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 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 _______________ Commission File Number 1-4471 A. Full title of the plan and address of the plan, if different from that of the issuer named below: THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. B. Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: Xerox Corporation P.O. Box 1600 Stamford, Connecticut 06904-1600 1 SIGNATURES THE PLAN. Pursuant to the requirements of the Securities Exchange Act of 1934, the persons who administer the plan have duly caused this annual report to be signed on its behalf by the undersigned thereunto duly authorized. THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Patricia M. Nazemetz Stamford, Connecticut Dated June 27, 1996 2 THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Financial Statements and Schedule December 31, 1995 and 1994 (With Independent Auditors' Report Thereon) 3 THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Statement of Net Assets Available for Plan Benefits with Fund Information December 31, 1995
4Fund Information ----------------------------------------------------------------------------------------------------------- Small Company Xerox Segregated Employee International U.S Stock Stock Balanced Income Stock Assets Loan Stock Fund Fund Fund Fund Fund Fund Fund Total Fund (see note 4 ) Assets: Employer contributions receivable $ 211,193 250,898 174,965 1,043,908 843,985 397,075 - - 2,922,024 Investment in employees' loans - - - - - - - 10,139,531 10,139,531 Investment in Master Trust 4,104,338 3,313,901 3,371,172 39,083,944 94,522,635 8,762,055 85,695 - 153,243,740 Total assets 4,315,531 3,564,799 3,546,137 40,127,852 95,366,620 9,159,130 85,695 10,139,531 166,305,295 Liabilities: Accrued expenses and other liabilities 248 2,625 1,371 39,194 18,647 (248) - - 61,837 Due from (to) other funds 30,673 139,839 96,345 68,885 (1,011,209) 374,189 - 301,278 - Net assets available for plan benefits $ 4,345,956 3,702,013 3,641,111 40,157,543 94,336,764 9,533,567 85,695 10,440,809 166,243,458 The accompanying notes are an integral part of the financial statements. THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Statement of Net Assets Available for Plan Benefits with Fund Information December 31, 1994
5Fund Information ----------------------------------------------------------------------------------------------------------- Small Company Xerox Segregated Employee International U.S Stock Stock Balanced Income Stock Assets Loan Stock Fund Fund Fund Fund Fund Fund Fund Total Fund (see note 4 ) Assets: Employer contributions receivable $ 33,574 16,700 23,082 1,435,336 1,416,645 125,831 - - 3,051,168 Investment in employees' loans - - - - - - - 8,970,184 8,970,184 Investment in Master Trust 3,354,512 1,329,298 1,429,505 30,366,601 91,493,729 5,406,194 1,874,205 - 135,254,044 Total assets 3,388,086 1,345,998 1,452,587 31,801,937 92,910,374 5,532,025 1,874,205 8,970,184 147,275,396 Liabilities: Accrued expenses and other liabilities 3,478 1,500 1,077 32,420 21,684 (938) - - 59,221 Due from (to) other funds (4,322) (4,403) (3,059) (51,790) (162,581) (4,279) - 230,434 - Net assets available for plan benefits $ 3,380,286 1,340,095 1,448,451 31,717,727 92,726,109 5,528,684 1,874,205 9,200,618 147,216,175 The accompanying notes are an integral part of the financial statements. THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Statement of Changes in Net Assets Available for Plan Benefits with Fund Information Year ended December 31, 1995
6Fund Information ---------------------------------------------------------------------------------------------------------------- Small Company Xerox Segregated Employee International U.S Stock Stock Balanced Income Stock Assets Loan Stock Fund Fund Fund Fund Fund Fund Fund Total Fund (see note 4 ) Contributions: Employer $ 285,946 297,649 217,513 1,045,428 2,049,923 511,263 - - 4,407,722 Employees- voluntary 419,960 360,707 315,241 3,809,861 7,862,875 774,063 - - 13,542,707 705,906 658,356 532,754 4,855,289 9,912,798 1,285,326 - - 17,950,429 Net income from Master Trust investments, net of administrative expenses 522,799 575,275 413,561 7,238,985 7,184,733 2,406,168 - - 18,341,521 Interest income on employees' loans - - - - - - - 656,459 656,459 Total 1,228,705 1,233,631 946,315 12,094,274 17,097,531 3,691,494 - 656,459 36,948,409 Benefit payments (176,424) (91,092) (101,305) (3,367,878) (13,502,814) (785,210) - - (18,024,723) Transfers among funds (86,611) 1,219,379 1,347,650 (286,580) (2,087,659) 1,098,599 (1,788,510) 583,732 - Transfer from AMTX, Inc. - - - - 104,799 - - - 104,799 Transfer to Retirement Income Guarantee Plan of the Xerox Corporation and the Xerographic Division, Union of Needletrades, Industrial and Textile Employees, A.F.L. - C.I.O. - C.L.C. - - - - (1,202) - - - (1,202) Net increase (decrease) in net assets available for plan benefits 965,670 2,361,918 2,192,660 8,439,816 1,610,655 4,004,883 (1,788,510) 1,240,191 19,027,283 Net assets available for plan benefits: Beginning of year 3,380,286 1,340,095 1,448,451 31,717,727 92,726,109 5,528,684 1,874,205 9,200,618 147,216,175 End of year 4,345,956 3,702,013 3,641,111 40,157,543 94,336,764 9,533,567 85,695 10,440,809 166,243,458 The accompanying notes are an integral part of the financial statements. THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Statement of Changes in Net Assets Available for Plan Benefits with Fund Information Year ended December 31, 1994
