<PAGE> 1
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 [FEE REQUIRED].
For the fiscal year ended: December 31, 1994
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [NO FEE REQUIRED].
For the transition period from to
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Commission file number: 1-5517
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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.
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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: September 13, 1995 By: Scientific-Atlanta, Inc.
Employee Benefit Committee
By: /s/ Brian C. Koenig
-------------------
Name: Brian C. Koenig
Title: Senior Vice President, Human Resources
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SCIENTIFIC-ATLANTA, INC.
VOLUNTARY EMPLOYEE RETIREMENT
AND INVESTMENT PLAN AND TRUST
FINANCIAL STATEMENTS AND SCHEDULES
AS OF DECEMBER 31, 1994 AND 1993
TOGETHER WITH
AUDITORS' REPORT
<PAGE> 4
SCIENTIFIC-ATLANTA, INC.
VOLUNTARY EMPLOYEE RETIREMENT AND INVESTMENT PLAN AND TRUST
FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
DECEMBER 31, 1994 AND 1993
TABLE OF CONTENTS
-----------------------------------------------
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
FINANCIAL STATEMENTS:
Statements of Net Assets Available for Plan Benefits, December 31,
1994 and 1993
Statement of Changes in Net Assets Available for Plan Benefits for the
Year Ended December 31, 1994
NOTES TO FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
SUPPLEMENTAL SCHEDULES:
Schedule
Number
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I. Item 27a - Schedule of Assets Held for Investment Purposes,
December 31, 1994
II. Item 27d - Schedule of Reportable Transactions for the Year
Ended December 31, 1994
<PAGE> 5
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, 1994 and 1993, and the related
statement of changes in net assets available for plan benefits for the year
ended December 31, 1994. 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, 1994 and 1993, and the changes in its net assets
available for plan benefits for the year ended December 31, 1994, in conformity
with generally accepted accounting principles.
Our audits were performed for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules listed in
the table of contents are presented for the purpose of additional analysis and
are not a required part of the basic financial statements but are supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. The 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 of each fund. The supplemental schedules
and fund information 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.
ARTHUR ANDERSEN LLP
Atlanta, Georgia
July 21, 1995
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SCIENTIFIC-ATLANTA, INC.
VOLUNTARY EMPLOYEE RETIREMENT AND INVESTMENT PLAN AND TRUST
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
DECEMBER 31, 1994 AND 1993
-----------------------------------------------------------
<TABLE>
<CAPTION>
1994 1993
----------- -----------
<S> <C> <C>
ASSETS:
PARTICIPANT DIRECTED INVESTMENTS,
AT MARKET (SCHEDULE I)
FIDELITY RETIREMENT MONEY MARKET FUND $ 8,855,296 $ 6,542,495
FIDELITY INTERMEDIATE BOND FUND 5,664,040 5,954,871
FIDELITY EQUITY INCOME FUND 12,336,325 10,460,786
FIDELITY U.S. EQUITY INDEX FUND 2,601,057 2,021,393
FIDELITY MAGELLAN FUND 14,418,451 11,611,208
SCIENTIFIC-ATLANTA COMMON STOCK FUND 26,340,024 17,355,547
----------- -----------
TOTAL ASSETS 70,215,193 53,946,300
LIABILITIES -- --
NET ASSETS AVAILABLE FOR PLAN BENEFITS $70,215,193 $53,946,300
=========== ===========
</TABLE>
The accompanying notes are an integral part of these statements.
