SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 11-K (Mark One) [ X ] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED] For the ten months 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 __________ Commission file number: 1-5442 --------------------- A. Full title of the plan and the address of the plan, if different from that of the issuer named below: GENERAL INSTRUMENT (PUERTO RICO), INC. SAVINGS PLAN ------------------------------------------- B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: General Instrument Corporation ------------------------------------------------------ (Exact name of registrant as specified in its charter) Delaware 13-3575653 ------------------------------- ------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 181 West Madison Street, Chicago, Illinois 60602 ------------------------------------------------ (Address of principal executive offices) (Zip Code) (312) 541-5000 --------------------------------------------------- (Registrant's telephone number, including area code) GENERAL INSTRUMENT (PUERTO RICO), INC. SAVINGS PLAN Financial Statements as of and for the Ten-Month Period Ended December 31, 1994 and Supplemental Schedules as of and for the Ten-Month Period Ended December 31, 1994 and Independent Auditors' Report GENERAL INSTRUMENT (PUERTO RICO), INC. SAVINGS PLAN TABLE OF CONTENTS INDEPENDENT AUDITORS' REPORT FINANCIAL STATEMENTS: Statement of Net Assets Available for Benefits as of December 31, 1994, with Fund Information Statement of Changes in Net Assets Available for Benefits for the Ten-Month Period Ended December 31, 1994, with Fund Information Notes to Financial Statements for the Ten-Month Period Ended December 31, 1994 SUPPLEMENTAL SCHEDULES: Item 27a -Schedule of Assets Held for Investment Purposes as of December 31, 1994 Item 27d - Schedule of Reportable Transactions for the Ten-Month Period Ended December 31, 1994 Note: Supplemental Schedules are included for filing with the Annual Return on Form 5500. Supplemental Schedules not included herein are omitted due to the absence of conditions under which they would be required. INDEPENDENT AUDITORS' REPORT Administrative Committee General Instrument (Puerto Rico), Inc. Savings Plan: We have audited the accompanying statement of net assets available for benefits of General Instrument (Puerto Rico), Inc. Savings Plan (the "Plan") as of December 31, 1994, and the related statement of changes in net assets available for benefits for the ten-month period then ended. These financial statements are the responsibility of the Plan's Administrative Committee. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion, such financial statements present fairly in all material respects, the net assets available for benefits of the Plan as of December 31, 1994, and the changes in net assets available for benefits for the ten-month period then ended, in conformity with generally accepted accounting principles. Our audit was conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules of (1) assets held for investment purposes as of December 31, 1994 and (2) reportable transactions for the ten-month period ended December 31, 1994 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 supplemental information by fund is presented for the purpose of additional analysis of the basic financial statements rather than to present information regarding the net assets available for benefits and changes in net assets available for benefits of the individual funds, and is not a required part of the basic financial statements. The supplemental schedules and fund information are the responsibility of the Plan's Administrative Committee. Such supplemental schedules and fund information have been subjected to the auditing procedures applied in our audit of the basic financial statements and, in our opinion, are fairly stated in all material respects when considered in relation to the basic financial statements taken as a whole. /s/Deloitte & Touche - ----------------------- Deloitte & Touche Parsippany, New Jersey June 19, 1995 GENERAL INSTRUMENT (PUERTO RICO), INC. SAVINGS PLAN STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION AS OF DECEMBER 31, 1994 Fund Information Vanguard General Vanguard World Fund- Instrument Vanguard World Intern- Corportion Investment Index VMMR VFISF Vanguard Fund-U.S ational Common Contract Wellington 500 Federal GNMA STAR Growth Growth Un- Stock Fund Trust Fund Portfolio Portfolio Portfolio Fund Portfolio Portfolio allocated Total ---------- ---------- ---------- --------- --------- --------- -------- --------- ---------- --------- --------- ASSETS: Investments, $ 123,322 $ 28,388 $ 79,862 $ 55,636 $9,791 $22,365 $ 22,131 $ 12,869 $ 22,647 $ - $377,011 at fair value Contributions receivable: Employees 1,412 3,306 9,662 6,818 1,317 3,039 3,173 1,556 1,906 - 32,189 Employer 