SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended Commission file number
July 31, 1995 0-10964
MAXWELL LABORATORIES, INC.
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(Exact name of Registrant as specified in its charter)
Delaware 95-2390133
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(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
8888 Balboa Avenue
San Diego, California 92123
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(Address of Principal (Zip Code)
Executive Offices)
Registrant's telephone number, including area code: (619) 279-5100
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange
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Title of each class on which registered
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None None
Securities registered pursuant to Section 12(g) of the Act:
Common Stock, $.10 par value
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the Registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes X No
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Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K ((S) 229.405 of this chapter) is not contained herein, and
will not be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this Form 10-K.
X
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State the aggregate market value of the voting stock
held by non-affiliates of the Registrant:
$22,237,259 at August 31, 1995
The Registrant has one outstanding class of Common Stock. 2,689,185 shares were
outstanding at August 31, 1995.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Registrant's definitive Proxy Statement for the 1995 Annual
Meeting of Shareholders to be filed with the Securities and Exchange Commission
pursuant to Regulation 14A (including the Appendix thereto) are incorporated by
reference in Part II and III of this Report.
PART I
ITEM 1. BUSINESS
Founded thirty years ago, the Registrant has over the years provided
state-of-the-art technical products and services in support of advanced defense
programs, principally nuclear weapons effects research. In the past several
years, the Registrant has broadened its business base by applying its core
technologies and capabilities to both commercial and government markets and now
provides diverse products and services primarily involving computer-oriented
technologies, ranging from PC based hardware to sophisticated software and
network solutions, and high-energy power conversion systems and components.
The Registrant has a strong foundation in advanced computer programming
and mathematical techniques used in understanding and analyzing complex physical
phenomena. This foundation, previously oriented to defense and space programs,
has recently led to a new focus on business initiatives involving sophisticated
but user-friendly software and integrated network solutions to the information
and data processing needs of state and local agencies. The Registrant also
designs and sells customized PC-based computer systems for integration by
original equipment manufacturers into equipment for real-time commercial and
industrial applications. A leader in pulsed power technology -- the delivery of
brief, high-voltage bursts of electrical energy at high peak power or high
average power when repetitive pulses are generated -- the Registrant designs,
develops and manufactures power conversion systems and components designed to
meet individual customer requirements for pulsed power. These systems and
components range from individual energy storage capacitors to major integrated
pulsed power systems. They are used in a variety of applications including
nuclear effects simulation and conventional defense programs, commercial and
governmental research and development projects, medical equipment and devices,
and purification equipment for the reduction of microbial contamination of food,
packaging, medical products, air and water.
The Registrant's business is conducted in two industry segments: (i)
Commercial, Industrial and Scientific Products and (ii)Technology Programs and
Services. In its Commercial, Industrial and Scientific Products industry
segment the Registrant designs, manufactures and sells products to a broad range
of commercial and governmental customers, a significant portion of which
products and services are derived from technologies developed through activities
in its other industry segment. The Technology Programs and Services industry
segment is comprised of research, development, engineering, analysis, design,
testing services and manufacturing primarily for the federal government but also
for foreign governments and occasionally industrial and defense companies.
The following table sets forth, for the periods indicated, the
Registrant's approximate revenues attributable to its Commercial, Industrial and
Scientific Products industry segment and its Technology Programs and Services
industry segment:
Year Ended July 31
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1995 1994 1993
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(In thousands)
Commercial, Industrial and
Scientific Products $42,762 $43,014 $38,419
Technology Programs and
Services 32,242 42,449 48,483
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Total $75,004 $85,463 $86,902
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Additional financial information relating to these two segments is contained in
Note 11 of Notes to the Consolidated Financial Statements contained in the
Appendix to the Registrant's Proxy Statement for its 1995 Annual Meeting of
Shareholders (the "Proxy Statement Appendix").
The Registrant was originally incorporated in California in 1965 and
reincorporated in the State of Delaware in 1986. Its principal place of
business and executive offices are located in San Diego, California.
COMMERCIAL, INDUSTRIAL AND SCIENTIFIC PRODUCTS
The Registrant develops, manufactures and sells a variety of products
which have evolved from or employ technology developed through the Registrant's
technology programs or were derived from acquisitions. These products include
critical components, subsystems and complete turnkey systems.
Commercial and Industrial PC Computers. Through its I-Bus Division,
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the Registrant is engaged in the design, development and manufacture of
customized PC computers, and components such as enclosures, CPUs and passive
backplanes, for real-time commercial and industrial applications. These
products are sold primarily through strategic partnerships with Original
Equipment Manufacturers (OEMs) in which I-Bus typically performs custom design
and engineering services to meet the OEM's particular requirements and then
manufactures and sells the computers to the OEM for integration into the final
product. I-Bus' products are used as data processing and control elements, and
incorporate advanced computer technology into complex products and systems. I-
Bus sells to OEMs in a variety of markets including voice processing, light
industrial, telecommunications, networking, medical imaging and instrumentation.
In recent fiscal years, and again in fiscal 1995, sales of these
products are a substantial portion of the Registrant's total business. I-Bus'
industry is highly competitive, with price, delivery, reliability and service
being of significant importance to customers. The I-Bus products are in a
growing market and are subject to price erosion. Moreover, I-Bus' business is
characterized by continuous technological change, which can lead to product
obsolescence.
Purification Technologies. The Registrant has been developing new
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methods and equipment that could significantly alter techniques for reducing
microbial contamination. Following seven years of proprietary research and
development funded by the Registrant and companies in the food industry, the
Registrant formed its majority-owned subsidiary in November, 1988, then named
Foodco Corporation and in 1995 renamed PurePulse Technologies, Inc., to actively
pursue commercial markets for this technology. While food industry applications
remain a key focus, substantial markets are emerging for medical and
pharmaceutical sterilization as well as for purification of air and water. Two
of the world's leading food processing and packaging companies, Kraft General
Foods and Tetra Laval Group, hold minority interests in PurePulse Technologies,
Inc. ("PurePulse").
During fiscal 1995, testing at pilot-line facilities as well as
extensive laboratory testing continued to validate the effectiveness of the
PureBright/TM/ (pulsed light) technology being commercialized by PurePulse for
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food packaging applications.
