SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
[X] ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934 (Fee Required)
For the Fiscal Year Ended February 28, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934 (No Fee Required)
COMMISSION FILE NO. 0-7422
STANDARD MICROSYSTEMS CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 11-2234952
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
80 Arkay Drive, Hauppauge, New York 11788
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
(516) 435-6000
(REGISTRANTIS TELEPHONE NUMBER, INCLUDING AREA CODE )
SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:
Name of each Exchange on
Title of each Class which registered
None
Securities registered pursuant to Section 12(g) of the Act:
COMMON STOCK, $.10 PAR VALUE
(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 (Check Mark) 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 REGISTRANTIS 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. ( )
AS OF APRIL 28, 1995, 13,220,953 SHARES OF THE REGISTRANTIS COMMON STOCK
WERE OUTSTANDING AND THE AGGREGATE MARKET VALUE OF THE VOTING STOCK HELD BY NON-
AFFILIATES OF THE REGISTRANT WAS APPROXIMATELY $245,380,000.
DOCUMENTS INCORPORATED REFERENCE
THE DOCUMENTS INCORPORATED BY REFERENCE INTO THIS FORM 10-K AND THE PARTS
HEREOF INTO WHICH SUCH DOCUMENTS ARE INCORPORATED ARE LISTED BELOW:
DOCUMENT PART
THOSE PORTIONS OF THE REGISTRANT'S 1995 ANNUAL REPORT TO
SHAREHOLDERS (THE "ANNUAL REPORT") WHICH ARE SPECIFICALLY
IDENTIFIED HEREIN AS INCORPORATED BY REFERENCE INTO THIS
FORM 10-K. II
THOSE PORTIONS OF THE REGISTRANT'S PROXY STATEMENT FOR THE
REGISTRANT'S 1995 ANNUAL MEETING (THE "PROXY STATEMENT")
WHICH ARE SPECIFICALLY IDENTIFIED HEREIN AS INCORPORATED BY
REFERENCE INTO THIS FORM 10-K. III
PART I
ITEM 1. BUSINESS.
GENERAL
Standard Microsystems Corporation (the "Company", the "Registrant", or "SMC
(R) ") is a Delaware corporation, organized in 1971. As used herein, the term
"Company" includes the Company's subsidiaries except where the context
otherwise requires. The address of the principal executive office of the
Company is 80 Arkay Drive, Hauppauge, New York 11788, and its telephone number
at that address is 516-435-6000. Through SMC Massachusetts Inc., a wholly-
owned subsidiary, SMC develops internetworking products. Toyo Microsystems
Corporation, a majority owned subsidiary located in Tokyo, Japan, markets and
sells SMC products in Japan. Through wholly owned subsidiaries listed below,
SMC operates branch offices to market and sell its products in the following
locations:
Subsidiary Location
SMC Australia, Inc. Sydney, Australia
Standard Microsystems Corporation (Canada) Oakville, Ontario, Canada
Standard Microsystems (Europe) Ltd. London, England
SMC France, Inc. St. Germain-en-Laye, France
Standard Microsystems GmbH Munich, Germany
SMC Sales, Inc. Various States
Standard Microsystems Corporation (Asia) Taipei, Taiwan
SMC Singapore Singapore
SMC South Africa Johannesburg, South Africa
BUSINESS AND PRODUCT DESCRIPTION
Standard Microsystems conducts its operations primarily through two
divisions, System Products and Component Products. The System Products Division
designs, produces and markets products that allow personal computers (PCs) to be
connected to local area networks (LANs) and products that connect LANs to each
other. The Component Products Division designs, produces and markets metal-
oxide-semiconductor/very-large-scale-integrated (MOS/VLSI) circuits mainly for
PC input/output (I/O) control and computer and industrial network control
PERCENT OF REVENUES BY PRODUCT LINE
Fiscal year ended February: 1995 1994 1993
System products 69.0% 82.2% 90.5%
Component products 31.0% 17.8% 9.5%
Total 100.0% 100.0% 100.0%
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BUSINESS AND PRODUCT DESCRIPTION: SYSTEM PRODUCTS DIVISION
SMC LAN products enable a personal computer to be connected to a network and
permit LANs to be connected to each other. Connection to a LAN permits a
personal computer user to send messages to and receive messages from other LAN
users and share common resources such as printers, disk drives, files and
programs. LANs offer individuals the advantages of working at their own PCs
and, at the same time, provide an organization the benefits of connectivity and
productivity by allowing multiple users to communicate and share resources.
Internetworking, or connecting LANs to each other, allows users to communicate
and share resources within a facility or over an entire enterprise instead of
being confined to a workgroup or a department.
SMC LAN products include network interface cards (adapters), wiring hubs,
associated software and transceivers that operate over a variety of media
including 10Base-T twisted pair, unshielded twisted pair, shielded twisted pair,
coaxial, and optical fiber cabling. The Company provides LAN products for major
protocols or technologies used for PC-based LANs: Ethernet, Fast Ethernet, Token
Ring and ARCNET(R). LAN technologies combine hardware and software to control
traffic signaling and message passage between PCs and peripheral devices. End
users differentiate LAN technologies chiefly based upon speed and volume of
data transmitted, installation procedures and equipment cost.
SMC's modular platform, internetworking LAN switch product line integrates
the functions of a bridge, a router and intelligent hubs in a single chassis.
It operates over major LAN protocols: Ethernet, Token Ring and FDDI (Fiber
Distributed Data Interface) and provides a high speed interface to campus
networks. It is most often used as a collapsed backbone to connect LANs within
a single facility. A new Ethernet switch is used in workgroups to accelerate
the bandwidth by segmenting the network into smaller portions, each of which
receives full network bandwidth.
On March 1, 1994, the Division formed the Desktop Networks Business Unit
and the Enterprise Networks Business Unit to focus on product development and
marketing. Desktop Networks concentrates on adapter products, and Enterprise
Networks concentrates on wiring hub and LAN switch product lines. Sales,
manufacturing, technical customer support and marketing communications continue
as centralized divisional functions serving both business units.
