<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, 1995
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.
<PAGE> 2
REQUIRED INFORMATION
EXHIBITS
The following exhibit is filed as part of this report:
EX-23 Consent of Arthur Andersen LLP.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the trustees (or other persons who administer the employee benefit plan) have
duly caused this annual report to be signed on its behalf by the undersigned
hereunto duly authorized.
Scientific-Atlanta, Inc.
Voluntary Employee Retirement
and Investment Plan and Trust
Date: June 25, 1996 By: Scientific-Atlanta, Inc.
Employee Benefit Committee
By: /s/ Brian C. Koenig
-------------------
Name: Brian C. Koenig
Title: Senior Vice President,
Human Resources
<PAGE> 3
SCIENTIFIC-ATLANTA, INC.
VOLUNTARY EMPLOYEE RETIREMENT
AND INVESTMENT PLAN AND TRUST
FINANCIAL STATEMENTS AND SCHEDULES
AS OF DECEMBER 31, 1995 AND 1994
TOGETHER WITH
AUDITORS' REPORT
<PAGE> 4
SCIENTIFIC-ATLANTA, INC.
VOLUNTARY EMPLOYEE RETIREMENT AND INVESTMENT PLAN AND TRUST
FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
DECEMBER 31, 1995 AND 1994
TABLE OF CONTENTS
-----------------------------------------------------------
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
FINANCIAL STATEMENTS:
Statements of Net Assets Available for Plan Benefits, December 31,
1995 and 1994
Statement of Changes in Net Assets Available for Plan Benefits for the
Year Ended December 31, 1995
NOTES TO FINANCIAL STATEMENTS AND SCHEDULES
SUPPLEMENTAL SCHEDULES:
Schedule
Number
------
I. Item 27a - Schedule of Assets Held for Investment Purposes,
December 31, 1995
II. Item 27d - Schedule of Reportable Transactions for the Year
Ended December 31, 1995
<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, 1995 and 1994, and the related
statement of changes in net assets available for plan benefits for the year
ended December 31, 1995. 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, 1995 and 1994, and the changes in its net assets
available for plan benefits for the year ended December 31, 1995, 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 of assets
held for investment purposes and reportable transactions are presented for the
purpose of additional analysis and are not a required part of the basic
financial statements but are supplementary information required by the
Department of Labor'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 available for plan benefits 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
June 10, 1996
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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, 1995 AND 1994
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<TABLE>
<CAPTION>
1995 1994
----------- -----------
<S> <C> <C>
ASSETS:
PARTICIPANT DIRECTED INVESTMENTS, AT MARKET VALUE (NOTES 1 & 2)
FIDELITY RETIREMENT MONEY MARKET FUND $ 9,764,728 $ 8,855,296
FIDELITY INTERMEDIATE BOND FUND 6,407,083 5,664,040
FIDELITY EQUITY INCOME FUND 16,657,805 12,336,325
FIDELITY U.S. EQUITY INDEX FUND 5,187,095 2,601,057
FIDELITY MAGELLAN FUND 21,792,084 14,418,451
FIDELITY PURITAN FUND 178,526 --
FIDELITY OVERSEAS FUND 178,456 --
FIDELITY LOW-PRICED STOCK FUND 477,076 --
FIDELITY SCIENTIFIC-ATLANTA COMMON STOCK FUND 28,885,142 26,340,024
---------- ----------
TOTAL ASSETS 89,527,995 70,215,193
LIABILITIES -- --
NET ASSETS AVAILABLE FOR PLAN BENEFITS $89,527,995 $70,215,193
========== ==========
</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, 1995
-----------------------------------------------------------
<TABLE>
<CAPTION>
PARTICIPANT DIRECTED INVESTMENTS
----------------------------------------------------------------------------------
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 fair
value of investments $ -- $ 344,057 $ 3,053,947 $ 1,100,786 $ 4,335,486
