<PAGE>
================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549-1004
_______________________
FORM 11-K
(Mark One)
/X/ Annual Report Pursuant to Section 15(d) of the Securities Exchange Act
of 1934
For the year ended December 31, 1999 Commission file number 1-9553
OR
/ / Transition Report Pursuant to Section 15(d) of the Securities Exchange
Act of 1934
VIACOM INVESTMENT 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>
VIACOM INVESTMENT PLAN
FINANCIAL STATEMENTS
DECEMBER 31, 1999
INDEX
-----
<TABLE>
<CAPTION>
Pages
-----
<S> <C>
(a) Financial Statements:
Report of Independent Accountants............................................... 1
Statement of net assets available for benefits
at December 31, 1999 and December 31, 1998................................... 2
Statement of changes in net assets available for benefits for the years
ended December 31, 1999 and December 31, 1998................................ 3
Notes to financial statements................................................... 4 - 13
Schedules
---------
Additional information:
Item 27a - Schedule of assets held for investment purposes
for the year ended December 31, 1999................................... I
Item 27d - Schedule of reportable transactions
during the year ended December 31, 1999................................ II
</TABLE>
All other schedules are omitted as not applicable or not required.
(b) Exhibit:
I - Consent of Independent Accountants
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.
VIACOM INVESTMENT PLAN
Date: June 21, 2000 By: /s/ Barbara Mickowski
------------------------------------------
Barbara Mickowski
Member of the Retirement Committee
<PAGE>
Report of Independent Accountants
To the Participants and
Administrator of the
Viacom Investment Plan
In our opinion, the financial statements listed in the accompanying index
present fairly, in all material respects, the net assets available for benefits
of the Viacom Investment Plan (the "Plan") at December 31, 1999 and 1998, and
the changes in net assets available for benefits for the years then ended, in
conformity with generally accepted accounting principles. These financial
statements are the responsibility of the Plan's management; our responsibility
is to express an opinion on these financial statements based on our audits. We
conducted our audits of these statements in accordance with generally accepted
auditing standards which 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, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for the opinion expressed above.
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules as listed in
the accompanying index 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 and fund information are the responsibility of
the Plan's management. These supplemental schedules have been subjected to the
auditing procedures applied in the audits 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.
PricewaterhouseCoopers LLP
New York, New York
June 20, 2000
1
<PAGE>
VIACOM INVESTMENT PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
December 31,
---------------------------------
Assets: 1999 1998
------- ---- ----
<S> <C> <C>
Investments, at fair value:
Registered investment companies............................. $378,969,859 $312,757,399
Viacom Inc. Common Stock.................................... 297,294,586 198,210,169
Investments in other........................................ 715,404 606,828
Loans to participants....................................... 11,896,270 13,379,773
Investments, at contract value:
Plan's interest in Master Trust............................. 50,888,504 92,315,381
------------ ------------
Total investments................................... 739,764,623 617,269,550
Cash and cash equivalents...................................... 26,724 140,612
Receivables:
Investment income.......................................... 28,444 31,883
Contributions:
Employee................................................. 742,453 912,506
Employer................................................. 244,632 309,448
------------ ------------
Total assets................................................... 740,806,876 618,663,999
Liabilities:
------------
Payable to other plan.................................... -- 35,742,504
------------ ------------
Net assets available for benefits.............................. $740,806,876 $582,921,495
============ ============
</TABLE>
The accompanying notes are an integral part of these financial statements.