14,633 - - - - - - - - 18,045 32,678 ---------- ---------- ---------- --------- --------- --------- -------- --------- ---------- --------- --------- Total assets 139,367 31,694 89,524 62,454 11,108 25,404 25,304 14,425 24,553 18,045 441,878 LIABILITIES: Accrued liabilities 167 167 167 167 167 167 167 167 167 - 1,503 ---------- ---------- ---------- --------- --------- --------- -------- --------- ---------- --------- --------- NET ASSETS AVAILABLE FOR BENEFITS $ 139,200 $ 31,527 $ 89,357 $ 62,287 $ 10,941 $ 25,237 $ 25,137 $ 14,258 $ 24,386 $ 18,045 $ 440,375 ========== ========== ========== ========= ========= ========= ======== ========= ========== ========= ========= See notes to financial statements. GENERAL INSTRUMENT (PUERTO RICO), INC. SAVINGS PLAN STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION TEN-MONTH PERIOD ENDED DECEMBER 31, 1994 Fund Information General Vanguard World Fund- Instrument Vanguard World Intern- Corportion Investment Index VMMR VFISF Vanguard Fund-U.S. ational Common Contract Wellington 500 Federal GNMA STAR Growth Growth Un- Stock Fund Trust Fund Portfolio Portfolio Portfolio Fund Portfolio Portfolio allocated Total ---------- ---------- ---------- --------- --------- --------- -------- --------- ---------- --------- --------- CONTRIBUTIONS: Employees $ 10,508 $ 31,831 $ 91,733 $ 61,616 $ 12,505 $ 25,692 $25,476 $ 15,758 $ 20,596 $ - $295,715 Employer 124,329 - - - - - - - - 18,045 142,374 Other - - 893 298 - 893 - 447 447 - 2,978 ---------- ---------- ---------- --------- --------- --------- -------- --------- ---------- --------- --------- Net contri- butions 134,837 31,831 92,626 61,914 12,505 26,585 25,476 16,205 21,043 18,045 441,067 ---------- ---------- ---------- --------- --------- --------- -------- --------- ---------- --------- --------- INVESTMENT INCOME: Interest - 616 - - - - - - - - 616 Dividends - - 1,924 1,068 183 629 1,003 134 272 - 5,213 Net gain (loss) on investments 4,331 - (1,749) (359) - (358) (983) 287 (810) - 359 ---------- ---------- ---------- --------- --------- --------- -------- --------- ---------- --------- --------- Net investment income 4,331 616 175 709 183 271 20 421 (538) - 6,188 ---------- ---------- ---------- --------- --------- --------- -------- --------- ---------- --------- --------- Total additions 139,168 32,447 92,801 62,623 12,688 26,856 25,496 16,626 20,505 18,045 447,255 ---------- ---------- ---------- --------- --------- --------- -------- --------- ---------- --------- --------- DISTRIBUTIONS 592 387 586 - 410 202 - - - - 2,177 ADMINISTRATIVE EXPENSES 1,252 533 792 589 302 323 359 271 282 - 4,703 ---------- ---------- ---------- --------- --------- --------- -------- --------- ---------- --------- --------- Total deductions 1,844 920 1,378 589 712 525 359 271 282 - 6,880 TRANSFER (TO) FROM OTHER FUNDS 1,876 - (2,066) 253 (1,035) (1,094) - (2,097) 4,163 - - ---------- ---------- ---------- --------- --------- --------- -------- --------- ---------- --------- --------- NET ASSETS AVAILABLE FOR BENEFITS, END OF PERIOD $ 139,200 $ 31,527 $ 89,357 $ 62,287 $ 10,941 $ 25,237 $ 25,137 $ 14,258 $ 24,386 $ 18,045 $440,375 ========== ========== ========== ========= ========= ========= ======== ========= ========== ========= ========= See notes to financial statements. GENERAL INSTRUMENT (PUERTO RICO), INC. SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS TEN-MONTH PERIOD ENDED DECEMBER 31, 1994 A. DESCRIPTION OF THE PLAN 1. General - The General Instrument (Puerto Rico), Inc. Savings Plan (the "Plan"), was established and effective, March 1, 1994, and is an employee contributory program to encourage long- term savings by eligible employees of General Instrument (Puerto Rico), Inc. (the "Company") through a systematic program of salary deductions. The Company is a subsidiary of General Instrument Corporation, a holding company whose stock is traded on the New York Stock Exchange. The employee may elect to have compensation reduced by, and authorize the Company to contribute to the Plan on his or her behalf, a Matched Participant Contribution of 1%, 2%, 3%, 4%, 5% or 6% of compensation for each payroll period. Compensation represents the participant's base salary or wages, without reduction for his or her Matched or Unmatched Participant Contributions to the Plan and Section 165(e) of the Puerto Rico Income Tax Act of 1954, as amended ("PRITA"), contributions, and excluding any other form of additional compensation such as overtime pay, commissions, bonuses or incentive compensation. Each Plan year, the Company will contribute to the Plan, on behalf of the employee, a Matching Employer Contribution equal to 50% of the employee's Matched Participant Contribution (see Note A.6.). In addition, an employee who has elected a Matched Participant Contribution rate of 6% may elect to further reduce compensation, and authorize the