UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
[X] ANNUAL REPORT PURSUANT TO SECTION 15(D) OF THE SECURITIES EXCHANGE ACT
OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(D) OF THE SECURITIES EXCHANGE ACT
OF 1934
FOR THE TRANSITION PERIOD FROM _______ TO ________
COMMISSION FILE NUMBER: 0-12700
BLOCKBUSTER ENTERTAINMENT
RETIREMENT AND SAVINGS PLAN
(FULL TITLE OF THE PLAN)
VIACOM INC.
(NAME OF ISSUER OF SECURITIES HELD PURSUANT TO THE PLAN)
1515 BROADWAY
NEW YORK, NEW YORK 10036-5794
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICE)
<PAGE>
BLOCKBUSTER ENTERTAINMENT
RETIREMENT AND SAVINGS PLAN
DECEMBER 31, 1995
CONTENTS
PAGE
REPORT OF INDEPENDENT AUDITORS 1
AUDITED FINANCIAL STATEMENTS:
STATEMENT OF ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
AS OF DECEMBER 31, 1995 2
STATEMENT OF ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
AS OF DECEMBER 31, 1994 3
STATEMENT OF CHANGES IN ASSETS AVAILABLE FOR BENEFITS WITH FUND
INFORMATION FOR THE PERIOD ENDED DECEMBER 31, 1995 4
NOTES TO FINANCIAL STATEMENTS 5
SUPPLEMENTAL SCHEDULES:
SCHEDULE I - ITEM 27A - SCHEDULE OF ASSETS HELD
FOR INVESTMENT PURPOSES 10
SCHEDULE II - ITEM 27D - SCHEDULE OF REPORTABLE TRANSACTIONS 11
ALL OTHER SCHEDULES ARE OMITTED AS NOT APPLICABLE OR NOT REQUIRED.
<PAGE>
REPORT OF INDEPENDENT AUDITORS
TO THE PLAN ADMINISTRATOR OF
BLOCKBUSTER ENTERTAINMENT
RETIREMENT AND SAVINGS PLAN:
WE HAVE AUDITED THE STATEMENT OF ASSETS AVAILABLE FOR BENEFITS WITH FUND
INFORMATION OF BLOCKBUSTER ENTERTAINMENT RETIREMENT AND SAVINGS PLAN AS OF
DECEMBER 31, 1995, AND 1994, AND THE RELATED STATEMENT OF CHANGES IN ASSETS
AVAILABLE FOR BENEFITS WITH FUND INFORMATION FOR THE YEARS THEN ENDED. THESE
FINANCIAL STATEMENTS AND THE SCHEDULES REFERRED TO BELOW ARE THE RESPONSIBILITY
OF THE PLAN'S ADMINISTRATOR. OUR RESPONSIBILITY IS TO EXPRESS AN OPINION ON
THESE FINANCIAL STATEMENTS AND SCHEDULES BASED ON OUR AUDIT.
WE CONDUCTED OUR AUDIT 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 THE
PLAN ADMINISTRATOR, AS WELL AS EVALUATING THE OVERALL FINANCIAL STATEMENT
PRESENTATION. WE BELIEVE THAT OUR AUDIT PROVIDES A REASONABLE BASIS FOR OUR
OPINION.
IN OUR OPINION, THE FINANCIAL STATEMENTS REFERRED TO ABOVE PRESENT FAIRLY, IN
ALL MATERIAL RESPECTS, THE ASSETS AVAILABLE FOR BENEFITS OF THE PLAN AS OF
DECEMBER 31, 1995, AND 1994, AND THE CHANGES IN ITS ASSETS AVAILABLE FOR
BENEFITS FOR THE YEARS THEN ENDED, IN CONFORMITY WITH GENERALLY ACCEPTED
ACCOUNTING PRINCIPLES.
OUR AUDIT WAS MADE FOR THE PURPOSE OF FORMING AN OPINION ON THE BASIC FINANCIAL
STATEMENTS TAKEN AS A WHOLE. THE SUPPLEMENTAL SCHEDULES OF ASSETS HELD FOR
INVESTMENT PURPOSES AND REPORTABLE TRANSACTIONS (SCHEDULES I AND II
RESPECTIVELY) ARE PRESENTED FOR PURPOSES 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 SCHEDULES HAVE BEEN SUBJECTED TO THE AUDITING PROCEDURES
APPLIED IN THE AUDIT OF THE BASIC FINANCIAL STATEMENTS AND, IN OUR OPINION, ARE
FAIRLY STATED IN ALL MATERIAL RESPECTS IN RELATION TO THE BASIC FINANCIAL
STATEMENTS TAKEN AS A WHOLE.