2
<PAGE>
VIACOM INVESTMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
<TABLE>
<CAPTION>
Year ended December 31,
---------------------------
1999 1998
----- -----
<S> <C> <C>
Additions to net assets attributed to:
Contributions:
Employee.......................................................... $ 34,742,868 $ 54,355,899
Employer.......................................................... 10,632,224 17,713,131
Rollover.......................................................... 3,011,828 4,188,616
Investment income..................................................... 25,538,564 44,150,975
Plan's interest in Master Trust investment income..................... 3,157,952 5,461,219
Net appreciation in fair value of investments......................... 186,927,376 177,503,327
------------- -------------
Total additions.................................................. 264,010,812 303,373,167
------------- -------------
Deductions to net assets attributed to:
Participants benefits paid............................................ 55,540,940 92,943,544
Plan expenses......................................................... 531,728 1,158,970
------------- -------------
Total deductions................................................. 56,072,668 94,102,514
------------- -------------
Net increase..................................................... 207,938,144 209,270,653
Transfer to Blockbuster Investment plan.............................. (49,770,353) --
Transfer of Non-Consumer Publishing balances......................... (282,410) (291,489,225)
Net assets available for benefits, beginning of year.................. 582,921,495 665,140,067
------------- -------------
Net assets available for benefits, end of year $ 740,806,876 $ 582,921,495
============= =============
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
VIACOM INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - PLAN DESCRIPTION
The following is a brief description of the Viacom Investment Plan (the "Plan")
and is provided for general information only. Participants should refer to the
Plan document for more complete information regarding the Plan.
The Plan is a defined contribution plan offered on a voluntary basis to
substantially all employees of Viacom International Inc. (the "Company"), a
wholly owned subsidiary of Viacom Inc.
Eligible employees may become participants in the Plan following the attainment
of age 21 and completion of twelve months of employment service, generally
measured from date of hire. In addition, part-time employees are eligible to
participate in the Plan upon completion of one thousand hours of service within
a consecutive twelve-month period. The Plan is subject to the provisions of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and is
administered by a committee (the "Administrator") appointed by the board of
directors of the Company. Although the Company 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.
On October 26, 1998 and November 27, 1998, Viacom Inc. completed the sale of its
music retail stores ("Music") to Wherehouse Entertainment, Inc. and its
educational, professional and reference publishing businesses ("Non-Consumer
Publishing") to Pearson plc, respectively. As a result, the Plan was amended
such that the Plan participants employed in these businesses were deemed to be
fully vested in the value of their accrued benefits as of the respective dates
of disposition.
Subsequent to the Music sale, the Plan participants from the Music business were
entitled to the normal payment options offered to terminated employees.
On December 31, 1998, the assets held for the Plan participants of Non-Consumer
Publishing, except for the assets held in the Certus Interest Income Fund, were
transferred to a qualified Plan sponsored by Pearson plc; the assets held in the
Certus Interest Income Fund were transferred on January 27, 1999.
Effective May 1, 1999, the Plan participants who are employees of Blockbuster
Inc. ("Blockbuster Participants"), a majority owned subsidiary of Viacom Inc.,
were transferred to the Blockbuster Investment Plan, a defined contribution
401(k) plan sponsored by Blockbuster Inc. On April 30, 1999, the Plan's account
balances of all Blockbuster Participants were transferred to the Blockbuster
Investment Plan. Generally, the terms of the Blockbuster Investment Plan are
similar to those of the Plan.
4
<PAGE>
VIACOM INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
Investment and participant accounts
-----------------------------------
Putnam Fiduciary Trust Company (the "Trustee") is the trustee and custodian of
Plan assets.
Plan participants have the option of investing their contributions or existing
account balances among the following funds (see Note 9 for the addition of
future investment funds):
Growth
Putnam S&P 500 Index Fund
-------------------------
This fund invests primarily in publicly traded common stocks either directly or
through collective investment trusts having a similar investment objective. The
fund is designed to achieve a return, before the assessment of any fees, that
closely approximates the return of the Standard & Poor's 500 Composite Stock
Price Index.
Putnam Investors Fund
---------------------
This fund seeks long-term growth of capital and any increased income that
results from this growth. The fund is designed for investors seeking long-term
growth of capital from a portfolio primarily consisting of quality common
stocks.
Putnam Voyager Fund
-------------------
This fund seeks capital appreciation by investing in a combination of stocks of
smaller companies expected to grow over time as well as stocks of larger, more
established corporations. The fund is designed for investors seeking a
diversified portfolio offering the opportunity for capital growth while also
providing current income.
