================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549-1004
FORM 11-K
(Mark One)
/ / Annual Report Pursuant to Section 15(d) of the Securities Exchange Act of
1934
OR
/X/ Transition Report Pursuant to Section 15(d) of the Securities Exchange Act
of 1934
For the transition period October 1, 1995 to December 31, 1995
Commission file number 1-9553
PARAMOUNT (PDI) DISTRIBUTION INC.
EMPLOYEES' SAVINGS PLAN
------------------------------------------------------------
(Full title of the plan)
VIACOM INC.
------------------------------------------------------------
(Name of issuer of the securities held pursuant to the plan)
1515 Broadway
New York, New York 10036
------------------------------------------------------------
(Address of principal executive offices)
================================================================================
<PAGE>
THE PARAMOUNT (PDI) DISTRIBUTION INC.
EMPLOYEES' SAVINGS PLAN
FINANCIAL STATEMENTS
DECEMBER 31, 1995
INDEX
Page
----
Financial statements:
Statement of Net Assets Available for Benefits, with Fund
Information - December 31, 1995.................................... 1
Statement of Net Assets Available for Benefits, with Fund
Information - September 30, 1995................................... 2
Statement of Changes in Net Assets Available for Benefits, with
Fund Information - three months ended December 31, 1995............ 3
Statement of Changes in Net Assets Available for Benefits, with
Fund Information - the year ended September 30, 1995............... 4
Notes to financial statements........................................ 5-9
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
persons who administer the Plan have duly caused this annual report to be signed
on its behalf by the undersigned, hereunto duly authorized.
PARAMOUNT (PDI) DISTRIBUTION INC.
EMPLOYEES' SAVINGS PLAN
Date: June 28, 1996 By: Marguerite Heilman
----------------------------------
Marguerite Heilman
Member of the Retirement Committee
<PAGE>
PARAMOUNT (PDI) DISTRIBUTION INC.
EMPLOYEES' SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
DECEMBER 31, 1995
<TABLE>
<CAPTION>
Employer Fund Employee Funds
------------- ------------------------------------
Income
Viacom Inc. Equity Investment Balanced Combined
Stock Fund Fund Fund Fund Funds
---------- ---- ---- ---- -----
<S> <C> <C> <C> <C> <C>
Assets:
Investments:
Viacom Inc. Class B Common Stock.......... $ 104,817 $ 104,817
Other..................................... $ 80,394 $ 155,568 $ 25,757 261,719
Contributions receivable:
Employer.................................. 14,652 4,144 9,565 1,262 29,623
Employee.................................. -- 375 390 190 955
---------- --------- --------- --------- ----------
Net assets available for benefits.............. $ 119,469 $ 84,913 $ 165,523 $ 27,209 $ 397,114
========== ========= ========= ========= ==========
</TABLE>
See accompanying notes to the financial statements.
-1-
<PAGE>
PARAMOUNT (PDI) DISTRIBUTION INC.
EMPLOYEES' SAVINGS PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
SEPTEMBER 30, 1995
<TABLE>
<CAPTION>
Employer Fund Employee Funds
------------- --------------------------------------
Income
Viacom Inc. Equity Investment Balanced Combined
Stock Fund Fund Fund Fund Funds
---------- ---- ---- ---- -----
<S> <C> <C> <C> <C> <C>
Assets:
Investments:
Viacom Inc. Class B Common Stock.......... $ 88,555 $ 88,555
Other..................................... $ 62,520 $ 122,791 $ 20,151 205,462
Contributions receivable:
Employer.................................. 7,764 4,201 10,206 1,288 23,459
Employee.................................. -- 352 356 190 898
--------- --------- --------- --------- ----------
Net assets available for benefits.............. $ 96,319 $ 67,073 $ 133,353 $ 21,629 $318,374
========= ========= ========= ========= ==========
</TABLE>
See accompanying notes to the financial statements.
-2-
<PAGE>
PARAMOUNT (PDI) DISTRIBUTION INC.
EMPLOYEES' SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
THREE MONTHS ENDED DECEMBER 31, 1995
<TABLE>
<CAPTION>
Employer Fund Employee Funds
------------- ------------------------------------
Income
Viacom Inc. Equity Investment Balanced Combined
Stock Fund Fund Fund Fund Funds
---------- ---- ---- ---- -----
<S> <C> <C> <C> <C> <C>
Additions to net assets attributable to:
Contributions:
Employer................................... $ 29,861 $ 12,553 $ 29,005 $ 3,857 $ 75,276
Employee................................... -- 1,074 1,094 570 2,738
Investment income (loss)...................... (6,711) 4,213 2,071 1,153 726
---------- ----------- ---------- ---------- -----------
Net additions.............................. 23,150 17,840 32,170 5,580 78,740
Net assets available for benefits,
beginning of year............................. 96,319 67,073 133,353 21,629 318,374
---------- ----------- ---------- ---------- -----------
Net assets available for benefits, end of year.... $ 119,469 $ 84,913 $ 165,523 $ 27,209 $ 397,114
========== =========== ========== ========== ===========
</TABLE>
See accompanying notes to the financial statements.