7Fund Information --------------------------------------------------------------------------------------------------------- Small Company Xerox Segregated Employee International U.S Stock Stock Balanced Income Stock Assets Loan Stock Fund Fund Fund Fund Fund Fund Fund Total Fund (see note 4 ) Contributions: Employer $ 33,305 16,340 22,812 1,421,797 1,496,837 126,084 - - 3,117,175 Employees- voluntary 394,279 204,052 157,440 3,676,059 9,395,921 478,178 - - 14,305,929 427,584 220,392 180,252 5,097,856 10,892,758 604,262 - - 17,423,104 Net income from Master Trust investments, net of administrative expenses (205,008) (25,378) 33,598 (282,640) 5,654,635 429,090 - - 5,604,297 Interest income on employees' loans - - - - - - - 534,057 534,057 Total 222,576 195,014 213,850 4,815,216 16,547,393 1,033,352 - 534,057 23,561,458 Benefit payments (282,639) (86,778) (102,492) (2,481,851) (8,988,424) (295,426) - - (12,237,610) Transfers among funds 1,296,987 104,681 744,306 (843,683) (685,625) 1,417,407 (2,565,777) 531,704 - Net increase (decrease) in net assets available for plan benefits 1,236,924 212,917 855,664 1,489,682 6,873,344 2,155,333 (2,565,777) 1,065,761 11,323,848 Net assets available for plan benefits: Beginning of year 2,143,362 1,127,178 592,787 30,228,045 85,852,765 3,373,351 4,439,982 8,134,857 135,892,327 End of year 3,380,286 1,340,095 1,448,451 31,717,727 92,726,109 5,528,684 1,874,205 9,200,618 147,216,175 The accompanying notes are an integral part of the financial statements. THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Notes to Financial Statements December 31, 1995 and 1994 (1) Description of Plan The following description of the Profit Sharing Plan of Xerox Corporation and The Xerographic Division,Union of Needletrades, Industrial and Textile Employees, A.F.L - C.I.O. - C.L.C. (Plan) provides only general information. Participants should refer to the summary plan description or plan document for a more complete description of the Plan's provisions. General The Plan is a defined contribution plan covering substantially all domestic full and part-time Union of Needletrades, Industrial and Textile Employees, A.F.L. - C.I.O. - C.L.C. employees of Xerox Corporation (sponsor). Employees hired on or before the first working day in July are eligible to participate in the Plan immediately. Otherwise, employees are eligible to participate beginning on the next January 1. Payments of Benefits Upon termination of service, a participant may elect to receive either a lump sum amount equal to the value of his or her account, or may purchase an annuity payable from a legal reserve life insurance company. Amounts allocated to participants who have elected to withdraw from the Plan but have not been paid are $1,875,933 in 1995 and $884,395 in 1994. Employee Savings Contributions Subject to limits imposed by the Internal Revenue Code, eligible employees may contribute up to 18% annual of pay (as defined in the Plan) through any combination of before-tax and after-tax payroll deductions. (The maximum before-tax contribution for the 1995 calendar year is $9,240.) Employees are immediately vested in their savings contributions. Xerox Corporation matches 35% of employee savings contributions, up to a maximum match equaling 4% of annual pay. These contributions are made annually to eligible participants of record on the last day of February following the Plan year-end. The 1995 contribution will be recorded in the 1996 financial statements. 8 THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Notes to Financial Statements (1) Description of Plan (continued) Xerox Optional Profit Sharing Contributions Eligible employees may receive an optional profit sharing contribution from the sponsor. The contribution ranges from zero to 10% of pay and is based upon the return on assets (ROA) of the Xerox Document Processing industry segment as defined in the Plan document and the participant's length of service. An employee may receive the contribution in cash or Xerox Corporation common stock, or may elect to invest all or part of the contribution on a tax deferred basis, subject to limits imposed by the Internal Revenue Code, through the Plan's investment funds. Employees are immediately vested in optional profit sharing contributions. During 1995, the sponsor's ROA was 18.5%, which resulted in an optional profit sharing contribution for all eligible active employees at December 31, 1995 equal to 10.0% of pay or $21,672,430. Participants elected to invest $2,922,024 into the Plan at December 31, 1995. During 1994, the sponsor's ROA was 16.1%, which resulted in an optional profit sharing contribution for all eligible active employees at December 31, 1994 equal to 9.1% of pay or $20,602,337. Participants elected to invest $3,051,168 into the Plan at December 31, 1994. During 1993, the sponsor's ROA targets (as defined in the Plan document) requiring the sponsor to make optional profit sharing contributions were not achieved. Accordingly, no optional profit sharing contributions were made in the plan year ended December 31, 1994. Investment Funds As further described in note 3, the investment funds are part of the Xerox Trust Agreement to Fund Retirement Plans (Master Trust). Employees can direct their plan accounts to one or more of the following six investment funds: International Stock Fund -- Invests primarily in stocks of companies based outside of the United States. U.S. Stock Fund -- Invests primarily in stocks of medium to large U.S. companies. 