NETWORK INTERFACE CARDS (ADAPTERS): Installed in a personal computer or
workstation, an adapter is a printed circuit board which provides for connection
to a LAN over telephone--unshielded twisted pair (UTP) or shielded twisted pair
(STP)--wire, coaxial or fiber optic cables. The Company's adapters permit
connection to the communications links or buses internal to a PC. These buses,
which allow for transmission of signals in a computer, are known as industry
standard architecture (ISA), extended industry standard
architecture (EISA), micro-channel architecture (MCA) and peripheral component
interconnect (PCI). An adapter provides a connector for a cable which plugs
into a wall outlet, much as a telephone cable connects to a wall outlet. SMC
provides software for communicating over and diagnosing a network, installing
an adapter and collecting data for managing a network for its Ethernet and
Token Ring adapters.
TheEtherCard Elite Ultra(TM) line of 16-bit Ethernet adapters, shipped in July
1993, was SMC's first family of single chip-based Ethernet controller adapters.
Based on SMC proprietary chips, a 32-bit EISA bus master version was shipped
in February 1994. Bus mastering allows the adapter to transfer data between
the network and workstation without intervention by the microprocessor in the
workstation.
Shipped in August 1994, and based on a more advanced single chip
controller, the EtherEZ(TM) family of auto-configurable 16-bit Ethernet
adapters supports Plug and Play (PnP) which allows a PC to discover an adapter.
When installed in a PC not supporting PnP, the set up procedure is similar to
but faster than that of Elite Ultra adapters.
Shipped in September 1994, the EtherPower(TM) family of auto-configurable
Ethernet adapters is installed on the high speed, 32-bit PCI local bus.
Serving as a high-speed interface between the processor and the adapter, the
PCI bus eliminates bottlenecks by bypassing the traditional I/O bus (like ISA),
provides a wider data path and a faster data transfer rate.
Shipped in February 1995, the EtherPower 10/100(TM) PCI bus and Ether 10/100(TM)
EISA bus auto-configurable Fast Ethernet adapters work with either 10BASE-T or
100BASE-T hubs. Both adapters feature connectors for UTP and STP cabling. The
STP connection allows Token Ring users to switch to Fast Ethernet by changing
adapters and hubs, leaving the cabling intact.
The TokenCard Elite(TM) line of adapters, shipped in October 1992, marked SMC's
entry into the Token Ring market. Incorporating SMC's internally developed
chip set allows for low cost production. Shipped in June 1994, a 32-bit EISA
version uses the same bus master chip as on the Ethernet bus master adapter.
WIRING HUBS: The cables, beginning at the adapter connector, are usually
linked to a centrally located wiring hub. The hub passes along and boosts
signals from one computer or port on a LAN to one or more other ports. Wiring
hubs are called concentrators for Ethernet, multi-station access units (MAUs)
for Token Ring and hubs for ARCNET. SMC hub products are best suited to
workgroup or departmental sized LANs.
In addition to the physical signaling function, intelligent hubs
incorporate software which aids in managing a network. SMC produces both
conventional and intelligent hubs and the software to support network
management. SMC's Elite 3512 (TM)12-port Ethernet
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concentrator is upgradable to an intelligent concentrator
by installing the Company's Network Management Module(TM). SMC's Elite 3812
stackable concentrator allows stacking 8 concentrators or 96 UTP ports or 112
total ports, all controlled by a single Network Management Module.
The new 6-member TigerHub(TM) family of unmanaged hubs of 3 to 12 ports is
based on a proprietary, highly integrated circuit which controls up to 7 hub
ports. SMC also introduced a Ring Management Module, that when added to the
EliteStack(TM) stackable MAUs, provides industry compliant SNMP network
management for Token Ring.
INTERNETWORKING PLATFORM: SMC's EliteSwitch(TM) model ES/1(TM) internetworking
product is based on an 800 megabit per second (Mbps) backplane. The dual RISC
(reduced instruction set computer) processor architecture of its Packet
Processing Engine(TM) is capable of filtering and forwarding at the maximum
packet rate of each of its ports. The chassis can house five modules, each with
a RISC processor, and redundant power supplies. The modules and power supplies
are hot swappable, enabling parts installation without interrupting the ES/1's
operation.
By varying the mix of modules, the ES/1 platform can be configured as: (i)
a bridge or router to seamlessly interconnect LAN segments in a collapsed
backbone environment; (ii) a bridge or router to connect LANs to enterprise
networks; (iii) a bridge or router to connect clients and servers in a client-
server network; (iv) an intelligent hub for Ethernet, Token-Ring, FDDI or any
combination of the three; and (v) any combination of the above.
The environments which best utilize the ES/1's attributes apply to
interconnecting different types of LANs within a building or between buildings
within close proximity, an environment known as INTRANETWORKING. In those
environments, the customer can use the ES/1's high speed bridging and routing,
the faculty to translate between LAN protocols, the support of popular IP and
IPX (Novell) routing protocols and the ability to connect to high speed phone
lines. The user can make these connections without incurring additional costs
associated with routers, which usually incorporate software to connect computer
resources over a wide area.
Shipped in November 1994, the TigerSwitch(TM) XE is an intelligent Ethernet LAN
switch used to increase more bandwidth to a workgroup. A TigerSwitch may be
connected to chassis or stackable hubs, workstations and servers, segmenting
the network so that each attached entity receives a full 10 Mbps of bandwidth
provided by Ethernet. TigerSwitches can be trunked together or to ES/1s,
providing a large network of switched Ethernet ports.
SUPPORT SOFTWARE: Supporting software that accompanies SMC's(TM)
EliteSeries lines of SuperDisk(TM) Ethernet and Token Ring adapters is
delivered on which contains: (i) drivers for popular network operating systems,
(ii) EZStart(TM) installation and test utility and (iii)
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PC Agent/SNMP. SMC believes extensive software support, which is supplied
without charge, distinguishes its line of adapters.
A driver is software that enables network hardware to communicate over a LAN
by providing the link between the network protocol and the network operating
system. Suppliers of network operating systems regularly update their software,
which requires SMC to regularly alter its drivers. SMC also updates drivers to
improve performance over a network.
Drivers are supplied for servers and workstations operating under network
operating systems such as Novell(R) Netware(R) 2.x, Novell Netware 3.x, Novell
Netware 4.x, Novell Netware Lite, Novell Netware for SAA, Microsoft(R)
LANManager, IBM(R) LANServer, SCO or ISC UNIX, Artisoft LANtastic(R), Banyan(R)
Vines(R) and the OSI consortium's GOSIP. SMC offers Driver Assurance, insuring
that drivers which work on new EliteSeries adapters are compatible with prior
generations. Installers also have the flexibility to choose either a fully
software or hardware (jumper) configurable setup.