Europacific Growth Fund
-----------------------
This fund, a registered investment company, is managed by the Capital Research
and Management Company and invests in stocks of companies outside of the United
States. Its performance will fluctuate with the value of the foreign exchange
markets and the underlying stocks.
Viacom Inc. Common Stock Fund
-----------------------------
This fund invests in shares of Viacom Inc. Class B Common Stock.
Growth and Income
George Putnam Fund of Boston
----------------------------
This fund seeks to provide a balanced investment composed of a well-diversified
portfolio of stocks and bonds that will produce both capital growth and current
income.
Putnam Fund for Growth and Income
---------------------------------
This fund seeks capital growth and current income. The fund is designed for
investors seeking long-term growth of capital from a portfolio primarily
consisting of attractively priced stocks, offering the opportunity for capital
growth while also providing current income.
5
<PAGE>
VIACOM INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
Income
Putnam Income Fund
------------------
This fund seeks high current income consistent with what the Trustee believes to
be prudent risk. This fund invests in a variety of bonds, including corporate
bonds from creditworthy companies.
Capital Preservation
Certus Interest Income Fund
---------------------------
This fund is managed by Certus Financial Corporation and seeks to preserve
principal and minimize market volatility while offering a competitive and
predictable rate of return. This fund invests in guaranteed investment contracts
and synthetic investment contracts. Synthetic investment contracts consist of
benefit responsive wrapper contracts backed by investments which are held in the
trust and owned by the Plan.
Each of the funds, except for the Certus Interest Income Fund, the Europacific
Growth Fund and the Viacom Inc. Common Stock Fund are registered investment
companies managed by Putnam Management Company, Inc. and, therefore, are
identified as parties-in-interest. The Viacom Inc. Common Stock Fund is also
identified as a party-in-interest as it invests in shares of Viacom Inc. Class B
Common Stock.
Investment elections are required to be in multiples of 5% of the amount
contributed and can be changed at any time. The Plan 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 other
Plan fiduciary will be responsible for any losses which may occur.
Effective January 1, 1994, the Company and certain affiliated companies entered
into a master trust agreement (the "Master Trust") with the Trustee to combine
certain investments of the Plan, affiliated companies' plans, and, effective
October 1, 1995, a separate Collective Bargaining Plan. The Master Trust
currently holds assets for the Plan, the Collective Bargaining Plan and the
Blockbuster Investment Plan. The Master Trust assets are managed by Certus.
However, the Trustee records the activity of each plan separately in order to
distinguish the specific assets available to each plan. Net investment assets
and net investment earnings on the investments of the Master Trust are allocated
daily to the plans participating in the Master Trust. Such allocation is based
on the ratio of net investment assets of each of the participating plans to
total net investment at the time the Master Trust was formed, adjusted for any
contributions or disbursements attributable to specific participating plans.
Note 8 sets forth the Plan's proportionate interest in the Master Trust, and
certain financial information of the Master Trust.
Employer matching contributions are currently invested entirely in Viacom Inc.
Class B Common Stock.
6
<PAGE>
VIACOM INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
Loans to Participants
---------------------
The Loan Fund is a separate fund established solely for the purpose of
administering loans to participants. Participants are eligible to receive loans
based on their account balances. The maximum loan available to a participant is
the lesser of 50% of the participant's vested account balance or $50,000,
reduced by the highest outstanding balance of any Plan loan made to the
participant during the twelve-month period ending on the day before the loan is
made. The minimum loan available to a participant is $500. The interest rate on
participant loans is established on the first day of the calendar quarter at a
rate of 1% above the annual prime commercial rate and only one loan may be
outstanding at one time. Participants may elect repayment periods from twelve to
sixty months through payroll deductions commencing as soon as administratively
possible following the distribution of the loan. The Plan allows participants
to elect a repayment term of up to 300 months for loans used for the acquisition
of a principal residence. Transfers of participant balances for loan
disbursements and repayments of loan principal and interest to the Loan Fund are
specifically identified in the respective participants' accounts within each
fund.