Company to contribute to the Plan on his or her behalf, an Unmatched Participant Contribution of 1%, 2%, 3% or 4% of the employee's compensation for each payroll period. The contribution limitation for employee Matched and Unmatched Participant Contributions is $7,000 less any elective contributions under another defined benefit plan or defined contribution plan excluded from the participant's gross income. An employee may also contribute to the Plan a Rollover Amount provided the Administrative Committee of the Plan is satisfied that the amount to be rolled over to the Plan constitutes a Rollover Amount under PRITA. Such contributions are classified as "other" in the statement of changes in net assets available for benefits. PRITA requires that the Plan provisions do not discriminate in favor of highly compensated employees. In order to determine whether the Plan discriminates in such a manner, contribution levels are reviewed using the Actual Deferral Percentage ("ADP") test. To comply with such 1994 requirements, the Company has elected to fund a Qualified Non-Elective Contribution to the Plan in the amount of $18,045 which must be received by the Plan no later than December 31, 1995. Such amount has been recorded as an unallocated contribution receivable at December 31, 1994 and will be directed to the investment funds upon receipt. 2. Eligibility - All persons employed by the Company (including officers and directors who are employees) became eligible to participate in the Plan as of March 1, 1994 or at any time thereafter without satisfying any minimum period of qualifying employment. All persons hired by the Company after March 1, 1994 became eligible to participate in the Plan on the date of hire. 3. Vesting - A participant's interest in his or her participant Contributions Account and any Rollover Contribution Account (including all earnings on contributions to such accounts) are immediately and fully vested at all times and not subject to forfeiture. A participant's interest in his or her Employer Contributions Account (including all earnings on such account) will be 50% vested upon commencing employment, 75% vested upon completing one year of employment, and 100% vested upon completing two years of employment. Such years of employment need not be consecutive. Notwithstanding the foregoing, a participant becomes fully vested in his or her Employer Contributions Account upon the earlier of: (i) obtaining normal retirement date; (ii) total disability or (iii) termination of employment by way of death. 4. Conditions of Distribution and Withdrawal - Distributions under the Plan may be made upon a participant's death, total disability, retirement or other termination of employment. Prior to termination of employment, the participant may make withdrawals from his or her accounts pursuant to the following: (i) All or any portion of the balance in the Rollover Contribution Account including investment income thereon. (ii) All or any portion of the Matched Contribution Account, the Unmatched Contribution Account, the Rollover Contribution Account, and the vested portion of the Employer Contribution Account, upon attaining age 59-1/2. (iii) All or any portion of the Employer Contribution Account, the Matched Contribution account excluding any income or gain thereon, and the Unmatched Contribution Account excluding any income or gain thereon, for reasons of hardship subject to certain restrictions as defined in the Plan document. Except in the case of a financial hardship, withdrawals prior to termination of employment are subject to the following conditions: (i) no more than one request for a withdrawal may be made during any six-month period; and (ii) a participant's Matched and Unmatched Contributions and Employer Matching Contributions shall be suspended for a period of six months following receipt of the withdrawal. Upon withdrawal from the Plan or after termination of employment, the non-vested portion of a participant's account will be forfeited. The forfeiture may be used to reduce future employer contributions. 5. Loans - A participant is eligible to receive loans under the Plan without a required period of prior participation in the Plan. A participant may not have more than one loan from the Plan outstanding at any one time. A separate loan fund has been established to account for loans made from each specified fund. As periodic principal and interest payments become due, they are reallocated back to the specific funds from which the loan was borrowed. However, no loans were issued by the Plan during the ten-month period ended December 31, 1994. The amount of a loan may not exceed the following amount: (i) The lesser of 50% of the vested value of the participant's accounts or $50,000. (ii) Notwithstanding anything in (i) to the contrary, no loan shall be made in a principal amount of less than $1,000 and the principal amount must be in increments of $100. Interest is paid on the outstanding principal amount of each loan at a fixed per annum rate equal to the prime lending rate as published in the Wall Street Journal on the last business day of each month plus 1-1/2%. This rate applies during the full term of the loan and is not modified. Interest paid by a participant is credited to his or her applicable account. The term of the loan is fixed by the Administrative Committee at the time the loan is made and may not be extended. All loans are for a minimum term of one year and are in one year increments. Any loan which is to be used to acquire a dwelling unit which within a reasonable time is to be used as the principal residence of the borrowing participant (a "residence loan") must be repaid within the earlier of fifteen years or disposition of such principal residence. Any other loan will be treated as a "non-residence loan" and must be repaid within a maximum of five years. A participant may repay all (but not part) of any loan at any time without penalty by payment of the outstanding principal amount thereof, plus unpaid accrued interest to the date of repayment. Regardless of its original maturity, the outstanding principal amount of any loan and accrued interest thereon becomes immediately due and payable sixty days following the date a participant's employment with the Company terminates for any reason whatsoever. A loan, including interest thereon, is repaid by payroll deductions under a fixed schedule which provides for interest and amortization of principal in substantially level payments over the term of the loan. As collateral for repayment of each loan made to participant, such participant pledges the assets of his or her Plan accounts. 6. Investment Funds - Banco Santander is the "Trustee" of the Plan. Vanguard Fiduciary Trust Company ("Vanguard") is the "Investment Manager" and recordkeeper of the Plan. All Matching Employer Contributions and earnings thereon are invested solely in The General Instrument Corporation Common Stock Fund. The General Instrument Corporation Common Stock Fund is also an investment option for participants. A participant may elect to invest all Participant Contributions or Rollover Amounts in one or any combination of the funds described below, in whole multiples of 5% of the aggregate amount of such contributions. A participant may elect to transfer once each day all or any part of the aggregate value in his or her accounts or his or her interest in one or more investment fund or funds subject to rules restricting transfers related to the Vanguard Investment Contract Trust. A description of the funds are as follows: General Instrument Corporation Common Stock Fund - Consists principally of General Instrument Corporation common stock (4,043 shares held at December 31, 1994) and temporary cash investments. Vanguard Investment Contract Trust (Common Collective Trust) - Consisting of one or more guaranteed investment contracts issued by insurance companies and banks. Vanguard Wellington Fund (Registered Investment Company) - Consisting of a portfolio of approximately 63% in common stocks and 37% in fixed income securities (including corporate and government bonds and money market instruments). Vanguard Index 500 Portfolio (Registered Investment Company) - Consisting of a portfolio of the five-hundred stocks in the Standard & Poor's 500 Composite Stock Price Index, each individual stock being weighted relative to its total market value and parallel to its representation in the Index. VMMR Federal Portfolio (Registered Investment Company) - Consisting of a portfolio of securities issued by the U.S. Treasury and agencies of the U.S. Government with maturities of one year or less. VFISF GNMA Portfolio (Registered Investment Company) - Consisting of a portfolio of fixed income securities guaranteed by the U.S. Government and approximately 97% of which is normally invested in Government National Mortgage Association ("GNMA") certificates, the balance being invested in temporary cash investments. STAR Fund (Registered Investment Company) - Comprised of investments in seven Vanguard equity funds and three Vanguard fixed income funds. At December 31, 1994 the percentage of STAR fund investments in equity and fixed income funds was 62% and 38%, respectively. World Fund - U.S. Growth Portfolio (Registered Investment Company) - Consisting of a portfolio of United States corporations' common stock. World Fund - International Growth Portfolio (Registered Investment Company) - Consisting of a portfolio of equity securities of corporations located outside the United States. 