COMMISSION FILE NO. 1-8606
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UNITED STATES
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
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1996
OR
[_] TRANSITION REPORT PURSUANT TO SECTION 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM TO
COMMISSION FILE NUMBER 1-8606
BELL ATLANTIC SAVINGS AND
SECURITY PLAN
(NON-SALARIED EMPLOYEES)
(FULL TITLE OF THE PLAN AND THE ADDRESS OF THE PLAN, IF DIFFERENT FROM THAT OF
THE ISSUER NAMED BELOW)
BELL ATLANTIC CORPORATION
1717 ARCH STREET
PHILADELPHIA, PENNSYLVANIA 19103
(NAME OF ISSUER OF THE SECURITIES HELD PURSUANT TO THE PLAN AND THE ADDRESS OF
ITS PRINCIPAL EXECUTIVE OFFICE)
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BELL ATLANTIC
SAVINGS AND SECURITY PLAN
(NON-SALARIED EMPLOYEES)
FINANCIAL STATEMENTS
DECEMBER 31, 1996 AND 1995
BELL ATLANTIC SAVINGS AND SECURITY PLAN (NON-SALARIED EMPLOYEES)
INDEX TO FINANCIAL STATEMENTS AND EXHIBITS
PAGE(S)
FINANCIAL STATEMENTS: -------
Report of Independent Accountants............................... 2
Financial Statements:
Statements of Net Assets Available for Plan Benefits at Decem-
ber 31, 1996 and 1995........................................ 3-4
Statements of Changes in Net Assets Available for Plan Bene-
fits for the years ended December 31, 1996 and 1995.......... 5-6
Notes to Financial Statements................................. 7-13
Signature....................................................... 14
Bell Atlantic Master Savings Trust Schedule of Investments--De-
cember 31, 1996................................................ S1-S4
EXHIBIT: EXHIBIT NUMBER
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Consent of Independent Accountants ............................. 24
UNLESS OTHERWISE INDICATED, ALL INFORMATION IS AS OF APRIL 16, 1997
1
REPORT OF INDEPENDENT ACCOUNTANTS
Vice President--Treasurer
Bell Atlantic Corporation:
We have audited the accompanying statements of net assets available for plan
benefits of the Bell Atlantic Savings and Security Plan (Non-Salaried
Employees) (the "Plan") as of December 31, 1996 and 1995, and the related
statements of changes in net assets available for plan benefits for the years
then ended. These financial statements and the accompanying schedule are the
responsibility of the Plan's management. Our responsibility is to express an
opinion on these financial statements and the accompanying schedule 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
Plan as of December 31, 1996 and 1995, and the changes in net assets available
for plan benefits for the years then ended, 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 accompanying schedule of
investments as of December 31, 1996 on pages S1 to S4 is presented for the
purpose of complying with the Securities and Exchange Commission's rules and
is not a required part of the basic financial statements. The fund information
in the statements of net assets available for plan benefits and the statements
of changes in net assets available for plan benefits is presented for purposes
of additional analysis rather than to present the net assets available for
plan benefits and changes in net assets available for plan benefits of each
fund. The schedule of investments 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.
Coopers & Lybrand L.L.P.
2400 Eleven Penn Center
Philadelphia, Pennsylvania
April 10, 1997
2
BELL ATLANTIC SAVINGS AND SECURITY PLAN (NON-SALARIED EMPLOYEES)
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
DECEMBER 31, 1996
(DOLLARS IN THOUSANDS)
NON-PARTICIPANT
PARTICIPANT DIRECTED DIRECTED
---------------------------------------------------------------------------- -------------------------
SHORT- .
TERM U.S. U.S. INTERNATIONAL ESOP
BELL ATLANTIC GOVERNMENT FIXED BOND EQUITY EQUITY BELL ATLANTIC UNALLOCATED
SHARES MONEY MARKET INCOME MARKET INDEX INDEX LOAN SHARES SHARES
FUND FUND FUND* INDEX FUND FUND FUND FUND FUND FUND
ASSETS: ------------- ------------ -------- ---------- ------- ------------- ------- ------------- -----------
Allocated share of
Master Trust net
investments
(Note 4)............ $732,409 $9,758 $283,988 $7,323 $58,202 $15,397 $36,842 $294,141 $174,600
Allocations and
contributions
receivable.......... 709 29 419 27 319 80 -- 3,214 --
Fund, plan and other
transfers
receivable--net..... -- 23 -- 198 3,313 542 289 -- --
Prepaid expenses.... -- -- -- -- -- -- -- -- 298
-------- ------ -------- ------ ------- ------- ------- -------- --------
Total Assets.... 733,118 9,810 284,407 7,548 61,834 16,019 37,131 297,355 174,898
-------- ------ -------- ------ ------- ------- ------- -------- --------
LIABILITIES:
Notes payable (Note
5).................. -- -- -- -- -- -- -- -- 158,791
Accrued interest.... -- -- -- -- -- -- -- -- 6,487
Fund, plan and other
transfers payable--
net................. 5,363 -- 462 -- -- -- -- 102 --
Administrative
expenses payable.... 455 1 329 3 1 -- -- 187 14
-------- ------ -------- ------ ------- ------- ------- -------- --------
Total Liabili-
ties............ 5,818 1 791 3 1 -- -- 289 165,292
-------- ------ -------- ------ ------- ------- ------- -------- --------
Net assets available
for Plan benefits
(Note 3)............ $727,300 $9,809 $283,616 $7,545 $61,833 $16,019 $37,131 $297,066 $ 9,606
======== ====== ======== ====== ======= ======= ======= ======== ========
TOTAL
ASSETS: ----------
Allocated share of
Master Trust net
investments
(Note 4)............ $1,612,660
Allocations and
contributions
receivable.......... 4,797
Fund, plan and other
transfers
receivable--net..... 4,365
Prepaid expenses.... 298
----------
Total Assets.... 1,622,120
----------
LIABILITIES:
Notes payable (Note
5).................. 158,791
Accrued interest.... 6,487
Fund, plan and other
transfers payable--
net................. 5,927
Administrative
expenses payable.... 990
----------
Total Liabili-
ties............ 172,195
----------
Net assets available
for Plan benefits
(Note 3)............ $1,449,925
==========
* Formerly Interest Income Fund.