With a Windows-like user interface in a DOS environment, EZStart (i)
automatically configures a ADAPTER; (ii) loads the drivers of choice; (iii)
diagnoses the ADAPTER and tests communications along the network and (iv)
installs PC Agent/SNMP. EZStart's macro function records mouse clicks or
keystrokes which can be saved and reused to automatically install a large number
of adapters without installer intervention.
PC Agent/SNMP uses Simple Network Management Protocol (SNMP), an industry-
standard protocol which facilitates network management. PC Agent/SNMP gathers
data about the status of a computer in which an adapter resides. On request,
that data is passed along to an SNMP-based network management program. PC
Agent/SNMP for Ethernet and Token-Ring allows SMC adapters to be polled for
status data by SNMP compliant network management systems such as enterprise-wide
packages offered by Hewlett-Packard, Sun Microsystems or Novell.
SNMP agents are provided as software embedded in flash, read only memory
with both SMC's intelligent concentrators and switching hub platform. The
agents gather status data about the physical hardware on the segment of a LAN
connected to that hub. The network management systems which utilize data
gathered by PC Agent/SNMP also utilize data gathered by the hub based agents.
SMC offers EliteView(TM), a family of SNMP-based software packages for
managing workgroup, departmental or enterprise LANs. EliteView's capabilities
have been regularly upgraded. Shipped in June 1994, EliteView 4.0 operates on
a PC under a Windows environment and supports both Ethernet and Token Ring
networks. Features that improve upon prior releases include the ability to:
(i) utilize dynamic data exchange (DDE) to share information with other
DDE-based applications such as Microsoft's Excel
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spreadsheet; (ii) create an inventory and a logical road map; (iii) graphically
display the devices that are IP, IPX and SNMP auto-discoverable; and (iv) draw
and customize hierarchical views of various network levels. Release 4.1
supports the TigerSwitch. EliteView 4.0-ES gathers status data from ES/1 LAN
switches, as well as from hub-based and PC-based agents.
Several versions of EliteView operate under the UNIX operating system to
monitor and manage the ES/1 internetworking platform. EliteView/OV runs under
Hewlett-Packard OpenView network management system (NMS), allowing a network
manager to monitor and manage the ES/1 along with all other network devices.
Similarly, EliteView/NV runs under IBM NetView/6000 and EliteView/SN runs
under SunConnect SunNet Manager. A user can click on an icon on the screen of
these UNIX-based NMSs to access EliteView .
SMC provides an out-of-band network management utility with SMC's
intelligent MAUs. Out-of-band management allows the utility to monitor the
network even when the network is unable to operate. SMC also offers network
management for ARCNET installations.
THE SMC UNITY FRAMEWORK: The System Products Division has developed a
framework called SMC Unity to highlight the breadth of SMC's product portfolio
for the LAN backbone, wiring closet and desktop. SMC Unity consists of three
basic layers of functionality for a comprehensive, on-premises networking
solution:
The LAN Access layer provides intelligent Ethernet, Fast Ethernet and Token
Ring adapters and unmanaged hubs and represents the intersection at which
individual PC users access the network.
The Bandwidth Acceleration layer utilizes SMC's TigerSwitch, connected to
SMC's or others' stackable hubs, to segment and, thus, increase the capacity of
a network without impacting a useris existing wiring, hubs and adapters.
The Intranetworking layer depends upon the multi-technology ES/1 LAN switch
to: (i) provide a high speed backbone; (ii) translate between Ethernet, Token
Ring and FDDI protocols; (iii) accommodate emerging Fast Ethernet and ATM
technologies and (iv) be reliable through redundancy, hot swappability and
other measures.
DESIGN CRITERIA: SMC's System Products Division designs and develops
critical integrated circuit components that control the operation of its
Ethernet and Token Ring network interface cards. The Company believes that this
vertical integration provides an advantage in terms of control over costs,
performance, quality and time-to-market, when compared to those competitors who
buy critical integrated circuits from merchant semiconductor manufacturers. The
single-chip 790UltraChip(TM) Ethernet controller is the key device on the
EtherCard Elite Ultra family of 16-bit Ethernet adapters and on the 32-bit bus
master version. A more advanced single-chip 795 Ethernet controller is the key
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device on the EtherEZ family of auto-configurable Plug and Play (PnP) 16-bit
Ethernet adapters. The 571 EISA bus master chip is used on both the Ethernet
and Token Ring EISA adapters.
Chip and board designers, software developers and documentation personnel
are able to focus on optimizing the performance of each product aided by the
high level of functional integration obtainable within a single integrated
circuit. SMC has also designed critical components for its hub and
internetworking products. The 710 hub chip supports six 10Base-T Ethernet
ports.
BUSINESS AND PRODUCT DESCRIPTION: COMPONENT PRODUCTS DIVISION
The Component Products Division designs, develops and manufactures very-
large-scale-integrated (VLSI) circuitry. SMC maintains its SuperCell(TM)
library of complex circuit functions which shortens the design cycle of VLSI
circuits. Component products are focused on the personal computer
input/output (PC I/O) and networking markets. During fiscal 1994 and 1995, the
Division's revenues were primarily from PC I/O devices.
SMC's PC I/O controllers consist of integrated circuits with a variety of
levels of functional integration for control and interfacing of various
peripheral and communications functions in a PC. Features include AT
interfaces, digital data separation, vertical or horizontal recording, control
of serial and parallel ports, interfaces with the game port and hard disk drive,
and other functions for floppy disk control. ChiProtect(TM) circuitry prevents
damage to the integrated circuit from inadvertent current overloads on the
parallel port interface.
PC I/O controllers introduced by SMC during fiscal 1993 and 1994 are known
as super I/O devices. In a single package, these circuits combine many of the
connectivity functions listed above that have become required features for PCs.
SMC's super I/O class of devices are pin compatible, offering customers the
flexibility to design one circuit board layout, modifying characteristics by
inserting one or another of SMC's devices. Popular PC I/O devices support
Enhanced Parallel Port (EPP) and Microsoft and Hewlett-Packard sponsored
Extended Capabilities Port (ECP) protocols that provide very high speed
communications through the parallel port between a PC and peripheral equipment.
During fiscal 1995, SMC announced PC I/O devices with enhanced features
including interfaces for infrared (IR) wireless communications, support of PnP
and low electrical power usage for laptop and handheld PCs. SMC also announced
and began to ship a class of PC I/O controllers known as ultra I/O. On a single
chip, these devices add keyboard and mouse control, system clock generator and a
real time clock to the super I/O level of functionality.