During fiscal 1995, a significant portion of PurePulse's activities were
performed under a $6.5 million, three-year technology development agreement with
Tetra Laval, originally signed in fiscal 1993, to further develop the PureBright
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technology for certain applications. This work is expected to result in the
development of commercial PureBright equipment for certain applications which
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Tetra Laval will have the exclusive right to commercialize, subject to further
agreement on appropriate royalties and other provisions. During fiscal 1995,
PurePulse began a concentrated program to demonstrate satisfaction of stringent
lamplife requirements involved in the major application of current interest to
Tetra Laval. Early in fiscal 1996, PurePulse also reached agreement in
principle for
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an extension of the funding provided by Tetra Laval under the technology
development agreement for an additional 18 months to support several programs
including the lamplife development effort. Continued work under such programs,
and the funding for such work, will require demonstration of sufficient
technical progress in the lamplife program. While PurePulse believes that the
required lamplife will be achieved, technical issues remain and a significant
amount of experimental and testing data must be accumulated to reach the project
goals. Loss or curtailment of this technology development funding or a decision
by Tetra Laval to delay or decrease its expected commercial use of this
technology would have a material adverse impact on PurePulse.
PurePulse is also developing technology for cool pasteurization of
liquid foods and beverages under the trade name CoolPure/TM/. Testing and
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development of the CoolPure technology is being funded by PurePulse and under
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contracts with the U.S. Army Natick Food Laboratory.
Marketing and product research for non-food applications of PurePulse's
technologies are being pursued in areas such as sterilization of medical
supplies and packaging, killing of airborne bacterial and viral contaminants in
hospitals and water purification. The activity for application studies in each
of these areas increased in fiscal 1995. During the last fiscal year, PurePulse
also continued to pursue required clearances from the U. S. Food and Drug
Administration for certain applications of its technologies and in July, 1995,
received notification from that agency that the use of CoolPure technology for
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food treatment does not require a food additive petition. This notice allows
PurePulse to begin commercial marketing of CoolPure systems for food treatment.
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Power Conversion Systems and Components. The Registrant manufactures
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and sells compact, high performance power conversion systems and components to
government and university laboratories and industrial customers for a wide
variety of applications.
The Registrant develops, manufactures and sells compact capacitors which
are used to store and deliver electrical energy in single or repetitive pulses,
generally at high voltage. The Registrant's capacitors are used for commercial
and military applications requiring high levels of reliability and performance.
The majority of these capacitors are manufactured using modifications and
variations of the Registrant's standard designs to fit specific customer needs.
The Registrant continues to be a major supplier of capacitors for use in
portable heart defibrillators - medical devices used to restore the normal
rhythm of an erratically-beating heart. During fiscal 1995 the Registrant's
Sierra Capacitor/Filter Division successfully introduced a new line of patented
feedthrough filter capacitors for use in filtering out electromagnetic
interference in implantable pacemakers and defibrillators, and is in commercial
production of these devices.
The Registrant also develops, manufactures and sells a line of compact
capacitor charging power supplies for both commercial and military markets. The
power supply line was primarily developed by the Registrant under funding from
the NASA Center for the Commercial Development of Space Power Systems at Auburn
University. The product line, introduced in fiscal 1991, is manufactured under
license from Auburn University. The compact power supplies charge high voltage
pulsed power systems used in industrial, medical and scientific lasers,
accelerators and research and development devices. Power supplies for other
industrial and commercial applications requiring highly regulated current and
voltage were added to this product line in fiscal 1993 to broaden the market
potential.
Computer Based Information Systems. Fiscal 1995 saw the further
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expansion of a new business area for the Registrant which began in fiscal 1994,
consisting of computer software, networking and integration services to solve
information and data processing needs of state and local agencies. The
Registrant continued work on a $1.7 million project started last fiscal year
under which the Registrant is providing networking services for a state-wide
child support enforcement system in South Carolina. During fiscal 1995 work
began on a two-year $5.2 million program to provide an integrated criminal
justice information system for Sarasota County, Florida, which will integrate
the information and data
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processing requirements of all the County's criminal justice agencies and the
criminal courts into one networked system. This integrated system will be among
the first of its kind in the country. At fiscal 1995 year end the Registrant was
selected by the Florida Association of Court Clerks to implement a $3.2 million
networked offender-based tracking and case management system in 37 counties in
Florida. In each of the projects in Florida, the Registrant is teamed with AT&T
to provide computer hardware and other support and with local software vendors.
Other Products. The Registrant is marketing accounting and management
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information software programs, as well as software that is used on personal
computers as an aid to analyze and present experimental data. During fiscal
1995 the Registrant signed a software development and license agreement with
Glencoe/McGraw-Hill under which the Registrant will develop multimedia software
products on CD ROM to supplement textbooks in high school physics and algebra
classes. Glencoe, the market leader in supplying textbooks to high schools,
will provide development funding to the Registrant, will market the software and
will pay royalties to the Registrant on sales of such products. The physics
product is substantially completed and will be marketed in the current fiscal
year, and the algebra products (Algebra I and II) will be written during the
current fiscal year and marketed thereafter.
Additionally, the Registrant has a line of laboratory pulse generators
and related equipment that will meet the needs of companies requiring
sophisticated electromagnetic pulse (EMP) testing and simulation.
TECHNOLOGY PROGRAMS AND SERVICES
The Registrant is engaged in technology programs and services related to
nuclear and advanced conventional weapons and their effects as well as chemical
analytical services. Research and development is performed under contract to
develop improved pulsed power components for above ground simulation devices and
conventional weapons development. Computer-based modeling is performed for
electromagnetic effects due to both naturally occurring and nuclear weapon
environments. Chemical analysis technologies are utilized in the analysis,
detection and control of environmental pollutants.
On October 1, 1995, the Defense Nuclear Agency ("DNA"), an agency of the
Department of Defense ("DOD") and the principal customer of the Registrant in
its Technology Programs and Services segment, ceased operations at three of the
four major radiation simulators owned by DNA and operated by the Registrant in
San Diego. This facility close down is part of DNA's overall strategic response
to reduced global threats and shrinking defense budgets. The Registrant expects
to provide significant assistance to DNA in the closure of the facilities, which
is expected to take two years to complete. The Registrant may experience
additional significant reductions in its defense business and there is no
assurance that these reductions will be offset by growth in commercial revenues.