HOLLYWOOD, FLORIDA SHAUN M. DAVIS, CPA
JUNE 18, 1995
<PAGE>
BLOCKBUSTER ENTERTAINMENT
RETIREMENT AND SAVINGS PLAN
STATEMENT OF ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
AS OF DECEMBER 31, 1995
<TABLE>
<CAPTION>
PARTICIPANT DIRECTED
--------------------------------------------------------------------
NATIONS
NATIONS NATIONS STRATEGIC
VIACOM CAPITAL BALANCED FIXED NATIONS
COMPANY STOCK STOCK GROWTH ASSETS INCOME PRIME
FUND FUND FUND FUND FUND FUND TOTAL
=========== =========== =========== =========== =========== =========== ===========
<S> <C> <C> <C> <C> <C> <C> <C>
INVESTMENTS, AT FAIR VALUE:
COMPANY STOCK FUND .............. $ 1,564,533 $ 1,689,026 $ 3,253,559
SHARES OF REGISTERED
INVESTMENT COMPANIES:
NATIONS CAPITAL GROWTH
FUND ...................... $ 3,780,962 3,780,962
NATIONS BALANCED ASSETS
FUND ...................... $ 2,329,117 2,329,117
NATIONS STRATEGIC FIXED
INCOME FUND ............... $ 1,580,913 1,580,913
NATIONS PRIME FUND ......... $ 4,346,075 4,346,075
----------- ----------- ----------- ----------- ----------- ----------- -----------
TOTAL INVESTMENTS .......... 1,564,533 1,689,026 3,780,962 2,329,117 1,580,913 4,346,075 15,290,626
----------- ----------- ----------- ----------- ----------- ----------- -----------
CONTRIBUTIONS RECEIVABLE:
EMPLOYER'S .................... 307,652 498,625 194,889 49,481 812,887 1,863,534
PARTICIPANTS' ................. -- 58,151 169,352 62,788 16,028 74,338 380,658
----------- ----------- ----------- ----------- ----------- ----------- -----------
TOTAL CONTRIBUTIONS
RECEIVABLE ................ -- 365,803 667,977 257,677 65,509 887,225 2,244,192
----------- ----------- ----------- ----------- ----------- ----------- -----------
TOTAL ASSETS .................... 1,564,533 2,054,829 4,448,939 2,586,794 1,646,422 5,233,300 17,534,818
ACCOUNTS PAYABLE ................ (427) (427)
----------- ----------- ----------- ----------- ----------- ----------- -----------
ASSETS AVAILABLE FOR BENEFITS ... $ 1,564,533 $ 2,054,829 $ 4,448,939 $ 2,586,794 $ 1,646,422 $ 5,232,873 $17,534,391
=========== =========== =========== =========== =========== =========== ===========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
2
<PAGE>
BLOCKBUSTER ENTERTAINMENT
RETIREMENT AND SAVINGS PLAN
STATEMENT OF ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
AS OF DECEMBER 31, 1994
<TABLE>
<CAPTION>
PARTICIPANT DIRECTED
----------------------------------------------------------------------
NATIONS
NATIONS NATIONS STRATEGIC
CAPITAL BALANCED FIXED NATIONS
COMPANY STOCK GROWTH ASSETS INCOME PRIME
FUND FUND FUND FUND FUND TOTAL
---------- ---------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
INVESTMENTS, AT FAIR VALUE:
COMPANY STOCK FUND ....................... $2,041,627 $2,041,627
SHARES OF REGISTERED
INVESTMENT COMPANIES:
NATIONS CAPITAL GROWTH
FUND ............................... $1,584,876 1,584,876
NATIONS BALANCED ASSETS
FUND ............................... $1,127,608 1,127,608
NATIONS STRATEGIC FIXED
INCOME FUND ........................ $ 790,772 790,772
NATIONS PRIME FUND .................. $1,270,976 1,270,976
---------- ---------- ---------- ---------- ---------- ----------
TOTAL INVESTMENTS ................... 2,041,627 1,584,876 1,127,608 790,772 1,270,976 6,815,859
---------- ---------- ---------- ---------- ---------- ----------
CONTRIBUTIONS RECEIVABLE:
EMPLOYER'S ............................. 454,872 308,092 232,122 1,620,392 2,615,478
PARTICIPANTS' .......................... 9,251 4,926 4,093 20,987 39,257
---------- ---------- ---------- ---------- ---------- ----------
TOTAL CONTRIBUTIONS
RECEIVABLE ......................... 464,123 313,018 236,215 1,641,379 2,654,735
---------- ---------- ---------- ---------- ---------- ----------
CASH ..................................... 1,668
---------- ---------- ---------- ---------- ---------- ----------
CONTINGENCY
---------- ---------- ---------- ---------- ---------- ----------
ASSETS AVAILABLE FOR BENEFITS ............ $2,041,627 $2,048,999 $1,440,626 $1,026,987 $2,912,355 $9,472,262
