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
(X) Annual report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the fiscal year ended August 25, 1995 or
( ) Transition report pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934 For the transition period from
_____ to ____
Commission file number 0-10843
CSP Inc.
(Exact name of registrant as specified in its charter)
MASSACHUSETTS 04-2441294
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
40 Linnell Circle, Billerica, Massachusetts 01821
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (508)663-7598
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT: NONE
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
Common Stock, par value $.01
(Title of Class)
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 ( )
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K 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)
The aggregate market value of the voting stock held by non-affiliates of the
registrant based on the closing selling price as reported on NASDAQ on November
2, 1995, was $23,242,640.
The number of shares outstanding of the registrant's Common Stock, $.01 par
value, was 2,635,220 at November 2, 1995.
DOCUMENTS INCORPORATED BY REFERENCE
The information required by Part II, Items 5, 6, 7 and 8 is incorporated by
reference to the Registrant's 1995 Annual Report to Stockholders. The
information required by Part III, Items 10,11,12 and 13 is incorporated by
reference to the Registrant's Proxy Statement dated November 8, 1995 filed with
respect to the Annual Meeting of Stockholders of the Registrant to be held on
December 12, 1995.
CSP Inc.
Form 10-K
Year Ended August 25, 1995
Item Number
in Form 10-K Table of Contents Page
Part I
1 Business........................................ 4
2 Properties...................................... 15
3 Legal Proceedings............................... 15
4 Submission of Matters to a Vote
of Security Holders............................ 15
Part II
5 Market for Registrant's Common Equity
and Related Stockholder Matters................ 16
6 Selected Financial Data......................... 16
7 Management's Discussion and Analysis of
Financial Condition and Results of Operations.. 16
8 Financial Statements and Supplementary Data..... 16
9 Change in and Disagreements with Accountants
on Accounting and Financial Disclosure......... 16
Part III
10 Directors and Executive Officers of the
Registrant...................................... 17
11 Executive Compensation........................... 17
12 Security Ownership of Certain Beneficial Owners
and Management.................................. 17
13 Certain Relationships and Related Transactions... 17
Part IV
14 Exhibits, Financial Statement Schedules and
Reports on Form 8-K............................. 18
PART I
ITEM 1. BUSINESS
GENERAL
CSP Inc. (the "Company" or "CSPI") was founded in 1968 and is located in
Billerica, Massachusetts, just off Route 128 in the Boston computer corridor.
CSPI pioneered the concept of attached processors specifically designed to carry
out scientific calculations at very high speeds. The Company had its initial
public offering in 1982. In 1988, the Company established its Scanalytics
division to develop and market imaging systems for molecular and cell biology.
In 1994, the Company established its Vision Systems division to commercialize
technology developed by United Parcel Service (UPS) to automate parcel sortation
capabilities. CSPI sells all products through its own direct sales force in the
U.S., with 14% of total sales outside the U.S. via its French subsidiary and a
worldwide organization of distributors.
CURRENT PRODUCTS
EMBEDDED COMPUTERS
Providing additional computation power for specific signal processing
application problems has been CSPI's core technology since its inception. The
Company's products consist of both hardware and software, each optimized for the
other. A typical OEM/volume end user will employ one or more units in an
embedded system for defense, medical imaging, advanced vision and seismic
applications.
Historically, the Company provided array processors (Mini- MAP and MAP 4000)
for use with Digital Equipment Corporation's Q-Bus based Micro-VAX
minicomputers. These products are still supplied to a small number of OEM
customers and represent $825,000 of embedded computer sales in 1995.
The present products are VME-based boards (called SuperCards) which are
incorporated into customized signal processing systems by OEM customers. Now in
its fourth generation, the SuperCard family is a product line of embedded signal
processors that employ multiple Intel i860 RISC microprocessors. The latest
version, the SuperCard-4SLX, employs eight 40MHz i860's and provides 640 MFLOPS
of computational power with 64 MB of high speed memory and a high bandwidth
interconnection scheme based upon National Semiconductor's QuickRing.