Dividends and interest 555,980 385,326 965,911 119,659 1,249,132
-------------- -------------- -------------- -------------- --------------
555,980 729,383 4,019,858 1,220,445 5,584,618
-------------- -------------- -------------- -------------- --------------
CONTRIBUTIONS:
Participants 1,160,986 836,195 2,019,147 905,954 3,663,286
Employer -- -- -- -- --
Rollover deposits 227,357 165,504 367,091 292,278 659,443
-------------- -------------- -------------- -------------- --------------
1,388,343 1,001,699 2,386,238 1,198,232 4,322,729
-------------- -------------- -------------- -------------- --------------
TOTAL ADDITIONS 1,944,323 1,731,082 6,406,096 2,418,677 9,907,347
PAYMENTS TO PARTICIPANTS (875,289) (436,065) (938,073) (133,143) (583,947)
ADMINISTRATIVE EXPENSES (3,386) (2,032) (4,867) (1,220) (6,371)
TRANSFERS IN (OUT) 1,579 -- -- -- --
INTERFUND TRANSFERS (157,795) (549,942) (1,141,676) 301,724 (1,943,396)
-------------- -------------- -------------- -------------- --------------
NET INCREASE 909,432 743,043 4,321,480 2,586,038 7,373,633
NET ASSETS AVAILABLE FOR PLAN BENEFITS,
BEGINNING OF YEAR 8,855,296 5,664,040 12,336,325 2,601,057 14,418,451
-------------- -------------- -------------- -------------- --------------
NET ASSETS AVAILABLE FOR PLAN BENEFITS,
END OF YEAR $ 9,764,728 $ 6,407,083 $ 16,657,805 $ 5,187,095 $ 21,792,084
============= ============= ============= ============= =============
</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, 1995
-----------------------------------------------------------
<TABLE>
<CAPTION>
PARTICIPANT DIRECTED INVESTMENTS
-----------------------------------------------------------------
SCIENTIFIC-
ATLANTA
LOW-PRICED COMMON TOTAL
PURITAN OVERSEAS STOCK STOCK 1995
-------------- -------------- -------------- -------------- --------------
<S> <C> <C> <C> <C> <C>
INVESTMENT INCOME:
Net appreciation (depreciation) in fair
value of investments $ 4,702 $ (3,890) $ (10,128) $ (6,245,955) $ 2,579,005
Dividends and interest 6,661 3,939 28,111 -- 3,314,719
-------------- -------------- -------------- -------------- --------------
11,363 49 17,983 (6,245,955) 5,893,724
-------------- -------------- -------------- -------------- --------------
CONTRIBUTIONS:
Participants 21,266 30,382 44,551 1,124,318 9,806,085
Employer -- -- -- 5,453,157 5,453,157
Rollover deposits 34,921 9,549 55,056 334,717 2,145,916
-------------- -------------- -------------- -------------- --------------
56,187 39,931 99,607 6,912,192 17,405,158
-------------- -------------- -------------- -------------- --------------
TOTAL ADDITIONS 67,550 39,980 117,590 666,237 23,298,882
PAYMENTS TO PARTICIPANTS (5,177) (5,126) -- (952,739) (3,929,559)
ADMINISTRATIVE EXPENSES (19) (12) (475) (38,139) (56,521)
TRANSFERS IN (OUT) -- -- -- (1,579) --
INTERFUND TRANSFERS 116,172 143,614 359,961 2,871,338 --
-------------- -------------- -------------- -------------- --------------
NET INCREASE 178,526 178,456 477,076 2,545,118 19,312,802
NET ASSETS AVAILABLE FOR PLAN BENEFITS,
BEGINNING OF YEAR -- -- -- 26,340,024 70,215,193
-------------- -------------- -------------- -------------- --------------
NET ASSETS AVAILABLE FOR PLAN BENEFITS,
END OF YEAR $ 178,526 $ 178,456 $ 477,076 $ 28,885,142 $ 89,527,995
============== ============== ============== ============== ==============
</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, 1995 AND 1994
-----------------------------------------------------------
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 nine investment funds have been established by the Plan for
investing participants' contributions. All investment elections are
participant directed. Participants may change their investment elections
daily. The Plan has specific guidelines and limitations as to the type of
securities eligible for investment by each fund.