Network circuits are sold to vendors of ARCNET, Ethernet and Fast Ethernet
equipment. Versions of ARCNET devices have been developed which are optimized
for use in the
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industrial control and transportation markets. In October 1993, the Division
announced availability of a single-chip Ethernet controller with RAM (SCECR) on
board. The device integrates an Ethernet controller, memory management, ISA
bus interface, encoder and decoder, 10Base-T transceiver and AUI interface and
memory. In April 1994, the division announced the FEAST (TM) chip, the first
100Base-T Fast Ethernet controller device available from a semiconductor
supplier. It also supports 10Base-T on the same chip.
BUSINESS AND PRODUCT DESCRIPTION: WARRANTY POLICY
The Company's products are generally under warranty against defects in
material and workmanship for periods of one year to the lifetime of a product.
Estimated warranty costs are accrued when products are sold.
MARKETS AND COMPETITION
Network products of the SYSTEM PRODUCTS DIVISION are used chiefly in
conjunction with personal computers which are connected to local area networks.
Integrated circuits of the COMPONENT PRODUCTS DIVISION are used primarily in
personal computers.
Competition is characterized by rapid technological change and significant
unit price reductions which may not always correspond to a decrease in
production costs. Product line differentiation may be determined by breadth,
diversity, performance characteristics such as speed, quality and reliability
and prices. Among the competitors, important distinctions are timeliness of
shipments, depth of customer support and technical service. The principal
methods SMC uses to compete include new products, servicing customers and
reducing manufacturing costs. However, although past performance can be a
guide, there is no assurance that the Company can continue to improve or
maintain gross profit margins.
MARKETS AND COMPETITION: SYSTEM PRODUCTS DIVISION
The available worldwide market for the Company's LAN products is determined
by the installed base of PCs, sales of new PCs and the portion of PCs connected
to local area networks. SMC agrees with market forecasters who believe that the
percentage of PCs connected to LANs has increased over recent years. Competitors
include domestic and foreign manufacturers, many of whom possess substantially
greater resources than SMC.
SMC's Ethernet, Fast Ethernet, Token Ring and ARCNET adapters address over
90% of the available market for network interface cards in terms of units sold.
The coverage statistics are based upon estimates of the worldwide adapter market
for calendar 1994 made by market research firms. According to the market
estimates, during 1994, about 23 million adapters were shipped for installation
into personal computers. These market researchers estimate that in calendar
1993, 17 million adapters were shipped.
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The Desktop Networks Business Unit, which includes Ethernet, Fast Ethernet,
Token Ring and ARCNET adapters, accounted for 79% of System Products Division
revenues, or 54% of Company revenues, during fiscal 1995.
SMC's line of conventional and intelligent wiring hubs is aimed principally
at workgroup and departmental environments. As network management gains in
importance in both workgroup and departmental-sized networks, SMC believes that
hub products will become a larger portion of the System Products Division
revenues.
The LAN switch internetworking product line has benefited from the growing
need to supply more bandwidth to networks and to build enterprise-wide networks
by connecting LANs which utilize different protocols. The ES/1 is best applied
to connecting LANs within a facility or in close proximity on a campus. SMC
believes the power and flexibility provided by the platform's high-speed
backplane, architecture and modularity offers a competitive advantage and lower
initial and lifetime costs to customers. Utilizing much of the technology of
the ES/1, the new TigerSwitch XE is aimed at accelerating bandwidth for
workgroup LANs. SMC believes its power and flexibility offers a competitive
advantage and lower initial and lifetime costs to customers.
The Enterprise Networks Business Unit, which includes Ethernet, Token Ring
and ARCNET wiring hubs and LAN switches, accounted for 21% of divisional
revenues, or 15% of Company revenues, during fiscal 1995.
Because many competitors sell products which perform similar functions, the
System Products Division's strategy is to provide superior price/performance
solutions for the PC LAN market, along with the highest level of customer
support, technical service and software. SMC has combined its comprehensive
product line and services into the SMC Unity framework for on-premises
networking solutions. Market share for each participant is based on a
combination of price, performance, service, promotional and advertising activity
and strength of the marketing channels.
Competition is provided by domestic and foreign manufacturers in both the
US and international markets. Some companies concentrate on aggressive pricing
as the principal competitive tool. On the other hand, the leading manufacturers
supplement price strategies with performance and service. In addition, shorter
product life cycles have required acceleration of new product design cycles.
The Company has been able to lower production costs through manufacturing
efficiencies while advancing the technology and features of its products and
passing along cost savings through reduced selling prices. In most cases,
product improvements are derived from SMC's semiconductor and board design,
production, testing and software capabilities. Most of the System Products
Division's competitors lack the depth of SMC's
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semiconductor design capability and commitment. SMC believes its breadth and
timeliness of driver support provides an advantage over most other adapter
suppliers.
MARKETS AND COMPETITION: COMPONENT PRODUCTS DIVISION
The Division's strategy is to concentrate its product development, sales
and marketing resources into the PC I/O and networking markets. These markets
represent a small portion of the total semiconductor market. Competitors
include both domestic and foreign manufacturers, many of whom possess
substantially greater resources than SMC.
Within the PC I/O market, SMC believes the variety of performance features
and the design flexibility provided to customers has led to strong acceptance of
its family of PC I/O devices and allowed SMC to become the market leader. The
division has continually added devices with enhanced features. Principal
customers for PC I/O devices are most major producers of PCs.
The fiscal 1993, 1994 and 1995 introductions of 10 Mbps and 100 Mbps single
chip Ethernet control devices placed the Component Products Division in a
growing and very competitive market for PC LANs.
A family of low cost industrial ARCNET controllers addresses industrial
network solutions, characterized by long design-in cycles. Addressing specific
customers, SMC's foundry business applies semiconductor fabrication skills to
non-semiconductor products, including a device for ink jet printer heads.
SALES AND DISTRIBUTION
SMC's system products are sold primarily to distributors of computer
products as well as system integrators, original equipment manufacturers (OEMs)
and end users. Component products are sold primarily to OEMs and also to
distributors of semiconductor devices. The Company maintains a reserve for
anticipated product returns and price protection.
One customer, Ingram Micro D Inc., accounted for over 10% of revenues in
fiscal 1995.
