SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 10-Q
(Mark One)
/X/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934.
For the quarterly period ended May 31, 1995
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934.
For the transition period from to
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Commission file number: 0-18268
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INTEGRATED SYSTEMS, INC.
(Exact name of Registrant as specified in its charter)
California 94-2658153
(State or other jurisdiction (I.R.S. employer
of incorporation or organization) identification no.)
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3260 Jay Street
Santa Clara, California 95054-3309
(408) 980-1500
(Address, including zip code, of Registrant's
principal executive offices and telephone
number, including area code)
------------------------------
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
------- -------
The number of shares outstanding of the Registrant's Common Stock on June 30,
1995 was 9,598,616 shares.
The Exhibit Index is located on page 11. Page 1 of 15 pages.
INTEGRATED SYSTEMS, INC.
INDEX
Page
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements 3
Condensed Consolidated Balance Sheets at May 31, 1995 and
February 28, 1995 4
Condensed Consolidated Statements of Income for the Three
Months Ended May 31, 1995 and 1994 5
Condensed Consolidated Statements of Cash Flows for the Three
Months Ended May 31, 1995 and 1994 6
Notes to Condensed Consolidated Financial Statements 7
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 8
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 11
Item 5. Other Information 11
Item 6. Exhibits and Reports on Form 8-K 11
SIGNATURES 13
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PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
The condensed consolidated interim financial statements included herein have
been prepared by Integrated Systems, Inc. (the "Company"), without audit,
pursuant to the rules and regulations of the Securities and Exchange Commission.
Although certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to such rules and
regulations, the Company believes that the disclosures made are adequate to make
the information presented not misleading. It is suggested that the condensed
consolidated interim financial statements be read in conjunction with the
consolidated financial statements and the notes thereto included in the
Company's Annual Report on Form 10-K for the year ended February 28, 1995. The
February 28, 1995 condensed consolidated balance sheet data was derived from the
audited financial statements, but does not include all disclosures required by
generally accepted accounting principles.
The accompanying condensed consolidated interim financial statements have been
prepared in all material respects in conformity with the standards of accounting
measurements set forth in Accounting Principles Board Opinion No. 28 and, in the
opinion of management, reflect all adjustments, consisting only of normal
recurring adjustments, necessary to summarize fairly the financial position,
results of operations, and cash flows for the periods indicated. The results of
operations for the interim periods presented are not necessarily indicative of
the results to be expected for the full year.
Prior to fiscal 1996, the Company's fiscal year was reported on a 52/53-week
period ending on the last Saturday in February of each year. Accordingly,
quarterly periods did not necessarily end on the last day of a calendar month.
Beginning in fiscal 1996, the Company's fiscal year end is the last day in
February and quarterly periods will end on the last day of a calendar month. The
effect of this change was not material to the Company's financial statements for
the first quarter of fiscal 1996. For clarity of presentation herein, all fiscal
periods are described as ending on a calendar month-end.
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INTEGRATED SYSTEMS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
May 31, February 28,
1995 1995
-------- --------
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents ...................... $ 9,201 $ 7,144
Marketable securities, current ................. 9,714 6,472
Accounts receivable, net ....................... 11,570 14,156
Deferred income taxes .......................... 967 1,153
Other current assets ........................... 2,574 2,757
-------- --------
Total current assets ...................... 34,026 31,682
Marketable securities, noncurrent ................... 20,672 22,299
Property and equipment, net ......................... 2,921 2,584
Other assets ........................................ 576 427
Intangible assets, net .............................. 5,019 5,466
-------- --------
Total assets .............................. $ 63,214 $ 62,458
======== ========
LIABILITIES
Current liabilities:
Accounts payable ............................... $ 2,052 $ 1,741
Accrued payroll and related expenses ........... 1,454 2,110
Other accrued liabilities ...................... 2,843 3,097
Income taxes payable ........................... 1,631 1,952
Deferred revenue ............................... 5,771 6,067
-------- --------
Total current liabilities ................. 13,751 14,967
Other liabilities ................................... 185 200
-------- --------
Total liabilities ......................... 13,936 15,167
-------- --------
SHAREHOLDERS' EQUITY
Common Stock, no par value, 25,000 shares
authorized: 9,565 and 9,494 shares
issued and outstanding at
May 31, 1995 and February 28, 1995,
respectively ................................... 36,171 35,529
Unrealized holding gain (loss) on marketable
securities, net ................................ 169 (109)
Retained earnings ................................... 12,938 11,871
-------- --------
Total shareholders' equity ................ 49,278 47,291
-------- --------
Total liabilities and shareholders'
equity .................................. $ 63,214 $ 62,458
======== ========
The accompanying notes are an integral part of these condensed consolidated
financial statements.