Contributions
-------------
The Plan permits participants to contribute up to 15% of annual compensation on
a before-tax, after-tax or combination basis, subject to the Internal Revenue
Code ("IRC") limitations set forth below. The employer's matching contribution
is equal to (i) 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 specified date or (ii)
50% of the first 5% of annual compensation contributed on a before-tax basis if
base pay is greater than $65,000.
A new employee is permitted to rollover into the Plan part or all of
distributions from an individual retirement account, individual retirement
annuity or another qualified plan.
The IRC limits the amount of annual participant contributions that can be made
on a before-tax basis; the limit was $10,000 for both 1999 and 1998. Total
compensation considered under the Plan, based on IRC limits, may not exceed
$160,000 for 1999 and 1998. The IRC also contains an annual limit on aggregate
participant and employer contributions to defined contribution plans equal to
the lesser of $30,000 or 25% of compensation. All contributions made to the Plan
on an annual basis may be further limited due to certain non-discrimination
tests prescribed by the IRC.
Vesting
-------
Participants in the Plan are immediately vested in their own contributions and
earnings thereon. Employer matching contributions will vest at 20% per year of
service, becoming fully vested after five years of service. If participants
terminate employment prior to being vested in their employer matching
contributions and receive a distribution of the vested portion of their account,
the non-vested portion of their account is forfeited and used to pay
administrative expenses and to fund future employer matching contributions.
Employer matching contributions of $840,082 and $1,138,762 during the years
ended December 31, 1999 and December 31, 1998, respectively, were forfeited by
terminating employees before those amounts became vested.
7
<PAGE>
VIACOM INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
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, or their beneficiaries, may receive their account
balances, in a lump sum or in installments over a period of up to 20 years, in
the event of retirement, termination of employment, disability or death.
Participants must receive a required minimum distribution upon attainment of age
70 1/2 unless they are still employed.
Participants who have been in the Plan or affiliated plans at least five years
may elect to withdraw up to 100% of their employer matching contribution account
and earnings thereon, while those who have participated less than five years are
limited to withdrawing vested employer matching contributions made at least two
years prior to the withdrawal including earnings thereon. In addition,
participants in the Plan may receive part or all of their after-tax and rollover
contributions. Upon attainment of age 59 1/2, participants may withdraw all or
part of their before-tax contributions and earnings thereon. All of the above
withdrawal elections are subject to a provision that a participant can make only
one such request during each calendar year.
A participant may obtain a hardship withdrawal of the vested portion of employer
matching contributions and before-tax contributions provided that the
requirements for hardship are met. There is no restriction on the number of
hardship withdrawals permitted.
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 vested interests in such net
assets at that date.
Plan Expenses
-------------
The Company pays for expenses incurred in connection with the administration of
the Plan and the investment of Plan assets, to the extent not covered by
forfeitures.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Accounting Method
-----------------
The accrual method of accounting is used for financial statement presentation.
8
<PAGE>
VIACOM INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
During the year the Plan adopted Statement of Position 99-3 ("SOP 99-3")
Accounting for and Reporting of Certain Defined Contribution Plan investments
and Other Disclosure Matters. Pursuant to SOP 99-3, a defined contribution plan
that provides participant-directed investment programs is no longer required to
disclose amounts relating to those individual programs as a separate fund in the
financial statements in columnar form, or in the related disclosures, or by
separate financial statements for each fund.
Reclassification
----------------
Pursuant to the adoption of SOP 93-3, certain information for 1998 has been
reclassified to conform with the 1999 presentation.
Investment Valuation and Income Recognition
-------------------------------------------
Short-term money market obligations are carried at cost which approximates fair
value due to the short-term maturity of these investments. Viacom Inc. Class A
Common Stock and Class B Common Stock are reported at fair value based on the
quoted market price of the stock on the New York Stock Exchange. Investments
with registered investment companies are reported at fair value based upon the
market value of the underlying securities as priced by national security
exchanges. Guaranteed investment income contracts and synthetic investment
contracts held by the Master Trust are reported at contract value. Participant
loans consist of the outstanding principal of loans to Plan participants at
December 31, 1999 and 1998. The loans outstanding as of December 31, 1999 and
1998 carry interest rates ranging from 7.0% to 12.5%. Cash and cash equivalents
are valued at cost plus accrued interest, which approximate market value.