SALES AND DISTRIBUTION: SYSTEM PRODUCTS DIVISION
Standard Microsystems sells and markets most LAN products primarily through
LAN and microcomputer distributors and OEM/strategic accounts. The distributors
sell products to thousands of resellers who offer products to end users. The
Division provides service and support and promotional programs to encourage
resellers to buy SMC products from distributors.
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In accordance with industry practice, distributor inventory is protected
with respect to price on inventories which the distributor may have on hand at
the time of a change in the published list price, and with respect to the
rotation of slow moving inventory in exchange for other inventory of equal
value. Distributor contracts may be terminated by written notice by either
party. The contracts specify the terms covering the return of inventories.
Returns of product pursuant to termination of these agreements have not been
material.
LAN switches are sold chiefly to end users, value added resellers and
OEM/strategic accounts who buy directly from SMC. Sales of Token Ring products
frequently require direct end-user contact by SMC personnel although sales are
fulfilled through the distributor channel. Because internetworking products
impact a broad portion of a customer's network, they generally fall under the
authority of an organization's information technology manager. As a result,
during this past fiscal year, SMC has expanded its sales organization to also
sell directly to end users.
SALES AND DISTRIBUTION: COMPONENT PRODUCTS DIVISION
Sales are primarily to OEMs and electronic component distributors.
Producers of PCs are the Division's largest customer group. In accordance with
industry practice, distributor inventory is protected with respect to price on
inventories which the distributor may have on hand at the time of a change in
the published list price. Also, in accordance with industry practice, slow
moving inventory may be exchanged for other inventory of equal value.
Distributor contracts may be terminated by written notice by either party. The
contracts specify the terms for the return of inventories. Returns of product
pursuant to termination of these agreements have not been material.
SALES AND DISTRIBUTION: INTERNATIONAL SALES
As a percentage of total revenues, the Company's sales to customers located
outside the United States (mainly in Europe, the Far East and Canada) were 46.8%
in fiscal 1995, 44.0% in fiscal 1994, and 43.9% in fiscal 1993. Export sales
are made in United States dollars, except for sales by Toyo Microsystems, which
are denominated in Japanese yen. SMC's competitive position in foreign markets
may be impacted by currency fluctuations.
BACKLOG
The Company schedules production based upon a forecast of demand for its
products. Sales are made primarily pursuant to purchase orders generally
requiring delivery within one month. In light of industry practice and
experience, the Company believes that backlog is not a particularly meaningful
indicator of future sales.
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MANUFACTURING
Products of the System Products Division are assembled by turnkey
subcontractors at plants located in the United States and Ireland. Design and
assembly of these products primarily utilize surface mount technology. SMC
provides the subcontract manufacturer with detailed documentation necessary to
build a board to required quality specifications. This documentation includes
board schematics and drawings, bill of materials, quality specifications and
packaging, handling and shipping details.
The subcontract manufacturer is then responsible for component procurement,
including printed circuit boards, incoming test of components, mounting all
components on the printed circuit board and the burn-in and final testing of the
boards. SMC requires that assembled boards be manufactured to Interconnecting
and Packaging and Electronic Circuit (IPC) standards.
SMC utilizes semiconductor foundries and assembly contractors in the US,
Southeast Asia and Western Europe to provide state-of-the-art CMOS manufacturing
and assembly capacity. These foundries manufacture most of the proprietary
integrated circuits used in System Products Division products. During fiscal
1995, 92% of the revenues of the Component Products Division resulted from the
sale of product manufactured by subcontractor foundries, compared to 88% in
1994. The Company continuously explores additional subcontract manufacturing
relationships.
In October 1994, SMC and AT&T Microelectronics entered into a cooperative
wafer fabrication agreement for SMC to invest $16 million in wafer fabrication
equipment for a semiconductor plant owned by AT&T Microelectronics, located in
Madrid, Spain. This investment provides SMC with wafers from a facility capable
of producing device geometries of 0.9 to 0.45 microns (millionths of a meter).
SMC will receive wafers over a five year period beginning near the end of fiscal
1996 when SMC is expected to first receive wafers.
In the first quarter of fiscal 1996, SMC purchased a minority equity
interest in Singapore-based Chartered Semiconductor Pte Ltd. for approximately
$14 million. An additional $6.0 million will be invested in early fiscal 1997.
This transaction provides SMC with wafers from an advanced facility being built
that will be capable of producing device geometries of 0.6 to 0.2 microns. SMC
will receive wafers over a ten year period beginning near the end of fiscal 1996
when SMC is expected to first receive wafers.
The Company has developed relationships with several suppliers who
represent the primary source for certain components, raw material and finished
product. Most components and other materials purchased by SMC and its
subcontractors are generally available from multiple suppliers. However,
certain components and other materials are available from a single source. The
inability to obtain certain components or materials
13
could lead to an interruption in shipments of certain SMC products. SMC and
its subcontract assemblers have generally been able to obtain both sole and
multiple-sourced materials without interrupting production schedules. However,
the inability to obtain certain components, materials or finished products from
a supplier or subcontractor could cause a temporary interruption in the sale of
the Company's products.
High levels of production by PC manufacturers have led to an industry-wide
shortage of silicon wafer fabrication capacity. As a result, SMC believes it
was unable to produce all the integrated circuits it was capable of selling in
fiscal 1995. Currently faced with limited subcontractor fabrication capacity,
difficulty in securing additional capacity could impact revenue and profit
growth in fiscal 1996 and beyond
RESEARCH AND DEVELOPMENT
The technology involved in designing and manufacturing SMC's products is
complex and is constantly being refined. Accordingly, the Company is committed
to a program of research and development oriented toward improving and refining
its existing capabilities and developing new techniques, designs and
technologies for component and system products.
During the fiscal year which ended February 28, 1995, SMC spent $28,286,000
on research and development, which equaled 7.5% of revenues. This compares with
$23,963,000 or 7.4% of revenues spent during fiscal 1994 and $17,033,000 or 6.8%
of revenues during fiscal 1993.
Engineering groups within both the System Products and Component Products
Divisions utilize semiconductor design techniques to minimize chip area and
utilize advanced wafer processing and packaging methods. The goal is to obtain
the best features, performance and reliability while minimizing integrated
circuit manufacturing costs.