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INTEGRATED SYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)
(unaudited)
Three Months Ended
May 31,
--------------------
1995 1994
------- -------
Revenue:
Product licenses ................................. $ 9,519 $ 5,789
Maintenance and renewals ......................... 2,337 2,301
Engineering services ............................. 2,286 2,011
------- -------
Total revenue ................................ 14,142 10,101
------- -------
Costs and expenses:
Cost of product licenses revenue ................. 1,761 653
Cost of maintenance and renewals revenue ......... 153 165
Cost of engineering services revenue ............. 1,721 1,449
Marketing and sales .............................. 5,697 4,179
Research and development ......................... 2,339 1,707
General and administrative ....................... 1,233 877
Amortization of intangible assets ................ 186 532
------- -------
Total costs and expenses ..................... 13,090 9,562
------- -------
Income from operations ................... 1,052 539
Interest and other income ............................ 517 391
------- -------
Income before income taxes ............... 1,569 930
Provision for income taxes ........................... 502 298
------- -------
Net income ............................... $ 1,067 $ 632
======= =======
Earnings per share ................................... $ 0.11 $ 0.07
======= =======
Shares used in per share calculations ................ 9,976 9,452
======= =======
The accompanying notes are an integral part of these condensed consolidated
financial statements.
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INTEGRATED SYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
Three Months Ended
May 31,
------------------
1995 1994
------- -------
Cash flows from operating activities:
Net income ........................................... $ 1,067 $ 632
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization .................... 982 920
Changes in assets and liabilities:
Accounts receivable ....................... 2,586 1,614
Other current assets ...................... 183 (627)
Accounts payable, accrued payroll and
other accrued liabilities ............ (599) (824)
Income taxes payable ...................... (321) (607)
Deferred revenue .......................... (296) (14)
Other assets and liabilities .............. (164) (103)
------- -------
Net cash provided by operating activities ........ 3,438 991
------- -------
Cash flows from investing activities:
Purchases of marketable securities, net .............. (1,151) (55)
Additions to property and equipment, net ............. (712) (480)
Capitalized software development costs ............... (160) (300)
------- -------
Net cash used in investing activities ............ (2,023) (835)
------- -------
Cash flows from financing activities:
Proceeds from exercise of common stock options and
purchases under the employee stock purchase plan . 642 375
------- -------
Net cash provided by financing activities ........ 642 375
------- -------
Net increase in cash and cash equivalents ................ 2,057 531
Cash and cash equivalents at beginning of period ......... 7,144 8,021
------- -------
Cash and cash equivalents at end of period ............... $ 9,201 $ 8,552
======= =======
Supplemental disclosure of noncash investing and
financing activities:
Unrealized gain (loss) on marketable securities ...... $ 464 $ (429)
The accompanying notes are an integral part of these condensed consolidated
financial statements.
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INTEGRATED SYSTEMS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Information for the three months ended May 31, 1995 and 1994 is unaudited)
1. Summary of Significant Accounting Policies
The condensed consolidated financial statements include the accounts of
Integrated Systems, Inc. and its majority owned subsidiaries, after elimination
of all significant intercompany accounts and transactions, and should be read in
conjunction with the Company's Annual Report on Form 10-K for the year ended
February 28, 1995. These condensed consolidated financial statements do not
include all disclosures normally required by generally accepted accounting
principles.
2. Software Development Costs
The Company incurs certain costs to develop computer software to be licensed or
otherwise marketed to customers. Costs that are required to be capitalized under
Statement of Financial Accounting Standards No. 86, "Accounting for the Costs of
Computer Software to be Sold, Leased or Otherwise Marketed" ("SFAS No. 86") were
$160,000 in the first three months of fiscal 1996 compared to $300,000 in the
same period of the previous year. Such costs are being amortized using the
greater of the amount computed using the ratio that current gross revenues for a
product bear to the total of current and anticipated future gross revenues for
that product, or on a straight-line basis over three years. Amortization for the
three months ended May 31, 1995 was $214,000 compared to $45,000 for the three
months ended May 31, 1994.