Interest income is accrued as earned and dividend income is recorded on the ex-
dividend date.
9
<PAGE>
VIACOM INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
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.
The Plan presents in the statement of changes in net assets available for
benefits the net appreciation (depreciation) in the fair value of its
investments which consists of the realized gains or losses and the unrealized
appreciation (depreciation) on those investments.
Payment of Benefits
-------------------
Benefits are recorded when paid.
Use of Estimates
----------------
The preparation of financial statements in conformity with generally accepted
accounting principles requires the Plan to make estimates and assumptions, such
as those regarding fair value, that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of changes in net assets
available for benefits during the reporting period. Actual results could differ
from those estimates.
NOTE 3 - OTHER MATTERS
On February 25, 1999, the Board of Directors of Viacom Inc. declared a 2-for-1
common stock split, effected in the form of a dividend. The additional shares
were issued on March 31, 1999 to shareholders of record on March 15, 1999. All
common share and per share amounts reflect the stock split for the periods
presented.
10
<PAGE>
VIACOM INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
NOTE 4 - INVESTMENTS
Individual investments that represent greater than 5% of net assets available
for benefits are identified below:
<TABLE>
<CAPTION>
At December 31,
-----------------------------------------------------------------
1999 1998
---- ----
Units Net Assets Units Net Assets
----- ---------- ----- ----------
<S> <C> <C> <C> <C>
Viacom Inc. Class B Common Stock.............. 4,614,403 $278,883,006 2,510,600 $185,784,356
Putnam Voyager Fund........................... 5,027,427 158,866,704 5,001,058 111,423,581
Putnam Investors Fund......................... 4,030,037 77,578,210 4,452,128 66,158,631
Putnam Fund for Growth and Income............. 3,062,011 57,473,953 3,141,141 64,456,221
Plan's interest in Master Trust............... 50,888,504 50,888,504 92,315,381 92,315,381
</TABLE>
During 1999 and 1998 the Plan's investments (including investments bought, sold
and held during the year) appreciated (depreciated), as follows:
<TABLE>
<CAPTION>
Year Ended December 31,
--------------------------------
1999 1998
---- ----
<S> <C> <C>
Putnam Voyager Fund...................................... $ 44,696,530 $ 16,539,790
Putnam Vista Fund........................................ 1,041,774 323,617
Putnam Fund for Growth and Income........................ (4,668,587) 3,489,421
Putnam U.S. Government Income Trust...................... (72,277) 3,802
Europacific Growth Fund.................................. 10,507,755 2,103,495
George Putnam Fund of Boston............................. (1,398,412) (53,804)
Putnam Investors Fund.................................... 18,046,212 20,518,683
Putnam S&P 500 Index Fund................................ 2,873,379 2,807,179
Putnam Income Fund....................................... (1,105,686) (704,081)
Viacom Inc. Common Stock................................. 117,006,688 132,475,225
------------ ------------
Net appreciation...................................... $186,927,376 $177,503,327
============ ============
</TABLE>
NOTE 5 - NONPARTICIPANT-DIRECTED INVESTMENTS
Information about the net assets and the significant components of the changes
in net assets relating to the nonparticipant-directed investments is as follows:
<TABLE>
<CAPTION>
December 31,
-------------------------------
1999 1998
---- ----
<S> <C> <C>
Net Assets:
Viacom Inc. Common Stock $232,703,371 $156,912,244
Investment in Other 603,129 509,927
</TABLE>
11
<PAGE>
VIACOM INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
<TABLE>
<CAPTION>
Year Ended
December 31, 1999
-----------------
<S> <C>
Changes in Net Assets:
Contributions $ 10,632,224
Dividends 9,330
Net appreciation 91,237,586
Benefits paid to participants (15,237,326)
Transfers to forfeitures (840,082)
------------
$ 85,801,732
============
</TABLE>
NOTE 6 - RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500
The following is a reconciliation of net assets available for benefits per the
financial statements to the Form 5500:
<TABLE>
<CAPTION>
December 31,
------------------------------
1999 1998
---- ----
<S> <C> <C>
Net assets available for benefits per the financial statements..... $740,806,876 $582,921,495
Amounts allocated to withdrawing participants...................... (691,207) (826,511)
------------ ------------
Net assets available for benefits per the Form 5500................ $740,115,669 $582,094,984
============ ============
</TABLE>
The following is a reconciliation of benefits paid to participants per the
financial statements to the Form 5500 for the year ended December 31, 1999:
<TABLE>
<S> <C>
Benefits paid to participants per the financial statements........ $ 55,540,940
Add: Amounts allocated to withdrawing participants
at December 31, 1999........................................... 691,207
Less: Amounts allocated to withdrawing participants
at December 31, 1998........................................... (826,511)
------------
Benefits paid to participants per the Form 5500................... $ 55,405,636
============
</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, 1999 but are not paid as of that date.