SuperCard-3 utilizes one or two of the 50MHz version of the i860 and is
available for VME, S-Bus and Turbochannel. The earlier Supercard-2 and 1 are
still supplied to a limited number of existing customers.
New board level products currently in development are designed to employ a
combination of Analog Devices' 21060 DSP chip and the PowerPC RISC processor
from Motorola/IBM. The Company differentiates itself from its major competitors
by its use of standard interfaces and the interoperability this affords its OEM
customers.
All SuperCards are supported by a rich software development environment,
real-time software for multiple board installations and an extensive library of
five hundred commonly employed micro-coded mathematical subroutines. New
products currently in development are to be similarly supported. Third party
software support includes VxWorks (Wind River Systems), Unison (Multiprocessor
Toolsmith), FORTRAN (Lahey Computer Systems) and "C" (Metaware Corp) compilers.
The Company has placed great emphasis on its ability to migrate customer
application code to new generations of its hardware.
SuperCard products are priced from $5,000 to $45,000 (depending upon model
and quantity) and represented $9,527,000 of embedded computer sales in 1995.
SCANALYTICS
CELLSCAN, 3D FLUORESCENCE MICROSCOPY
Based upon technology developed by the University of Massachusetts Medical
Center in over ten years of research, CELLscan is a system designed to allow the
in vivo analysis of the internal workings and structure of living cells. The
system permits cell biologists to study the cell's reaction to external stimuli
and understand the fundamental processes of cell life and death.Fluorescent
probes are infused into the cell and illuminated under a standard microscope.
The resulting images are processed by a SuperCard array to compensate for the
distortions introduced by the measurement and then displayed in three dimensions
on a PC. An alternative, incumbent, technology called con-focal microscopy
employs an expensive optical system to produce similar images.
This technology is licensed exclusively to CSPI for a period of ten years
which commenced in April 1991, providing that the Company maintain certain
royalty levels which Management anticipates will be met.
The Company sells complete systems ($60,000 to $100,000 exclusive of the
microscope) to individual researchers in academia and biopharmaceutical
companies.
CELLscan sales were $573,000 for 1995.
ELECTROPHORESIS PRODUCTS
Gel electrophoresis is the most widely used separation technique for
proteins and nucleic acids in molecular biology. Radioactively labeled active
components are separated by molecular size and visualized by exposure to
photographic film. The film is scanned and the digital image produced
transferred to a PC for further analysis. The characteristic patterns are
interpreted to produce information concerning the nucleotide sequence of DNA,
the comparison of RFLP fragments (for DNA fingerprinting and other experiments)
and the expression of proteins.
The Scanalytics division markets several shrink-wrapped software packages
for gel electrophoresis analysis that sell from $1,500 to $5,000 and were
developed in association with Dartmouth College and the National Cancer
Institute. These packages are sold directly to individual researchers and via a
number of OEM suppliers of scanner equipment.
The Company acquired the assets of AMBIS, a supplier of radioisotopic
imagers, in March 1994 and has integrated the manufacture of these products into
its Billerica facility. AMBIS imagers eliminate the intermediate step of using
photographic film to determine the pattern generated by gel electrophoresis.
Priced from $25,000 to $50,000, AMBIS imagers appeal particularly to researchers
interested in quantitative measurements.
Sales of Electrophoresis products were $1,609,000 in 1995.
VISION SYSTEMS
This division was founded in 1994 to commercialize technology developed by
United Parcel Service (UPS) to automate UPS's parcel sortation capabilities. The
Danbury R/D facility of UPS had developed a bar-code reader, incorporating the
Company's SuperCard-2, together with a two-dimensional bar-code for use in its
high-speed sortation facilities. The Company supplied UPS with a limited number
of preproduction readers for evaluation in their Grand Rapids, MI experimental
facility in 1993 and then received a order for production quantities to equip a
newly constructed facility in Chicago. These units were shipped in fiscal
1994/1995 and are currently in daily operation.