========== ========== ========== ========== ========== ==========
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
3
<PAGE>
BLOCKBUSTER ENTERTAINMENT
RETIREMENT AND SAVINGS PLAN
STATEMENT OF CHANGES IN ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
FOR THE PERIOD ENDED DECEMBER 31, 1995
<TABLE>
<CAPTION>
PARTICIPANT DIRECTED
---------------------------------------------------------------------------------
NATIONS
NATIONS NATIONS STRATEGIC
VIACOM CAPITAL BALANCED FIXED NATIONS
COMPANY STOCK STOCK GROWTH ASSETS INCOME PRIME
FUND FUND FUND FUND FUND FUND TOTAL
------------ ------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
ADDITIONS TO ASSETS
ATTRIBUTED TO
CONTRIBUTIONS:
PARTICIPANTS' $ 34 $ 460,525 $1,922,422 $ 959,146 $ 669,443 $2,128,008 $6,139,578
EMPLOYER'S ............... 0 1,427,539 499,123 194,931 49,523 813,127 2,984,243
------------ ------------ ------------ ------------ ------------ ------------ ------------
34 1,888,064 2,421,545 1,154,077 718,966 2,941,135 9,123,821
NET REALIZED AND UNREALIZED
GAINS (LOSSES) ON
INVESTMENTS .............. 295,371 (33,561) 370,570 120,580 123,704 0 876,664
INVESTMENT INCOME ......... 0 0 338,141 316,749 81,238 210,588 946,716
------------ ------------ ------------ ------------ ------------ ------------ ------------
TOTAL ADDITIONS ......... 295,405 1,854,503 3,130,256 1,591,406 923,908 3, 151,723 10,947,200
DEDUCTIONS FROM ASSETS
ATTRIBUTED TO:
BENEFITS PAID TO
PARTICIPANTS ............... (620,580) (71,929) (720,504) (422,614) (257,177) (793,651) (2,886,455)
------------ ------------ ------------ ------------ ------------ ------------ ------------
TOTAL DEDUCTIONS ........ (620,580) (71,929) (720,504) (422,614) (257,177) (793,651) (2,886,455)
------------ ------------ ------------ ------------ ------------ ------------ ------------
NET INCREASE (DECREASE)
PRIOR TO INTERFUND TRANSFERS . (325,175) 1,782,574 2,409,752 1,168,792 666,731 2,358,072 8,060,746
INTERFUND TRANSFERS, NET ..... (151,610) 272,255 (9,906) (22,635) (47,306) (38,422) 2,376
------------ ------------ ------------ ------------ ------------ ------------ ------------
NET INCREASE ................. (476,785) 2,054,829 2,399,846 1,146,157 619,425 2,319,650 8,062,695
ASSETS AVAILABLE FOR BENEFITS:
BEGINNING OF PERIOD .......... 2,041,627 0 2,048,999 1,440,626 1,026,987 2,912,355 9,470,594
ADJUSTMENT TO BEGINNING
BALANCE ...................... (309) 0 94 11 10 1,296 1,102
------------ ------------ ------------ ------------ ------------ ------------ ------------
ADJUSTED BEGINNING BALANCE ... 2,041,318 0 2, 049,093 1,440,637 1,026,997 2,913,651 9,471,696
------------ ------------ ------------ ------------ ------------ ------------ ------------
END OF PERIOD ................ $ 1,564,533 $ 2,054,829 $ 4,448,939 $ 2,586,794 $ 1,646,422 $ 5,233,301 $ 17,534,391
============ ============ ============ ============ ============ ============ ============
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS
4
<PAGE>
BLOCKBUSTER ENTERTAINMENT
RETIREMENT AND SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1995 AND 1994
NOTE 1 - DESCRIPTION OF PLAN:
THE FOLLOWING DESCRIPTION OF THE BLOCKBUSTER ENTERTAINMENT RETIREMENT AND
SAVINGS PLAN (THE "PLAN") IS PROVIDED FOR GENERAL INFORMATION PURPOSES ONLY.
PARTICIPANTS SHOULD REFER TO THE PLAN DOCUMENT FOR A MORE COMPLETE DESCRIPTION
OF THE PLAN.
THE PLAN WAS ESTABLISHED EFFECTIVE JULY 1, 1993. THE PLAN, AS AMENDED, IS A
DEFINED CONTRIBUTION PLAN COMMONLY KNOWN AS AN INTERNAL REVENUE CODE ("IRC")
SECTION 401(K) PROFIT SHARING PLAN AND IS SUBJECT TO THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974 ("ERISA") AS AMENDED.
TO BECOME A PARTICIPANT, AN EMPLOYEE MUST COMPLETE ONE YEAR OF SERVICE AND
ATTAIN THE AGE OF 21. PRIOR TO APRIL 1, 1995 PARTICIPATION BECAME EFFECTIVE ON
THE JANUARY 1 OR JULY 1 IMMEDIATELY FOLLOWING COMPLETION OF THE AGE AND SERVICE
REQUIREMENT. EFFECTIVE APRIL 1, 1995 EMPLOYEES ELIGIBLE TO ENROLL IN THE PLAN
COULD DO SO QUARTERLY. THERE WERE 6,548 AND 10,190 ACTIVE PLAN PARTICIPANTS AS
OF DECEMBER 31, 1995 AND DECEMBER 31, 1994 RESPECTIVELY.