Environmental Programs. The Registrant is involved in pollution control
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consisting primarily of the analysis of environmental samples for hazardous
substances. This work is primarily performed under contracts with large
engineering firms involved in remediation of military sites. In prior years,
under multi-year consulting contracts with the EPA, the Registrant developed
technical, quality control and administrative procedures that have become models
for EPA testing facilities. A major capital investment in fiscal 1994 resulted
in a new facility for chemical analytical services, consolidating operations
into a state-of-the-art laboratory.
During fiscal year 1995, the Registrant also continued its consulting
services in environmental concerns, advising private companies on procedures and
quality assurance methodologies required to meet EPA requirements.
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Capacitor Research and Development Program. Under an agreement with
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Auburn University, in which the Registrant obtained an exclusive license to
develop an innovative capacitor concept, and under its own research programs,
the Registrant is exploring promising technologies at the low-voltage end of the
high-energy-density capacitor market. Currently, the development is primarily
focused on capacitors for electrically powered vehicles under a DOE contract.
The Registrant expects to manufacture and market capacitors for electric and
hybrid vehicles, utility applications requiring uninterruptible power sources,
and other commercial applications if the development is successful. Under this
program the technical goals have been exceeded and scalability to full size
units has been demonstrated. The next phase is to produce and test a number of
full size units and obtain performance and reliability data to validate
commercially acceptable performance.
Nuclear and Advanced Conventional Weapons Effects Research. A
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substantial portion of this work is performed under contracts with agencies of
the DOD, primarily DNA. Modern military operations, both strategic and
tactical, depend upon the reliability and survivability of missiles, satellites
and other military and telecommunications equipment. Legislation enacted during
the Registrant's 1992 fiscal year and Executive action during fiscal year 1993
limiting underground testing resulted in a shift of activities in this area to a
greater emphasis on vulnerability and lethality analysis and experimental
verification by above-ground simulation testing. Recent world events have
resulted in a reduction in funding for testing of military equipment hardened
against the effects of the hostile environment produced by a nuclear or advanced
conventional weapon.
The Registrant continues, however, to be involved in many aspects of
weapons effects testing and research, including test design and analysis of
weapons effects, as well as designing, building and operating above-ground
simulation test facilities. Three of the four radiation simulators in San Diego
which were designed, built, and operated by the Registrant and owned by the
United States Government ceased operation on October 1, 1995, as previously
described. The Registrant will continue to provide testing and analysis on the
fourth simulation facility and with its gamma ray source after the closure of
the other three simulation devices.
The Registrant's radiation effects engineering group provides a complete
range of services for the hardening of electronics. Hardening is the process by
which a component or system is built or modified to withstand hazardous effects
of a hostile environment. These hardening services encompass concept
definition, development, production assistance, test and field development. The
Registrant participates in large non-nuclear simulation tests performed by the
DOD. The Registrant provides test design services, develops new instrumentation
and participates in performing measurements on such tests.
The Registrant also develops new technology and hardware for more
powerful, and compact, next-generation X-ray simulators.
Conventional Defense Technology. The potential use of compact pulsed-
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power systems to deliver billions of watts of electrical power to a gun barrel
offers an alternate approach to extending the range of artillery and naval
bombardment guns, and for air defense and defense against tactical ballistic
missiles. The Registrant operates an experimental gun facility for DNA for
several mission-oriented programs including projectile development, extended
range shore bombardment and anti-armor. The Registrant continued support work
in fiscal 1995 on an electrothermal cartridge program which combines electrical
energy with chemical energy (chemically inert propellants) to create major
improvements in projectile velocities, range and lethality.
INTERNALLY-FUNDED, COMPANY-SPONSORED RESEARCH AND DEVELOPMENT
The Registrant conducts internally-funded, company-sponsored research
and development to refine and expand its products and services. In addition,
internally-funded, company-sponsored engineering, research and development work
is performed to prepare proposals both for research and
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development contracts and contracts to manufacture and deliver products. In
fiscal 1995, 1994, and 1993, the Registrant expended approximately $5,038,000,
$4,794,000, and $5,650,000 respectively, on internally-funded, company-sponsored
research and development.
BACKLOG
As of July 31, 1995, 1994 and 1993, the Registrant's funded backlog
amounted to approximately $38 million, $32 million, and $39 million,
respectively. The funded backlog consists of the unexpended funding under cost
reimbursement contracts not yet completed, remaining revenues to be recognized
on contracts accounted for on a percentage of completion basis and firm orders
for products not yet delivered. The Registrant expects to complete or deliver
substantially all of its currently funded backlog within twenty-four months. At
July 31, 1995, the unfunded portion of contracts awarded was an additional $33
million, compared to $53 million at July 31, 1994 and $54 million at July 31,
1993.
CUSTOMERS
A substantial portion of the Registrant's sales (approximately 43% in
fiscal 1995 and 54% in fiscal 1994) is derived from contracts with the United
States government, principally agencies of the DOD, and subcontracts with
government suppliers. The DNA is the Registrant's largest single customer,
accounting for 14% and 15% of the Registrant's total sales and 32% and 31% of
sales of Technology Programs and Services in fiscal 1995 and 1994, respectively.
No other customer accounted for as much as 10% of the Registrant's total sales
during such periods.
GOVERNMENT BUSINESS
The reductions in defense budgets over the past three years have already
affected the Registrant's activities, particularly in the area of system
survivability products and services. In particular, reductions in research and
development funding by the government agencies with which the Registrant does
business is having a material adverse effect upon the Registrant's operations.
For example, the superconducting super collider project, which accounted for
approximately $4 million of the Registrant's fiscal 1993 revenue, was terminated
at the convenience of the government in fiscal 1994. In addition, as described
above, operations at major simulation facilities run by the Registrant for DNA
have been terminated and closure activities have begun.