3. Earnings Per Share
Earnings per share is computed using the weighted average number of common and
common equivalent shares outstanding during the period. Common equivalent shares
result from the assumed exercise of outstanding stock options that have a
dilutive effect when applying the treasury stock method.
The following table sets forth the calculation of earnings per share for
purposes of this report:
Three Months Ended
May 31,
-------------------
(in thousands, except per share data) 1995 1994
------ ------
(unaudited)
Primary:
Net income ........................................ $1,067 $ 632
====== ======
Number of shares:
Weighted average number of common
shares outstanding ......................... 9,535 9,162
Dilutive effect of stock options, net ........ 441 290
------ ------
9,976 9,452
====== ======
Earnings per share ..................................... $ 0.11 $ 0.07
====== ======
Fully diluted:
Net income ........................................ $1,067 $ 632
====== ======
Number of shares:
Weighted average number of common
shares outstanding ......................... 9,535 9,162
Dilutive effect of stock options, net ........ 441 298
------ ------
9,976 9,460
====== ======
Earnings per share ..................................... $ 0.11 $ 0.07
====== ======
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4. Contingency Settlement
In November 1994, the Company and Microtec Research, Inc. (MRI), a development
tools supplier, began arbitration proceedings related to a royalty payment
dispute. In March 1995, the Company received notification that the judgment in
the arbitration proceedings was principally in favor of MRI. In June 1995, the
final award was determined to be $690,000 plus a portion of MRI's legal fees and
costs. A majority of the award amount was accrued for in the prior fiscal year.
The remainder of the award and the Company's legal costs, which were incurred in
the first quarter of fiscal 1996, were charged to expense in the first quarter
of fiscal 1996.
5. Change in Fiscal Year
Prior to fiscal 1996, the Company's fiscal year was reported on a 52/53-week
period ending on the last Saturday in February of each year. Accordingly,
quarterly periods did not necessarily end on the last day of a calendar month.
Beginning in fiscal 1996, the Company's fiscal year end is the last day in
February and quarterly periods will end on the last day of a calendar month. The
effect of this change was not material to the Company's financial statements for
the first quarter of fiscal 1996. For clarity of presentation herein, all fiscal
periods are described as ending on a calendar month-end.
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
The following information should be read in conjunction with the condensed
consolidated interim financial statements and the notes thereto included in Item
1 of this Quarterly Report and with Management's Discussion and Analysis of
Financial Condition and Results of Operations contained in the Company's Annual
Report on Form 10-K for the year ended February 28, 1995, as filed with the
Securities and Exchange Commission on May 26, 1995.
Results of Operations
The following table sets forth for the periods indicated the percentage of total
revenue represented by each line item in the Company's condensed consolidated
statements of income and the percentage change from the comparative prior period
in each line item:
Percentage of Period-to-Period
Total Revenue Percentage Change
------------------ ---------------------
Three Months Ended Three Months Ended
May 31, May 31,
1995 1994 1995 compared to 1994
----- ----- ---------------------
Revenue:
Product licenses .................................................. 67% 57% 64%
Maintenance and renewals .......................................... 17 23 2
Engineering services .............................................. 16 20 14
--- ---
Total revenue ................................................ 100 100 40
--- ---
Costs and expenses:
Cost of product licenses revenue .................................. 13 7 170
Cost of maintenance and renewals revenue .......................... 1 2 (7)
Cost of engineering services revenue .............................. 12 14 19
Marketing and sales ............................................... 40 41 36
Research and development .......................................... 17 17 37
General and administrative ........................................ 9 9 41
Amortization of intangible assets ................................. 1 5 (65)
--- ---
Total costs and expenses ..................................... 93 95 37
--- ---
Income from operations .................................. 7 5 95
Interest and other income .............................................. 4 4 32
--- ---
Income before income taxes .............................. 11 9 69
Provision for income taxes ............................................. 3 3 68
--- ---
Net income .............................................. 8% 6% 69%
--- ---
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Revenue
The Company's revenue is primarily derived from the licensing of its products,
related maintenance and license renewals, and engineering services. Total
revenue in the first quarter of fiscal 1996 of $14,142,000 increased 40%
compared to the first quarter of fiscal 1995 due to growth in all revenue
categories. Total product licenses revenue increased by 64% in the first quarter
of fiscal 1996 compared to the first quarter of fiscal 1995 due to growth in
both the real-time and MATRIXx product lines. Total maintenance and renewals
revenue increased by 2% over the prior year's first quarter. Engineering
services revenue increased by 14% between the comparative periods due to
increases in the number and size of contracts.