ON SEPTEMBER 29, 1994, BLOCKBUSTER WAS MERGED WITH AND INTO VIACOM, INC. (THE
"BLOCKBUSTER MERGER"). EACH SHARE OF BLOCKBUSTER COMMON STOCK OUTSTANDING AT THE
TIME OF THE BLOCKBUSTER MERGER WAS CONVERTED INTO THE RIGHT TO RECEIVE (I) 0.08
OF A SHARE OF VIACOM CLASS A COMMON STOCK, (II) 0.60615 OF A SHARE OF VIACOM
CLASS B COMMON STOCK, AND (III) ONE RIGHT TO RECEIVE UP TO A FRACTION OF A SHARE
OF VIACOM CLASS B COMMON STOCK. INCLUDED IN THE VIACOM INC. SECURITIES WERE
CERTAIN VARIABLE COMMON RIGHTS ("VCRS") REPRESENTING THE RIGHT TO RECEIVE VIACOM
CLASS B COMMON STOCK DEPENDING ON THE MARKET VALUE OF VIACOM CLASS B COMMON
STOCK DURING A SPECIFIED PERIOD FOLLOWING THE MERGER. THE PLAN'S FIDUCIARY
ASSUMED THE VCRS WERE NOT "QUALIFYING EMPLOYER SECURITIES" UNDER ERISA AND THAT
IT WAS A PROHIBITED TRANSACTION UNDER ERISA SECTIONS 406 AND 407 FOR THE PLAN TO
ACQUIRE AND HOLD THE VCRS. THE PLAN'S FIDUCIARY DETERMINED THAT IT WAS IN THE
BEST INTEREST OF PLAN PARTICIPANTS TO SELL THE VCRS AND SUCH SALES WERE
COMPLETED BY DECEMBER, 1994.
PURSUANT TO THE BLOCKBUSTER MERGER, BLOCKBUSTER CEASED TO EXIST AS A COMPANY AND
VIACOM (THE "COMPANY"), THE EMPLOYER, IS THE PLAN ADMINISTRATOR. THE COMPANY HAS
ENTERED INTO AN AGREEMENT WHEREBY NATIONSBANK OF GEORGIA, N.A. (THE "TRUSTEE")
HAS BEEN APPOINTED TRUSTEE. UNDER THE TERMS OF THE AGREEMENT, THE TRUSTEE HOLDS
AND INVESTS THE FUNDS OF THE PLAN SUBJECT TO THE DIRECTION OF THE PLAN ADVISORY
COMMITTEE. THE PLAN PROVIDES SIX DISTINCT INVESTMENT FUND ALTERNATIVES FOR
PARTICIPANTS. PARTICIPANT MAY DIRECT THE INVESTMENT OF THE AMOUNT ALLOCATED TO
THEIR ACCOUNT INTO ANY OF THE FUND OPTIONS.
THE COMPANY HAS SELECTED THE FOLLOWING INVESTMENT OPTIONS FOR USE IN THE PLAN:
COMPANY STOCK FUND - FUNDS ARE INVESTED IN CASH EQUIVALENTS AND VIACOM CLASS A
AND CLASS B COMMON STOCK
VIACOM STOCK FUND - FUNDS ARE INVESTED IN VIACOM CLASS B COMMON STOCK.
5
<PAGE>
BLOCKBUSTER ENTERTAINMENT RETIREMENT AND SAVINGS PLAN
Notes to Financial Statements - continued
NOTE 1 - DESCRIPTION OF PLAN - CONTINUED
NATIONS CAPITAL GROWTH FUND - FUNDS ARE INVESTED PRIMARILY IN COMMON STOCKS OF
COMPANIES WITH ABOVE AVERAGE POTENTIAL FOR CAPITAL APPRECIATION.
NATIONS BALANCED ASSETS FUND - FUNDS ARE INVESTED PRIMARILY AMONG THREE ASSET
GROUPS: COMMON STOCKS, FIXED INCOME SECURITIES AND CASH EQUIVALENT.
NATIONS STRATEGIC FIXED INCOME FUND - FUNDS ARE INVESTED PRIMARILY IN INVESTMENT
GRADE FIXED INCOME AND RELATED SECURITIES.
NATIONS PRIME FUND - FUNDS ARE INVESTED PRIMARILY IN MONEY MARKET INSTRUMENT.
THE PLAN INCLUDES A 401(K) ARRANGEMENT BY WHICH ELIGIBLE PARTICIPANTS MAY DIRECT
THE COMPANY TO CONTRIBUTE A PORTION OF THEIR COMPENSATION TO THE PLAN. AMOUNT
CONTRIBUTED BY PARTICIPANTS ARE 100% VESTED AT ALL TIMES. IN 1995 AND 1994, EACH
QUALIFIED EMPLOYEE COULD CONTRIBUTE UP TO $9,240, SUBJECT TO LIMITATIONS BY THE
INTERNAL REVENUE CODE. DURING EACH PLAN YEAR, THE COMPANY WILL CONTRIBUTE AT ITS
DISCRETION TO THE PLAN AN AMOUNT DETERMINED BY THE COMPANY. THE COMPANY MAY
CHOOSE NOT TO CONTRIBUTE TO THE PLAN FOR A PARTICULAR PLAN YEAR. PARTICIPANTS
MUST BE EMPLOYED BY THE COMPANY ON THE LAST DAY OF THE PLAN YEAR TO BE ENTITLED
TO AN ALLOCATION OF THE COMPANY'S CONTRIBUTION. COMPANY CONTRIBUTIONS ARE
ALLOCATED TO ACTIVE PARTICIPANT' ACCOUNTS USING A RATIO BASED UPON RELATIVE
EMPLOYEE COMPENSATION AND BECOME VESTED IN ACCORDANCE WITH THE FOLLOWING
SCHEDULE:
PERCENT OF
NONFORFEITABLE
YEARS OF SERVICE INTEREST
---------------- --------------
LESS THAN 1 0%
1 25%
2 50%
3 75%
4 OR MORE 100%
ADDITIONALLY, ALLOCATED AMOUNTS BECOME FULLY VESTED UPON NORMAL RETIREMENT AGE
AS DEFINED IN THE PLAN, DEATH OR TERMINATION OF EMPLOYMENT BECAUSE OF INABILITY
TO WORK DUE TO TOTAL OR PERMANENT DISABILITY WHILE EMPLOYED. THE COMPANY RETAINS
THE RIGHT TO AMEND, AND IF NECESSARY, TERMINATE THE PLAN. IN THE EVENT OF PLAN
TERMINATION, ALL AMOUNTS CREDITED TO PARTICIPANTS' ACCOUNTS BECOME 100% VESTED.