As a result of overall defense cutbacks, the Registrant has experienced
increased competition in bidding for ongoing programs from contractors seeking
to replace their lost business. Such defense cutbacks and increased competition
have resulted in relatively high costs of doing business in many of the
Registrant's defense areas and in price pressure on awarded programs.
The Registrant's funded government contracts are typically performable
over a one-year period. While no assurance can be given that the Registrant
will receive further funding under these contracts or be awarded any additional
contracts, the Registrant historically has received continuous funding from the
DNA under a series of contracts since 1968; however, there has been a continued
decrease in funding for such programs over the past few years. Government
agencies may terminate their contracts, in whole or in part, at their
convenience. In such event, the government agency is obligated generally to pay
the costs incurred by the Registrant thereunder plus a fee based upon work
completed. The Registrant has been adversely impacted by curtailment in several
of these programs, and further substantial curtailment of these government
programs would have a material adverse effect upon the Registrant's sales and
income.
Contract costs for services or products supplied to government agencies,
including allocated indirect costs, are subject to audit and adjustment.
Contract costs have been agreed upon through fiscal 1992. Contract revenues for
periods subsequent to fiscal 1992 have been recorded in amounts which are
expected to be realized upon final settlement.
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NATURE OF CONTRACTS
Contracts entered into by the Registrant are fixed price contracts or
cost reimbursement contracts. Under a fixed price contract, the customer agrees
to pay a specific price for the Registrant's performance. Under a cost
reimbursement contract, the customer (a government agency or government prime
contractor in substantially all cases) agrees to pay an amount which is equal to
the Registrant's allowable costs in performing the contract, plus a fixed or
incentive fee. Certain costs of doing business, such as interest and
advertising expenses, are not allowable under cost reimbursement contracts.
Greater risks are involved under a fixed price contract than under a
cost reimbursement contract because in a fixed price contract the Registrant
assumes responsibility for providing the specified product or services
regardless of the actual costs incurred. Failure to anticipate technical
problems, estimate costs accurately or control costs during contract performance
will reduce or eliminate the contemplated profit and can result in a loss. On
the other hand, higher profit margins are generally permitted by the government
in establishing prices for fixed price contracts because of such risks. During
fiscal 1995 and 1994, approximately 65% and 63%, respectively, of the
Registrant's sales were derived from fixed price contracts and standard purchase
orders and approximately 35% and 37%, respectively, of the Registrant's sales
were derived from cost reimbursement contracts. Substantially all of the
Registrant's sales in the Commercial, Industrial and Scientific products area
are under fixed price contracts and standard purchase orders. In the Technology
Programs and Services, area approximately 72% and 67% of sales were derived from
cost reimbursement contracts in fiscal 1995 and 1994, respectively, and the
balance of Technology Programs and Services sales in such years were under fixed
price contracts.
MATERIALS
The Registrant generally purchases components and materials, such as
electronics components, dielectric materials, and enclosures of metal and
plastic, from a number of suppliers. The Registrant's I-Bus Division, however,
does rely on a single qualified supplier for some of its critical components,
primarily CPU boards and power supplies, and interruptions in shipments from
such suppliers can have a material short-term impact on the operations of the I-
Bus Division. The Registrant is working with its OEM customers to expand the
number of qualified suppliers for these components.
In addition, in its power conversion systems and components business,
the Registrant has traditionally used one supplier each for capacitor grade
paper and polyester film and has considered the availability of these materials
to be adequate. During the past two years, however, the Registrant has
experienced problems with both of these critical suppliers. The primary paper
manufacturer, a German company, has gone through bankruptcy proceedings, but was
able to continue supporting the Registrant through the transition. The supplier
of polyester film unilaterally imposed a substantial increase in its prices.
The Registrant is taking steps to minimize the future likelihood and impact of
such occurrences by evaluating alternate sources.
SALES AND MARKETING
The Registrant's sales and marketing activities are coordinated by the
relevant operating division or subsidiary which is responsible for its own sales
and marketing planning, product development and sales support activities,
supplemented by participation from the Registrant's senior management. The
Registrant has sales personnel or product champions for each of its principal
product lines with support from scientists, applications engineers and technical
specialists. The Registrant develops contract opportunities for its customer-
funded technology programs through its technical staff. The Registrant's new
business focus is to define proprietary products and services utilizing its core
technologies and professional capabilities to meet the requirements of its
customers and to position the Registrant to enter new niche markets.
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Sales and marketing in the United States for the Registrant's products
are handled directly by the Registrant as well as through sales representatives
for selected products. The Registrant utilizes sales representatives to assist
senior management in marketing its products outside the United States.
EMPLOYEES
At July 31, 1995, the Registrant employed 579 persons, of whom 50 hold
Ph.D. degrees, 57 hold Masters degrees and 140 hold Bachelors degrees primarily
in the physical sciences and engineering. None of the Registrant's employees is
represented by a labor union. The Registrant considers its relations with its
employees to be good.
PATENTS, LICENSES AND TRADEMARKS
The Registrant relies primarily on its technological and engineering
abilities and on its design and production capabilities for the development and
maintenance of its business, rather than on patents. However, the Registrant
does file patent applications on concepts and processes developed by the
Registrant's personnel and has obtained a number of patents which the Registrant
believes provide protection for certain of its technologies and products. The
Registrant secures from all of its employees agreements designed to preserve the
confidentiality of proprietary information and to vest in the Registrant the
right to inventions developed in the course of employment.
COMPETITION AND OTHER BUSINESS RISKS
In most of its activities, the Registrant has a number of competitors,
some of which have been established longer and have substantially greater
financial and other resources. In its nuclear weapons effects simulation
business, the Registrant has one principal competitor.
The Registrant believes its ability to compete successfully is based
substantially upon its capability to design and manufacture products which are
responsive to the high quality, performance and reliability requirements of its
customers at competitive prices and to perform its technology contracts. The
Registrant's success also depends upon its ability to hire and retain highly
qualified engineers, scientists and management personnel.
The government obtains certain rights to technology and technical data
developed by the Registrant under its government funded contracts. Under
certain circumstances, the government may make such technology and data
available to the Registrant's competitors for use by them under other government
contracts. Except for these rights reserved to the government, the Registrant
retains all rights to the technology and technical data developed by it under
its government funded research.