The Company negotiated a non-exclusive license to the technology and is
marketing the units to other potential customers. The reader has been exhibited
at trade shows in the US, Europe and Japan. Datalogic, based in Bologna, Italy
has been engaged to distribute the reader outside the US. Further, the Company
is continuing to work with UPS's Danbury R/D facility to improve the reader's
performance and reduce its cost. This engineering effort is expected to result
in a product range with varying price and performance capabilities.
MARKETS, MARKETING AND DEPENDENCE ON CERTAIN CUSTOMERS
Applications for embedded computers include sonar and radar systems and
simulators, medical imaging, seismic data processing, package sortation, and
mathematical biology. The Company is able to address these widely diverse
markets primarily as an OEM supplier to system integrators and high volume
end-users. The current trend has returned to board-level embedded computer
products which has accelerated the movement to higher unit volume, OEM
customers. In the case of both Scanalytics and Vision Systems, the Company has
decided to offer a complete applications solution to individual end-users. The
following table sets forth the amount (in thousands of dollars) and percentage
of sales revenues attributable to OEM-volume and individual end-users during
fiscal years 1995, 1994 and 1993.
Year Ended August
1995 1994 1993
OEM-volume sales $13,344 72% $11,264 58% $13,331 74%
End-user sales 5,182 28% 8,196 42% 4,684 26%
$18,526 100% $19,460 100% $18,015 100%
====== ==== ====== ==== ======= ====
While military markets may be shrinking overall, CSPI's share has increased
as prime contractors are encouraged to seek commercial design solutions rather
than build in-house, custom products. In response to government pressure to
reduce defense expenditures, procurement agencies around the world have embraced
the concept of Commercial-Off-The-Shelf (COTS) based systems. Prime contractors
are being directed to employ relatively inexpensive commercial components
whenever possible, replacing custom, fully militarized designs. A further
benefit is that commercial products are estimated to be several years ahead of
militarized equivalents. The Company continues to win awards for several COTS
based systems and has received volume orders as the systems are deployed. The
most productive program has been sales of SuperCards for use with the U.S.
Navy's DTC-2 and TAC3 computers, which are used to co-ordinate information from
sensor arrays in both ship-based and shore-based installations. However, COTS
products are inappropriate for systems designed for truly hazardous conditions
and, to fill this need, the Company has entered into a license agreement with
Hughes Aircraft Company, Fullerton, CA, which has designed a fully MIL-Spec
version of the SuperCard 2XL.
Medical imaging has enjoyed sustained growth and the variety of non-invasive
technologies (e.g. MRI, PET, Ultrasound, Biomagnetics) employed is still
increasing. SuperCards are sold to several medical imaging equipment suppliers
on an OEM basis.
Instrumentation for biotechnology is used for both basic research and the
production of bio-pharmaceuticals. Funding for molecular and cell biology
research is a priority for most industrial nations and is predicted to increase.
Biotechnology techniques are now commonplace in all bio-pharmaceutical companies
and are extensively employed in the manufacturing of bio-engineered drugs.
Scanalytics instruments are used for both basic microbiological research and the
quality control of bio-pharmaceutical production. No single customer represents
a significant percentage of the total Scanalytics sales volume.
Barcodes are familiar to anyone shopping at the local supermarket. Designed
simply for product identification or zipcode encryption, these one-dimensional
codes have limited information storage capacity. The trend is towards
high-density, two-dimensional, machine codes capable of carrying sufficient
information for decisions to be made locally. Typical of these modern codes is
MaxiCode, which is designed specifically for high speed sortation tasks.
However, until recently, the widespread use of two- dimensional machine codes
has been limited by the lack of an accurate over-the-belt reader - an essential
element in any automation scheme. The machine-code reader developed by UPS, and
manufactured and marketed by the Company, addresses the need for an accurate,
affordable unit capable of unattended operation.
Besides UPS and its customers and competitors, several national post offices
have shown interest in code readers. The Company believes that there are many
other materials handling code readers as well. Recently, the 2D Symbology
Committee of the Automobile Industry Action Group has recommended MaxiCode for
the high speed sortation and tracking of incoming and outgoing goods.