-3-
<PAGE>
PARAMOUNT (PDI) DISTRIBUTION INC.
EMPLOYEES' SAVINGS PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION
YEAR ENDED SEPTEMBER 30, 1995
<TABLE>
<CAPTION>
Employer Fund Employee Funds
------------- ----------------------------------------
Income
Viacom Inc. Equity Investment Balanced Combined
Stock Fund Fund Fund Fund Funds
---------- ---- ---- ---- -----
<S> <C> <C> <C> <C> <C>
Additions to net assets attributable to:
Contributions:
Employer................................... $ 89,854 $ 55,361 $ 127,656 $ 17,467 $ 290,338
Employee................................... -- 4,291 5,018 2,303 11,612
Investment income............................. 6,465 7,648 999 1,859 16,971
---------- ---------- ---------- ---------- -----------
Total additions............................ 96,319 67,300 133,673 21,629 318,921
Deductions to net assets attributable to:
Withdrawals and terminations.................. -- 227 320 -- 547
---------- ---------- ---------- ---------- -----------
Total deductions........................... -- 227 320 -- 547
Net additions.............................. 96,319 67,073 133,353 21,629 318,374
Net assets available for benefits,
beginning of year............................. -- -- -- -- --
---------- ---------- ---------- ---------- -----------
Net assets available for benefits, end of year.... $ 96,319 $ 67,073 $ 133,353 $ 21,629 $ 318,374
========== ========== ========== ========== ===========
</TABLE>
See accompanying notes to the financial statements.
-4-
<PAGE>
PARAMOUNT (PDI) DISTRIBUTION INC.
EMPLOYEES' SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
Note A - Plan Description
The following is a brief description of the Paramount (PDI) Distribution Inc.
Employees' Savings Plan (the "Plan") and is provided for general information
purposes only. Participants should refer to the Plan document for more complete
information regarding the Plan.
The Plan is a defined contribution plan. The Plan was established on October 1,
1994 and was offered on a voluntary basis to substantially all employees of
Paramount (PDI) Distribution Inc. and its subsidiaries ("PDI"). PDI is a
subsidiary of National Amusements, Inc. ("NAI"). NAI owned approximately 25% of
Viacom Inc. Class A and B Common Stock on a combined basis as of December 31,
1995.
Prior to January 1, 1994, Participants in the Plan were previously employed by a
subsidiary of Viacom Inc. (the "Affiliated Company") and, therefore, were
eligible to participate in the Affiliated Company's defined contribution plan
(the "Affiliated Plan"). The provisions of the Plan mirror those of the
Affiliated Plan. Participants' previously existing account balances continue to
be held in the Affiliated Plan and remain subject to the Affiliated Plan
provisions. (See Note G)
Eligible employees may become Participants in the Plan following the earlier of
the attainment of age 25 or the completion of one year of employment service for
PDI or the Affiliated Company (collectively, the "Company"), generally measured
from the date of hire. The Plan is subject to the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), and is administered by a committee
appointed by the Board of Directors of PDI. Although PDI anticipates that the
Plan will continue indefinitely, it reserves the right by action of its Board of
Directors to amend or terminate the Plan provided that such action does not
retroactively reduce earned Participant benefits.
Vesting: Participants in the Plan are immediately vested in their own
- --------
contributions. Participants who commenced employment with the Affiliated Company
prior to January 1, 1992 vest in the Employer contribution at a rate of 20% for
each full year of service. Participants who commenced employment after December
31, 1991 vest in the Employer matching contributions after the completion of two
full years of service with the Company, at a rate of 33 1/3% for each of the
next three full years of service. Amounts which have been forfeited in
accordance with provisions of the Plan may be used to defray administrative
expenses or reduce future Employer matching contributions. (See Note G)
Loans to Participants: The Plan permits a Participant to borrow funds from the
- ----------------------
Plan using a portion of the Participant's vested account balance as collateral.