ITEM 2. DESCRIPTION OF PROPERTY
The Registrant owns in fee a 45,600 square foot industrial building, a
22,000 square foot high bay manufacturing facility, and a 35,000 square foot
engineering and administrative support facility situated on approximately 8.9
acres of land located in San Diego, California. The Registrant also leases five
other facilities in the San Diego area. The Registrant utilizes its facilities
in the following manner: corporate, sales and administrative (32,000 sq. ft.);
manufacturing, assembly and testing, research and development laboratories and
engineering (301,000 sq. ft.). From time to time each of the facilities is
utilized in both of the Registrant's industry segments.
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The Registrant's leased facilities in San Diego, California are for
varying terms and some of them contain options permitting the Registrant to
extend the lease term as shown in the table below:
Leased Facilities - San Diego, California
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Approximate Year of Approximate
Square Lease Option Current
Footage Expiration Period Annual Rent(1)
----------- ---------- ---------- ---------------
68,000 2006 5 Years $420,000
50,000 1999 None $330,000
43,000 1996 5 Years (2) $230,000
19,700 1999 10 Years (3) $120,000
37,900 2000 10 Years (3) $310,000
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TOTAL: 218,600
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(1) Annual rentals are subject to adjustments pursuant to Consumer Price Index
or other escalation clauses in certain of the leases included in the table.
(2) Consecutive one year options.
(3) Two (2) five-year options.
The Registrant also leases or has commitments to lease approximately
3,200; 7,210; 7,580; 350 and 200 square feet of office space in Reston and
Alexandria, Virginia; Albuquerque, New Mexico; Huntsville, Alabama; and Mission
Viejo, California, respectively, at a total approximate annual rent of $283,000.
The Registrant also owns a 12,400 square foot industrial building on 2.6 acres
of land located in Carson City, Nevada.
In addition to the facilities described above, the Registrant utilizes,
on a rent free basis, 10,100 square feet of space owned by the government
located adjacent to one of the Registrant's research and development facilities
in San Diego, California. Additionally, the Registrant utilizes, on a rent free
basis, 22,000 square feet at Kirtland Air Force Base in Albuquerque, New Mexico.
The Registrant also operates a 500 acre test site in San Diego under a
facilities contract with DNA.
The Registrant believes that its facilities are well maintained, in good
operating condition and are sufficient for its present operating needs.
ITEM 3. LEGAL PROCEEDINGS
In January 1991, the California Department of Toxic Substances Control
(DTSC) notified the Registrant that it had been identified as one of a number of
"potentially responsible parties" with respect to alleged hazardous substances
released into the environment at a recycling facility in San Diego County. As
the Registrant is not in the business of transporting or disposing of waste
materials, the Registrant retained the services of the owners of the recycling
facility to transport certain waste materials generated by the Registrant.
After properly delivering the materials to the transporter, the Registrant was
not further involved in the transportation, treatment or disposal of the
materials. Under California and Federal "Superfund" laws, the Registrant is a
potentially responsible party, even though the Registrant was not involved in
the transport or disposal of the substances. Moreover, it is the Registrant's
understanding that alleged hazardous substances from at least approximately 160
other parties were released at the facility, and that response costs of
approximately $7.9 million have been incurred at the site by the DTSC.
-10-
In August 1992, the Registrant and approximately 40 other potentially
responsible parties signed a Consent Order which had been negotiated with the
DTSC agreeing to pay for $4 million of the $7.9 million response costs
previously incurred, and to pay for certain future interim response actions
outlined in the Consent Order.
The currently estimated cost of such interim response actions is $9.1
million, and the Registrant's share of the cost, as allocated by the parties to
the Consent Order, is currently estimated at approximately 7.0%. The eventual
cost of all removal and remediation activities, for which the Registrant and the
other potentially responsible parties will share in additional reimbursements to
the State, and including the $9.1 million referred to above, is currently
estimated at the range of $15-$20 million. On the basis of amounts accrued by
the Registrant, it is management's opinion that any additional liability
resulting from this situation will not have a material effect on the
Registrant's financial statements.
Government investigators are following-up on allegations of wrongful
conduct first made in July, 1994, by a former employee at the Registrant's
Sierra Capacitor/Filter Division. The Registrant is cooperating with the
investigating agents and has conducted its own examination into the charges.
After considerable internal investigation, the Registrant has found no evidence
of wrongdoing at the Division and believes that the former employee's charges
are unfounded.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None
ITEM 4.1 EXECUTIVE OFFICERS OF THE REGISTRANT
The executive officers of the Registrant as of the date of this report
are set forth in the following table. Officers of the Registrant serve at the
pleasure of the Board of Directors.
Name Age Position
- ---- --- --------
Alan C. Kolb 66 President, Chief Executive Officer, and Director.
Dr. Kolb served as President and Chief Executive
Officer of the Registrant from 1970 until June,
1980. In June, 1980 Dr. Kolb was elected Chief
Executive Officer, and in August, 1992 he also
assumed the duties of President of the Registrant.
From 1980 to 1995 Dr. Kolb served as Chairman of the
Board.
Donn A. Starry 70 Chairman of the Board and Director. General Starry,
U.S. Army, Retired, has served on the Registrant's
Board of Directors since 1988 and was elected
Chairman in October, 1995. General Starry retired
from the Army in 1983 and joined Ford Aerospace
Corporation. He retired as Executive Vice President
of Ford Aerospace Corporation in 1990 and thereafter
has served as consultant and advisor to industry and
government in the United States and several foreign
countries.
Sean M. Maloy 37 Executive Vice President, Chief Operating Officer
and Director. Mr. Maloy has been employed with the
Registrant since December, 1982 and served as Vice
President-Finance and Administration, Chief
Financial Officer and Treasurer of the Registrant
from September,
-11-
Name Age Position
- ---- --- --------
1985 to March, 1994 at which time he assumed his
current duties as Chief Operating Officer.
Gary J. Davidson 39 Vice President-Finance and Administration, Treasurer
and Chief Financial Officer. Mr. Davidson served as
Corporate Controller of the Registrant from May,
1986 until his appointment as Vice President-
Finance, Treasurer and Chief Financial Officer in
March, 1994. Mr. Davidson assumed the duties of
Vice President-Administration in March, 1995.