See notes to financial statements.
3
BELL ATLANTIC SAVINGS AND SECURITY PLAN (NON-SALARIED EMPLOYEES)
STATEMENT OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
DECEMBER 31, 1995
(DOLLARS IN THOUSANDS)
NON-PARTICIPANT
PARTICIPANT DIRECTED DIRECTED
---------------------------------------------------------------------------- -------------------------
.
U.S. U.S. INTERNATIONAL ESOP
BELL ATLANTIC GOVERNMENT INTEREST BOND EQUITY EQUITY BELL ATLANTIC UNALLOCATED
SHARES MONEY MARKET INCOME MARKET INDEX INDEX LOAN SHARES SHARES
FUND FUND FUND INDEX FUND FUND FUND FUND FUND FUND
ASSETS: ------------- ------------ -------- ---------- ------- ------------- ------- ------------- -----------
Allocated share of
Master Trust net
investments
(Note 4)............ $772,673 $7,659 $294,823 $6,872 $28,215 $9,835 $33,634 $268,820 $224,108
Allocations and
contributions
receivable.......... 1,320 27 472 26 148 41 -- 5,282 --
Fund, plan and other
transfers
receivable--net..... -- -- -- 3 232 -- 249 -- --
Prepaid expenses.... -- -- -- -- -- -- -- -- 397
-------- ------ -------- ------ ------- ------ ------- -------- --------
Total Assets.... 773,993 7,686 295,295 6,901 28,595 9,876 33,883 274,102 224,505
-------- ------ -------- ------ ------- ------ ------- -------- --------
LIABILITIES:
Notes payable (Note
5).................. -- -- -- -- -- -- -- -- 191,765
Accrued interest.... -- -- -- -- -- -- -- -- 7,834
Fund, plan and other
transfers payable--
net................. 1,757 137 801 -- -- 54 -- -- --
Administrative
expenses payable.... 523 3 366 7 2 7 -- 165 36
-------- ------ -------- ------ ------- ------ ------- -------- --------
Total Liabili-
ties............ 2,280 140 1,167 7 2 61 -- 165 199,635
-------- ------ -------- ------ ------- ------ ------- -------- --------
Net assets available
for Plan benefits
(Note 3)............ $771,713 $7,546 $294,128 $6,894 $28,593 $9,815 $33,883 $273,937 $ 24,870
======== ====== ======== ====== ======= ====== ======= ======== ========
TOTAL
ASSETS: ----------
Allocated share of
Master Trust net
investments
(Note 4)............ $1,646,639
Allocations and
contributions
receivable.......... 7,316
Fund, plan and other
transfers
receivable--net..... 484
Prepaid expenses.... 397
----------
Total Assets.... 1,654,836
----------
LIABILITIES:
Notes payable (Note
5).................. 191,765
Accrued interest.... 7,834
Fund, plan and other
transfers payable--
net................. 2,749
Administrative
expenses payable.... 1,109
----------
Total Liabili-
ties............ 203,457
----------
Net assets available
for Plan benefits
(Note 3)............ $1,451,379
==========
See notes to financial statements.
4
BELL ATLANTIC SAVINGS AND SECURITY PLAN (NON-SALARIED EMPLOYEES)
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1996
(DOLLARS IN THOUSANDS)
NON-PARTICIPANT
PARTICIPANT DIRECTED DIRECTED
---------------------------------------------------------------------- --------------------
SHORT-
BELL GOVERNMENT TERM U.S. BOND U.S. INTERNATIONAL BELL ESOP
ATLANTIC MONEY FIXED MARKET EQUITY EQUITY ATLANTIC UNALLOCATED
SHARES MARKET INCOME INDEX INDEX INDEX LOAN SHARES SHARES
FUND FUND FUND* FUND FUND FUND FUND FUND FUND TOTAL
-------- ---------- -------- --------- ------- ------------- ------- -------- ----------- ----------
Net assets
available for Plan
benefits, December
31, 1995........... $771,713 $7,546 $294,128 $6,894 $28,593 $ 9,815 $33,883 $273,937 $24,870 $1,451,379
-------- ------ -------- ------ ------- ------- ------- -------- ------- ----------
Employee
contributions...... 31,380 1,313 25,966 1,191 6,052 2,321 -- -- -- 68,223
Employing company
contributions and
allocations........ 2,028 -- -- -- -- -- -- -- 31,180 33,208
Transfer of ESOP
Shares and
participants'
balances--net...... (14,563) 1,556 (18,821) 77 21,796 4,080 2,559 39,920 (22,486) 14,118
-------- ------ -------- ------ ------- ------- ------- -------- ------- ----------
Total
allocations,
contributions
and transfers... 18,845 2,869 7,145 1,268 27,848 6,401 2,559 39,920 8,694 115,549
Allocated share of
Master Trust net
investment
activities (Note
4)................. 16,613 451 17,508 268 8,082 927 2,879 6,786 (10,107) 43,407
-------- ------ -------- ------ ------- ------- ------- -------- ------- ----------
Net additions... 35,458 3,320 24,653 1,536 35,930 7,328 5,438 46,706 (1,413) 158,956
-------- ------ -------- ------ ------- ------- ------- -------- ------- ----------
Less: Distributions
to participants.... 78,739 1,039 34,630 871 2,616 1,101 2,190 23,114 -- 144,300
Interest
expense......... -- -- -- -- -- -- -- -- 13,683 13,683
Amortization of
capitalized ESOP
expenses........ -- -- -- -- -- -- -- -- 99 99
Administrative
expenses........ 1,132 18 535 14 74 23 -- 463 69 2,328
-------- ------ -------- ------ ------- ------- ------- -------- ------- ----------
Total
deductions...... 79,871 1,057 35,165 885 2,690 1,124 2,190 23,577 13,851 160,410
-------- ------ -------- ------ ------- ------- ------- -------- ------- ----------
Net assets
available for Plan
benefits, December
31, 1996 (Note 3).. $727,300 $9,809 $283,616 $7,545 $61,833 $16,019 $37,131 $297,066 $ 9,606 $1,449,925
======== ====== ======== ====== ======= ======= ======= ======== ======= ==========
* Formerly Interest Income Fund.