The Company's real-time product licenses, maintenance and renewals revenue
increased 71% in the first quarter of fiscal 1996 compared to the same quarter
of the prior fiscal year as the embedded software market continues to grow.
Contributing to revenue growth of the real-time product family was the
introduction of pSOSystem for the PowerPC in the first quarter of fiscal 1996
and sales of the FlexOS product line, which was acquired in the third quarter of
fiscal 1995. Real-time product licenses, maintenance and renewals revenue in the
first quarter of fiscal 1996 increased in all geographic regions. MATRIXx
product licenses, maintenance and renewals revenue increased 19% in the first
quarter of fiscal 1996 compared to the first quarter of fiscal 1995 due to an
increase in European sales and the introduction of new products, particularly
MATRIXx for Windows NT and MATRIXx version 4.1.
Domestic product licenses, maintenance and renewals revenue increased by 27%
between the comparative quarterly periods, while international product licenses,
maintenance and renewals revenue increased by 84%. The percentage of the
Company's total revenue from customers located internationally increased to 36%
in the first quarter of fiscal 1996, compared to 27% in the first quarter of
fiscal 1995.
Costs and Expenses
The Company's cost of product licenses revenue as a percentage of total revenue
increased to 13% in the first quarter of fiscal 1996 compared to 7% in the first
quarter of fiscal 1995 due primarily to an increase in the amortization of
capitalized research and development expenditures with the recent releases of
new products and an increase in royalty payments related to third party software
sales. In addition, a portion of the arbitration award costs related to a
royalty payment dispute with a development tools supplier were charged to cost
of revenue in the first quarter of fiscal 1996 (see Note 4 of Notes to Condensed
Consolidated Financial Statements). The cost of maintenance and renewals revenue
as a percentage of total revenue was not significant in the first quarter of
fiscal 1996 and fiscal 1995. The cost of engineering services revenue increased
as a percentage of engineering services revenue due primarily to changes in
contract mix.
Marketing and sales expenses increased 36% quarter over quarter but decreased
from 41% to 40% of total revenue. The Company expects sales and marketing
expenses as a percentage of revenue to be lower for the whole of fiscal 1996.
Research and development expenses increased by 37% between the quarterly
comparative periods. This increase was primarily the result of increased
activity associated with bringing several significant products to market,
including increased personnel and consulting expenses, and due to a decrease in
software capitalization. Costs that are required to be capitalized under
Statement of Financial Accounting Standards No. 86, "Accounting for the Costs of
Computer Software to be Sold, Leased or Otherwise Marketed" ("SFAS No. 86") were
$160,000 in the first quarter of fiscal 1996 compared to $300,000 in the first
quarter of fiscal 1995. The amount capitalized represents approximately 6% of
total research and development expenditures for the first quarter of fiscal 1996
compared to 15% for the first quarter of fiscal 1995. The amount of research and
development expenditures capitalized in a given time period depends upon the
nature of the development performed and, accordingly, amounts capitalized may
vary from period to period. Capitalized costs are being amortized using the
greater of the amount computed using the ratio that current gross revenues for a
product bear to the total of current and anticipated future gross revenues for
that product, or on a straight-line basis over three years. Amortization for the
three months ended May 31, 1995 was $214,000 compared to $45,000 for the three
months ended May 31, 1994.
General and administrative expenses increased 41% between the three-month
comparative periods due primarily to legal expenses associated with arbitration
proceedings between the Company and a development tools supplier (see Note 4 of
Notes to Condensed Consolidated Financial Statements).
Amortization of intangible assets in the first quarter of fiscal 1996 has
decreased from the prior year quarter as certain assets and deferred
compensation related to the acquisition of Software Components Group, Inc. in
the second quarter of fiscal 1992 became fully amortized in fiscal 1995.
-9-
Other
The Company's interest and other income increased by $126,000 between the
three-month quarterly comparative periods due primarily to an increase in cash
and marketable securities.