NON VESTED AMOUNT FORFEITED UPON ANY PARTICIPANT'S WITHDRAWAL ARE ALLOCATED TO
ACTIVE PARTICIPANT'S ACCOUNTS USING A RATIO BASED UPON RELATIVE EMPLOYEE
COMPENSATION.
NOTE 2 - PLAN AMENDMENTS
THE COMPANY AMENDED THE PLAN ON DECEMBER 13, 1993 TO GRANT CREDIT FOR YEARS OF
SERVICE TO EMPLOYEES OF BUSINESSES WHICH ARE MERGED OR CONSOLIDATED WITH THE
COMPANY SUBSEQUENT TO JULY 1, 1993. CREDIT FOR YEARS OF SERVICE GRANTED BY THIS
AMENDMENT APPLIES ONLY FOR PURPOSES OF DETERMINING PARTICIPATION AND NOT FOR
PURPOSES OF DETERMINING VESTING IN THE PLAN.
THE COMPANY ALSO AMENDED THE PLAN ON FEBRUARY 14 AND 16, 1995WAS ALSO AMENDED IN
1995 AS FOLLOWS:
1. COMPENSATION FOR THE PURPOSE OF THE CONTRIBUTION AND ALLOCATION OF ANY
NONELECTIVE EMPLOYER CONTRIBUTIONS WILL EXCLUDE COMMISSIONS, OVERTIME AND
BONUSES.
6
<PAGE>
BLOCKBUSTER ENTERTAINMENT RETIREMENT AND SAVINGS PLAN
Notes to Financial Statements - continued
NOTE 2 - PLAN AMENDMENTS - CONTINUED
2. ENROLLMENT IS NOW PERMITTED ON JANUARY 1, APRIL 1, JULY 1 AND OCTOBER 1.
3. THE COMPANY WILL MATCH 40% OF THE FIRST 5% OF A PARTICIPANTS BEFORE TAX
CONTRIBUTIONS TO THE PLAN, THE MATCH WILL BE MADE IN SHARES OF CLASS B
COMMON STOCK AND WILL VEST 25% FOR EACH YEAR
OF SERVICE.
4. THE ADVISORY COMMITTEE WILL ALLOCATE A PARTICIPANT FORFEITURE, TO REDUCE
EMPLOYER MATCHING CONTRIBUTIONS FOR THE PLAN YEAR IN WHICH THE FORFEITURE
OCCURS.
5. A PARTICIPANT MAY ELECT TO HAVE A HARDSHIP DISTRIBUTION FROM HIS/HER
DEFERRAL CONTRIBUTIONS ACCOUNT. THE HARDSHIP DISTRIBUTION WILL BE MADE CASH
ONLY.
NOTE 3 - SIGNIFICANT ACCOUNTING POLICIES:
Basis of Accounting-
The financial statements of the Plan are prepared under the accrual method of
accounting.
Investment Valuation and Income Recognition-
The Plan's investments are stated at fair value. Shares of common stock of the
Company included in the Company Stock Fund are stated at current value based on
the last reported sales price on the last business day of the year. Shares of
registered investment companies are valued at quoted market prices which
represent the net asset value of shares held by the Plan at period end.
Net realized and unrealized gains (losses) on investments consist of the
following:
Realized gains (losses) on sales of investments represent the difference between
proceeds received at the time of sale and the cost of the assets at the time of
purchase.
Unrealized appreciation (depreciation) of investments represents the difference
between the current value of assets at year end and the cost of those assets at
the time of purchase.
Purchases and sales of securities are recorded on a trade-date basis. Investment
income consists of interest and dividend income.
Payment of Benefit-
Benefits are recorded when paid.
NOTE 4 - PARTIES-IN-INTEREST TRANSACTIONS:
Certain Plan investments are shares of mutual funds managed by NationsBank of
North Carolina, N.A., an affiliate of the Trustee. The Company pays for all fees
and expenses of the Plan. The fees and expenses primarily consist of legal,
accounting, and other administrative services.