See notes to financial statements.
5
BELL ATLANTIC SAVINGS AND SECURITY PLAN (NON-SALARIED EMPLOYEES)
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR PLAN BENEFITS
FOR THE YEAR ENDED DECEMBER 31, 1995
(DOLLARS IN THOUSANDS)
NON-PARTICIPANT
PARTICIPANT DIRECTED DIRECTED
------------------------------------------------------------------------------ -----------------------
GOVERNMENT INTERNATIONAL ESOP
BELL ATLANTIC MONEY INTEREST U.S. BOND U.S. EQUITY EQUITY BELL UNALLOCATED
SHARES MARKET INCOME MARKET INDEX INDEX LOAN ATLANTIC SHARES
FUND FUND FUND INDEX FUND FUND FUND FUND SHARES FUND FUND
------------- ---------- -------- ---------- ----------- ------------- ------- ----------- -----------
Net assets
available (deficit)
for Plan benefits,
December 31, 1994.. $567,089 $6,369 $271,278 $4,846 $14,311 $7,048 $30,386 $178,506 $(31,518)
-------- ------ -------- ------ ------- ------ ------- -------- --------
Employee
contributions...... 33,308 1,244 29,477 1,000 3,937 2,004 -- -- --
Employing company
contributions and
allocations........ 197 -- -- -- -- -- -- 12,034 28,654
Transfer of ESOP
Shares and
participants'
balances--net...... (25,348) 347 1,456 387 5,457 (21) 2,447 28,090 (19,787)
-------- ------ -------- ------ ------- ------ ------- -------- --------
Total
allocations,
contributions
and transfers... 8,157 1,591 30,933 1,387 9,394 1,983 2,447 40,124 8,867
Allocated share of
Master Trust net
investment
activities (Note
4)................. 232,031 410 17,306 949 6,034 1,295 1,984 76,906 63,962
-------- ------ -------- ------ ------- ------ ------- -------- --------
Net additions... 240,188 2,001 48,239 2,336 15,428 3,278 4,431 117,030 72,829
-------- ------ -------- ------ ------- ------ ------- -------- --------
Less: Distributions
to participants.... 34,412 805 24,814 273 1,102 489 934 21,237 --
Interest
expense......... -- -- -- -- -- -- -- -- 16,279
Amortization of
capitalized ESOP
expenses........ -- -- -- -- -- -- -- -- 99
Administrative
expenses........ 1,152 19 575 15 44 22 -- 362 63
-------- ------ -------- ------ ------- ------ ------- -------- --------
Total
deductions...... 35,564 824 25,389 288 1,146 511 934 21,599 16,441
-------- ------ -------- ------ ------- ------ ------- -------- --------
Net assets
available for Plan
benefits, December
31, 1995 (Note 3).. $771,713 $7,546 $294,128 $6,894 $28,593 $9,815 $33,883 $273,937 $ 24,870
======== ====== ======== ====== ======= ====== ======= ======== ========
TOTAL
-----------
Net assets
available (deficit)
for Plan benefits,
December 31, 1994.. $1,048,315
-----------
Employee
contributions...... 70,970
Employing company
contributions and
allocations........ 40,885
Transfer of ESOP
Shares and
participants'
balances--net...... (6,972)
-----------
Total
allocations,
contributions
and transfers... 104,883
Allocated share of
Master Trust net
investment
activities (Note
4)................. 400,877
-----------
Net additions... 505,760
-----------
Less: Distributions
to participants.... 84,066
Interest
expense......... 16,279
Amortization of
capitalized ESOP
expenses........ 99
Administrative
expenses........ 2,252
-----------
Total
deductions...... 102,696
-----------
Net assets
available for Plan
benefits, December
31, 1995 (Note 3).. $1,451,379
===========
See notes to financial statements.
6
BELL ATLANTIC SAVINGS AND SECURITY PLAN (NON-SALARIED EMPLOYEES)
NOTES TO FINANCIAL STATEMENTS
1. DESCRIPTION OF PLAN
The following description of the Bell Atlantic Savings and Security Plan
(Non-Salaried Employees) (the "Plan" or "BASSP") provides only general
information on the Plan's provisions as of December 31, 1996. Participants
should refer to the Benefits Handbook, Plan document and prospectus for a more
complete description of the Plan's provisions.
The Plan is a defined contribution plan covering all regular non-salaried
employees of Bell Atlantic Corporation ("Bell Atlantic") and its participating
subsidiaries. Prior to May 1, 1993, employees who had at least one year of
service were eligible to make tax-deferred or after-tax contributions to the
Plan. Effective May 1, 1993, employees are immediately eligible to make tax-
deferred or after-tax contributions to the Plan at date of hire. Employees
also become eligible for employer matching contributions upon completion of
one year of service. The Plan includes an employee stock ownership plan
("ESOP") which obtained loans to purchase Bell Atlantic shares that are being
allocated to participant accounts in the form of employer matching
contributions based upon the loan repayment schedule. Depending on the value
of Bell Atlantic shares from time to time, the ESOP may fund more or less than
all of the required matching contributions in a given calendar year. In the
event of a shortfall, Bell Atlantic and its participating subsidiaries make
additional employer matching contributions to the Plan. Any surplus is
allocated in equal amounts to the Plan accounts of participants who, as of the
last day of the year, are active employees of Bell Atlantic and its
participating subsidiaries, and have account balances under the Plan. In 1996,
Bell Atlantic and its participating subsidiaries made no additional
contributions to the BASSP. Additional contributions to the BASSP in 1995
amounted to $12,231,000.