Sales to individual customers constituting 10% or more of total sales
consisted of sales to UPS of $3,948,000 (21%)in fiscal year 1995. The Company
anticipates that, for the foreseeable future, a significant percentage of its
sales will be dependent upon a relatively small number of customers.
The Company markets its products through sales offices in Billerica, MA,
Laurel, MD, and San Diego, CA, and a French sales company (a wholly-owned
subsidiary) near Paris. Elsewhere in the U.S. and throughout the remainder of
the world, these offices coordinate the activities of independent distributors
and manufacturers representatives who represent other company's product lines
not competitive with CSPI and are either paid a commission on units sold or are
permitted to buy units at a discount for subsequent resale. Geographically,
North America accounts for approximately 86% of total sales due to the dominance
of U.S. based manufacturers in the Company's major markets and the wider
acceptance of the VME standard in the U.S. The following
table sets forth the amounts (in thousands of dollars) and percentage of sales
by geographical area during fiscal years 1995, 1994 and 1993.
Year Ended August
1995 1994 1993
North America $15,992 86% $16,234 83% $14,443 80%
Europe 1,207 6% 1,392 7% 2,362 13%
Middle East 318 2% 535 3% 431 2%
Far East 953 5% 1,299 7% 705 4%
South America 56 1% -- -% 74 1%
------- ---- ------- ---- ------- ----
Total $18,526 100% $19,460 100% $18,015 100%
======= ==== ======= ==== ======= ====
COMPETITION
The embedded computer, bar-code reader and bio-instrumentation markets are
very competitive. The Company believes its products to be among the leaders in
performance and price. All the markets are characterized by rapid technological
change, and the introduction of new products with superior capabilities or lower
pricing could adversely affect the Company's business.
The Company's principal direct competitors in the floating-point embedded
computer market are Mercury Computer Inc., Analogic Corp., and Star
Technologies, Inc. New companies enter the field periodically, and larger
companies with greater technical resources and marketing organizations could
decide to compete in the future.
The future growth of the embedded computer market depends upon providing
high speed computation for a specific range of signal processing applications in
a compact, low power, and inexpensive package that can be easily integrated into
an OEM customer's design. Certain competitors may offer products with features
not provided by CSPI today. Other companies may offer embedded computers
designed for particular applications not addressed by the Company or for
attachment to computers incompatible with the Company's products. Since the
majority of sales are to OEM-volume users, the principal barrier to competition
is the reluctance of established users to redesign their product once it is in
production and the strength of the Company's relationships with its customers.
Competitors to Scanalytics products include Molecular Dynamics, Inc.,
BioImage Corp., Fuji Instruments, BioRad Corp., LKB, and Protein Databases, Inc.
The majority of these competitors are small to medium-sized companies, but there
is little barrier to entry for much larger companies should the market grow to
more substantial proportions. The Company's competitive advantages are the use
of its embedded computer in a low-cost, PC compatible environment to accelerate
the interpretation of collected images and the sophistication of its internally
developed software packages.
The only direct competitor to the Company's machine code reader is Accusort
Corp. which has also licensed the relevant technology from UPS. Machine code
readers of conventional laser design, which have some of the same performance
characteristics, are available from Computer Identics, Intermec, LaserData,
Datalogic and Accu-Soft Systems, Inc. The Company's competitive advantage stems
from the use of its SuperCards in the reader, its superior signal processing
expertise and its proven capability as a quality supplier.
MANUFACTURING, ASSEMBLY AND TESTING
All of the Company's manufacturing is performed at its plant in Billerica,
MA. The primary manufacturing process is the assembly and test of printed
circuit boards and systems, designed by the Company and fabricated by other
vendors. The Company endeavors to build for inventory and supplies its products
in a variety of standard formats. A small percentage of sales reflects products
customized to a particular customer's specification, and even these products are
easily reconfigurable should the customer cancel the order for any reason.