7
<PAGE>
BLOCKBUSTER ENTERTAINMENT RETIREMENT AND SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS - CONTINUED
NOTE 5 - INCOME TAX STATUS:
THE PLAN OBTAINED ITS DETERMINATION LETTER ON FEBRUARY 29, 1996, IN WHICH THE
INTERNAL REVENUE SERVICE STATED THAT THE PLAN WAS IN COMPLIANCE WITH THE
APPLICABLE REQUIREMENTS OF THE INTERNAL REVENUE CODE. THE PLAN ADMINISTRATOR AND
THE PLAN'S TAX COUNSEL BELIEVE THAT THE PLAN IS CURRENTLY DESIGNED AND BEING
OPERATED IN COMPLIANCE WITH THE APPLICABLE REQUIREMENTS OF THE INTERNAL REVENUE
CODE. THEREFORE, THEY BELIEVE THAT THE PLAN WAS QUALIFIED AND THE RELATED TRUST
WAS TAX EXEMPT AS OF THE FINANCIAL STATEMENT DATE.
NOTE 6 - RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500:
THE FOLLOWING IS A RECONCILIATION OF ASSETS AVAILABLE FOR BENEFITS PER THE
FINANCIAL STATEMENTS TO NET ASSETS AVAILABLE FOR BENEFITS PER THE FORM 5500 AT
DECEMBER 31, 1995 AND 1994: -
<TABLE>
<CAPTION>
1995 1994
---- ----
<S> <C> <C>
ASSETS AVAILABLE FOR BENEFIT PER THE FINANCIAL STATEMENTS $17,534,391 $9,472,262
LESS: AMOUNTS ALLOCATED TO WITHDRAWING PARTICIPANTS (7,990)
----------- ----------
NET ASSETS AVAILABLE FOR BENEFITS PER THE FORM 5500 $17,534,391 $9,464,272
=========== ==========
</TABLE>
THE FOLLOWING IS A RECONCILIATION OF BENEFITS PAID TO PARTICIPANTS PER THE
FINANCIAL STATEMENTS TO THE FORM 5500 FOR THE PERIOD ENDED DECEMBER 31, 1995 AND
1994:
<TABLE>
<CAPTION>
1995 1994
---- ----
<S> <C> <C>
BENEFITS PAID TO PARTICIPANTS PER THE FINANCIAL STATEMENTS $ 2,886,454 $ 701,043
ADD: AMOUNTS ALLOCATED TO WITHDRAWING PARTICIPANTS AT
DECEMBER 31, 1995 AND 1994 - (7,990)
----------- -------------
BENEFITS PAID TO PARTICIPANTS PER THE FORM 5500 $ 2,886,454 $ 709,033
============ =============
</TABLE>
AMOUNTS ALLOCATED TO WITHDRAWING PARTICIPANTS ARE RECORDED ON THE FORM 5500 FOR
BENEFIT CLAIMS THAT HAVE BEEN PROCESSED AND APPROVED FOR PAYMENT PRIOR TO
DECEMBER 31, 1994 BUT ARE NOT YET PAID AS OF THAT DATE.
THE FOLLOWING IS A RECONCILIATION OF NET REALIZED AND UNREALIZED GAINS ON
INVESTMENTS PER THE FINANCIAL STATEMENTS TO THE SUM OF NET GAIN ON SALE OF
ASSETS, UNREALIZED APPRECIATION OF ASSETS AND NET INVESTMENT GAIN FROM
REGISTERED INVESTMENT COMPANIES PER THE FORM 5500 AT DECEMBER 31, 1995 AND1994:
<TABLE>
<CAPTION>
1995 1994
---- ----
<S> <C> <C>
NET REALIZED AND UNREALIZED LOSSES PER THE FINANCIAL STATEMENTS $ 876,664 $ (769)
ADD: INVESTMENT INCOME FROM REGISTERED INVESTMENT COMPANIES 946,716 120,649
----------- ----------
TOTAL NET INVESTMENT GAINS PER THE FORM 5500 $ 1,823,380 $ 119,880
=========== ==========
</TABLE>
THE FOLLOWING IS A RECONCILIATION OF INVESTMENT INCOME PER THE FINANCIAL
STATEMENTS TO NET INVESTMENT GAIN FROM REGISTERED INVESTMENT COMPANIES PER THE
FORM 5500 FOR THE PERIOD ENDED DECEMBER 31, 1995 AND 1994:
8
<PAGE>
BLOCKBUSTER ENTERTAINMENT RETIREMENT AND SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS - CONTINUED
NOTE 6 - RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500 - CONTINUED
<TABLE>
<CAPTION>
1995 1994
---- ----
<S> <C> <C>
INVESTMENT INCOME PER THE FINANCIAL STATEMENTS $ 946,716 $ 120,649
ADD: NET REALIZED AND UNREALIZED LOSSES FROM REGISTERED
INVESTMENT COMPANIES - (145,246)
---------- ----------
NET INVESTMENT GAIN (LOSS) FROM REGISTERED INVESTMENT COMPANIES
PER THE FORM 5500 $ 946,716 $ (24,597)
=========== ==========
</TABLE>