Eligible employees may authorize basic contributions of $5 to $45 per week,
which is as much as 5% to 7% of the basic weekly rate, and supplementary
contributions up to an amount which, when added to the basic contribution, is
not more than 16% of the employee's weekly rate. Bell Atlantic makes employer
matching contributions in an amount generally equal to 66 2/3% of basic
contributions. One participating subsidiary makes employer matching
contributions equal to 37 1/2% of basic contributions. One participating
subsidiary also makes an annual employer contribution which is based on a
percentage of eligible compensation. Participants may invest their
contributions in a Bell Atlantic Shares Fund ("BASF"), a Government Money
Market Fund ("GMMF"), a Short-Term Fixed Income Fund ("STFF"), a U.S. Bond
Market Index Fund ("BNDF"), a U.S. Equity Index Fund ("USEF"), or an
International Equity Index Fund ("INTF"). Employer matching contributions are
invested only in the BASF until employees reach age 55 and ten years of
service.
Effective July 1, 1996, the investment guidelines for the Interest Income
Fund were revised to include a portfolio of market-valued, short-term bonds in
addition to the investment contracts already in the account. Consequently,
this option has been renamed the Short-Term Fixed Income Fund.
The Plan provides for 100% vesting of employer matching contributions upon
attaining three years of service. A terminated employee's unvested employer
matching contributions are forfeited and offset against the participating
companies' obligation to make subsequent contributions to the Plan.
Forfeitures were $37,951 and $72,656 in 1996 and 1995, respectively.
The assets of the Plan are commingled for investment purposes in the Bell
Atlantic Master Savings Trust (the "Master Trust") with the assets of the Bell
Atlantic Savings Plan for Salaried Employees ("BASP").
The Plan includes an employee loan provision authorizing participants to
borrow an amount from their vested account balances in the Plan. Loans are
generally repaid by payroll deductions. The
7
repayment period for loans generally will not be less than one year nor more
than fifteen years. Each loan will bear interest at a rate established by the
Treasurer of Bell Atlantic based upon market interest rates as set forth in
the Plan.
Certain administrative expenses of the Plan and Master Trust are charged to
the Plan and are therefore reflected in the earnings of the investment fund to
which the expenses relate. Expenses of the Plan and Master Trust attributable
to the operations of the ESOP are charged against the ESOP unallocated shares
account, which has no affect on the earnings in participants' accounts.
Although it has not expressed any intent to do so, Bell Atlantic has the
right under the Plan to discontinue all employer matching contributions at any
time and to terminate the Plan subject to the provisions of ERISA. In the
event of plan termination, participants will become 100% vested in their
accounts.
2. ACCOUNTING POLICIES
The values of Master Trust investments are determined as follows: Bell
Atlantic shares and other equity securities traded on a national stock
exchange are valued on the basis of the last published sales prices per share
on December 31 as reported on the composite tape or, if no sales were made on
that date, at the last published sales prices on the next preceding day on
which sales were made; U.S. Government and other fixed income securities are
valued by the Master Trust's trustee at fair value based on current market
yields for investments with similar characteristics such as maturity, coupon,
and quality as determined by an independent source; securities traded in the
over-the-counter market and listed securities for which no sales were reported
on the valuation date, are valued at the reported bid price; units in the
STFF, the BNDF, the USEF, and the INTF are valued on the basis of net asset
values provided by the investment managers pursuant to contractually specified
methodologies which are similar to the aforementioned procedures for equity
and fixed income investments; and temporary cash investments are valued at
cost which approximates fair value. The contracts with the insurance companies
and commercial banks included in the STFF are valued at contract value which
approximates fair value.
Purchases and sales of securities are reflected as of the trade date.
Dividend income is recorded on the ex-dividend date. Interest earned on
investments is recorded on the accrual basis.
The Plan presents in the Statement of Changes in Net Assets Available for
Plan Benefits its allocated share of Master Trust investment activities which
includes net appreciation (depreciation) in the fair value of its investments.
Net appreciation (depreciation) in the fair value of investments consists of
the realized gains or losses and the unrealized appreciation (depreciation) on
those investments.
Prepaid expenses incurred in connection with the formation of the ESOP are
being amortized over 10 years on a straight-line basis. These expenses include
debt placement costs and legal fees associated with the placement of the ESOP
debt.
The Plan participates in certain commingled investment funds. The funds'
managers utilize futures and foreign currency forward contracts to minimize
transaction costs and the effect of cash flows (such as contributions,
transfers, and distributions) on the funds' investment performance. Futures
contracts are fully collateralized and are marked to market daily. Foreign
currency forward contracts are matched with the settlement of purchases and
sales of foreign securities and are also marked to market daily.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the dates of the financial
statements and the reported amounts of revenues and expenses during the
reporting periods. Actual results could differ from those estimates.
8
3. EMPLOYEE INTEREST IN THE PLAN
The interest of an employee in each type of investment of the Plan is
represented by units as described in the Plan document. The number of
employees participating in each investment option, the number of units and the
values per unit at December 31, were as follows:
1996 1995
--------------------------------- ---------------------------------
NUMBER OF NUMBER VALUE NUMBER OF NUMBER VALUE
EMPLOYEES OF PER EMPLOYEES OF PER
PARTICIPATING UNITS UNIT PARTICIPATING UNITS UNIT
------------- ----------- ------- ------------- ----------- -------
Bell Atlantic Shares
Fund................... 39,377 195,670,646 $5.2611 40,622 188,280,872 $5.4372
Government Money Market
Fund................... 2,859 7,030,557 1.3843 2,593 5,525,915 1.3132
Short-Term Fixed Income
Fund*.................. 24,716 55,336,520 5.0931 26,908 59,861,824 4.7950
U.S. Bond Market Index
Fund................... 2,753 5,291,237 1.4041 2,439 5,022,478 1.3536
U.S. Equity Index Fund.. 7,150 24,963,258 2.4644 4,887 13,991,532 2.0217
International Equity
Index Fund............. 4,133 9,855,333 1.6186 3,037 6,466,550 1.4988
Loan Fund............... 8,560 -- -- 8,278 -- --
At December 31, 1996, 32,225 participants were actively contributing to the
Plan; 10,493 participants were not actively contributing to the Plan. The
total number of participants in the Plan was less than the sum of the number
of participants shown in the schedule above because many participants were
invested in more than one fund.