<PAGE> 7
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
FOR THE YEAR ENDED DECEMBER 31, 1994
--------------------------------------------------------------
<TABLE>
<CAPTION>
PARTICIPANT DIRECTED INVESTMENTS
FIDELITY FUNDS
------------------------------------------------------------------------------
RETIREMENT INTER-
MONEY MEDIATE EQUITY U.S. EQUITY
MARKET BOND INCOME INDEX MAGELLAN
---------- ---------- ----------- ---------- -----------
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Net appreciation (depreciation) in
market value of investments $ -- $ (516,610) $(1,117,176) $ (46,574) $ (744,595)
Dividends and Interest 296,938 402,687 1,119,772 73,638 496,297
---------- ---------- ----------- ---------- -----------
296,938 (113,923) 2,596 27,064 (248,298)
---------- ---------- ----------- ---------- -----------
CONTRIBUTIONS:
Participants 906,346 859,287 1,779,898 636,393 3,188,015
Employer -- -- -- -- (615)
Rollover deposits 109,544 92,249 99,049 40,469 343,199
---------- ---------- ----------- ---------- -----------
1,015,890 951,536 1,878,947 676,862 3,530,599
---------- ---------- ----------- ---------- -----------
TOTAL ADDITIONS 1,312,828 837,613 1,881,543 703,926 3,282,301
PAYMENTS TO PARTICIPANTS (964,709) (272,717) (480,381) (63,502) (539,654)
ADMINISTRATIVE EXPENSES (2,764) (2,188) (4,410) (830) (5,490)
TRANFERS IN (OUT) 7,491 (1,665) (2,497) (832) (2,496)
INTERFUND TRANSFERS 1,959,955 (851,874) 481,284 (59,098) 72,582
---------- ---------- ----------- ---------- -----------
NET INCREASE (DECREASE) 2,312,801 (290,831) 1,875,539 579,664 2,807,243
NET ASSETS AVAILABLE FOR PLAN
BENEFITS, BEGINNING OF YEAR 6,542,495 5,954,871 10,460,786 2,021,393 11,611,208
---------- ---------- ----------- ---------- -----------
NET ASSETS AVAILABLE FOR PLAN
BENEFITS, END OF YEAR $8,855,296 $5,664,040 $12,336,325 $2,601,057 $14,418,451
========== ========== =========== ========== ===========
</TABLE>
The accompanying notes are an integral part of this statement.
<PAGE> 8
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
FOR THE YEAR ENDED DECEMBER 31, 1994
--------------------------------------------------------------
<TABLE>
<CAPTION>
SCIENTIFIC
ATLANTA
COMMON
STOCK
FUND 1994
----------- ------------
<S> <C> <C>
INVESTMENT INCOME:
Net appreciation (depreciation) in
market value of investments $ 6,054,441 $ 3,629,486
Dividends and Interest -- 2,389,332
----------- ------------
6,054,441 6,018,818
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CONTRIBUTIONS:
Participants 427,126 7,797,065
Employer 4,342,375 4,341,760
Rollover deposits 521,380 1,205,890
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5,290,881 13,344,715
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TOTAL ADDITIONS 11,345,322 19,363,533
PAYMENTS TO PARTICIPANTS (731,711) (3,052,674)
ADMINISTRATIVE EXPENSES (30,031) (45,713)
TRANSFERS IN (OUT) 3,746 3,747
INTERFUND TRANSFERS (1,602,849) --
------------ -----------
NET INCREASE 8,984,477 16,268,893
NET ASSETS AVAILABLE FOR PLAN
BENEFITS, BEGINNING OF YEAR 17,355,547 53,946,300
----------- -----------
NET ASSETS AVAIABLE FOR PLAN
BENEFITS, END OF YEAR $26,340,024 $70,215,193
=========== ===========
</TABLE>
The accompanying notes are an integral part of this statement.
<PAGE> 9
SCIENTIFIC-ATLANTA, INC.
VOLUNTARY EMPLOYEE RETIREMENT AND INVESTMENT PLAN AND TRUST
NOTES TO FINANCIAL STATEMENTS AND SCHEDULES
DECEMBER 31, 1994 AND 1993
-----------------------------------------------------------
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 provisions has been published in a summary Plan
description available to all participants and beneficiaries.
The following six 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.
The Money Market Fund (Fidelity Retirement Money Market Portfolio)
- 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.
The Bond Fund (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.
The Equity Mutual Fund (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.
The Equity Index Fund (Fidelity U.S. Equity Index Portfolio) -
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.