9 THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Notes to Financial Statements (1) Description of Plan (continued) Small Company Stock Fund -- Invests primarily in stocks of smaller U.S. companies that fund managers believe have greater value than indicated by the current market price, or above average prospects for long-term growth. Balanced Fund -- Under normal market conditions, invests approximately 70% in stocks; most of the remainder in bonds; some real estate, private placements, and cash. The mix may shift with market outlook. Income Fund -- Invests in contracts with insurance companies and banks; short to intermediate duration, high-quality bonds. Xerox Stock Fund -- Invests in Xerox Corporation common stock and some cash for administrative purposes. Segregated Assets Fund This fund was established on April 1, 1991 and represents participant investments in certain guaranteed investment contracts which are segregated and frozen. See note 4 to the financial statements for further discussion. Employee Loan Fund Participants are permitted to borrow from their profit sharing savings accounts subject to certain limitations. The loans are payable over terms up to 14.5 years and bear interest at the quarterly Citibank commercial prime rate in effect at the time of loan issuance plus 1%. Principal and interest payments on the loans are redeposited into the participants' accounts based on their current investment allocation elections. At December 31, 1995, market value on loans approximates fair value. (2) Federal Income Taxes The Plan obtained its latest determination letter from the Internal Revenue Service (IRS) on September 8, 1995, covering Plan amendments through December 31, 1994, indicating that the Plan, as designed, was in compliance with the applicable requirements of the Internal Revenue 10 THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Notes to Financial Statements (2) Federal Income Taxes (continued) Code. The Plan Administrator and the Plan's internal tax counsel believe that the Plan, as currently designed and operated, is in compliance with the applicable requirements of the Internal Revenue Code. Accordingly, they believe that the Plan was qualified and the related trust was tax-exempt as of the financial statement date. As long as the Plan continues to be qualified under present federal income tax laws and regulations, participants will not be taxed on company contributions or on investment earnings on such contributions at the time such contributions and investment earnings are received by the trustee under the Plan, but may be subject to tax thereon at such time as they receive distributions under the Plan. (3) Master Trust As discussed in note 1, the Plan participates in the Master Trust. The following other Xerox employee benefit plans also participate in the Master Trust as of December 31, 1995: Xerox Corporation Profit Sharing and Savings Plan; Xerox Corporation Retirement Income Guarantee Plan; Retirement Income Guarantee Plan of Xerox Corporation and The Xerographic Division, Union of Needletrades, Industrial and Textile Employees, A.F.L.-C.I.O.-C.L.C.; and XDS Investment Plan. The Master Trust has six investment pools -- the International Stock Pool, U.S. Stock Pool, Small Company Stock Pool, All Other Pool, Income Fund, and the Xerox Stock Fund. Participants direct their accounts into investment funds, as described in note 1, which participate in the aforementioned investment pools. Each of the plans has an ownership interest in one or more of these investment pools in accordance with that interest as determined by participant fund elections. In addition, there is a Segregated Assets Fund which is discussed in note 4. The following financial information is presented for the Master Trust and each of the Master Trust investment pools: 11 THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Notes to Financial Statements (3) Master Trust (continued) Statement of Net Assets of the Master Trust as of December 31, 1995:
12Small Company Xerox Segregated International U.S Stock Stock All Other Income Stock Assets Stock Pool Pool Pool Fund Fund Fund Total Assets Pool (see note 4) Cash (overdraft) $ 112 (50) (11) 11,111 - - - 11,162 Receivables: Accrued dividends 1,588,368 926,468 198,054 1,094,896 - 754,349 - 4,562,135 Accrued interest 86,628 438,421 187,760 11,002,442 7,929,389 3,435 - 19,648,075 Due from brokers 7,721,360 81,205,650 2,438,355 17,443,810 - - - 108,809,175 Total receivables 9,396,356 82,570,539 2,824,169 29,541,148 7,929,389 757,784 - 133,019,385 Investments at fair value: At market value: Short-term investments 9,268,743 44,489,749 49,274,613 197,009,116 44,703,298 789,372 - 345,534,891 Fixed income investments 9,589,491 10,226,338 - 833,168,785 290,096,610 - - 1,143,081,224 Equity securities: Xerox common stock - - - - - 142,246,963 - 142,246,963 Other 752,790,518 1,305,238,786 540,752,355 715,008,555 - - - 3,313,790,214 Investments at contract value: Investment contracts with insurance companies and banks - - - - 755,604,296 - 1,269,049 756,873,345 Investment in real estate trusts - - - 135,536,235 - - - 135,536,235 Other investments - - - 119,926,428 - - - 119,926,428 Total investments 771,648,752 1,359,954,873 590,026,968 2,000,649,119 1,090,404,204 143,036,335 1,269,049 5,956,989,300 Total assets 781,045,220 1,442,525,362 592,851,126 2,030,201,378 1,098,333,593 143,794,119 1,269,049 6,090,019,847 Due to brokers 3,768,819 82,671,588 4,181,722 83,214,374 - 2,736,487 - 176,572,990 Net assets $ 777,276,401 1,359,853,774 588,669,404 1,946,987,004 1,098,333,593 141,057,632 1,269,049 5,913,446,857 THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Notes to Financial Statements (3) Master Trust (continued) The allocation of Master Trust investments by investment pool and fund as of December 31, 1995 is as follows:
13Small Company Xerox Segregated International U.S Stock Stock Balanced Income Stock Assets Stock Fund Fund Fund Fund Fund Fund Total Fund (see note 4) International Stock Pool $ 81,173,622 - - 696,102,779 - - - 777,276,401 U.S. Stock Pool - 83,817,175 - 1,276,036,599 - - - 1,359,853,774 Small Company Stock Pool - - 77,790,975 510,878,429 - - - 588,669,404 All Other Pool - - - 1,946,987,004 - - - 1,946,987,004 Income Fund - - - - 1,098,333,593 - - 1,098,333,593 Xerox Stock Fund - - - - - 141,057,632 - 141,057,632 Segregated Assets Fund - - - - - - 1,269,049 1,269,049 Total $ 81,173,622 83,817,175 77,790,975 4,430,004,811 1,098,333,593 141,057,632 1,269,049 5,913,446,857 THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Notes to Financial Statements (3) Master Trust (continued) Investments in the Master Trust for all participating plans as of December 31, 1995 are as follows:
14Small Company Xerox Segregated International U.S Stock Stock Balanced Income Stock Assets Stock Fund Fund Fund Fund Fund Fund Total Fund (see note 4) Xerox Corporation Profit Sharing and Savings Plan $ 77,069,284 80,503,274 74,419,803 602,798,747 761,171,723 132,295,577 864,596 1,729,123,004 The Profit Sharing Plan of Xerox Corporation and The Xerographic Division, Union of Needletrades, Industrial and Textile Employees, A.F.L.-C.I.O.- C.L.C. 4,104,338 3,313,901 3,371,172 39,083,944 94,522,635 8,762,055 85,695 153,243,740 Xerox Corporation Retirement Income Guarantee Plan - - - 3,380,714,262 212,647,377 - 279,767 3,593,641,406 Retirement Income Guarantee Plan of Xerox Corporation and The Xerographic Division, Union of Needletrades, Industrial and Textile Employees, A.F.L.-C.I.O. C.L.C. - - - 406,958,302 29,991,858 - 38,991 436,989,151 XDS Investment Plan - - - 449,556 - - - 449,556 Total $ 81,173,622 83,817,175 77,790,975 4,430,004,811 1,098,333,593 141,057,632 1,269,049 5,913,446,857 THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Notes to Financial Statements (3) Master Trust (continued) Statement of Net Assets of the Master Trust as of December 31, 1994:
Small Company Xerox Segregated International U.S Stock Stock All Other Income Stock Assets Stock Pool Pool Pool Fund Fund Fund Total Assets Pool (see note 4) Cash $ 3,148 9,097 45 18 - - - 12,308 Receivables: Accrued dividends 446,621 683,726 337,463 871,380 - 647,774 - 2,986,964 Accrued interest 33,924 532,682 267,210 13,031,739 6,729,148 11,142 - 20,605,845 Due from brokers 2,235,831 1,426,530 10,684,287 13,483,796 - - - 27,830,444 Total receivables 2,716,376 2,642,938 11,288,960 27,386,915 6,729,148 658,916 - 51,423,253 Investments at fair value: At market value: Short-term investments 9,009,966 41,792,714 68,793,635 332,087,600 52,220,697 2,713,608 - 506,618,220 Fixed income investments 673,386 18,912,572 - 484,053,271 226,745,618 - - 720,384,847 Equity securities: Xerox common stock - - - - - 89,619,651 - 89,619,651 Other 653,939,252 863,617,173 512,963,406 749,417,078 - - - 2,779,936,909 Investments at contract value: Investment contracts with insurance companies and banks - - - - 769,803,524 - 27,686,390 797,489,914 Interest in real estate trusts - - - 163,723,180 - - - 163,723,180 Other investments - - - 93,340,341 - - - 93,340,341 Total investments 663,622,604 924,322,459 581,757,041 1,822,621,470 1,048,769,839 92,333,259 27,686,390 5,161,113,062 Total assets 666,342,128 926,974,494 593,046,046 1,850,008,403 1,055,498,987 92,992,175 27,686,390 5,212,548,623 Due to brokers 3,048,676 7,664,546 1,942,416 27,119,404 - 1,357,626 - 41,132,668 Net assets $ 663,293,452 919,309,948 591,103,630 1,822,888,999 1,055,498,987 91,634,549 27,686,390 5,171,415,955 15 THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Notes to Financial Statements (3) Master Trust (continued) The allocation of Master Trust investments by investment pool and fund as of December 31, 1994 is as follows:
16Small Company Xerox Segregated International U.S Stock Stock Balanced Income Stock Assets Stock Fund Fund Fund Fund Fund Fund Total Fund (see note 4) International Stock Pool $ 68,022,397 - - 595,271,055 - - - 663,293,452 U.S. Stock Pool - 39,275,076 - 880,034,872 - - - 919,309,948 Small Company Stock Pool - - 42,258,270 548,845,360 - - - 591,103,630 All Other Pool - - - 1,822,888,999 - - - 1,822,888,999 Income Fund - - - - 1,055,498,987 - - 1,055,498,987 Xerox Stock Fund - - - - - 91,634,549 - 91,634,549 Segregated Assets Fund - - - - - - 27,686,390 27,686,390 Total $ 68,022,397 39,275,076 42,258,270 3,847,040,286 1,055,498,987 91,634,549 27,686,390 5,171,415,955 THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Notes to Financial Statements (3) Master Trust (continued) Investments in the Master Trust for all participating plans as of December 31, 1994 are as follows:
17Small Company Xerox Segregated International U.S Stock Stock Balanced Income Stock Assets Stock Fund Fund Fund Fund Fund Fund Total Fund (see note 4) Xerox Corporation Profit Sharing and Savings Plan $ 64,667,885 37,945,778 40,828,765 479,095,378 723,861,153 86,228,355 18,971,989 1,451,599,303 The Profit Sharing Plan of Xerox Corporation and The Xerographic Division, Union of Needletrades, Industrial and Textile Employees, A.F.L.-C.I.O.- C.L.C. 3,354,512 1,329,298 1,429,505 30,366,601 91,493,729 5,406,194 1,874,205 135,254,044 Xerox Corporation Retirement Income Guarantee Plan - - - 2,966,903,954 208,810,260 - 5,989,417 3,181,703,631 Retirement Income Guarantee Plan of Xerox Corporation and The Xerographic Division, Union of Needletrades, Industrial and Textile Employees, A.F.L.-C.I.O. C.L.C. - - - 370,313,301 31,333,845 - 850,779 402,497,925 XDS Investment Plan - - - 361,052 - - - 361,052 Total $ 68,022,397 39,275,076 42,258,370 3,847,040,286 1,055,498,987 91,634,549 27,686,390 5,171,415,955 THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Notes to Financial Statements (3) Master Trust (continued) Statement of Changes in Net Assets of the Master Trust for the year ended December 31, 1995:
18Small Company Xerox Segregated International U.S Stock Stock All Other Income Stock Assets Stock Pool Pool Pool Fund Fund Fund Total Pool (see note 4) Additions: Transfers in $ 10,919,316 10,753,389 9,981,002 84,925,835 82,263,870 17,720,205 - 216,563,617 Investment earnings: Interest 797,053 3,551,707 2,697,288 76,515,170 75,080,721 68,860 - 158,710,799 Dividends 11,086,858 40,508,183 9,230,997 27,300,325 - 2,953,710 - 91,080,073 Netappreciation 103,304,225 291,258,259 100,229,056 242,818,178 10,799,345 36,855,487 - 785,264,550 Margin variation on futures contracts 955,499 242,881 - 25,280,953 (177,409) - - 26,301,924 Other 188,292 30,830 167,806 841,022 34,575 2,866 - 1,265,391 Total investment earnings 116,331,927 335,591,860 112,325,147 372,755,648 85,737,232 39,880,923 - 1,062,622,737 Total additions 127,251,243 346,345,249 122,306,149 457,681,483 168,001,102 57,601,128 - 1,279,186,354 Deductions: Administrative expenses 5,373,025 4,088,595 3,284,523 12,857,817 2,012,683 94,743 - 27,711,386 Transfers out 4,455,977 3,632,277 3,303,774 327,339,211 160,481,105 10,231,722 - 509,444,066 Total deductions 9,829,002 7,720,872 6,588,297 340,197,028 162,493,788 10,326,465 - 537,155,452 Transfers between funds/pools (3,439,292) 101,919,449 (118,152,078) 6,613,550 37,327,292 2,148,420 (26,417,341) - Net assets: Beginning of year $663,293,452 919,309,948 591,103,630 1,822,888,999 1,055,498,987 91,634,549 27,686,390 5,171,415,955 End of year $777,276,401 1,359,853,774 588,669,404 1,946,987,004 1,098,333,593 141,057,632 1,269,049 5,913,446,857 THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Notes to Financial Statements (3) Master Trust (continued) The allocation of net income from Master Trust investments, net of administrative expenses, by investment pool and fund for the year ended December 31, 1995:
19Small Company Xerox International U.S Stock Stock Balanced Income Stock Stock Fund Fund Fund Fund Fund Total Fund International Stock Pool $10,942,675 - - 100,016,227 - - 100,958,902 U.S. Stock Pool - 16,469,124 - 315,034,141 - - 331,503,265 Small Company Stock Pool - - 11,827,943 97,212,681 - - 109,040,624 All Other Pool - - - 359,897,831 - - 359,897,831 Income Fund - - - - 83,724,549 - 83,724,549 Xerox Stock Fund - - - - - 39,786,180 39,786,180 Segregated Assets Fund - - - - - - - Total $10,942,675 16,469,124 11,827,943 872,160,880 83,724,549 39,786,180 1,034,911,351 THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Notes to Financial Statements (3) Master Trust (continued) Net income from Master Trust investments, net of administrative expenses, for all participating plans for the year ended December 31, 1995:
20Small Company Xerox International U.S Stock Stock Balanced Income Stock Stock Fund Fund Fund Fund Fund Total Fund Xerox Corporation Profit Sharing and Savings Plan $10,423,107 15,892,723 11,414,088 113,729,773 57,960,411 37,379,321 246,799,423 The Profit Sharing Plan of Xerox Corporation and The Xerographic Division, Union of Needletrades, Industrial and Textile Employees, A.F.L.-C.I.O.- C.L.C.* 519,568 576,401 413,855 7,245,759 7,181,696 2,406,859 18,344,138 Xerox Corporation Retirement Income Guarantee Plan - - - 699,131,478 16,272,638 - 685,404,116 Retirement Income Guarantee Plan of Xerox Corporation and The Xerographic Division, Union of Needletrades, Industrial and Textile Employees, A.F.L.-C.I.O.- C.L.C. - - - 81,984,094 2,309,804 - 84,293,898 XDS Investment Plan - - - 69,776 - - 69,776 Total $10,972,675 16,469,124 11,827,943 872,160,880 83,724,549 39,786,180 1,034,911,351 *The above allocation of investment results, net of administrative expenses, is at the Master Trust level. This allocation differs from the amounts reported in the statement of changes in net assets available for plan benefits due to the impact of investment manager expenses accrued at the Plan level. THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Notes to Financial Statements (3) Master Trust (continued) Statement of Changes in Net Assets of the Master Trust for the year ended December 31, 1994:
21Small Company Xerox Segregated International U.S Stock Stock All Other Income Stock Assets Stock Pool Pool Pool Fund Fund Fund Total Pool (see note 4) Additions: Transfers in $ 11,553,765 8,122,564 6,987,403 127,619,433 72,701,254 9,380,959 - 236,365,378 Investment earnings: Interest 12,145 1,949,452 1,131,681 67,938,487 72,446,366 57,426 - 143,535,557 Dividends 9,106,518 31,651,521 18,577,981 25,163,430 - 2,269,628 - 86,769,078 Net appreciation (depreciation) (39,257,213)(41,485,157) 6,093,049 (93,044,732) (3,223,805) 5,978,104 - (164,939,754) Other (480,965) 33,815 56,565 118,626 276,363 - - 4,404 Total (30,619,515) (7,850,369) 25,859,276 175,811 69,498,924 8,305,158 - 65,369,285 Total additions(19,065,750) 272,195 32,846,679 127,795,244 142,200,178 17,686,117 - 301,734,663 Deductions: Administrative expenses 4,074,596 3,744,502 3,776,084 14,169,577 1,883,726 63,378 - 27,711,863 Transfers out 5,022,659 2,280,352 2,291,424 255,504,460 138,968,228 7,209,639 - 411,276,762 Total deductions 9,097,255 6,024,854 6,067,508 269,674,037 140,851,954 7,273,017 - 438,988,625 Transfers between funds/pools 11,805,631 (43,544,663)(12,823,122) 33,702,115 32,302,896 16,459,916 (37,902,773) - Transfers from other plans - XES, Inc. Employee Retirement Plan - - - 438,524 - - - 438,524 Net assets: Beginning of year $679,650,826 968,607,270 577,147,581 1,930,627,153 1,021,847,867 64,761,533 65,589,163 5,308,231,393 End of year $663,293,452 919,309,948 591,103,630 1,822,888,999 1,055,498,987 91,634,549 27,686,390 5,171,415,955 THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Notes to Financial Statements (3) Master Trust (continued) The allocation of net income (loss) from Master Trust investments, net of administrative expenses, by investment pool and fund for the year ended December 31, 1994:
22Small Company Xerox International U.S Stock Stock Balanced Income Stock Stock Fund Fund Fund Fund Fund Total Fund International Stock Pool $(3,808,376) - - (30,885,735) - - (34,694,111) U.S. Stock Pool - (515,834) - (11,079,037) - - (11,594,871) Small Company Stock Pool - - 1,343,142 20,740,050 - - 22,083,192 All Other Pool - - - (13,993,766) - - (13,993,766) Income Fund - - - - 67,615,198 - 67,615,198 Xerox Stock Fund - - - - - 8,241,780 8,241,780 Total $(3,808,376) (515,834) 1,343,142 (35,218,488) 67,615,198 8,241,780 37,657,422 THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Notes to Financial Statements (3) Master Trust (continued) Net income (loss) from Master Trust investments, net of administrative expenses, for all participating plans for the year ended December 31, 1994:
23Small Company Xerox International U.S Stock Stock Balanced Income Stock Stock Fund Fund Fund Fund Fund Total Fund Xerox Corporation Profit Sharing and Savings Plan $(3,606,027) (491,403) 1,308,846 (4,303,058) 46,619,642 7,813,834 47,341,834 The Profit Sharing Plan of Xerox Corporation and The Xerographic Division, Union of Needletrades, Industrial and Textile Employees, A.F.L.-C.I.O.- C.L.C.* (202,349) (24,431) 34,296 (290,849) 5,689,437 427,946 5,634,050 Xerox Corporation Retirement Income Guarantee Plan - - - (27,190,008) 13,183,761 - (14,006,247) Retirement Income Guarantee Plan of Xerox Corporation and The Xerographic Division, Union of Needletrades, Industrial and Textile Employees, A.F.L.-C.I.O.- C.L.C. - - - (3,423,714) 2,122,358 - (1,301,356) XDS Investment Plan - - - (10,859) - - (10,859) Total $(3,808,376) (515,834) 1,343,142 (35,218,488) 67,615,198 8,241,780 37,657,422 *The above allocation of investment results, net of administrative expenses, is at the Master Trust level. This allocation differs from the amounts reported in the statement of changes in net assets available for plan benefits due to the impact of investment manager expenses accrued at the Plan level. THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Notes to Financial Statements (3) Master Trust (continued) With respect to the Plan, the Joint Administrative Board (JAB) is responsible for establishing investment guidelines, reviewing the investment decisions and reviewing investment results. The JAB consists at present of five Xerox Corporation representatives and five union representatives. Marketable securities are valued at the last reported sales price on the last business day of the year. Quotations are obtained from national securities exchanges or, in instances where securities are not listed on any of the exchanges, quotations are obtained from brokerage firms. Securities and trust funds that are not readily marketable are valued based on comparisons to yields of issues of similar quality and maturities. The value of the investment contracts with insurance companies and banks is at contract value, which approximates fair value. In connection with the investment contracts, all of which are fully benefit-responsive, the following information is presented: (i) The average investment yields for the years ended December 31, 1995 and 1994 were 6.9% and 6.7%, respectively. (ii) The crediting interest rates at December 31, 1995 and 1994 ranged from 5.0% to 9.3% and from 4.2% to 10.2%, respectively. (iii) The fair value, as determined by discounting future cash flows and the market value of underlying investments, at December 31, 1995 and 1994 was $772,781,602 and $813,486,486, respectively. Contract values were $756,873,345 and $797,489,914 at December 31,1995 and 1994, respectively. The Master Trust invests in real estate group trusts. These trusts provide pension and profit sharing plans with a medium for pooling their funds for investment in income producing real estate. The group trusts value real estate holdings at estimated market value based upon independent appraisals, consideration of significant changes in economic circumstances, and capital additions made to properties after the appraisal date. Such market value estimates necessarily involve subjective judgments. Accordingly, the actual market price of the real estate can only be determined by negotiation between independent third parties in a sales transaction. 24 THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Notes to Financial Statements (3) Master Trust (continued) Purchases and sales of securities are recorded on a trade date basis. Dividend income is recorded on the ex-dividend date. Interest income is recorded as earned. Margin variation represents market fluctuations on futures investments. Derivative financial instruments are used by the Master Trust's equity and balanced portfolio investment managers primarily to rebalance the fixed income/ equity allocation of the Master Trust's portfolio and to hedge the currency risk component of the Master Trust's foreign investments. Certain of the Master Trust's fixed income investment managers are permitted to use certain specified types of derivative instruments as part of their respective strategies. These strategies include the use of futures and options as substitutes for certain types of fixed income securities. Leveraging of the Master Trust's assets and speculation are prohibited. Currency hedge positions are not permitted to exceed the level of exposure in the related Master Trust's assets. The derivatives most commonly used by the investment managers are highly liquid exchange traded equity and fixed income futures and over-the-counter foreign exchange forward contracts. The use of derivative instruments is not believed to materially increase the credit or market risk of the Master Trust's investments. The net appreciation (depreciation) of investments for the year ended December 31, 1995 is as follows: 25