NEW PRODUCTS: Key networking products introduced by the SYSTEM PRODUCTS
DIVISION during fiscal 1995 included two lines of single-chip based Ethernet
adapters and low cost unmanaged concentrators. Key internetworking products
introduced included a workgroup Ethernet switch and Token Ring and fiber
input/output modules (IOMs) for the ES/1. Software introduced supported routing
protocols and network management based on the SNMP industry standard protocol.
Key products introduced by the COMPONENT PRODUCTS DIVISION during fiscal
1995 included extensions to its PC I/O controller family and a single-chip Fast
Ethernet controller.
14
PRODUCTS INITIALLY SHIPPED IN FISCAL 1995
ETHERNET PRODUCTS:
ETHEREZ (TM): 16-bit ISA PnP (auto-configurable) compliant adapters
with 10Base-T connector, thin coax connector or a combination of 10Base-T and
thin coax connectors, I/O or memory mapped
ETHERPOWER(TM): 32-bit PCI auto-configurable adapters with 10Base-T
connector or a combination of 10Base-T and thin coax connectors, bus master
ETHERPOWER10/100(TM): 32-bit PCI auto-configurable adapters with 10Base-T and
STP connectors, bus master, software selection of 10Base-T or 100Base-T
ETHER10/100(TM): 32-bit EISA auto configurable adapters with 10Base-T
connectors, DMA burst mode access, software selection of 10Base-T or 100Base-T
ELITECARD(TM): PCMCIA credit-card-sized adapters with a 10Base-T or a
combination of 10Base-T and thin coax connectors for laptop and portable
computers
ETHERCARD ELITE ULTRA(TM): 16-bit ISA adapters with 10Base-T and AUI connectors
or thin coax and AUI connectors
TIGERHUB(TM): Family of six unmanaged hubs configured: TP6 - 6 10Base-T ports,
1 AUI port; TP6B - 6 10Base-T ports, 1 BNC port; CX3 - 3 BNC ports, 1 AUI port;
TP12 - 12 10Base-T ports, 1 AUI port, 1 BNC port, segmentable; CX6 - 6 BNC
ports, 1 AUI port, 1 10Base-T port, segmentable; FL6 - 6 dual fiber ports, 1
AUI port, 1 BNC port, segmentable
TOKEN RING PRODUCTS:
TOKENCARD ELITE MASTER32(TM): 32-bit EISA adapter with 10Base-T and
thin coax connectors, bus master
ELITESTACK RMM(TM): plug-in module with microprocessor and SNMP agent stored in
flash PROM to allow up to 32 EliteStack stackable MAUs to be monitored by an
SNMP-based NMS
LAN SWITCHING PRODUCTS:
QUAD TOKEN RING INPUT/OUTPUT MODULES (QTIOM): four port modules with connectors
for twisted pair or coax cables; each IOM connects an ES/1 to four independent
Token-Ring LANs and allows seamless connection to attached networks,
including Ethernet and FDDI
INTELLIGENT FDDI INPUT/OUTPUT MODULE (IFIOM): dual attached fiber interface
allowing an ES/1 to switch between multiple FDDI networks
HIGH-SPEED SERIAL INTERFACE INPUT/OUTPUT MODULE (HIOM): connection
across public network to T3/E3 or Sonnet up to 52 Mbps or T1/E1 up to 10 Mbps
TIGERSWITCH(TM) XE: Ethernet store and forward switch with 24 RJ-45 ports, 1
AUI port and 1 RS-232C connection with 10 Mbps to each port for an aggregate of
240 Mbps of bandwidth
15
NETWORK MANAGEMENT SOFTWARE:
ELITEVIEW(TM) V4.0: Windows based NMS for managing networks with SMC
hubs and adapters, supporting SNMP agents for SMC Ethernet and Token
Ring adapters and hubs; V4.0-ES: also incorporates ES/1 support; also shipped
V4.1 and V4.1-ES
ELITEVIEW(TM) /NV, /OV and /SN SNAP-INS: SNMP applications enabling
management, control and monitoring of ES/1 from within UNIX based NMSs: /NV -
with IBM's NetView; /OV - with Hewlett-Packard's OpenView; /SN -
with SunConnect's SunNet Manager
NETWORK AND PC I/O CONTROLLERS:
SMC91C100: FEAST (Fast Ethernet using Advanced SMC Technology) dual speed 10
and 100Mbps controller, memory management and 32-bit data path
FDC37C665IR,..666IR: infrared communications for wireless data transfers
between notebook PCs, personal digital assistants and desktop PCs, low power;
super I/O features of 2.88 megabyte floppy disk control, serial port and
parallel port control with chip protection and power down, EPP and ECP protocol
support to interface with high speed peripherals
FDC37C667: ISA PnP compatible in addition to Super I/O features
FDC37C92X: adds keyboard controller and real time clock to features of 665IR to
become ultra I/O class controller (X varies from 1 to 5, depending upon the
BIOS [basic input/output system] supported)
FDC37C93X: adds PnP support to 92X features
SMC34C731: 486 core logic companion, buffers to drive ISA bus signals, memory
refresh
SMC34C761: high voltage buffer including multiple line drivers and receivers,
timers and dual game port interface, for use with SMC PC I/O devices
PATENTS AND LICENSE AGREEMENTS
The Company has received numerous United States patents relating to its
technologies and additional patent applications are pending.
The Company has entered into non-exclusive patent licensing and
patent/technology licensing agreements which have entitled the licensees to
utilize the Company's patents or technologies, in exchange for which the Company
has received, in various combinations, lump-sum payments, royalty payments, the
right to utilize other patents or technologies of the licensees or other
consideration, including the right to manufacture, market and sell specific
products designed by the licensees. These agreements have typically provided
for bi-directional licenses under certain patents, utility models and design
patents, existing at the effective date of the particular agreement and patent
applications filed within a specified period of years after the effective date
of the agreement. The licenses usually continue for the life of the particular
patent.
16
The Company has, from time to time, been informed of claims that it may be
infringing patents owned by others. When the Company deems it appropriate, the
Company may seek licenses under certain of such patents. However, no assurance
can be given that satisfactory license agreements will be obtained if sought by
the Company or that failure to obtain any such licenses would not adversely
affect the Company's future operations.
ENVIRONMENTAL REGULATION
Federal, state and local regulations impose various controls on the
discharge of certain chemicals and gases used in semiconductor processing. The
Company's facilities have been designed to comply with these regulations.