Long-Term Capital Appreciation Fund (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.
Scientific-Atlanta Common Stock Fund, (S-A 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.
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.
<PAGE> 10
Although the Plan has received a favorable determination letter dated
July 1, 1993 from the Internal Revenue Service, it has not been updated
for the latest plan amendments. However, the plan administrator and
management believe that the Plan was designed and 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 through the year ended December 31, 1994.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
The financial statements are prepared on an accrual basis in accordance
with generally accepted accounting principles.
Realized gains and losses on investment transactions are determined for
accounting purposes as of the settlement date on a moving average cost
basis. Investments are stated at market value (based on quoted market
prices) in the accompanying Statements of Net Assets Available for Plan
Benefits.
3. PARTICIPATION:
Employees of the Company are eligible to participate in the Plan if they
(a) are a regular full-time employee or a regular part-time employee
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 as reported on Internal Revenue Service
Form W-2.
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.
Prior to October 1, 1993, the amount contributed to the Plan by the
Company on behalf of a participant was equal to $.50 for each $1.00 of
the participant's contributions up to 5% of the participant's annual
compensation. For any plan year, the Company's combined contribution on
behalf of the participant to this Plan and the Scientific-Atlanta, Inc.
Stock Purchase Plan could not exceed 2.5% of the participant's annual
compensation for such Plan year. The Company's matching contributions to
the Plan were in the form of the Company's common stock, cash, or a
combination of both.
4. TRUST AGREEMENT:
At December 31, 1994, 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.
<PAGE> 11
SCHEDULE I
SCIENTIFIC-ATLANTA, INC.
VOLUNTARY EMPLOYEE RETIREMENT AND INVESTMENT PLAN AND TRUST
ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 1994
-----------------------------------------------------------
<TABLE>
<CAPTION>
Face Amount Market
Investment Description or Shares Cost Value
-------------------------------------- ------------- ------------ -------------
<S> <C> <C> <C>
Fidelity Investments Mutual Funds (*):
--------------------------------------
Retirement Money Market 8,855,297 $ 8,855,297 $ 8,855,296
Intermediate Bond 576,199 6,014,477 5,664,040
Equity Income 401,835 11,851,848 12,336,325
U.S. Equity Index 153,818 2,474,618 2,601,057
Magellan 215,845 14,789,412 14,418,451
Common Stock
------------
Scientific-Atlanta, Inc.(*) 2,035,551 12,901,948 26,340,024
----------- -----------
Total Investments $56,887,600 $70,215,193
=========== ===========
</TABLE>
(*) Represents a party in interest.
The accompanying notes are an integral part of this schedule.
<PAGE> 12
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, 1994
-----------------------------------------------------------
<TABLE>
<CAPTION>
Purchases Sales, Maturities or Withdrawals
---------------------------- ----------------------------------------------------
Number of Number of Net Gain/
Description Transactions Amount Transactions Proceeds Cost (Loss)
--------------------------- ------------ ------------- ------------ ------------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C>
Fidelity Money Market
Portfolio (*) 214 $ 7,468,204 176 $5,155,403 $5,155,403 --
Fidelity Intermediate Bond
Fund (*) 192 1,938,425 142 1,712,646 1,758,286 (45,640)
Fidelity Equity-Income
Fund (*) 215 5,503,578 149 2,510,863 2,312,049 198,814
Fidelity Magellan Fund (*) 231 7,304,160 163 3,752,322 3,789,998 (37,676)
Scientific-Atlanta Common
Stock Fund (*) 241 11,689,564 189 8,759,509 5,766,319 2,993,190
</TABLE>
(1) Represents individual transactions or a series of transactions in
securities of the same issue or with a person in excess of 5% of the market
value of the Plan's assets as of January 1, 1994.
(*) Represents a party in interest.
The accompanying notes are an integral part of this schedule.
<PAGE> 1
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.
ARTHUR ANDERSEN LLP
Atlanta, Georgia
September 11, 1995