U.S. Small International Stock Company All Other Income Xerox Stock Pool Pool Stock Pool Pool Fund Stock Fund Total Investments at fair value: Short-term and fixed income investments $ (455,516) 1,871,329 - 63,009,046 10,799,345 - 75,224,204 Xerox common stock - - - - - 36,855,487 36,855,487 Other equity investments 103,759,741 289,386,930 100,229,056 168,529,561 - - 661,905,288 Investments at estimated fair value: Real estate - - - (5,348,896) - - (5,348,896) Other investments - - - 16,628,467 - - 16,628,467 Total $103,304,225 291,258,259 100,229,056 242,818,178 10,799,345 36,855,487 785,264,550 THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Notes to Financial Statements (3) Master Trust (continued) The net appreciation (depreciation) of investments for the year ended December 31, 1994 is as follows:
(4) Segregated Assets Fund - Investment Contracts With Executive Life Insurance Company On April 11, 1991, the California Department of Insurance (CDI) took over Executive Life Insurance Company (ELIC) citing a "serious danger of insolvency" and temporarily suspended all payments on Guaranteed Investment Contracts (GICs) issued by ELIC. Effective April 1, 1991, in order to treat all participants fairly, the affected assets were transferred into a Segregated Assets Fund which will not be available for loans, transfers, withdrawals or distributions until the situation has been resolved. The Xerox retirement and savings plans have received $64.3 million in payments related to the ELIC investments through December 31, 1995. Subsequent to December 31, 1995, all investments in the fund have been recovered. 26U.S. Small International Stock Company All Other Balanced Xerox Stock Pool Pool Stock Pool Pool Fund Stock Fund Total Investments at fair value: Short-term and fixed income investments $ (46,924) (903,095) - (71,758,503) (3,223,805) - (75,932,327) Xerox common stock - - - - - 5,978,104 5,978,104 Other equity investments (39,210,289) (40,582,062) 6,093,049 (8,446,013) - - (82,145,315) Investments at estimated fair value: Real estate - - - (2,077,711) - - (2,077,711) Other investments - - - (10,762,505) - - (10,762,505) Total $(39,257,213) (41,485,157) 6,093,049 (93,044,732) (3,223,805) 5,978,104 (164,939,754) There are no investments in the Plan that represent 5% or more of Master Trust net assets. Other investments consist primarily of private placement limited partnerships. THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Notes to Financial Statements (5) Unit Values The interests of Plan participants in each of the funds is expressed in terms of units, representing undivided interests in the net assets of the fund. Unit value is calculated monthly by dividing the total value of net assets of each fund (reduced by employer contributions receivable not yet received by the Master Trust and by unaccrued benefit payments and other reconciling items) by units outstanding at the valuation date. The total number of units and net asset value per unit outstanding during the year ended December 31, 1995 was as follows:
27International Fund U.S Stock Fund Small Co. Fund Balanced Fund Income Fund Xerox Stock Fund Units Unit Units Unit Units Unit Units Unit Units Unit Units Unit Outstanding Value Outstanding Value Outstanding Value Outstanding Value Outstanding Value Outstanding Value January 31: 3,169,561 $1.018130 1,329,325 $1.029036 1,327,320 $1.077083 3,351,130 $9.144290 16,155,691 $5.679131 1,328,658 $4.546439 February 28: 3,035,577 1.019070 1,334,593 1.067032 1,322,355 1.112642 3,274,368 9.386685 15,933,421 5.716524 1,326,524 4.643632 March 31: 2,983,408 1.041911 1,344,743 1.092511 1,384,677 1.148665 3,269,526 9.589252 16,121,091 5.750308 1,350,992 4.925474 April 30: 2,949,175 1.078100 1,464,590 1.117114 1,455,388 1.169514 3,359,641 9.801530 16,633,841 5.786225 1,445,398 5.170663 May 31: 2,879,621 1.101337 1,494,621 1.157223 1,495,823 1.186400 3,332,583 10.072054 16,592,006 5.835838 1,493,408 4.787161 June 30: 2,908,216 1.107386 1,568,770 1.183467 1,601,530 1.245101 3,324,768 10.274284 16,534,575 5.869781 1,527,128 4.944176 July 31: 2,960,759 1.181317 1,645,662 1.220654 1,666,186 1.317888 3,349,135 10.631160 16,470,584 5.901137 1,520,771 5.034070 August 31: 3,003,841 1.171576 1,857,052 1.226346 1,716,908 1.341249 3,368,695 10.696712 16,402,231 5.938466 1,487,881 5.129378 September 30: 3,058,124 1.199565 2,071,657 1.268495 1,867,106 1.372466 3,399,521 10.943127 16,156,115 5.969829 1,472,763 5.695305 October 31: 3,211,091 1.186678 2,146,919 1.256804 2,118,264 1.304997 3,428,208 10.821345 16,065,770 6.010552 1,484,990 5.499589 November 30: 3,239,333 1.205377 2,258,750 1.310500 2,260,207 1.344355 3,408,629 11.113660 15,798,607 6.051636 1,494,729 5.846293 December 31: 3,280,879 1.253083 2,472,696 1.341163 2,490,481 1.354599 3,436,181 11.362424 15,636,291 6.094389 1,505,177 5.846807 The Segregated Assets Fund had 257,331 units outstanding and a net asset value of $85,695 at December 31, 1995. THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Notes to Financial Statements (5) Unit Values (continued) The total number of units and net asset value per unit outstanding during the year ended December 31, 1994 was as follows:
28International Fund U.S Stock Fund Small Co. Fund Balanced Fund Income Fund Xerox Stock Fund Units Unit Units Unit Units Unit Units Unit Units Unit Units Unit Outstanding Value Outstanding Value Outstanding Value Outstanding Value Outstanding Value Outstanding Value January 31: 1,882,767 $1.200894 1,096,317 $1.056652 558,769 $1.093340 3,197,136 $9.592572 15,901,851 $5.314789 920,211 $3.969112 February 28: 2,107,201 1.154608 1,113,299 1.028188 613,488 1.090478 3,242,491 9.404461 15,666,537 5.343498 916,156 3.955156 March 31: 2,744,702 1.097568 1,299,804 0.982281 810,343 1.039180 3,417,570 9.023587 15,854,715 5.377876 943,386 3.896747 April 30: 2,800,004 1.110907 1,291,307 0.993102 942,041 1.048419 3,511,615 9.063770 15,941,182 5.410052 975,011 4.029895 May 31: 2,849,471 1.127810 1,344,330 1.009099 1,085,064 1.041191 3,531,999 9.115321 16,358,152 5.445251 971,341 4.127161 June 30: 2,969,745 1.088512 