Fidelity Retirement Money Market Fund - This is a fixed income
fund invested in short-term securities with the objective of
current income that is designed to provide investors with a return
that reflects current short-term money market rates.
Fidelity Intermediate Bond Fund - This is a fixed income fund
invested in U.S. Treasury bonds or other government bonds, and
corporate bonds with a fixed interest rate.
Fidelity Equity Income Fund - This is a fund containing a variety
of corporate securities, with more investment risk than the Bond
Fund and Money Market Fund, with the objective of both current
income and capital appreciation.
Fidelity U.S. Equity Index Fund - This is a fund that invests
primarily in the common stocks of the 500 companies included in
the S&P 500 Index. The objective is for both current income and
long-term capital appreciation.
Fidelity Magellan Fund - This fund is invested in securities of
large United States and foreign corporations as well as smaller,
lesser known companies with the objective of long-term capital
appreciation. This fund offers more overall investment risks than
the other funds currently offered under the Plan.
Fidelity Puritan Fund - This fund invests in a broad list of
high-yielding securities among a variety of companies and
industries. The fund's objective is to obtain as much income as
possible, consistent with the preservation of capital. This
investment option was made available to participants effective
July 1, 1995.
Fidelity Overseas Fund - This fund is invested in securities of
issuers whose principal activities are outside the United States.
The fund seeks long-term capital appreciation as its objective.
This investment option was made available to participants
effective July 1, 1995.
Fidelity Low-Priced Stock Fund - This fund seeks long-term capital
appreciation and invests mainly in equity securities that are
considered by the fund's management to be low-priced at the time
of purchase. This investment option was made available to
participants effective July 1, 1995.
<PAGE> 10
Fidelity Scientific-Atlanta Common Stock Fund - This fund is
invested primarily in Scientific-Atlanta common stock with the
balance in short-term money market investments. The objective of
this fund is to give employees the opportunity to become
shareholders of the Company and to share in the Company's
performance. Employees have the option to redirect the Company's
matching contribution, which is made only to this fund, to the
other Fidelity funds.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
The financial statements are prepared on an accrual basis in accordance
with generally accepted accounting principles. The preparation of the
financial statements in conformity with generally accepted accounting
principles requires the Plan's management to use estimates and
assumptions that affect the accompanying financial statements and
disclosures. Actual results could differ from these estimates.
Realized gains and losses on investment transactions are determined for
accounting purposes as of the settlement date on a moving average cost
basis. Net realized and unrealized appreciation (depreciation) is
recorded in the accompanying Statement of Changes In Net Assets Available
for Plan Benefits as net appreciation (depreciation) in fair value of
investments. Investments are stated at market value (based on quoted
market prices) in the accompanying Statements of Net Assets Available for
Plan Benefits.
3. PLAN TERMINATION:
Although it has not expressed any intent to do so, the Company has the
right under the Plan to discontinue its contributions at any time and to
terminate the Plan subject to the provisions of ERISA.
4. TAX STATUS:
The Internal Revenue Service has determined and informed the Company by a
letter dated September 29, 1995, that the Plan was designed in accordance
with applicable sections of the Internal Revenue Code ("IRC").
Additionally, the plan administrator believes that the Plan is currently
being operated in compliance with the applicable requirements of the IRC.
Therefore, the plan administrator believes that the Plan was qualified
and the related trust was tax-exempt as of the financial statement date.
5. PARTICIPATION:
Employees of the Company are eligible to participate in the Plan if they
(a) are regular full-time employees or regular part-time employees
scheduled to work at least 20 hours a week, and (b) are at least 18 years
of age. Eligibility begins immediately upon employment provided the
above age and service requirements are met. This eligibility requirement
complies with the provisions of ERISA.
Participants may contribute to the Plan an amount ranging from 1/2% to
15% of their annual compensation. Individual accounts are maintained for
each of the Plan's participants to reflect the participant's share of the
Plan's income, the Company's contribution, and the participant's
contribution. Allocations are based on participant account balances, as
defined.