7. Income Tax Status - The Plan has been established and operated to comply with Section 3165, Subchapter 9, Title 13 of the Laws of the Commonwealth of Puerto Rico and the regulations thereunder and to be exempt from tax under Section 165 of PRITA. The Company has applied for a determination letter from the Treasury Department of Puerto Rico. The Plan administrator and the Plan's tax counsel believe that the Plan is designed and is currently being operated in compliance with the applicable requirements of PRITA. Therefore, no provision for income taxes is included in the Plan's financial statements. 8. Plan Termination - While the Company has not expressed any intent to terminate the Plan, it may do so at anytime. B. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 1. Investments - Investments are stated at fair or market values. The market value of General Instrument Corporation common stock is based on the closing price as quoted on the New York Stock Exchange. The investments in units of the Vanguard funds are valued at the redemption prices established by the Investment Manager, based upon its determination of the market value of the underlying investments. 2. Administrative Expenses - The Plan provides that all expenses shall be paid by the Plan unless the Company, at its sole discretion, elects to pay such expenses without reimbursement. 3. Other - All security transactions are recorded on a trade date basis. Net gains and losses on the disposal of investments in each fund are computed using the average cost method based on the beginning market value as carried forward from the end of the prior plan year. Dividend income is recorded on the ex- dividend date. Income from other investments is recorded as earned on an accrual basis. 4. Benefit Claims - As prescribed by the American Institute of Certified Public Accountant's Audit and Accounting Guide, "Audits of Employee Benefit Plans," benefits payments are recognized as reductions of Plan assets upon disbursement. C. INVESTMENTS Investments held by the Trustee and Investment Manager at December 31, 1994 were as follows: Name of Number Fair Issuer and of Historical Fair Value Title of Issues Units Cost Value Per Unit - --------------------------- ------- ---------- -------- -------- General Instrument Corporation Common Stock Fund 3,132 $119,098 $123,322 $39.37 Vanguard: Investment Contract Trust 28,388 28,388 28,388 1.00 Wellington Fund 4,119 81,638 79,862 19.39 Index 500 Portfolio 1,295 56,005 55,636 42.97 VMMR Federal Portfolio 9,791 9,791 9,791 1.00 VFISF GNMA Portfolio 2,335 22,716 22,365 9.58 STAR Fund 1,756 23,116 22,131 12.60 U.S. Growth Portfolio 839 12,665 12,869 15.33 International Growth Portfolio 1,686 23,459 22,647 13.43 * * * * * * SUPPLEMENTAL SCHEDULES GENERAL INSTRUMENT (PUERTO RICO), INC. SAVINGS PLAN ITEM 27a - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AS OF DECEMBER 31, 1994 Description Name of Issuer of Number of Current and Title of Issue Investment Units Cost Value - ------------------------------ --------------------- ---------- ----------- ----------- General Instrument Corporation Common Stock and Common Stock Fund Temporary Cash Investments 3,132 $119,098 $ 123,322 Vanguard: Investment Contract Trust Common/Collective Trust 28,388 28,388 28,388 Wellington Fund Shares of Registered Investment Company 4,119 81,638 79,862 Index 500 Portfolio Shares of Registered Investment Company 1,295 56,005 55,636 VMMR Federal Portfolio Shares of Registered Investment Company 9,791 9,791 9,791 VFISF GNMA Portfolio Shares of Registered Investment Company 2,335 22,716 22,365 STAR Fund Shares of Registered Investment Company 1,756 23,116 22,131 U.S. Growth Portfolio Shares of Registered Investment Company 839 12,665 12,869 International Growth Shares of Registered Portfolio Investment Company 1,686 23,459 22,647 ---------- --------- TOTAL ASSETS HELD FOR INVESTMENT PURPOSES $376,876 $ 377,011 ========== ========== GENERAL INSTRUMENT (PUERTO RICO), INC. SAVINGS PLAN ITEM 27d - SCHEDULE OF REPORTABLE TRANSACTIONS TEN MONTH PERIOD ENDED DECEMBER 31, 1994 Number Purchase Number of Price or of Selling Realized Investment Purchases Contribution Sales Price Gain (Loss) - ------------------------------ --------- ------------ ------- ------- ----------- General Instrument Corporation Common Stock Fund 10 $120,978 6 $1,986 $ 106 Vanguard: Investment Contract Trust 18 29,141 4 753 - Wellington Fund 13 84,889 6 3,278 27 Index 500 Portfolio 14 56,417 3 422 10 VMMR Federal Portfolio 20 11,427 5 1,636 - VFISF GNMA Portfolio 22 24,175 5 1,452 (7) STAR Fund 11 23,306 3 193 3 U.S. Growth Portfolio 10 14,783 4 2,201 83 International Growth Portfolio 11 23,573 3 115 1 SIGNATURES The Plan. 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. General Instrument (Puerto Rico), Inc. Savings Plan --------------------------------------------------- Date: June 29, 1995 /s/ Susan M. Meyer ------------------ ------------------------------------------- Susan M. Meyer Member of the General Instrument Corporation Employee Benefits Administrative Committee