NOTE 7 - UNIT/SHARE INFORMATION:
THE PLAN ASSIGNS UNITS TO PARTICIPANTS WITHIN EACH OF THE RESPECTIVE FUNDS USED
IN THE PLAN, EXCEPT THE VIACOM FUND WHICH ASSIGNED BY SHARES . TOTAL
UNITS/SHARES AND NET ASSET VALUES PER UNIT/SHAREST FOR EACH OF THE FUNDS AT
DECEMBER 31, 1995 AND1994 ARE AS FOLLOWS:
<TABLE>
<CAPTION>
1995 1994
---- ----
NET ASSETS NET ASSET
TOTAL VALUE PER TOTAL VALUE PER
UNITS/SHARES UNIT/SHARES UNITS/SHARES UNIT/SHARES
------------ ----------- ------------ -----------
<S> <C> <C> <C> <C>
COMPANY STOCK 120,740 $ 12.96 180,127 $ 11.33
NATIONS CAPITAL GROWTH 294,009 $ 12.86 144,342 $ 10.98
NATIONS BALANCED ASSETS 205,209 $ 11.35 108,216 $ 10.42
NATIONS STRATEGIC FIXED INCOME 152,467 $ 10.32 84,665 $ 9.34
NATIONS PRIME 4,325,709 $ 1.00 1,270,976 $ 1.00
VIACOM 36,652 $ 47.38 -- --
</TABLE>
NOTE 8 - SUBSEQUENT EVENT:
EFFECTIVE JANUARY 1, 1996, THE COMPANY MERGED THE FOLLOWING DEFINED CONTRIBUTION
PLANS SPONSORED BY SUBSIDIARIES OF VIACOM INC., WITH AND INTO THE VIACOM
INVESTMENT PLAN: PARAMOUNT COMMUNICATIONS INC, EMPLOYEES' SAVINGS PLAN, PRENTICE
HALL COMPUTER PUBLISHING DIVISION RETIREMENT PLAN, AND BLOCKBUSTER ENTERTAINMENT
RETIREMENT AND SAVINGS PLAN. THE FOLLOWING PARAGRAPHS REFLECT THE SIGNIFICANT
EFFECTS OF THE
MERGER.
PLAN PARTICIPANTS HAVE THE OPTION OF INVESTING THEIR CONTRIBUTIONS OR EXISTING
ACCOUNT BALANCE AMONG THE FOLLOWING FUNDS: (1) PUTNAM VOYAGER FUND; (2) PUTNAM
INVESTORS FUND; (3) GEORGE PUTNAM FUND OF BOSTON; (4) CAPITAL RESEARCH
EUROPACIFIC GROWTH FUND; (5) PUTNAM FUND FOR GROWTH AND INCOME; (6) PUTNAM
INCOME FUND; (7) CERTUS INTEREST INCOME FUND; AND (8) THE VIACOM COMMON STOCK
FUND. THE PUTNAM INVESTORS FUND, GEORGE PUTNAM FUND OF BOSTON AND PUTNAM INCOME
FUND ARE REGISTERED INVESTMENT COMPANIES MANAGED BY PUTNAM MANAGEMENT COMPANY,
INC. AND THEREFORE IDENTIFIED AS PARTIES IN INTEREST. THE CAPITAL RESEARCH
EUROPACIFIC GROWTH FUND IS A REGISTERED INVESTMENT COMPANY MANAGED BY CAPITAL
RESEARCH AND MANAGEMENT COMPANY.
THE PLAN WAS AMENDED REGARDING THE COMPANY'S MATCHING CONTRIBUTIONS. SUCH
CONTRIBUTIONS WILL BE EQUAL TO 50% OF THE FIRST 6% OF ANNUAL COMPENSATION THAT
IS CONTRIBUTED ON A BEFORE-TAX BASIS IF BASE PAY IS $65,000 OR LESS AT A
SPECIFIC DATE (5% OF ANNUAL COMPENSATION IF BASE PAY IS GREATER THAN $65,000).
FOR EMPLOYEES HIRED AFTER JANUARY 1, 1996, THE COMPANY'S MATCHING CONTRIBUTION
WILL VEST AT 20% PER YEAR OF SERVICE, BECOMING FULLY VESTED AFTER FIVE YEARS OF
SERVICE.
9
<PAGE>
BLOCKBUSTER ENTERTAINMENT
RETIREMENT AND SAVINGS PLAN
ITEM 27A-SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
AS OF DECEMBER 31, 1995
<TABLE>
<CAPTION>
(C) DESCRIPTION OF INVESTMENT
INCLUDING MATURITY DATE, RATE
OF INTEREST, COLLATERAL, PAR OR (E) CURRENT
(A) (B) IDENTITY OF ISSUE, BORROWER, LESSOR OR SIMILAR PARTY MATURITY VALUE (D) COST VALUE
- --- -------------------------------------------------------- ------------------------ -------- --------
<S> <C> <C> <C>
* COMPANY STOCK FUND 120,740 UNITS $1,257,863 $1,564,533
* NATIONS CAPITAL GROWTH FUND 294,009 UNITS 3,572,573 3,780,962
* NATIONS BALANCED ASSETS FUND 205,209 UNITS 2,291,569 2,329,117
* NATIONS STRATEGIC FIXED INCOME FUND 152,467 UNITS 1,503,756 1,580,913
* NATIONS PRIME FUND 4,346,086 UNITS 4,346,086 4,034,086
* VIACOM STOCK FUND 36,652 SHARES 1,725,403 1,689,026
</TABLE>
* IDENTIFIED AS A PARTY-IN-INTEREST TO THE PLAN.