Risk Factors That May Affect Future Results of Operations
The Company believes that in the future, its results of operations could be
impacted by factors such as delays in shipment of the Company's new products and
major new versions of existing products, market acceptance of new products and
upgrades, growth in the marketplace in which it operates, competitive product
offerings and adverse changes in general economic conditions in any of the
countries in which the Company does business. The Company's performance may also
be adversely affected by the ability of its suppliers to provide competitive
products. During the quarter, the Company's competitors have continued to make a
variety of product announcements and offerings. The Company continues to release
new versions of its product lines and the successful acceptance of these
products will play a key role in future growth. The impact of any of these
factors is difficult to predict or forecast.
During any quarter, the Company receives a relatively small number of large
orders. Delays in the receipt of one or more such orders would have a
significant negative impact on quarterly revenue and a potentially more
significant impact on earnings.
Due to the risk factors noted above, the Company's future earnings and stock
price may be subject to significant volatility, particularly on a quarterly
basis. Any shortfall in revenue or earnings from levels expected by securities
analysts could have an immediate and significant adverse effect on the trading
price of the Company's common stock in any given period. Additionally, the
Company often does not learn of such shortfalls until late in the fiscal
quarter, or after the quarter is over, which could result in an even more
immediate and adverse effect on the trading price of the Company's common stock.
Finally, the Company participates in a highly dynamic industry, which often
results in significant volatility of the Company's common stock price.
Consequently, the purchase or holding of the Company's stock involves a high
degree of risk.
Liquidity and Capital Resources
The Company has funded its operations to date principally through cash flows
from operations. As of May 31, 1995, the Company had $39,587,000 of cash, cash
equivalents and marketable securities. This represents an increase of $3,672,000
from February 28, 1995. During fiscal 1995, the Company announced that the Board
of Directors authorized the Company to repurchase up to an additional 500,000
shares of common stock for cash, from time-to-time at market prices, pursuant to
a repurchase program announced in September 1992. In fiscal 1995, under this
program, the Company repurchased 125,000 shares of common stock for $1,094,000.
The Company believes that cash flows from operations, together with existing
cash balances and available borrowings, will be adequate to meet the Company's
cash requirements for working capital, capital expenditures and stock
repurchases for the next twelve months and the foreseeable future.
Net cash provided by operating activities during the three months ended May 31,
1995 totaled $3,438,000 compared to $991,000 in the three months ended May 31,
1994. The increase in net cash provided by operating activities was primarily
due to increased net income and from changes in accounts receivable and other
current assets. Net cash used in investing activities totaled $2,023,000 in the
first three months of fiscal 1996 compared to $835,000 in the first three months
of fiscal 1995. The increase in net cash used in investing activities was due
primarily to net purchases of marketable securities and increased expenditures
on property and equipment. Net cash provided by financing activities during the
three months ended May 31, 1995 totaled $642,000 compared to $375,000 for the
three months ended May 31, 1994. This increase was due to an increase in
proceeds from the exercise of common stock options and purchases under the
Employee Stock Purchase Plan. The Company expects that it will be able to
sustain its level of expenditures on property and equipment and fund operational
needs for the next twelve months and the foreseeable future, from cash flow from
operations.
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PART II - OTHER INFORMATION
Item 1. Legal Proceedings
The information required by this item is incorporated by reference
to Note 4 of Notes to Condensed Consolidated Financial Statements
on page 8 of this report.
Item 5. Other Information
Not applicable.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits.
The following exhibits are filed herewith:
Exhibit Page
Number Title Number
------- ----- ------
10.13 Form of Stock Option Exercise Form used in 14
connection with Registrant's 1988 Stock
Option Plan, as amended to date.
27.00 Financial Data Schedule 15
The following exhibits are incorporated herein by reference:
Exhibit
Number Title
------- ------
2.01 Agreement and Plan of Reorganization by and among
Registrant, Software Components Group, Inc. a
California corporation ("SCG"), and Alfred Chao dated
as of August 9, 1991 (incorporated by reference to
Exhibit Number 2.01 to Registrant's Form 8-K filed
with the Securities and Exchange Commission on
September 3, 1991 (the "September 3, 1991 Form
8-K")).