All loans require approval by the Retirement Committee. Periodic payroll
deductions are required to repay the loans on a level amortization basis. Loans
involving the purchase of a primary residence may be for any length of time up
to 25 years. Loans for any other reason must be repaid within five years. The
interest rate on the loans will be determined by the Retirement Committee. In
the event of the Participant's termination of employment with the Employer, the
Participant may either repay the loan in full or have the loan balance deducted
from the Participant account. Since the inception of the Plan, there have been
no loans granted.
Distributions and Withdrawals: Earnings on both employee and employer
- ------------------------------
contributions are not subject to income tax until they are distributed or
withdrawn from the Plan.
Participants in the Plan may receive their account balances, in a lump sum or in
installments over a period of up to 15 years, in the event of retirement,
termination of employment, disability, or death. Participants must receive a
required minimum distribution by the April 1 after the attainment of age 70 1/2
even if they
-5-
<PAGE>
PARAMOUNT (PDI) DISTRIBUTION INC.
EMPLOYEES' SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (continued)
are still employed. Participants may obtain a hardship withdrawal of before-tax
contributions provided that the requirements for hardship are met.
At December 31, 1995 and September 30, 1995, all amounts allocated to
withdrawing participants have been paid.
Plan Expenses: PDI pays for expenses incurred in connection with the
- --------------
administration of the Plan, while the Plan pays for expenses incurred in
connection with the investment of Plan assets. Such investment fees are charged
directly to or included in the investment income of the respective funds.
Note B - Contributions and Investment Programs (See Note G)
Investments of the Plan have been commingled with the investments of the
Affiliated Plan and invested with the Fund managers described below. However,
the activity of each plan is recorded separately, so that contributions,
earnings, and withdrawals and terminations for the Plan can be identified and
separately reported to Participants and on the face of the financial statements.
The Plan's net investment assets represent less than 1% of the commingled net
investment assets, as reported by the trustee, Chemical Bank. Investment income
includes earnings on investments and any realized/unrealized gains and losses on
investments. Interest and dividend receivables are included in investments.
The investment programs of the Plan during the periods presented are as follows:
Participant Contributions: A Participant may contribute to the Plan from 1% to
- --------------------------
12% of the Participant's base pay including certain commissions, subject to
adjustments to comply with the Internal Revenue Code. A Participant's
contributions can be made with pre-tax or after-tax dollars. A Participant may
change or suspend the amount of the Participant's contribution at any time
effective as of the first day of any month; however, any suspension must be for
a minimum of three months. Upon enrollment or re-enrollment, each Participant
shall direct that the Participant's contributions be invested in one or more of
the following investment options in increments of 10%.
Viacom Inc. Stock Fund
Contributions to this fund are invested in Viacom Inc. Class B Common Stock.
Investments in the Viacom Inc. Stock Fund qualify as party-in-interest
transactions. Since the inception of the Plan, there have been no Participant
contributions to this fund.
Equity Fund
This fund is primarily invested in a portfolio of common stocks constructed and
maintained with the objective of providing investment results which approximate
the performance of the Standard and Poor's 500 Stock Index (the "S&P 500"). The
fund may purchase or sell individual securities or futures contracts on the S&P
500 or on a similarly broad index. Bankers Trust Company is the investment
manager of this fund.
-6-
<PAGE>
PARAMOUNT (PDI) DISTRIBUTION INC.
EMPLOYEES' SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (continued)
Income Investment Fund
This fund is invested in fixed income securities issued by insurance companies,
financial institutions and the U.S. Government and its agencies. State Street
Bank and Trust Company is the investment manager of this fund.
Balanced Fund
This fund, of which J.P. Morgan is the investment manager, invests in a balanced
combination of a J.P. Morgan managed bond fund and an equity index fund.
Such direction may be revised by the Participant quarterly.
Employer Contribution: The Employer shall provide a matching contribution of 50%
- ----------------------
of the first 6% of each Participant's contribution. Employer matching
contributions are invested in the Viacom Inc. Stock Fund.
As reflected in the financial statements, employer contributions consist of
Participants' before-tax contributions and the employer's matching
contributions, and employee contributions consist of Participants' after-tax
contributions.
The number of Participants in each fund as of December 31, 1995 was as
follows:
Employer Fund:
Viacom Inc. Stock Fund........................ 58
Employee Funds:
Viacom Inc. Stock Fund........................ 0
Equity Fund................................... 25
Income Investment Fund........................ 50
Balanced Fund................................. 9
The total number of Participants in the Plan was less than the sum of the number
of Participants shown above because many of the Participants invest in more than
one fund.
Note C - Summary of Significant Accounting Policies
Accounting Method: The accrual method of accounting is used for record keeping
- ------------------
and financial statement presentation.