4. INTEREST IN BELL ATLANTIC MASTER SAVINGS TRUST
BASSP'S SHARE OF MASTER TRUST NET ASSETS
The Plan's allocated share of the Master Trust's net assets is based upon
the total of each individual Plan participant's share of the Master Trust. The
allocated share of the net assets of each fund in the Master Trust at December
31 was as follows:
1996 1995
----- -----
Bell Atlantic Shares Fund (for the BASP)..................... -- --
Bell Atlantic Shares Fund (for the BASSP).................... 100.0% 100.0%
Government Money Market Fund................................. 10.0% 7.8%
Short-Term Fixed Income Fund* (for the BASP)................. -- --
Short-Term Fixed Income Fund* (for the BASSP)................ 100.0% 100.0%
U.S. Bond Market Index Fund.................................. 14.9% 13.6%
U.S. Equity Index Fund....................................... 12.0% 7.9%
International Equity Index Fund.............................. 15.9% 13.6%
Loan Fund (for the BASP)..................................... -- --
Loan Fund (for the BASSP).................................... 100.0% 100.0%
ESOP Unallocated Shares Fund (for the BASP).................. -- --
ESOP Unallocated Shares Fund (for the BASSP)................. 100.0% 100.0%
* Formerly--Interest Income Fund
9
At December 31, the financial position of the Master Trust was as follows:
1996 1995
----------- -----------
(DOLLARS IN THOUSANDS)
ASSETS:
Investments at fair value:
Bell Atlantic Shares Fund--BASP:
Bell Atlantic Corporation common shares............ $ 1,119,023 $ 1,137,316
Temporary cash investments......................... 6,288 20,610
Bell Atlantic Shares Fund--BASSP:
Bell Atlantic Corporation common shares............ 1,026,390 1,027,268
Temporary cash investments......................... 6,347 16,054
Government Money Market Fund:
Temporary cash investments......................... 98,223 97,702
Short-Term Fixed Income Fund*--BASP:
Contracts with insurance companies and commercial
banks............................................. 325,691 491,715
Pooled Obligations................................. 178,238 --
Temporary cash investments......................... 264 80,448
Short-Term Fixed Income Fund*--BASSP:
Contracts with insurance companies and commercial
banks............................................. 174,538 253,352
Pooled Obligations................................. 110,360 --
Temporary cash investments......................... 110 39,980
U.S. Bond Market Index Fund:
Fund shares........................................ 49,460 48,356
Temporary cash investments......................... 308 2,164
U.S. Equity Index Fund:
Fund shares........................................ 483,225 341,186
Temporary cash investments......................... 3,134 17,040
International Equity Index Fund:
Fund shares........................................ 96,257 70,788
Temporary cash investments......................... 1,395 1,334
Loan Fund--BASP:
Loans receivable from participants................. 41,746 45,179
Loan Fund--BASSP:
Loans receivable from participants................. 36,842 33,634
ESOP Unallocated Shares Fund--BASP:
Bell Atlantic Corporation common shares............ 280,130 347,845
Temporary cash investments......................... 12,901 13,605
ESOP Unallocated Shares Fund--BASSP:
Bell Atlantic Corporation common shares............ 166,327 215,532
Temporary cash investments......................... 8,241 6,652
----------- -----------
Total investments................................ 4,225,438 4,307,760
Receivables:
Dividends and interest income...................... 3,370 14,086
Receivables for investments sold................... 4,785 1,693
----------- -----------
Total assets..................................... 4,233,593 4,323,539
LIABILITIES:
Payable for investments purchased................... 22,300 7,255
----------- -----------
Net investments.................................. 4,211,293 4,316,284
=========== ===========
Investments at cost: ................................. $ 3,165,758 $3,210,823
=========== ===========
* Formerly Interest Income Fund
See Schedule I, Bell Atlantic Master Savings Trust Schedule of Investments.
The BASSP's principal financial instrument subject to credit risk is the
investment in the Master Trust. The Master Trust consists of separate
investment funds, as defined by the Plan, with different investment
objectives. The degree and concentration of credit risk varies by fund
depending upon the
10
type and diversity of investments. The schedule of investments depicts the
types of investments and their proportionate share of each investment fund.
BASSP'S SHARE OF MASTER TRUST INVESTMENT ACTIVITIES.
The Plan's allocated share of Master Trust investment activities is based
upon the total of each individual Plan participant's share of the Master Trust
investment activities during the years ended December 31, 1996 and 1995.
The Master Trust's investment activities for the year ended December 31 was
as follows:
1996 1995
----------- ------------
(DOLLARS IN THOUSANDS)
Investment Activities:
Dividends on Bell Atlantic Corporation common
shares:
Non-ESOP shares............................... $ 92,836 $ 91,447
ESOP shares................................... 22,336 25,979
Other dividends................................ 10,389 7,498
Short-Term Fixed Income Fund* (BASP) income.... 28,064 34,804
Short-Term Fixed Income Fund* (BASSP) income... 14,791 17,306
Other interest................................. 16,682 15,489
Net (depreciation) appreciation in value of
investments................................... (5,133) 808,956
---------- ------------
Net investment activities.................. $179,963 $ 1,001,479
========== ============
Allocated share of net investment activities:
BASP........................................... $136,529 $ 600,602
BASSP.......................................... 43,407 400,877
* Formerly Interest Income Fund
The value per share of Bell Atlantic common stock decreased from $66.88 at
December 31, 1995 to $64.75 at December 31, 1996. This represents a (3.18)%
decrease in the value per share. At December 31, 1996, approximately 43% of
BASP assets and 64% of BASSP assets were invested in the Bell Atlantic Shares
Funds. Between January 1 and April 10, 1997, Bell Atlantic common stock
closing prices have ranged from $58.75 to $71.38 per share.