Kedar D. Pyatt, Jr. 62 Senior Vice President, Chief Technical Officer and
Director. Dr. Pyatt has served as a Vice President
and a Director of the Registrant since January,
1984. He had previously served S-Cubed as Senior
Vice President from 1975 and Chairman of the Board
from January, 1983 to January, 1984.
Eduardo M. Waisman 51 Vice President. Dr. Waisman was appointed Vice
President in March, 1994 and at the same time named
President of the S-Cubed Division. From 1989 to
1992 he was Manager of the Plasma Physics Group of
S-Cubed. From 1992 to 1994, Dr. Waisman served as
Vice President of the Pulsed Power X-ray Simulator
Sector of the Balboa Division.
Richard E. Smith 54 Vice President. Mr. Smith was named Vice President
of the Registrant and President of the Balboa
Division in November, 1994. Prior thereto he was
General Manager of M/A-COM PHI, a subsidiary of M/A-
COM, Inc., and from 1989-1994 he was President of
the Ryan Electronics and Kinetics Division of
Teledyne, Inc. Since 1993 Mr. Smith has been a
member of the Board of Directors of Velcon
Industries.
Richard C. Eppel 55 Vice President. Mr. Eppel was appointed Vice
President in August, 1995. He is the President of
the I-Bus Division and has served in that capacity
since the acquisition of that business by the
Registrant in 1991.
Donald M. Roberts 47 General Counsel. Mr. Roberts has served as General
Counsel since joining the Registrant in April, 1994.
For more than five years prior thereto, Mr. Roberts
was a shareholder of the law firm of Parker,
Milliken, Clark, O'Hara & Samuelian, A Professional
Corporation, and a partner of the predecessor law
partnership, and in that capacity had served the
Registrant as outside legal advisor for more than
ten years.
Karl M. Samuelian 63 Secretary and Director. Mr. Samuelian has served as
Secretary of the Registrant since 1967. From 1978
to June, 1980, he also held the office of Chairman
of the Board of
-12-
Name Age Position
- ---- --- --------
the Registrant. For more than five years, Mr.
Samuelian has been a shareholder of the law firm of
Parker, Milliken, Clark, O'Hara & Samuelian, A
Professional Corporation and a partner of the
predecessor law partnership.
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON STOCK AND
RELATED STOCKHOLDER MATTERS.
The information required by this Item is contained in Note 13 (Quarterly
Results of Operations and Stock Information (Unaudited)) to the Registrant's
consolidated financial statements appearing in the Proxy Statement Appendix
(filed as Exhibit 13 hereto) at page A-19, and is incorporated herein by this
reference.
ITEM 6. SELECTED FINANCIAL DATA.
The information required by this Item is contained in the Proxy
Statement Appendix at page A-5 under the caption "Five Year Selected Financial
Data" and is incorporated herein by this reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.
The information required by this Item is contained in the Proxy
Statement Appendix at pages A-2 to A-4 under the caption "Management's
Discussion and Analysis of Financial Condition and Results of Operations" and is
incorporated herein by this reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
The following consolidated financial statements of the Registrant and
its subsidiary, included in the Proxy Statement Appendix at pages A-6 to A-20,
are incorporated herein by this reference:
1. Report of Ernst & Young LLP, Independent Auditors
2. Consolidated Balance Sheet at July 31, 1995 and 1994
3. Consolidated Statement of Income for the Years Ended July 31, 1995, 1994
and 1993
4. Consolidated Statement of Shareholders' Equity for the Three Years Ended
July 31, 1995
5. Consolidated Statement of Cash Flows for the Years Ended July 31, 1995,
1994 and 1993
6. Notes to Consolidated Financial Statements
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE
None.
-13-
PART III
ITEMS 10. THROUGH 13.
The information required under Item 10 (Directors and Executive Officers
of the Registrant), Item 11 (Executive Compensation), Item 12 (Security
Ownership of Certain Beneficial Owners and Management) and Item 13 (Certain
Relationships and Related Transactions) will be reported in the Registrant's
Proxy Statement for the 1995 Annual Meeting of Shareholders to be filed with the
Securities and Exchange Commission pursuant to Regulation 14A as follows and is
incorporated herein by reference:
Heading in Proxy
Item Number Statement
----------- ----------------
10...................... "ELECTION OF DIRECTORS"
11...................... "EXECUTIVE COMPENSATION"
12...................... "SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT"
13...................... "EXECUTIVE COMPENSATION"
(See also Item 4.1 -"Executive Officers of the Registrant," Part I, supra).
-----
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.
(a)1. FINANCIAL STATEMENTS.
The following consolidated financial statements of the Registrant and its
subsidiary, included in the Registrant's Proxy Statement Appendix, are
incorporated by reference in Part II, Item 8 of this report:
1. Report of Ernst & Young LLP, Independent Auditors
2. Consolidated Balance Sheet at July 31, 1995 and 1994
3. Consolidated Statement of Income for the Years Ended July 31, 1995,
1994 and 1993
4. Consolidated Statement of Shareholders' Equity for the Three Years
Ended July 31, 1995
5. Consolidated Statement of Cash Flows for the Years Ended July 31,
1995, 1994 and 1993
6. Notes to Consolidated Financial Statements
-14-
(a)2. FINANCIAL STATEMENT SCHEDULES.
Schedules for which provision is made in the applicable accounting
regulations of the Securities and Exchange Commission are omitted because they
are inapplicable or not required under the related instructions.
(a)3. EXHIBITS.
3.1 Restated Certificate of Incorporation of the Registrant - Exhibit 3.1
to the Registrant's Form 10-K Annual Report for the year ended July
31, 1987 ("1987 Form 10-K") is incorporated by reference.
3.2 Bylaws of the Registrant as amended to date - Exhibit 3.2 to the 1987
Form 10-K is incorporated by reference.
4.1 Form of Rights Certificate - Exhibit 1 to the Registrant's Form 8-A
filed June 30, 1989 is hereby incorporated by reference.