The amount contributed to the Plan by the Company on behalf of a
participant is equal to $1.00 for each dollar contributed by the
participant up to 3% of the participant's annual compensation plus $.50
for each dollar of the participant's contribution between 3% and 6% of
the participant's annual compensation. In addition, for any plan year,
the Company's contribution on behalf of the participant to this Plan
shall not exceed 4.5% of the participant's annual compensation for such
plan year. The Company's matching contributions to the Plan are in the
form of Scientific-Atlanta, Inc. common stock and are made only at the
end of each quarter. Vesting is immediate for both the participant's
contribution and the Company's matching contribution.
<PAGE> 11
6. TRUST AGREEMENT:
At December 31, 1995, the Plan's assets were held by the Trustee of the
Plan, Fidelity Management Trust Company. Company contributions are held
and managed by the Trustee, which invests cash received, interest, and
dividend income and makes distributions to participants. Certain
administrative functions are performed by officers or employees of the
Company or its subsidiaries and they act as the Plan Administrator. No
such officer or employee receives compensation from the Plan.
Administrative expenses such as trustee fees are paid by the Plan.
7. SUBSEQUENT EVENT:
The Pension Investment Committee of Scientific-Atlanta, Inc. has approved
the addition of a loan provision to the Plan. It is anticipated that the
amendment to the Plan will be effective July 1, 1996.
<PAGE> 12
SCHEDULE I
SCIENTIFIC-ATLANTA, INC.
VOLUNTARY EMPLOYEE RETIREMENT AND INVESTMENT PLAN AND TRUST
ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
DECEMBER 31, 1995
-----------------------------------------------------------
<TABLE>
<CAPTION>
Identity of Face Amount Market
Issue Investment Description or Shares Cost Value
- ---------------------- ----------------------- --------- ----------- ------
<S> <C> <C> <C> <C>
* Fidelity Investments Retirement Money Market Fund 9,764,728 $ 9,764,728 $ 9,764,728
* Fidelity Investments Intermediate Bond Fund 615,474 6,386,695 6,407,083
* Fidelity Investments Equity Income Fund 439,172 13,603,189 16,657,805
* Fidelity Investments U.S. Equity Index Fund 229,823 4,140,558 5,187,095
* Fidelity Investments Magellan Fund 253,455 18,678,220 21,792,084
* Fidelity Investments Puritan Fund 10,495 175,138 178,526
* Fidelity Investments Overseas Fund 6,139 177,995 178,456
* Fidelity Investments Low-Priced Stock Fund 25,788 486,807 477,076
* Fidelity Investments Scientific-Atlanta Common Stock Fund 3,122,718 24,638,724 28,885,142
------------- -----------
Total Investments $ 78,052,054 $89,527,995
============= ===========
</TABLE>
* Indicates a party-in-interest.
The accompanying notes are an integral part of this schedule.
<PAGE> 13
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, 1995
-----------------------------------------------------------
<TABLE>
<CAPTION>
Purchases Sales, Maturities or Withdrawals
-------------------------- ------------------------------------------------
Cost and Proceeds and
Current Value Current Value
of Asset on of Asset on
Identity of Number of Transaction Number of Transaction Cost of Net Gain/
Party Involved Description Transactions Date Transactions Date Asset (Loss)
- --------------------- ------------------- ------------ ------------ ------------ ------------ ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Fidelity Investments Retirement Money Market Fund 233 $15,599,080 205 $14,689,648 $ 14,689,648 $ -
Fidelity Investments Intermediate Bond Fund 198 2,220,152 156 1,821,165 1,847,934 (26,769)
Fidelity Investments Equity Income Fund 230 6,510,008 188 5,242,474 4,758,668 483,806
Fidelity Investments U.S. Equity Index Fund 199 3,119,584 129 1,634,333 1,453,644 180,689
Fidelity Investments Magellan Fund 239 10,799,731 194 7,761,583 6,910,924 850,659
Fidelity Investments Scientific-Atlanta Common 248 27,325,703 224 18,534,629 15,588,927 2,945,702
Stock Fund
</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, 1995.
The accompanying notes are an integral part of this schedule.
<PAGE> 1
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
June 25, 1996