5. LEVERAGED ESOP NOTES PAYABLE
The Leveraged ESOP notes payable bear an 8.17% interest rate subject to
adjustment (maximum 10.25% and minimum 6.77%) due to changes in the Federal
income tax rate or changes in the Federal law regarding the alternative
minimum tax. Interest and principal payments are guaranteed by Bell Atlantic
and are due on January 1 and July 1 of each year; principal payments began
July 1, 1990.
The following table displays the principal maturities under the note with
the final payment due January 1, 2000 (in thousands):
1997.................................... $ 38,097
1998.................................... 43,713
1999.................................... 49,867
2000.................................... 27,114
--------
$158,791
========
11
The fair value of the Leveraged ESOP notes payable is based on quoted market
prices for the same or similar instruments. As of December 31, 1996, the
carrying amount and the estimated fair value of the notes payable were:
CARRYING FAIR
AMOUNT VALUE
-----------------------
(DOLLARS IN THOUSANDS)
BASP............................................... $270,150 $282,594
BASSP.............................................. 158,791 166,588
----------- -----------
$428,941 $449,182
=========== ===========
6. TAX DETERMINATION
On October 30, 1995, the Internal Revenue Service issued a ruling that the
Plan meets the requirements of Section 401(a) of the Internal Revenue Code of
1986 (the "Code") and is exempt from Federal income taxes under Section 501(a)
of the Code and that the ESOP portion of the Plan qualifies as an employee
stock ownership plan within the meaning of Section 4975(e)(7) of the Code. The
Plan has been amended since receiving the determination letter. However, 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 the Code.
7. RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500
The following is a reconciliation of net assets available for plan benefits
per the financial statements to the Form 5500:
1996 1995
----------- -----------
(DOLLARS IN THOUSANDS)
Net assets available for benefits per the
financial statements............................ $ 1,449,925 $ 1,451,379
Amounts allocated to withdrawing participants.... 7,766 29,921
----------- -----------
Net assets available for benefits per the Form
5500............................................ $ 1,442,159 $ 1,421,458
=========== ===========
The following is a reconciliation of benefits paid to participants per the
financial statements to the Form 5500:
1996 1995
----------- -----------
(DOLLARS IN THOUSANDS)
Benefits paid to participants per the financial
statements....................................... $ 144,300 $ 84,066
Add: Amounts allocated to withdrawing participants
at December 31,.................................. 7,766 29,921
Less: Amounts allocated to withdrawing
participants at December 31,..................... 29,921 9,529
----------- -----------
Benefits paid to participants per the Form 5500... $ 122,145 $ 104,395
=========== ===========
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 but not yet paid as of that date.
8. PROPOSED BELL ATLANTIC-NYNEX MERGER
Bell Atlantic and NYNEX announced a proposed merger under a definitive
agreement entered into on April 21, 1996 and amended on July 2, 1996. Under
the terms of the amended agreement, NYNEX will become a subsidiary of Bell
Atlantic. NYNEX stockholders will receive 0.768 of a share
12
of Bell Atlantic common stock for each share of NYNEX common stock that they
own. Bell Atlantic stockholders will continue to own their existing shares
after the merger. At special meetings held in November 1996, the stockholders
of both companies approved the merger. The completion of the merger is subject
to a number of conditions, including certain regulatory approvals and receipt
of legal opinions that the merger will be tax free. Bell Atlantic is unable to
predict when it will be able to complete the merger. At this time, there are
no plans regarding the impact of the merger on the BASP/BASSP.
9. PLAN TRANSFERS
The line in the Statement of Changes in Net Assets described as "Transfer of
ESOP Shares and participants' balances--net" includes the effect of LESOP debt
service activity, the allocation of Bell Atlantic shares from the LESOP to the
BASF, participant-directed transfers between investment options, and asset
transfers between the BASSP and other defined contribution plans.
13
SIGNATURE
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THE
BELL ATLANTIC CORPORATE EMPLOYEES' BENEFITS COMMITTEE HAS DULY CAUSED THIS
ANNUAL REPORT TO BE SIGNED BY THE UNDERSIGNED THEREUNTO DULY AUTHORIZED.
Bell Atlantic Savings and Security Plan
(Non-Salaried Employees)
Date: April 18, 1997
By /s/ Ellen C. Wolf
----------------------------------
ELLEN C. WOLF
(Member of the Bell
Atlantic Corporate
Employees' Benefits
Committee)
14
SCHEDULE I
BELL ATLANTIC MASTER SAVINGS TRUST
SCHEDULE OF INVESTMENTS
(DOLLARS IN THOUSANDS)
DECEMBER 31, 1996
------------------------------------
NUMBER OF
SHARES OR
PRINCIPAL FAIR
NAME OF ISSUER AND TITLE OF ISSUE AMOUNT COST VALUE
--------------------------------- ----------- -------- ----------
BELL ATLANTIC SHARES FUND--BELL ATLANTIC SAVINGS PLAN FOR SALARIED EMPLOYEES
*Bell Atlantic Corporation Common Shares--
99.4%....................................... 17,282,211 shs. $728,964 $1,119,023
Temporary Cash Investments--0.6%............. $ 6,288 6,288 6,288
-------- ----------
Total.................................. 735,252 1,125,311
-------- ----------
BELL ATLANTIC SHARES FUND--BELL ATLANTIC SAVINGS AND SECURITY PLAN
(NON-SALARIED EMPLOYEES)
*Bell Atlantic Corporation Common Shares--
99.4%....................................... 15,851,583 shs. 671,315 1,026,390
Temporary Cash Investments--0.6%............. $ 6,347 6,347 6,347
-------- ----------
Total.................................. 677,662 1,032,737
-------- ----------
GOVERNMENT MONEY MARKET FUND
Temporary Cash Investments--100.0%
BT Pyramid Government Securities Cash Fund. 98,223 98,223 98,223
-------- ----------
Total.................................. 98,223 98,223
-------- ----------
@SHORT-TERM FIXED INCOME FUND--BELL ATLANTIC SAVINGS PLAN FOR SALARIED EMPLOYEES
+Contracts with Insurance Companies and
Commercial Banks--64.6%.....................