4.2 Form of Rights Agreement between the Registrant and First Interstate
Bank, the Rights Agent - Exhibit 4.2 to the Registrant's Form 10-K
Annual Report for the year ended July 31, 1990 ("1990 Form 10-K") is
incorporated by reference.
10.1 Maxwell Laboratories, Inc. Director Stock Option Plan - Exhibit 10.23
to the Registrant's Form 10-K Annual Report for the year ended July
31, 1989 ("1989 Form 10-K") is incorporated by reference.
10.2 Maxwell Laboratories, Inc. 1985 Stock Option Plan as amended to date -
Exhibit 10.3 to the Registrant's Form 10-K Annual Report for the year
ended July 31, 1991 ("1991 Form 10-K") is incorporated by reference.
10.3 Maxwell Laboratories, Inc. 1995 Stock Option Plan.
10.4 Maxwell Laboratories, Inc. 1994 Employee Stock Purchase Plan.
10.5 Maxwell Laboratories, Inc. 1994 Director Stock Purchase Plan.
10.6 Lease dated December 1, 1988 between Philip MacDonald, as Lessor, and
the Registrant, as Lessee - Exhibit 10.4 to the 1989 Form 10-K is
incorporated by reference.
10.7 Lease dated March 8, 1978 between S-Cubed (formerly known as Systems,
Science and Software), as lessee, and Cal-Sorrento, Ltd. (formerly
known as Industrial Developers, Ltd.), as lessor -- assumed by
Registrant pursuant to the Merger - Exhibit 10.8 to the 1984 Form 10-K
is incorporated by reference.
10.8 Lease dated February 28, 1986 between the Registrant, as lessee, and
Elkhorn Ranch, Inc., as lessor - Exhibit 10.11 to the Registrant's
Form 10-K Annual Report for the year ended July 31, 1986 ("1986 Form
10-K") is incorporated by reference.
10.9 Maxwell Laboratories, Inc. Executive Deferred Compensation Plan -
Exhibit 10.18 to the Registrant's Form 10-K Annual Report for the year
ended July 31, 1983 is incorporated by reference.
-15-
10.10 Office Lease Agreement dated August 28, 1987 by and between Airport
Property Company, a N.M. Limited Partnership, as lessor, and the
Registrant, as lessee - Exhibit 10.16 to the Registrant's 1988 Form
10-K is incorporated by reference.
10.11 Agreement of May, 1994 between the Registrant and Compagnie Europeene
de Composants Electroniques - LCC under which the Registrant licenses,
manufactures and distributes certain capacitors.
10.12 Lease dated April 17, 1995, by and between Cody Three, Inc., as
lessor, and the Registrant, as lessee.
10.13 Maxwell Laboratories, Inc. Special Severance Pay Plan - Exhibit 10.22
to the 1989 Form 10-K is incorporated by reference.
10.14 Employment Agreement dated June 20, 1989 between the Registrant and
Alan C. Kolb - Exhibit 10.26 to the 1989 Form 10-K is incorporated by
reference.
10.15 Employment Agreement dated June 20, 1989 between the Registrant and
Kedar D. Pyatt, Jr. - Exhibit 10.28 to the 1989 Form 10-K is
incorporated by reference.
10.16 Letter Agreement dated December 21, 1989 between the Registrant and
Alan C. Kolb - Exhibit 10.17 to the Registrant's Form 10-K Annual
Report for the year ended July 31, 1994 ("1994 Form 10-K") is
incorporated by reference.
10.17 Letter Agreement dated December 21, 1989 between the Registrant and
Kedar D. Pyatt, Jr. - Exhibit 10.18 to the 1994 Form 10-K is
incorporated by reference.
10.18 Lease dated October 12, 1994 by and between Madison Square
Partnership, as Lessor, and PurePulse Technologies, Inc. (formerly
Foodco Corporation) as Lessee.
10.19 Office Lease dated July 24, 1990 by and between King Street I
Associates, as Lessor, and the Registrant, as Lessee - Exhibit 10.27
to the 1990 Form 10-K is incorporated by reference.
10.20 Line of Credit Agreement dated February 4, 1994, between the
Registrant and Sanwa Bank of California - Exhibit 10.21 to 1994 Form
10-K is incorporated by reference.
10.21 License Agreement dated effective March 13, 1991 between the
Registrant and Auburn University - Exhibit 10.26 to the 1991 Form 10-K
is incorporated by reference.
10.22 Lease dated February 13, 1994 by and between Terilee Enterprises,
Inc., as Lessor, and the Registrant, as Lessee - Exhibit 10.23 to 1994
Form 10-K is incorporated by reference.
10.23 Agreement of Purchase and Sale of Assets dated February 13, 1992
between Registrant, Sierra Aerospace Technology, Inc., Donald Pruett,
Dick Ni and Annie Ni. Exhibit 10.32 to the 1992 Form 10-K is
incorporated by reference.
13 Proxy Statement for 1995 Annual Meeting of Shareholders, with
Appendix.
23 Consent of Independent Auditors.
27 Financial Data Schedule
-16-
(b) REPORTS ON FORM 8-K.
The Registrant filed no Reports on Form 8-K during the fourth quarter of its
fiscal year ended July 31, 1995.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
MAXWELL LABORATORIES, INC.
By /s/ Alan C. Kolb
-------------------------------------
Alan C. Kolb, Chief Executive Officer
and President
October 24, 1995
----------------
Date
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
/s/ Alan C. Kolb Chief Executive October 24, 1995
- ------------------------ Officer, President
Alan C. Kolb and Director
/s/ Donn A. Starry Chairman of the October 24, 1995
- ------------------------ Board and Director
Donn A. Starry
/s/ Lewis J. Colby, Jr. Director October 24, 1995
- ------------------------
Lewis J. Colby, Jr.
/s/ Adolphe G. Gueymard Director October 24, 1995
- ------------------------
Adolphe G. Gueymard
/s/ Kedar D. Pyatt, Jr. Director October 24, 1995
- ------------------------
Kedar D. Pyatt, Jr.