However, increasing public attention has focused on the environmental impact of
electronics manufacturing operations and, accordingly, there is no assurance
that future regulations will not impose significant costs on the Company.
EMPLOYEES
As of February 28, 1995, of the Company's 861 employees, 202 were engaged
in engineering, including research and development, 301 in marketing and sales,
161 in executive and administrative activities and 197 in manufacturing and
manufacturing support. This compared to February 28, 1994, when, of the
Companyis 755 employees, 182 were engaged in engineering, including research and
development, 207 in marketing and sales, 148 in executive and administrative
activities and 218 in manufacturing and manufacturing support.
Many employees are highly skilled and SMC's success depends upon its
ability to retain and attract such employees. The Company has never had a work
stoppage. No employees are represented by a labor organization and the Company
considers its employee relations to be satisfactory.
SMC and Standard Microsystems are registered trademarks of Standard
Microsystems Corporation. Product names and company names are the trademarks of
their respective holders.
17
ITEM 2. PROPERTIES.
The Company owns five facilities, totaling approximately 249,000 square
feet of plant and office space, located on approximately 28 acres in Hauppauge,
New York, where research, development, manufacturing, product testing,
warehousing, shipping, marketing, selling and administrative functions are
conducted.
The Company occupies a 50,000 square foot facility in Irvine, California,
where the Desktop Networks Business Unit of SMC's System Products Division
conducts research, development and marketing. The lease expires in 1997.
The Company occupies a 61,000 square foot facility in Andover,
Massachusetts, principally used by the Enterprise Networks Business Unit of
SMC's System Products Division which conducts research, development and
marketing. The lease expires in 2001.
In addition, the Company maintains offices in leased facilities in: San
Diego and San Jose, California; Boca Raton and Miami, Florida; Atlanta, Georgia;
Oakbrook Terrace, Illinois; Beachwood and Dayton, Ohio; Austin and Dallas,
Texas; McLean, Virginia; Bellevue, Washington; Sydney, Australia; Oakville,
Ontario, Canada; London, England; St. Germain-en-Laye, France; Munich, Germany;
Tokyo, Japan; Singapore; Johannesburg, South Africa and Taipei, Taiwan.
Machinery and equipment and leasehold improvements with an original cost of
approximately $108,372,000 and accumulated depreciation and amortization of
approximately $73,465,000 are owned by the Company as of February 28, 1995.
18
ITEM 3. LEGAL PROCEEDINGS. Not applicable.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not applicable.
EXECUTIVE OFFICERS OF THE REGISTRANT
The executive officers of the registrant as of April 30, 1995, are as
follows:
SERVED AS AN
NAME POSITION AGE OFFICER SINCE
Victor F. Trizzino President and 54 1980
Chief Executive Officer
Paul Richman Chairman 52 1971
Gerald E. Gollub Executive Vice President 52 1976
Arthur Sidorsky Executive Vice President 61 1980
Anthony M. D'Agostino Vice President Finance 37 1988
and Treasurer
All officers serve at the pleasure of the Board of Directors.
19
PART II
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY
AND RELATED STOCKHOLDER MATTERS.
The information captioned "Market price" and the last three paragraphs
appearing in the Annual Report under the heading "Quarterly Financial Data" are
incorporated herein by this reference. Except as specifically set forth herein
and elsewhere in this Form 10-K, no information appearing in the Annual Report
is incorporated by reference into this report nor is the Annual Report deemed
to be filed, as part of this report or otherwise, pursuant to the Securities
Exchange Act of 1934.
ITEM 6. SELECTED FINANCIAL DATA.
The information appearing in the Annual Report under the caption "Selected
Financial Data" is incorporated herein by this reference.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.
The information appearing in the Annual Report under the caption
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" is incorporated herein by this reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
The financial statements, notes thereto, Report of Independent Public
Accountants thereon and quarterly financial data appearing in the Annual Report
are incorporated herein by this reference.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE.
Inapplicable.
20
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
The information appearing in the Proxy Statement under the caption
"Election of Directors" is incorporated herein by this reference.
ITEM 11. EXECUTIVE COMPENSATION.
The information appearing in the Proxy Statement under the caption
"Executive Compensation" is incorporated herein by this reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT.
The information appearing in the Proxy Statement under the captions
"Election of Directors" and "Voting Securities of Certain
Beneficial Owners and Management" is incorporated herein by this reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
The information appearing in the Proxy Statement under the caption "Certain
Relationships and Related Transactions" is incorporated herein by this
reference.
21
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 Company
and its subsidiaries have been incorporated by reference from the
Annual Report pursuant to Part II, Item 8:
Consolidated Statements of Income for the three years ended February
28, 1995
Consolidated Balance Sheets, February 28, 1995 and February 28, 1994
Consolidated Statements of Shareholders' Equity for the three years
ended February 28, 1995
Consolidated Statements of Cash Flows for the three years ended
February 28, 1995
Notes to Consolidated Financial Statements
Report of Independent Public Accountants
2. Financial Statement Schedules
Report of Independent Public Accountants on Schedules
Schedule II - Valuation and Qualifying Accounts for the three years
ended February 28, 1995
22
All other schedules are omitted because of the absence of conditions
requiring them or because the required information is shown on the consolidated
financial statements or the notes thereto.
3. Exhibits, which are listed on the Exhibit Index, are filed as part
of this report and such Exhibit Index is incorporated by reference.
Exhibits 10(a) through 10(m) listed on the accompanying Exhibit
Index identify management contracts or compensatory plans or
arrangements required to be filed as exhibits to this report, and
such listing is incorporated herein by reference.
(b) No report on Form 8-K was filed during the last quarter of the period
covered by this report.
23
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.
STANDARD MICROSYSTEMS CORPORATION
(Registrant)
By S/ANTHONY M. D'AGOSTINO
ANTHONY M. D'AGOSTINO
Vice President Finance and Treasurer
(Principal Financial and Accounting Officer)
Date: May 25, 1995
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 indicated.