10
<PAGE>
BLOCKBUSTER ENTERTAINMENT CORPORATION
RETIREMENT AND SAVINGS PLAN
ITEM 27D - SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE PERIOD ENDED DECEMBER 31, 1995
<TABLE>
<CAPTION>
(B) DESCRIPTION OF ASSET (F) EXPENSE
(INCLUDING INTEREST RATE INCURRED
(A) IDENTITY OF AND MATURITY IN (C) PURCHASE (D) SELLING (E) LEASE WITH
PARTY INVOLVED CASE OF LOAN) PRICE PRICE RENTAL TRANSACTION
- --------------- ------------------------- ----------- ----------- ---------- -----------
PURCHASES: UNITS: TRANSACTIONS:
<S> <C> <C> <C> <C> <C> <C> <C>
* COMPANY STOCK FUND 69 18 $866
* NATIONS CAPITAL GROWTH FUND 219,545 140 $2,749,930
* NATIONS BALANCED ASSETS
FUND 140,464 111 $1,600,632
* NATIONS STRATEGIC FIXED
* INCOME FUND 102,055 103 $1,000,997
* NATIONS PRIME FUND 4,279,834 133 $4,279,834
* VIACOM CLASS B STOCK FUND 38,828 133 $1,874,963
SALES:
* COMPANY STOCK FUND 59,429 165 $773,030
* NATIONS CAPITAL GROWTH FUND 69,886 185 $924,508
* NATIONS BALANCED ASSETS
FUND 43,472 176 $519,714
NATIONS STRATEGIC FIXED
* INCOME FUND 34,255 176 $342,028
* NATIONS PRIME FUND 1,226,397 210 $1,226,397
* VIACOM CLASS B STOCK FUND 3,175,428 111 $152,375
</TABLE>
<TABLE>
<CAPTION>
(H) CURRENT VALUE
OF ASSET ON
(G) COST OF TRANSACTION (I) GAIN
ASSET DATE OR (LOSS)
---------- -------------- ---------
<S> <C> <C> <C>
* COMPANY STOCK FUND $866 $866 N/A
* NATIONS CAPITAL GROWTH FUND $2,749,930 $2,749,930 N/A
* NATIONS BALANCED ASSETS
FUND $1,600,632 $1,600,632 N/A
* NATIONS STRATEGIC FIXED
* INCOME FUND $1,000,997 $1,000,997 N/A
* NATIONS PRIME FUND $4,279,834 $4,279,834 N/A
* VIACOM CLASS B STOCK FUND $1,874,963 $1,874,963
SALES:
* COMPANY STOCK FUND $618,696 $773,030 $154,334
* NATIONS CAPITAL GROWTH FUND $803,026 $924,508 $121,482
* NATIONS BALANCED ASSETS
FUND $472,993 $519,714 $46,721
* NATIONS STRATEGIC FIXED
* INCOME FUND $335,915 $342,028 $6,113
* NATIONS PRIME FUND $1,226,397 $1,226,397
* VIACOM CLASS B STOCK FUND $149,545 $152,375 $2,830
</TABLE>
NOTES: TRANSACTIONS INCLUDED HEREIN REPRESENT INDIVIDUAL TRANSACTIONS OR A
SERIES OF TRANSACTIONS OR A SERIES OF TRANSACTIONS IN SECURITIES OF THE SAME
ISSUE IN EXCESS OF 5% OF THE CURRENT VALUE OF PLAN ASSETS AT THE BEGINNING OF
THE PLAN PERIOD.
THIS SCHEDULE INCORPORATES ALL DISCLOSURES REQUIRED BY THE DEPARTMENT OF LABOR
FOR ASSETS PURCHASED OR SOLD WITHIN THE PERIOD.
* IDENTIFIED AS A PARTY-IN-INTEREST TO THE PLAN.
11
<PAGE>
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THE PLAN
ADMINISTRATOR HAS DULY CAUSED THIS ANNUAL REPORT TO BE SIGNED ON ITS BEHALF BY
THE UNDERSIGNED HEREUNTO DULY AUTHORIZED.
BLOCKBUSTER ENTERTAINMENT
RETIREMENT AND SAVINGS PLAN
JUNE 28, 1996 ALBERT J. DETZ
SENIOR VICE PRESIDENT,
CHIEF FINANCIAL OFFICER
BLOCKBUSTER ENTERTAINMENT GROUP,
A DIVISION OF VIACOM, INC.
12
EXHIBIT INDEX
NUMBER DESCRIPTION OF EXHIBIT
- ------ ----------------------
23.1 CONSENT OF SHAUN M. DAVIS, CPA
EXHIBIT 23.1
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
As independent certified public accountants, we hereby consent to the
incorporation of our report included in this Form 11-K into the Company's
previously filed Registration Statements on Form S-3 (Registration Nos.
33-25040-33-31172, 33-31336, 33-36682, 33-40445, 33-42930, 33-47429, 33-54832,
33-56154, 33-58274, 33-60610, 33-65128-3367642-33-58672-33-69130-333-51267, and
33-51751), Form S-4 (Registration Nos. 33-29311, 33-38231, and 33-44635) and
Form S-8 (Registration Nos. 33-23765,33-32337, 33-45183, 33-64494 and 33-53949).
Shaun M. Davis, CPA
Hollywood, Florida,
June 18, 1996.