12
<PAGE>
VIACOM INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
NOTE 7 - INCOME TAX STATUS
The Internal Revenue Service has determined and informed the Company by a letter
dated January 22, 1998, that the Plan is exempt from federal income taxes under
the provisions of Section 501(a) of the IRC. The Plan has been amended since
receipt of the determination letter. However, the Company and the Company's tax
counsel believe that the Plan is designed and is currently being operated in
compliance with the applicable requirements of the IRC.
NOTE 8 - INVESTMENT IN MASTER TRUST
The value of the Plan's interest in the total investments of the Master Trust
was 93.9% at December 31, 1999 and 99.4% at December 31, 1998, and the allocated
share of investment income was 95.3% and 99.1% for the respective years then
ended.
The following table presents the contract value of investments of the Master
Trust:
<TABLE>
<CAPTION>
December 31,
-----------------------------
1999 1998
---- ----
<S> <C> <C>
Guaranteed investment contracts................................... $41,549,244 $ 54,001,585
Synthetic investment contracts.................................... 8,135,358 22,521,317
Putnam short-term investment fund................................. 4,500,050 16,355,305
Payable to other plan............................................. -- (35,742,504)
----------- ------------
Net Investments in Master Trust............................... $54,184,652 $ 57,135,703
=========== ============
</TABLE>
Investment income of the Master Trust is as follows:
<TABLE>
<CAPTION>
Year ended December 31,
------------------------------
1999 1998
---- ----
<S> <C> <C>
Guaranteed investment contracts................................... $ 2,521,135 $ 3,570,814
Synthetic investment contracts.................................... 654,742 1,566,581
Putnam short-term investment fund................................. 278,613 446,025
Investment manager fees........................................... (139,261) (89,454)
----------- ------------
Net Investment Income......................................... $ 3,315,229 $ 5,493,966
=========== ============
</TABLE>
13
<PAGE>
VIACOM INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
(continued)
The guaranteed investment contracts and synthetic 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 of a contract at market value. At December 31,
1999 and 1998, the fair value of such assets in the aggregate was $53,172,193
and $94,226,538 respectively, with an average yield of 6.31% for the respective
years then ended. The return on assets for the year ended December 31, 1999 and
1998 was 6.35% and 6.46%, respectively. The synthetic investment contract
interest rates are evaluated on a quarterly basis and may be reset when the
expected cash flow characteristics of an underlying security change.
On January 27, 1999, as a result of the sale of Non-Consumer Publishing to
Pearson plc described in Note 1, the Plan transferred the assets held in the
Master Trust for the participants of Non-Consumer Publishing totaling
$35,851,372, including accrued interest, to a qualified plan sponsored by
Pearson plc, including investment income earned subsequent to year end through
the transfer date.
