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VERIZON COMMUNICATIONS INC Annual Report (Amendment), Year Ended Dec 31, 1995

Filing Date
Filed April 29, 1996
Period End
December 31, 1995
Security
VZ
In the record · 2016–202610-K1110-Q328-K201

VZ filed 11 annual reports (10-K), 32 quarterly reports (10-Q) and 201 current reports (8-K) between 2016 and 2026.

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01—Abstract

Summary

Summary of the 10-K/A filed April 29, 1996. Cited figures are marked; the original filing is the authoritative source.

This filing is not a full 10-K for Verizon Communications (VZ).

It is Amendment No. 1 to the 10-K for fiscal 1995 of Bell Atlantic Corporation, the predecessor company, filed April 29, 1996. Its only purpose is to add two Form 11-K exhibits covering the employee savings plans: the Bell Atlantic Savings Plan for Salaried Employees (BASP) and the Bell Atlantic Savings and Security Plan for Non-Salaried Employees (BASSP). It contains no corporate income statement, balance sheet, segment data, or management discussion.

The filing therefore offers little direct information on Bell Atlantic's operating performance or financial health. The exhibits do show a strong year for plan participants and a material ESOP-related obligation. Combined net assets available for plan benefits were about $3.81 billiona at December 31, 1995 (BASP $2.35 billion; BASSP $1.45 billion), up from about $2.87 billion a year earlier.

Bell Atlantic common stock rose 34.42%, from $49.75 to $66.88b per share, which drove the Bell Atlantic Shares Fund's large investment gains. Employee participation in company stock is heavy: about 43% of BASP assets and 63% of BASSP assets were invested in the Bell Atlantic Shares Funds. For investors, the main points are the concentration of employee retirement assets in one stock and the leveraged ESOP debt.

Leveraged ESOP notes totaled about $497.8 millionc in carrying value across both plans (BASP $306.1 million; BASSP $191.8 million), carry an 8.17% rate, and are guaranteed by Bell Atlantic, with final payment due January 1, 2000. Because this is an amendment that adds only plan exhibits, investors should consult the original 10-K for Bell Atlantic's consolidated financial results.

02—Key points

Key Highlights

  1. The filing is a 10-K/A (Amendment No. 1) by Bell Atlantic Corporation, not a full 10-K by Verizon Communications; it adds only Form 11-K exhibits for two employee savings plans for fiscal year 1995.
  2. Combined plan net assets available for benefits were about $3.81 billion at year-end 1995 (BASP $2.35 billion; BASSP $1.45 billion), versus roughly $2.87 billion at year-end 1994.
  3. Bell Atlantic common stock rose 34.42% in 1995, from $49.75 to $66.88 per share, producing net appreciation of about $809 million across the Master Trust.
  4. About 43% of BASP assets and 63% of BASSP assets were invested in Bell Atlantic Shares Funds, indicating high employee concentration in company stock.
  5. Leveraged ESOP notes totaled about $497.8 million in carrying value (BASP $306.1 million; BASSP $191.8 million), bear 8.17% interest, and are guaranteed by Bell Atlantic.
  6. The IRS issued favorable determination letters in late 1995 confirming the plans' qualified status under Section 401(a) and their ESOP status.
  7. The filing includes no consolidated financial statements, segment results, or management discussion of Bell Atlantic's own operations.

03—Questions

Frequently Asked Questions

  1. Does this filing contain Verizon Communications' full annual financial results for 1995?

    No. The filing is Amendment No. 1 to Bell Atlantic Corporation's 1995 Form 10-K. It adds only two Form 11-K exhibits covering employee savings plans. Bell Atlantic's consolidated results must be found in the original 10-K. Verizon was not formed until 2000.

  2. How large are the employee savings plans, and how did they perform in 1995?

    The BASP held net assets of $2.35 billion and the BASSP held $1.45 billion at December 31, 1995. Combined assets grew by roughly $940 million, driven by investment gains of about $1.0 billion from the Master Trust, partly offset by benefit distributions of about $285 million and new employee and employer contributions of about $141 million and $90 million, respectively.

  3. What is the main risk for employees invested in these plans?

    A large share of assets is concentrated in Bell Atlantic stock: about 43% of BASP assets and 63% of BASSP assets were in Bell Atlantic Shares Funds at year-end 1995. Employees' retirement savings therefore depend heavily on the performance of one company's stock. The ESOP structure also means employer matching contributions are largely funded in company shares.

  4. What debt is associated with the ESOP, and when does it mature?

    The ESOP financed purchases of Bell Atlantic shares through leveraged notes totaling about $497.8 million in carrying value at year-end 1995, with an estimated fair value of about $533.9 million. The notes bear 8.17% interest, subject to adjustment within a range of 6.77% to 10.25%. Principal is repaid in installments through 2000, with the final payment due January 1, 2000. Bell Atlantic guarantees the payments.

04—Continue

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