Upon receipt of material by the Company from outside suppliers, products and
components are inspected by the Company's QC/QA technicians. During manufacture
and assembly, both subassemblies and completed systems are subjected to
extensive testing, including burn-in and vibration procedures designed to
minimize equipment failure. The Company also uses diagnostic programs to detect
and isolate potential component failures. A comprehensive log is maintained of
all past failures to monitor quality procedures and improve design standards.
The Company is solely dependent upon Intel Corp. for the i860
micro-processor used in its SuperCard products and Bipolar Integrated Technology
for a processor employed in the MAP-4000. The Company has sufficient quantities
of these components on hand to satisfy anticipated demand and has been assured
by Intel that supplies will continue to be available in any quantities
reasonably necessary. The Company does not consider the risk of interruption of
supply to be significant to meet its projected revenue requirements for the
immediate future.
The Company provides a warranty covering defects arising from products sold
and service performed, which varies from 90 days to one year depending upon the
particular unit. However, warranties of substantially greater scope have been
extended to certain major customers for financial and other considerations. The
Company maintains a reserve for warranty repairs equal approximately to 2% of
product sales for the last 90 days.
CUSTOMER SUPPORT
The Company supports its customers in a number of ways: telephone
assistance, on-site service, installation of systems (primarily in the
Scanalytics division), training and education. Customers are able to call a
support unit and report problems which are reviewed by an analyst. The analyst
will research the problem and will assist the customer, most commonly via
telephone,
in an effort to correct the problem. Service of this kind is available during
the warranty period, and is also available to report "bugs" in the software.
Customers may purchase software and hardware maintenance and on-site service
contracts after the warranty period.
The Company offers training courses at either corporate headquarters or the
customer site should the customer request it. Field and customer service support
is provided through Billerica, Massachusetts, San Diego, California, Laurel,
Maryland and Paris, France.
ENGINEERING AND DEVELOPMENT
During fiscal 1995, the Company's expenses (including depreciation) for
engineering and development were approximately $3,099,000 (17% of sales)
compared to approximately $2,834,000 (15% of sales) and $3,226,000 (18% of
sales) in fiscal years 1994 and 1993, respectively. Expenditures for engineering
and development are expensed as they are incurred. The Company expects to
continue substantial expenditures, both in additional applications software
development and development of hardware and software for embedded computer and
machine code systems. Additional expenditures may be necessary to complete the
conversion of the embedded computer product line from I860 based to 21060/power
pc based designs. The Company's products and development currently in process
are intended to extend the usefulness and marketability of existing products and
introduce new products into existing market segments.
Of the Company's 103 employees, 27 professional and staff employees were
engaged in software and hardware engineering and development activities as of
August 25, 1995.
The Company does not have any patents that are material to its business.
BACKLOG
The Company's backlog of customer orders and contracts was approximately
$3,055,028 at August 25, 1995 as compared to $6,010,374 at August 26, 1994. The
majority of this backlog is expected to be shipped during the next fiscal year
and primarily in the first quarter. The backlog of the Company has fluctuated
greatly over the last three years at year end. The backlog at the end of fiscal
year 1994 was unusually high due to remaining shipments for the UPS contract
which were completely shipped during the first and second quarters of fiscal
year 1995. Orders for SuperCard products (board-level product) have increased
recently and the Company is able to ship to customers in a
shorter period of time. Moreover, OEM purchasers are not committing themselves
to orders of the same magnitude as has been the case in the past.
EMPLOYEES
On August 25, 1995, the Company had 103 employees, including 8 part-time.
There were 27 employees engaged in embedded processor, Vision Systems, and
Scanalytics engineering; 33 employees in marketing, promotion, sales and
customer support; 27 employees in manufacturing, test and field service; and 16
employees in general management and administration.
None of the Company's employees is represented by a labor union and the
Company had no work stoppages. The Company considers relations with its
employees to be good.
EXECUTIVE OFFICERS
Information about the executive officers of the Company is set forth below.
NAME AND AGE BUSINESS AFFILIATIONS
Samuel Ochlis (72)........ Director of CSPI since 1972; Chairman of the
Board from December 1991 tothe present; Chief
Executive Officer from October 1991 to December
1991; President and Chief Executive Officer from
June 1990 to October 1991; President and Chief
Operating Officer from 1978 to June 1990;
Executive Vice President from 1974 to 1978.