NOTE 9 - SUBSEQUENT EVENTS
Effective February 1, 2000, Plan participants have the option of investing their
contributions or existing balances in eleven new funds. The new funds being
provided are Vanguard LifeStrategy Income Fund, Vanguard Moderate Growth Fund,
Vanguard LifeStrategy Growth Fund, Miller Anderson & Sherrerd, LLP Small Cap
Value Portfolio, Pacific Investment Management Company High Yield Fund, Capital
Guardian Emerging Markets Equity Fund, Morgan Stanley Dean Witter Institutional
Fund Technology Portfolio, Morgan Stanley Dean Witter Institutional Fund U.S.
Real Estate Portfolio, Putnam International Voyager Fund, Trust Company of the
West Galileo Small Cap Growth Fund, and Mellon Bank EB Daily Liquidity Aggregate
Bond Index Fund which has replaced the Putnam Income Fund. The Plan was enhanced
to provide participants with more investment choices.
14
<PAGE>
SCHEDULE I
VIACOM INVESTMENT PLAN
LINE 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT
DECEMBER 31, 1999
-----------------
<TABLE>
<CAPTION>
(c) Unit/ Principal
Amount/Shares/
Maturity and (d) Cost of (e) Current
(a) (b) Identity of issue, borrowing lessor or similar party Interest Rates Acquisitions Value
---------------------------------------------------- -------------- ------------ -----
Registered Investment Companies:
<S> <C> <C> <C>
* Putnam Voyager Fund.................................... 5,027,427 $ 108,768,762 $ 158,866,704
* Putnam Vista Fund...................................... 232,400 $ 3,051,771 4,132,080
* Putnam Fund for Growth and Income...................... 3,062,011 $ 64,561,860 57,473,953
* Putnam U.S. Government Income Trust................... 87,392 $ 1,129,728 1,077,540
* Putnam Money Market Trust.............................. 433,873 $ 433,873 433,873
Europacific Growth Fund................................ 771,016 $ 21,680,728 32,891,531
* George Putnam Fund of Boston........................... 921,868 $ 17,066,432 15,035,677
* Putnam Investors Fund.................................. 4,030,037 $ 51,532,015 77,578,210
* Putnam S&P 500 Index Fund.............................. 535,222 $ 14,702,012 18,700,640
* Putnam Income Fund..................................... 2,003,080 $ 13,990,779 12,779,651
Common Stock Fund:
* Viacom Inc. Class A Common Stock....................... 304,638 $ 4,560,974 18,411,580
* Viacom Inc. Class B Common Stock....................... 4,614,403 $ 99,575,076 278,883,006
Investments in other..................................... 2,230 $ 210,704 715,404
Plan's interest in Master Trust:
Certus Interest Income Fund............................ 50,888,504 $ 50,888,504 50,888,504
Various maturities
Loans to participants.................................... and interest rates 11,896,270
* ------------
Total investments........................ $ 739,764,623
============
</TABLE>
* Identified as a party-in-interest to the Plan.
<PAGE>
Schedule II
VIACOM INVESTMENT PLAN
LINE 27d - SCHEDULE OF REPORTABLE TRANSACTIONS
DURING THE YEAR ENDED DECEMBER 31, 1999
---------------------------------------
<TABLE>
<CAPTION>
Expenses Current Value
Incurred of Asset on
Description of Purchase Selling Lease With Cost of Transaction Net Gain
Identity of Party Involved Asset Price Price Rental Transaction Asset Date (Loss)
-------------------------- -------------- ----- ----- ------ ----------- ----- ---- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Single Transactions:
-------------------
Not Applicable
Series Transactions:
-------------------
Voyager........................... 1,159,381 units $30,820,592 N/A N/A $30,820,592
Viacom Inc. Class B Common Stock.. 901,761 units $42,764,820 N/A N/A $23,059,874 $42,764,820 $19,704,946
</TABLE>
The above transactions and series of transactions are in excess of 5 percent of
the current value of the Plan's assets as of December 31, 1998 as defined in
section 2520.103-6 of the Department of Labor Rules and Regulations for
Reporting and Disclosure under ERISA.
All of the above are parties-in-interest.
S-2