-17-
/s/ Karl M. Samuelian Director and Secretary October 24, 1995
- ------------------------
Karl M. Samuelian
/s/ John W. Weil Director October 24, 1995
- ------------------------
John W. Weil
Director October __, 1995
- ------------------------
Thomas B. Hayward
/s/ Henry F. Owsley Director October 24, 1995
- ------------------------
Henry F. Owsley
/s/ Sean M. Maloy Executive Vice President, October 24, 1995
- ------------------------ Chief Operating Officer,
Sean M. Maloy and Director
/s/ Gary J. Davidson Vice President-Finance October 24, 1995
- ------------------------ & Administration, Treasurer,
Gary J. Davidson and Chief Financial Officer
(Principal Financial and
Accounting Officer)
-18-
INDEX TO EXHIBITS
- -----------------
3.1 Restated Certificate of Incorporation of the Registrant - Exhibit 3.1
to the Registrant's Form 10-K Annual Report for the year ended July
31, 1987 ("1987 Form 10-K") is incorporated by reference.
3.2 Bylaws of the Registrant as amended to date - Exhibit 3.2 to the 1987
Form 10-K is incorporated by reference.
4.1 Form of Rights Certificate - Exhibit 1 to the Registrant's Form 8-A
filed June 30, 1989 is hereby incorporated by reference.
4.2 Form of Rights Agreement between the Registrant and First Interstate
Bank, the Rights Agent - Exhibit 4.2 to the Registrant's Form 10-K
Annual Report for the year ended July 31, 1990 ("1990 Form 10-K") is
incorporated by reference.
10.1 Maxwell Laboratories, Inc. Director Stock Option Plan - Exhibit 10.24
to the Registrant's Form 10-K Annual Report for the year ended July
31, 1989 ("1989 Form 10-K") is incorporated by reference.
10.2 Maxwell Laboratories, Inc. 1985 Stock Option Plan as amended to date -
Exhibit 10.3 to the Registrant's Form 10-K Annual Report for the year
ended July 31, 1991 ("1991 Form 10-K") is incorporated by reference.
10.3 Maxwell Laboratories, Inc. 1995 Stock Option Plan.
10.4 Maxwell Laboratories, Inc. 1994 Employee Stock Purchase Plan.
10.5 Maxwell Laboratories, Inc. 1994 Director Stock Purchase Plan.
10.6 Lease dated December 1, 1988 between Philip MacDonald, as Lessor, and
the Registrant, as Lessee - Exhibit 10.4 to the 1989 Form 10-K is
incorporated by reference.
10.7 Lease dated March 8, 1978 between S-Cubed (formerly known as Systems,
Science and Software), as lessee, and Cal-Sorrento, Ltd. (formerly
known as Industrial Developers, Ltd.), as lessor -- assumed by
Registrant pursuant to the Merger - Exhibit 10.8 to the 1984 Form 10-K
is incorporated by reference.
10.8 Lease dated February 28, 1986 between the Registrant, as lessee, and
Elkhorn Ranch, Inc., as lessor - Exhibit 10.11 to the Registrant's
Form 10-K Annual Report for the year ended July 31, 1986 ("1986 Form
10-K") is incorporated by reference.
10.9 Maxwell Laboratories, Inc. Executive Deferred Compensation Plan -
Exhibit 10.18 to the Registrant's Form 10-K Annual Report for the year
ended July 31, 1983 is incorporated by reference.
10.10 Office Lease Agreement dated August 28, 1987 by and between Airport
Property Company, a N.M. Limited Partnership, as lessor, and the
Registrant, as lessee - Exhibit 10.16 to the Registrant's 1988 Form
10-K is incorporated by reference.
10.11 Agreement of May, 1994 between the Registrant and Compagnie Europeene
de Composants Electroniques - LCC under which the Registrant licenses,
manufactures and distributes certain capacitors.
-19-
10.12 Lease dated April 17, 1995, by and between Cody Three, Inc., as
lessor, and the Registrant, as lessee.
10.13 Maxwell Laboratories, Inc. Special Severance Pay Plan - Exhibit 10.22
to the 1989 Form 10-K is incorporated by reference.
10.14 Employment Agreement dated June 20, 1989 between the Registrant and
Alan C. Kolb - Exhibit 10.26 to the 1989 Form 10-K is incorporated by
reference.
10.15 Employment Agreement dated June 20, 1989 between the Registrant and
Kedar D. Pyatt, Jr. - Exhibit 10.28 to the 1989 Form 10-K is
incorporated by reference.
10.16 Letter Agreement dated December 21, 1989 between the Registrant and
Alan C. Kolb - Exhibit 10.17 to the Registrant's Form 10-K Annual
Report for the year ended July 31, 1994 ("1994 Form 10-K") is
incorporated by reference.
10.17 Letter Agreement dated December 21, 1989 between the Registrant and
Kedar D. Pyatt, Jr. - Exhibit 10.18 to the 1994 Form 10-K is
incorporated by reference.
10.18 Lease dated October 12, 1994 by and between Madison Square
Partnership, as Lessor, and PurePulse Technologies, Inc. (formerly
Foodco Corporation) as Lessee.
10.19 Office Lease dated July 24, 1990 by and between King Street I
Associates, as Lessor, and the Registrant, as Lessee - Exhibit 10.27
to the 1990 Form 10-K is incorporated by reference.
10.20 Line of Credit Agreement dated February 4, 1994, between the
Registrant and Sanwa Bank of California - Exhibit 10.21 to 1994 Form
10-K is incorporated by reference.
10.21 License Agreement dated effective March 13, 1991 between the
Registrant and Auburn University - Exhibit 10.26 to the 1991 Form 10-K
is incorporated by reference.
10.22 Lease dated February 13, 1994 by and between Terilee Enterprises,
Inc., as Lessor, and the Registrant, as Lessee - Exhibit 10.23 to 1994
Form 10-K is incorporated by reference.
10.23 Agreement of Purchase and Sale of Assets dated February 13, 1992
between Registrant, Sierra Aerospace Technology, Inc., Donald Pruett,
Dick Ni and Annie Ni. Exhibit 10.32 to the 1992 Form 10-K is
incorporated by reference.
13 Proxy Statement for 1995 Annual Meeting of Shareholders, with
Appendix.
23 Consent of Independent Auditors.
27 Financial Data Schedule
-20-