1,384,781 0.975550 1,252,971 1.010557 3,536,665 8.912855 16,326,184 5.473619 1,036,525 4.017794 July 31: 2,970,762 1.131318 1,330,087 1.002377 1,152,342 1.032664 3,545,985 9.126801 16,327,289 5.506708 1,096,176 4.199496 August 31: 3,050,493 1.166434 1,298,434 1.041777 1,119,629 1.092222 3,542,581 9.407529 16,374,660 5.538935 1,096,996 4.427932 September 30: 3,140,377 1.129260 1,375,471 1.020149 1,170,077 1.091694 3,466,653 9.282228 16,475,920 5.564242 1,160,394 4.414350 October 31: 3,185,603 1.146509 1,325,810 1.037980 1,187,931 1.104301 3,477,835 9.368682 16,488,958 5.594922 1,205,467 4.235975 November 30: 3,236,921 1.102678 1,344,644 0.995463 1,256,736 1.073036 3,405,183 9.129961 16,283,629 5.611793 1,275,363 4.089238 December 31: 3,127,109 1.075880 1,356,979 1.004770 1,289,877 1.089892 3,366,467 9.166254 16,161,994 5.640873 1,328,103 4.116633 The Segregated Assets Fund had 5,623,391 units outstanding and a net asset value of $1,874,205 at December 31, 1994. THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Notes to Financial Statements (6) 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: December 31 1995 1994 Net assets available for plan benefits as reported in the Plan financial statements $166,243,458 $147,216,175 Benefit claims payable reported on line 31g of Form 5500 (1,875,933) (884,395) Net assets available for plan benefits as reported in the Plan Form 5500 164,367,525 146,331,780 The following is a reconciliation of benefits paid per the financial statements to the Form 5500: December 31 1995 1994 Benefits paid to participants as reported in the Plan financial statements $18,024,723 12,237,610 Add: Amounts allocated to withdrawing participants at December 31 1,875,933 884,395 Less: Amounts allocated to withdrawing participants at December 31, 1994 and 1993, respectively (884,395) (363,557) Benefits paid to participants as reported in the Form 5500 19,016,261 12,758,448 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. 29 THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Notes to Financial Statements (7) AMTX, Inc. AMTX, Inc.is a wholly-owned subsidiary of Xerox Corporation. Effective January 1, 1995, the AMTX, Inc. Employee's Retirement Plan was terminated, and employees' balances were transferred into The Profit Sharing Plan of Xerox Corporation and The Xerographic Division, Union of Needletrades, Industrial and Textile Employees, A.F.L.-C.I.O.-C.L.C. These employees are now participants in that Plan. (8) Subsequent Event In January, 1996, the Board of Directors approved a three-for-one stock split of the Company's common stock, subject to shareholder approval of an increase in the number of authorized shares from 350 million shares to 1,050 million shares. Pending shareholder approval, this action will become effective shortly after the 1996 annual shareholders' meeting. The stock split will not impact participants' interest in the Xerox Stock Fund. 30 THE PROFIT SHARING PLAN OF XEROX CORPORATION AND THE XEROGRAPHIC DIVISION, UNION OF NEEDLETRADES, INDUSTRIAL AND TEXTILE EMPLOYEES, A.F.L. - C.I.O. - C.L.C. Item 27a - Schedule of Assets Held for Investment Purposes December 31, 1995
31Description of investment including Identity of issuer, borrower, maturity date, rate of interest, Historical Cost Current Value lessor, or similar party collateral, par or maturity value Investment in Master Trust (1) $ 130,567,572 153,243,740 Investment in Employees' Loans Loans to Plan participants, maturity dates through 5/31/09, interest rates from 7.5% to 11.5% per annum. - 10,139,531 (1) See note 3. INDEPENDENT AUDITORS' REPORT The Plan Administrator and Participants The Profit Sharing Plan of Xerox Corporation and The Xerographic Division, Union of Needletrades, Industrial and Textile Employees, A.F.L.-C.I.O.-C.L.C. We have audited the accompanying statements of net assets available for plan benefits of the Profit Sharing Plan of Xerox Corporation and The Xerographic Division, Union of Needletrades, Industrial and Textile Employees, A.F.L.- C.I.O.-C.L.C. (Plan) as of December 31, 1995 and 1994, and the related statements of changes in net assets available for plan benefits for the years then ended. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements 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, 1995 and 1994, and the changes in those 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 supplemental schedule of assets held for investment purposes is presented for purpose of additional analysis and is not a required part of the basic financial statements, but is 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 statements of net assets available for plan benefits and the statement of changes in the 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 the assets available for plan benefits of each fund. The supplemental schedule 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. KPMG PEAT MARWICK LLP Rochester, New York May 10, 1996 30 EXHIBIT INDEX Electronic Submission Exhibit Document (b)(1) Accountants' Consent 2
ACCOUNTANTS' CONSENT The Board of Directors Xerox Corporation: We consent to incorporation by reference in the Registration Statement (No. 2-86275) on Form S-8 of Xerox Corporation of our report dated May 10, 1996, relating to the statements of net assets available for plan benefits of the Profit Sharing Plan of Xerox Corporation and The Xerographic Division, Union of Needletrades, Industrial and Textile Employees, A.F.L - C.I.O. - C.L.C. (Plan) as of December 31, 1995 and 1994, and the related statements of changes in net assets available for plan benefits for the years then ended, which report appears in the December 31, 1995 Annual Report on Form 11-K of the Xerox Corporation Profit Sharing and Savings Plan. KPMG PEAT MARWICK Rochester, New York June 27, 1996