2.02 Agreement of a Merger by and between Registrant and
SCG dated as of August 20, 1991 (incorporated by
reference to Exhibit Number 2.02 to the September 3,
1991 Form 8-K).
3.01(i) Registrant's Articles of Incorporation, as amended to
date (incorporated by reference to Exhibit Number
3.04 to the Registrant's Form 10-K for the fiscal
year ended February 28, 1993).
3.01(ii) Registrant's Bylaws, as amended July 14, 1993
(incorporated by reference to Exhibit Number 3.03 to
Registrant's Form 10-Q for the quarter ended August
31, 1993).
10.01 * Registrant's 401(k) Plan (incorporated by reference
to Exhibit Number 10.01 to Registrant's Registration
Statement on Form S-1 under the Securities Act of
1933, as amended, filed January 26, 1990,
Registration No. 33-33219 (the "S-1 Registration
Statement")).
10.02 * Registrant's 1983 Incentive Stock Option Plan, as
amended to date, and related documents (incorporated
by reference to Exhibit Number 10.02 to the S-1
Registration Statement).
10.03 * Registrant's 1988 Stock Option Plan, as amended to
date (incorporated by reference to Exhibit Number
4.01 to the Registrant's Form S-8 filed with the
Securities and Exchange Commission on June 16, 1992).
- --------------------
* Represents a management contract or compensatory plan or arrangement.
-11-
Exhibit
Number Title
------- -----
10.04 * Registrant's 1990 Stock Purchase Plan, as amended to
date (incorporated by reference to Exhibit Number
4.03 to the Registrant's Form S-8 filed with the
Securities and Exchange Commission on October 18,
1993).
10.05 * Form of Indemnity Agreement with Directors
(incorporated by reference to Exhibit Number 10.06 to
the S-1 Registration Statement).
10.06 Lease Agreement by and between Registrant and Boyd C.
Smith, Trustee of the Richard T. Peery 1976 Children
Trusts, and Louis B. Sullivan, Trustee of the John
Arrillaga 1976 Children Trusts, dba A&P Family
Investments dated as of December 13, 1990 (for 3260
Jay Street, Santa Clara, CA 95054) (incorporated by
reference to Exhibit Number 10.09 to the Registrant's
Form 10-K for the fiscal year ended February 28,
1991).
10.07 * Form of Stock Option Grant used in connection with
Registrant's 1988 Stock Option Plan, as amended to
date (incorporated by reference to Exhibit Number
19.01 to Registrant's Form 10-Q for the quarter ended
August 31, 1990).
10.08 * Form of Option Modification Agreement (incorporated
by reference to Exhibit Number 19.01 to the
Registrant's Form 10-Q for the quarter ended August
31, 1991).
10.09 Registrant's 1994 Directors Stock Option Plan
(incorporated by reference to Exhibit Number 10.10 to
the Registrant's Form 10-K for the fiscal year ended
February 28, 1994 (the "FY94 Form 10-K")).
10.10 * Form of Stock Option Grant and Stock Option Exercise
Form used in connection with Registrant's 1994
Directors Stock Option Plan (incorporated by
reference to Exhibit Number 10.11 to the Registrant's
FY94 Form 10-K).
10.11 Revolving Line of Credit Note by and between
Registrant and Wells Fargo Bank, National
Association, dated July 15, 1994 and related Letter
Agreement (incorporated by reference to Exhibit
Number 10.11 to the Registrant's Form 10-Q for the
quarter ended August 31, 1994).
10.12 Amendment dated January 19, 1995, to Revolving Line
of Credit Note by and between Registrant and Wells
Fargo Bank, National Association, dated July 15, 1994
and related Letter Agreement (incorporated by
reference to Exhibit Number 10.12 to the Registrant's
Form 10-K for the fiscal year ended February 28, 1995
(the "FY95 Form 10-K")).
(b) Reports on Form 8-K. No reports on Form 8-K were filed by Registrant
during the three months ended May 31, 1995.
- -------------------
* Represents a management contract or compensatory plan or arrangement.
-12-
SIGNATURES
Pursuant to the requirements 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.
Dated: July 14, 1995 INTEGRATED SYSTEMS, INC.
(Registrant)
-----------------------------
DAVID P. ST. CHARLES
President and Chief Executive Officer
----------------------------
STEVEN SIPOWICZ
Vice President Finance and
Chief Financial Officer
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