David S. Botten (51)...... Director and President of CSPI since October
1991; Chief Executive Officer from December 1991
to the present Chief Operating Officer of CSPI
from October 1991 to December 1991; Business
Development Manager of EG&G Instruments Group
from October 1988 to September 1991; General
Manager of EG&G, Princeton Applied Research from
September 1986 to October 1988.
Michael M. Stern (58)..... Director of CSPI from 1968 to January 1984; Vice
President of Operations and Treasurer of CSPI
since 1968.
James A. Waggett (58)..... Director of CSPI from 1968 to January 1984; Vice
President of Advanced Development from 1974 to
the present; Business Element Manager of the
Embedded Computing Division from August 1995 to
present; Clerk from 1971 to March 1983;
Assistant Clerk from March 1983 to the present.
James E. Storer (68)...... Director of CSPI from 1974 to August 1984; Chief
Scientist and Vice President from 1975 to the
present.
Gary W. Levine (47)....... Vice President of Finance and Chief Financial
Officer of CSPI since September 1983; Controller
of CSPI from May 1983 to September 1983.
Donald E. Johansen (63)... Vice President of Business Development of CSPI
since July 1992; Vice President of Hardware
Engineering from 1976 to July 1992
ITEM 2. PROPERTIES
The Company owns the land and building at 40 Linnell Circle, Billerica, MA.
The Company owns approximately 2.8 acres of land adjacent to the Company's
current facility. The Company believes space at its current location, combined
with space that will be available if the Company proceeds to build on the new
land, will be sufficient for future growth.
ITEM 3. LEGAL PROCEEDINGS
The Company was notified by the Department of Commerce (DOC) about possible
violations of certain export regulations during the period from September 15,
1990 to July 16, 1991. The Company has reached an agreement with the DOC subject
to final documentation, pursuant to which the Company will incur a penalty of
$160,000, of which $132,000 will be paid and $28,000 will be suspended if the
Company complies with export regulations for a period of one year.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
NONE
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS
The information required by this Item is incorporated by reference from
"Common Stock Data" on page 1 of the Company's 1995 Annual Report to
Stockholders. American Stock Transfer Company is the Transfer Agent and
Registrar for the Company's Common Stock. There were approximately 198
Stockholders of record as of November 2, 1995. The Company believes the number
beneficial owners of shares (including shares held in street name) at that date
were approximately 1,200.
ITEM 6. SELECTED FINANCIAL DATA
The information required by this Item is incorporated by reference from
"Selected Financial Data" on page 10 of the Company's 1995 Annual Report to
Stockholders.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITIONS AND RESULTS OF OPERATIONS
The information required by this Item is incorporated by reference from
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" on pages 11-15 of the Company's 1995 Annual Report to Stockholders.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The information required by this Item is incorporated by reference from
pages 16 to 26 and from "Independent Auditor's Report" on page 27 of the
Company's 1995 Annual Report to Stockholders.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
NONE
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The information for Directors required by this Item is incorporated by
reference from the Company's Proxy Statement dated November 8, 1995 filed with
respect to the Annual Meeting of Stockholders of the Company on December 12,
1995.
ITEM 11. EXECUTIVE COMPENSATION
The information required by this Item is incorporated by reference from the
Proxy Statement.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT
The information required by this Item is incorporated by reference from the
Proxy Statement.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information required by this Item is incorporated by reference from the
Proxy Statement.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND
REPORTS ON FORM 8K
A) The following are filed as part of this report:
1) Financial Statements (See item 8):
The following financial statements of the Company are included in Part II of
this report through incorporation by reference from the Company's 1995 Annual
Report to Stockholders.
