week, and (b) are at least 18 years of age. Eligibility begins immediately upon employment provided the above age and service requirements are met. This eligibility requirement complies with the provisions of ERISA. Participants may contribute to the Plan an amount ranging from 1/2% to 15% of their annual compensation. Individual accounts are maintained for each of the Plan's participants to reflect the participant's share of the Plan's income, the Company's contribution, and the participant's contribution. Allocations are based on participant account balances, as defined. The amount contributed to the Plan by the Company on behalf of a participant is equal to $1.00 for each dollar contributed by the participant up to 3% of the participant's annual compensation plus $.50 for each dollar of the participant's contribution between 3% and 6% of the participant's annual compensation. In addition, for any plan year, the Company's contribution on behalf of the participant to this Plan shall not exceed 4.5% of the participant's annual compensation for such plan year. The Company's matching contributions to the Plan are in the form of Scientific-Atlanta, Inc. common stock and are made only at the end of each quarter. Vesting is immediate for both the participant's contribution and the Company's matching contribution. Effective July 1, 1996, participants may borrow from their fund accounts a minimum of $1,000 up to a maximum equal to the lesser of $50,000 or 50% of their account balance. Each loan shall be treated as an investment of the borrower's account, with the interest rate being prime plus 1%. The interest rate on participant loans during 1996 was 9.25%. The participant shall be required to repay the loan in approximately equal installments of principal and interest over a period not in excess of 5 years, or up to 10 years for the purchase of a primary residence. The loans are secured by an assignment of the participant's right, title, and interest in the participant's account balance. Repayment of principal and payment of interest will be effected through payroll withholding. The principal amount of the loan, together with all accrued interest, shall immediately become due when the participant is no longer employed by an Employing Company, as defined, and is no longer a party in interest under Section 3(14) of ERISA. 6. TRUST AGREEMENT: At December 31, 1996, the Plan's assets were held by the Trustee of the Plan, Fidelity Management Trust Company. Company contributions are held and managed by the Trustee, which invests cash received, interest, and dividend income and makes distributions to participants. Certain administrative functions are performed by officers or employees of the Company or its subsidiaries and they act as the Plan Administrator. No such officer or employee receives compensation from the Plan. Administrative expenses such as trustee fees are paid by the Plan. 7. SUBSEQUENT EVENT: Effective February 3, 1997, the Fidelity Overseas Fund was discontinued as an investment option, and the Founders Growth Fund and the Templeton Foreign I Fund were added to the list of investment options available to participants. SCHEDULE I SCIENTIFIC-ATLANTA, INC. VOLUNTARY EMPLOYEE RETIREMENT AND INVESTMENT PLAN AND TRUST ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES DECEMBER 31, 1996 ___________________________________________________________
Identity of Face Amount Current Issue Investment Description or Shares Cost Value - ------------------------ ------------------------------- ---------------- ---------- ------------ * Fidelity Investments Retirement Money Market Fund 11,977,188 $11,977,188 $ 11,977,188 * Fidelity Investments Intermediate Bond Fund 656,200 6,767,436 6,614,492 * Fidelity Investments Equity Income Fund 500,145 16,891,967 21,421,219 * Fidelity Investments U.S. Equity Index Fund 356,901 7,561,161 9,618,477 * Fidelity Investments Magellan Fund 261,875 19,588,338 21,120,256 * Fidelity Investments Puritan Fund 60,267 1,032,872 1,039,006 * Fidelity Investments Overseas Fund 33,309 1,019,504 1,027,250 * Fidelity Investments Low-Priced Stock Fund 136,522 2,715,154 2,914,749 * Fidelity Investments Scientific-Atlanta Common Stock Fund 3,442,618 28,988,992 31,775,725 *The Plan Participant Loans (Interest Rate at 9.25%) 2,448,583 2,448,583 ----------- ------------ Total Investments $98,991,195 $109,956,945 =========== ============
. Indicates a party-in-interest. The accompanying notes are an integral part of this schedule. SCHEDULE II SCIENTIFIC-ATLANTA, INC. VOLUNTARY EMPLOYEE RETIREMENT AND INVESTMENT PLAN AND TRUST ITEM 27d - SCHEDULE OF REPORTABLE TRANSACTIONS (1) FOR THE YEAR ENDED DECEMBER 31, 1996 ___________________________________________________________
Purchases Sales, Maturities or Withdrawals ----------------------------------- ------------------------------------------- Cost and Proceeds and Current Value Current Value of Asset on of Asset on Identity of Number of Transaction Number of Transaction Party Involved Description Transactions Date Transactions Date - ---------------- ------------------ ----------------- ---------------- ----------------- ---------------- Fidelity Retirement Money Market Fund 235 $13,658,149 228 $ 11,445,687 Investments Fidelity Equity Income Fund 238 9,193,388 198 6,670,513 Investments Fidelity U.S. Equity Index Fund 229 6,449,769 176 3,285,184 Investments Fidelity Magellan Fund 247 11,471,145 231 10,608,867 Investments Fidelity Scientific-Atlanta Common Stock 254 23,353,061 247 21,367,273 Investments Fund Identity of Cost of Party Involved Asset Net Gain - ---------------- ------------ ------------ Fidelity $ 11,445,687 $ 0 Investments Fidelity 5,904,609 765,904 Investments Fidelity 3,029,166 256,018 Investments Fidelity 10,561,027 47,840 Investments Fidelity 19,002,793 2,364,480 Investments
(1) Represents individual transactions or a series of transactions in securities of the same issue or with a person in excess of 5% market value of the Plan's of January 1, 1996. The accompanying notes are an integral part of this schedule. EX-23 2 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS EXHIBIT 23 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation of our report included in this Form 11-K into Scientific-Atlanta, Inc.'s previously filed Registration Statement covering the Scientific-Atlanta, Inc. Voluntary Employee Retirement and Investment Plan and Trust. /s/ Arthur Andersen LLP ARTHUR ANDERSEN LLP Atlanta, Georgia June 23, 1997 -----END PRIVACY-ENHANCED MESSAGE-----