Investments: Investments are stated at aggregate current value. Investments in
- ------------
securities which are traded on national securities exchanges are valued at the
last reported sales price on the last business day of the year; investments
traded in the over-the-counter market and listed securities for which no sale
was reported on that date are valued at the mean between the last reported bid
and ask prices. The Investment Pricing Department of the Trustee establishes
current values for other investments which do not have an established market. In
cases where call options have been sold against investments, the current value
of
-7-
<PAGE>
PARAMOUNT (PDI) DISTRIBUTION INC.
EMPLOYEES' SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (continued)
such investments has been reduced by the current value of the option. The
guaranteed investment contracts are fully benefit-responsive and are therefore
presented in the financial statements at contract value. The Company does not
expect any employer initiated events that may cause premature liquidation to a
contract at market value.
Security Transactions: Purchases and sales of securities are recorded on the
- ----------------------
trade date. The historical average cost basis is used to determine gains or
losses on security dispositions.
Payment of Benefits: Benefits are recorded when paid.
- --------------------
Note D - Income Tax Status
The Plan is designed to be exempt from federal income tax and the Participants
will not be subject to federal income tax with respect to contributions made by
the Employer to the Participant's account and any earnings thereon or earnings
on all Participant contributions while such amounts are held in trust. The
Company intends to file the Plan with the I.R.S. for a determination letter in
the upcoming months.
Note E - Investment in Securities
The Plan assigns units to Participants within each of the respective funds.
Total units, net asset value per unit and total net assets in each fund at
December 31, 1995 and September 30, 1995 were as follows:
Total Net Asset Total Net
Fund Units Value Per Unit Asset Value
---- ----- -------------- -----------
December 31, 1995:
------------------
Employer Fund:
Viacom Inc. Stock Fund........... 103,600 $1.15 $ 119,469
Employee Funds:
Viacom Inc. Stock Fund........... -- --
Equity Fund...................... 64,649 1.31 84,913
Income Investment Fund........... 155,612 1.06 165,523
Balanced Fund.................... 21,776 1.25 27,209
-----------
Net assets available for benefits... $ 397,114
===========
September 30, 1995:
-------------------
Employer Fund:
Viacom Inc. Stock Fund........... 78,076 $1.23 $ 96,319
Employee Funds:
Viacom Inc. Stock Fund........... -- --
Equity Fund...................... 54,169 1.24 67,073
Income Investment Fund........... 127,229 1.05 133,353
Balanced Fund.................... 18,200 1.19 21,629
-----------
Net assets available for benefits... $ 318,374
===========
-8-
<PAGE>
PARAMOUNT (PDI) DISTRIBUTION INC.
EMPLOYEES' SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS (continued)
Note F - Termination Priorities
In the event that the Plan is terminated, subject to conditions set forth in
ERISA, the Plan provides that the net assets of the Plan be distributed to
Participants in proportion to their respective interests in such net assets.
Note G - Subsequent Events
Effective January 1, 1996, the Plan was merged with and into The Savings and
Investment Plan for Employees of PVI Transmission Inc. ("PVIP") (a defined
contribution plan sponsored by PVI Transmission Inc. ("PVI"), a subsidiary of
NAI). The resulting merged plan was renamed The Savings and Investment Plan for
Employees of PVI Transmission Inc. and Paramount (PDI) Distribution Inc. The
following paragraphs describe the significant effects of the merger.
Putnam Fiduciary Trust Company is the trustee and custodian of Plan Assets. PVIP
Participants have the option of investing their contributions or existing
account balances among the following funds: (1) Putnam Voyager; (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) Viacom Common Stock Fund. Each of
the funds, except for the Certus Interest Income Fund and the Capital Research
EuroPacific Growth Fund and the Viacom Common Stock Fund, are registered
investment companies managed by Putnam Management Company, Inc. and, therefore
are party-in-interest. The Certus Interest Income Fund, which is managed by
Certus Financial Corporation ("Certus"), primarily invests in guaranteed
investment contracts and bank investment contracts, some of which are created
by way of the concurrent purchase of a bank guarantee contract and a United
States government security. Investment elections are required to be in
multiplies of 5% and can be changed at any time. PVIP is intended to meet the
requirements of ERISA Section 404(c). Thus to the extent Participants exercise
control over the investment of contributions neither the Plan nor any Plan
fiduciary will be responsible for any losses which may occur.
PVIP provides for PDI's matching contributions amounts 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 as of a specified date (5% of annual compensation if base
pay is greater than $65,000). Participants may contribute up to 15% of annual
compensation on a before-tax, after-tax or combination basis, subject to
compliance with Internal Revenue Code limitations. The vesting schedule will
be 20% per year of service, becoming fully vested after five years.
-9-