Annual Report
Page
Independent Auditors' Report...............................27
Consolidated Balance Sheets at August 25, 1995 and
August 26, 1994............................................16
Consolidated Statements of Operations for years
ended August 25, 1995, August 26, 1994 and
August 27, 1993............................................17
Consolidated Statements of Shareholders' Equity for
years ended August 25, 1995, August 26, 1994 and
August 27, 1993............................................18
Consolidated Statements of Cash Flows for years ended
August 25, 1995, August 26, 1994 and August 27, 1993.....19
Notes to Consolidated Financial Statements. .............20-26
Form 10K
Page
2) Consolidated Financial Statement Schedules
None
3) Exhibits
Certain of the Exhibits listed hereunder have previously been filed with the
Commission and are hereby incorporated by reference pursuant to Rule 12b-32
under the Securities Exchange Act of 1934 and Rule 24 of the Commission's Rules
of Practice. The location of each document so incorporated by reference is noted
parenthetically.
3.1 Articles of Organization and amendments thereto, of the Company as of
the end of Fiscal 1986 (Exhibit 3.1 to the Form 10-K for the year ended
August 31, 1990)
3.2 By-Laws of the Company, as amended through March 21, 1995
10.1 1981 Incentive Stock Option Plan as amended (Exhibit 10.3 to the Form
S-8, File No. 2-79414, 1987 Registration Statement)
10.2 Mr. Ochlis' Employment and Deferred Compensation Agreement dated January
5, 1987 (Exhibit 10.5 to the Form S-8, File No. 2-79414, 1987
Registration Statement)
10.3 Form of Invention Agreement between the Company and certain of its
employees
10.4 CSPI Supplemental Retirement Income Plan (Exhibit 10.13 to Form 8
amendment 2 to Form 10-K for year ended August 31, 1986, dated February
23, 1987)
10.5 Trust Agreement (between CSP Inc. and Bank of Boston) dated January 5,
1987 as amended (Exhibit 10.11 to Form 10-K for year ended August 31,
1990)
10.6 Amendment to Mr. Ochlis' Employment and Deferred Compensation Agreement
dated March 20, 1989 (Exhibit 10.9 to Form 10-K for year ended August
31, 1991)
10.7 Employment Agreement between CSP Inc. and Mr. Botten dated August 14,
1991 (Exhibit 10.10 to Form 10-K for year ended August 31, 1991)
10.8 1991 Incentive Stock Option Plan (the Plan is included in the Company's
Proxy Statement dated November 10, 1991 with respect to the Annual
Meeting of Stockholders of the Company on December 10, 1991)
10.9 Retirement Agreement for Edmund U. Cohler (Exhibit 10.9 to Form 10-K for
the year ended August 26, 1994)
10.10 Symbology Reader License Agreement between UPS and CSPI (Exhibit 10.9 to
Form 10-K for the year ended August 26, 1994)
10.11 Software License Agreement between UPS and CSPI (Exhibit 10.12 to Form
10-K for the year ended August 26, 1994)
10.12 Patent Agreement between UPS and CSPI (Exhibit 10.13 to Form 10-K for
the year ended August 26, 1994)
10.13 Amendment to Mr. Ochlis' Employment Deferred Compensation Agreement
dated February 6, 1995
11.0 Computation of Per Share Earnings for the years ended August 25, 1995,
August 26, 1994, and August 27, 1993
13.1 1995 Annual Report to Stockholders
22.1 Subsidiaries of the Registrant (Exhibit 22.1 to Form 10-K for the year
ended August 26, 1994)
23.1 Consent of Independent Certified Public Accountants
27.1 Financial Data Schedule
EXHIBIT INDEX
Exhibit
Number Exhibit Page
3.2 By-Laws of the Company, as amended through March 21, 1995 22-30
10.3 Form of Invention Agreement between the Company and certain of its 31-33
employees
10.13 Amendment to Mr. Ochlis' Employment Deferred Compensation Agreement 34-35
dated February 6, 1995
11.0 Computation of Per Share Earnings for the years ended August 25, 1995, 36
August 26, 1994, and August 27, 1993
13.1 1995 Annual Report to Stockholders 37-69
23.1 Consent of Independent Certified Public Accountants 70
27.1 Financial Data Schedule 71