American Int'l Life Assurance, 7.02%
Maturing 10/1/99.......................... 5,482 5,482 5,482
American Int'l Life Assurance, 5.25%
Maturing 4/1/98........................... 6,871 6,871 6,871
American Int'l Life Assurance, 7.17%
Maturing 1/4/2000......................... 15,965 15,965 15,965
Hartford Life Ins. Co., 6.78% Maturing
7/1/97.................................... 7,141 7,141 7,141
John Hancock Mutual Life Ins. Co., 5.85%
Maturing 6/30/98.......................... 17,099 17,099 17,099
John Hancock Mutual Life Ins. Co., 6.60%
Maturing 10/1/99.......................... 7,719 7,719 7,719
ITT Hartford Life Ins. Co., 8.04% Maturing
1/1/99.................................... 20,202 20,202 20,202
Metropolitan Life Ins. Co., 5.58% Maturing
1/1/98.................................... 11,022 11,022 11,022
Metropolitan Life Ins. Co., 6.47% Maturing
4/1/98.................................... 30,866 30,866 30,866
Metropolitan Life Ins. Co., 5.08% Maturing
1/1/97.................................... 12,495 12,495 12,495
#MBL Life Assurance Corp., 3.5% to 5.0%
Maturing 12/31/2004....................... 7,587 7,587 7,587
New York Life 7.00% Maturing 7/1/99........ 29,305 29,305 29,305
New York Life 5.93% Maturing 3/31/98....... 3,792 3,792 3,792
New York Life, 5.18% Maturing 7/1/98....... 17,072 17,072 17,072
New York Life, 7.20% Maturing 1/1/2000..... 17,739 17,739 17,739
New York Life, 7.98% Maturing 4/3/2000..... 16,429 16,429 16,429
New York Life, Money Market Account........ 4,798 4,798 4,798
Principal Mutual Life Ins. Co., 5.10%
Maturing 1/2/97........................... 3,595 3,595 3,595
Principal Mutual Life Ins. Co., 5.90%
Maturing 10/1/97.......................... 22,926 22,926 22,926
Principal Mutual Life Ins. Co., 7.38%
Maturing 1/1/2000......................... 8,115 8,115 8,115
Principal Mutual Life Ins. Co., 6.00%
Maturing 7/1/98........................... 15,499 15,499 15,499
Provident Nat'l Assurance, 5.12% Maturing
1/2/97.................................... 9,736 9,736 9,736
S-1
SCHEDULE I
DECEMBER 31, 1996
---------------------------------
NUMBER OF
SHARES OR
PRINCIPAL FAIR
NAME OF ISSUER AND TITLE OF ISSUE AMOUNT COST VALUE
--------------------------------- ---------- -------- --------
@SHORT-TERM FIXED INCOME FUND--BELL ATLANTIC SAVINGS PLAN FOR SALARIED
EMPLOYEES--(CONTINUED):
Provident Nat'l Assurance, 4.59% Maturing
4/1/97....................................... $ 8,833 $ 8,833 $ 8,833
The Prudential Ins. Co. of America, 8.08%
Maturing 4/1/97.............................. 5,368 5,368 5,368
The Prudential Ins. Co. of America, 5.91%
Maturing 7/1/98.............................. 12,321 12,321 12,321
The Prudential Ins. Co. of America, 5.04%
Maturing 1/1/98.............................. 7,714 7,714 7,714
-------- --------
325,691 325,691
-------- --------
Pooled Obligations--35.4%
BGI 1-3 Year Government Bond Index Fund...... 15,241,329 shs. 174,047 178,238
-------- --------
Temporary Cash Investments--0.0%
BT Pyramid Government Securities Cash Fund... $ 264 264 264
-------- --------
Total..................................... 500,002 504,193
-------- --------
@SHORT-TERM FIXED INCOME FUND--BELL ATLANTIC SAVINGS AND SECURITY PLAN
(NON-SALARIED EMPLOYEES)
+Contracts with Insurance Companies and Commercial Banks--
61.3%
American Int'l Life Assurance, 5.11% Maturing
7/1/98....................................... $ 3,244 3,244 3,244
American Int'l Life Assurance, 7.17%, Maturing
1/4/2000..................................... 8,322 8,322 8,322
American Int'l Life Assurance, 7.02% Maturing
10/1/99...................................... 5,659 5,659 5,659
American Int'l Life Assurance, 5.25% Maturing
4/1/98....................................... 3,236 3,236 3,236
Hartford Ins. Co., 7.93%, Maturing 4/1/99..... 20,886 20,886 20,886
John Hancock Mutual Life Ins. Co., 5.81%
Maturing 6/30/98............................. 8,398 8,398 8,398
John Hancock Mutual Life Ins. Co., 6.57%
Maturing 10/1/99............................. 4,883 4,883 4,883
Metropolitan Life Ins. Co., 6.47% Maturing
4/1/98....................................... 13,182 13,182 13,182
Metropolitan Life Ins. Co., 5.04% Maturing
1/1/97....................................... 4,540 4,540 4,540
Metropolitan Life Ins. Co., 5.20% Maturing
7/1/98....................................... 7,562 7,562 7,562
New York Life, 7.28% Maturing 1/1/2000........ 5,228 5,228 5,228
New York Life, 5.88% Maturing 9/30/97......... 6,993 6,993 6,993
New York Life, 5.05% Maturing 4/1/97.......... 2,426 2,426 2,426
New York Life, 5.13% Maturing 7/1/98.......... 5,026 5,026 5,026
New York Life, 6.75% Maturing 7/1/99.......... 6,411 6,411 6,411
New York Life, 7.20% Maturing 10/1/99......... 6,131 6,131 6,131
New York Life, 5.92% Maturing 1/1/99.......... 8,041 8,041 8,041
Principal Mutual Life Ins. Co., 6.00% Maturing
7/1/98....................................... 4,337 4,337 4,337
Principal Mutual Life Ins. Co., 7.30% Maturing
9/30/99...................................... 4,780 4,780 4,780
Principal Mutual Life Ins. Co., 5.90% Maturing
10/1/97...................................... 13,867 13,867 13,867
Principal Mutual Life Ins. Co., 5.20% Maturing
4/1/97....................................... 5,466 5,466 5,466
Provident Nat'l Assurance, 4.62% Maturing
7/1/97....................................... 4,826 4,826 4,826
Provident Nat'l Assurance, 5.10% Maturing
4/1/97....................................... 4,805 4,805 4,805
The Prudential Ins. Co. of America, 6.78%
Maturing 1/1/99.............................. 9,769 9,769 9,769
The Prudential Ins. Co. of America, 5.88%
Maturing 7/1/98.............................. 6,520 6,520 6,520
-------- --------
174,538 174,538
-------- --------
Pooled Obligations--38.7%
BGI Short Term Money Market Fund............. 2,300 2,300 2,300
BGI 1-3 Year Government Bond Index Fund...... 9,240,334 shs. 105,407 108,060
-------- --------
Temporary Cash Investments--0.0%
BT Pyramid Government Securities Cash Fund... $ 110 110 110
-------- --------
107,707 110,360
-------- --------
Total..................................... 282,355 285,008
-------- --------
S-2
SCHEDULE I
DECEMBER 31, 1996
------------------------------
NUMBER OF
SHARES OR
PRINCIPAL FAIR
NAME OF ISSUER AND TITLE OF ISSUE AMOUNT COST VALUE
--------------------------------- --------- ------- -------
U.S. BOND MARKET INDEX FUND
Bond Funds--99.4%
BGI U.S. Debt Index Fund......................... 1,880,113 shs. $44,991 $44,744
BGI Daily U.S. Debt Index Fund................... 336,224 4,293 4,716
------- -------
49,284 49,460
------- -------
Temporary Cash Investments--0.6%
BT Pyramid Government Securities Cash Fund....... $ 308 308 308
------- -------
Total........................................ 49,592 49,768
------- -------
U.S. EQUITY INDEX FUND
Pooled Common Stock--98.6%
*Mellon E.B. Russell 1000 Stock Index Fund....... 1,017,440 shs. 247,399 402,283
Mellon E.B. Russell 2000 Stock Index Fund........ 156,217 30,132 46,432
Mellon E.B. Daily Opening Stock Index Fund....... 189,789 32,261 34,510
------- -------
309,792 483,225
------- -------
Temporary Cash Investments--1.4%
BT Pyramid Government Securities Cash Fund....... $ 3,134 3,134 3,134
------- -------
Total........................................ 312,926 486,359
------- -------
INTERNATIONAL EQUITY INDEX FUND
Pooled Common Stock--94.6%
BGI MSCI Equity Index Fund-UK.................... 145,359 shs. 1,924 2,292
BGI Europe Ex UK Equity Index Fund............... 1,003,883 13,036 14,286
BGI MSCI Equity Index Fund-Japan................. 793,840 7,340 6,493
BGI Pacific Ex Japan Equity Index Fund........... 102,313 1,223 1,353
BGI EAFE GDP Index Fund.......................... 4,817,623 65,054 71,833
------- -------
88,577 96,257
------- -------
Temporary Cash Investments--5.4%
BT Pyramid Government Securities Cash Fund....... $ 1,395 1,395 1,395
------- -------
Total........................................ 89,972 97,652
------- -------
LOAN FUND--BELL ATLANTIC SAVINGS PLAN FOR SALARIED EMPLOYEES
Participant Loan Obligations--7.17% to 9.50%....... 41,746 41,746
------- -------
Total Loan Fund.............................. 41,746 41,746
------- -------
LOAN FUND--BELL ATLANTIC SAVINGS AND SECURITY PLAN (NON-SALARIED EMPLOYEES)
Participant Loan Obligations--7.17% to 9.50%....... 36,842 36,842
------- -------
Total Loan Fund.............................. 36,842 36,842
------- -------
ESOP UNALLOCATED SHARES FUND--BELL ATLANTIC SAVINGS PLAN FOR SALARIED EMPLOYEES
*Bell Atlantic Corporation Common Shares--95.6%.... 4,326,337 shs. 200,813 280,130
Temporary Cash Investments--4.4%................... $ 12,901 12,901 12,901
------- -------
Total........................................ 213,714 293,031
------- -------
S-3
SCHEDULE I
DECEMBER 31, 1996
------------------------------------
NUMBER OF
SHARES OR
PRINCIPAL FAIR
NAME OF ISSUER AND TITLE OF ISSUE AMOUNT COST VALUE
--------------------------------- --------- ---------- ----------
ESOP UNALLOCATED SHARES FUND--BELL ATLANTIC SAVINGS AND SECURITY PLAN
(NON-SALARIED EMPLOYEES)
Bell Atlantic Corporation Common Shares--
95.3%....................................... 2,568,767 shs. $ 119,231 $ 166,327
Temporary Cash Investments--4.7%............. $ 8,241 8,241 8,241
---------- ----------
Total.................................. 127,472 174,568
---------- ----------
Grand Total............................ $3,165,758 $4,225,438
---------- ----------
- --------
* Investment represents 5% or more of the net investments of the Master Trust.
+ Under these contracts the respective insurance companies and commercial
banks contractually agree to the repayment of principal and the crediting of
interest. The composite effective annual interest rate earned on all
contracts in 1996, net of third party expenses and after the effect of cash
flows, was 6.3% for the BASP and 6.2% for the BASSP.
# MBL Life Assurance Corporation is the successor to Mutual Benefit Life
Insurance Company which was placed under a rehabilitation plan in 1993. The
contract interest rate will vary based upon the actual performance of the
underlying investments.
@ Formerly Interest Income Fund
Percentages represent percentage of total investments of each fund.
S-4