Signature and Title Date
PAUL RICHMAN May 25, 1995
Paul Richman
Chairman and Director
VICTOR F. TRIZZINO May 25, 1995
Victor F. Trizzino
President, Chief Executive Officer
and Director (Principal Executive
Officer)
24
EVELYN BEREZIN May 25, 1995
Evelyn Berezin
Director
ROBERT M. BRILL May 25, 1995
Robert M. Brill
Director
PETER F. DICKS May 25, 1995
Peter F. Dicks
Director
HERMAN FIALKOV May 25, 1995
Herman Fialkov
Director
RAYMOND FRANKEL May 25, 1995
Raymond Frankel
Director
IVAN T. FRISCH May 25, 1995
Ivan T. Frisch
Director
25
Schedule II
STANDARD MICROSYSTEMS CORPORATION AND SUBSIDIARIES
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
FOR THE THREE YEARS ENDED FEBRUARY 28, 1995
Additions
Balance at Charged to Write-offs, Balance at
Year Ended Beginning Costs and Net of End
February 28, 1995 of Period Expenses Recoveries of Period
Allowance for
doubtful accounts $1,001,000 $808,000 $(707,000) $1,102,000
Year Ended
February 28, 1994
Allowance for
doubtful accounts $ 792,000 $399,000 $(190,000) $1,001,000
Year Ended
February 28, 1993
Allowance for
doubtful accounts $ 504,000 $360,000 $ (72,000) $ 792,000
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS ON SCHEDULES
To Standard Microsystems Corporation:
We have audited in accordance with generally accepted auditing standards,
the financial statements included in Standard Microsystems Corporation's annual
report to shareholders incorporated by reference in this Form 10-K, and have
issued our report thereon dated March 29, 1995. Our audit was made for the
purpose of forming an opinion on those statements taken as a whole. The
schedule listed in the index above is the responsibility of the Company's
management and is presented for purposes of complying with the Securities and
Exchange Commission's rules and is not part of the basic financial statements.
This schedule has been subjected to the auditing procedures applied in the audit
of the basic financial statements and, in our opinion, fairly states, in all
material respects, the financial data required to be set forth therein in
relation to the basic financial statements taken as a whole.
ARTHUR ANDERSEN LLP
Baltimore, Maryland
March 29, 1995
EXHIBIT INDEX
Incorporated By Exhibit
Reference To: No. Exhibit
Exhibit 3(a) [9] 3.1 Restated Certificate of
Incorporation
Exhibit 3(b) [8] 3.2 By-Laws as amended
Exhibit 1 [5] 3.3 Rights Agreement dated as of
January 7, 1988 with Mellon
Securities Trust Company
as Rights Agent
Exhibit 3 [6] 3.4 Amendment No. 1 to Rights
Agreement
* 10.1 Employment Agreement, dated
as of March 1, 1995,
with Paul Richman
Exhibit 10(b)[13] 10.2 Employment Agreement dated as
of March 1, 1993,
with Victor Trizzino
Exhibit 10(c)[13] 10.3 Employment Agreement, dated as
of March 1, 1993,
with Gerald E. Gollub
Exhibit 10(d)[13] 10.4 Employment Agreement dated as
of March 1, 1993
with Arthur Sidorsky
Registrant's Proxy 10.5 1984 Stock Option Plan for
Statement dated May Officers and Key Employees
16, 1984, Exhibit A
Exhibit 10(g) [4] 10.6 Amendment to 1984 Stock Option
Plan for Officers and
Key Employees
Registrant's Proxy 10.7 1986 Stock Option Plan for
Statement dated May Officers and Key Employees
22, 1986, Exhibit A
Exhibit 10(i) [4] 10.8 Amendment to 1986 Stock Option
Plan for Officers and
Key Employees
Exhibit 10(m) [1] 10.9 Amendment to 1986 Stock Option
Plan for Officers and
Key Employees dated March
29, 1990
Registrant's Proxy 10.10 1989 Stock Option Plan
Statement dated June
6, 1989, Exhibit A
Registrant's Proxy 10.11 1991 Restricted Stock
Statement dated July Bonus Plan
17, 1991, Exhibit A
Registrant's Proxy 10.12 Director Stock Option
Statement dated May Plan
29, 1990, Exhibit A
Exhibit 10(m) [11] 10.13 Resolutions adopted February
18, 1992 amending Director Stock
Option Plan, 1991 Restricted Stock
Bonus Plan, 1989 Stock Option Plan,
1986 Stock Option Plan and
1984 Stock Option Plan
* 10.14 Retirement Plan for Directors
Registrant's Proxy 10.15 1993 Stock Option Plan
Statement dated May for Officers and Key
25, 1993, Exhibit A Employees
Exhibit 10(x)[13] 10.16 Executive Retirement Plan
Registrant's Proxy 10.17 1994 Stock Option Plan
Statement dated May for Officers and Key
26, 1994, Exhibit A Employees
* 10.18 Resolutions adopted October
31, 1994 amending the Retirement
Plan for Directors and
the Executive Retirement Plan
* 10.19 Resolutions adopted January 3,
1995 amending the 1994, 1993, 1989,
1986, and 1984 Stock Option and
the 1991 Restricted Stock Plan
Exhibit 10.2 [2] 10.20 Patent and Trade Secrets
Agreement, dated as of March 12,
1983 with Paul Richman
Exhibit 10(r) [7] 10.21 Patent and Trade Secrets
Agreement, dated as of March 1,
1988 with Gerald Gollub
* 10.22 Consulting Agreement dated as
of March 1, 1995 with
Herman Fialkov
Exhibit 10(t) [7] 10.23 Form of Severance Pay
Agreement (renewed
annually through December 31,
1995)
Exhibit 2(a) [10] 10.24 Agreement for Purchase and
Sale of Assets between SMC
and Western Digital Corporation,
dated September 16, 1991, as amended
Exhibit 2(b) [10] 10.25 Technology Transfer Agreement
between SMC and WDC dated as
of September 27, 1991
Exhibit 2(c) [10] 10.26 Noncompetition Agreement
between SMC and WDC dated as
of September 27, 1991
* 10.27 Credit Agreement dated January
13, 1995
Exhibit 2 [12] 10.28 Agreement and Plan of Merger
Among SMC, SMC Massachusetts
Inc., Sigma Network Systems Inc.,
Ashraf M. Dahod and Kwabena
D. Akufo dated December 8, 1992
* 13 Portions of Annual Report to
Stockholders for year ended
February 28, 1995 incorporated
by reference
* 23 Consent of Arthur Andersen LLP
* 27 Financial Data Schedule
* 99 Form 11-K for year ended
February 28, 1994 of
registrant's Incentive Savings
and Retirement Plan
_________________________
* Filed herewith.
[1] Registrant's Annual Report on Form 10-K
for fiscal year ended February 28, 1990.
[2] Registrant's Quarterly Report on Form
10-Q for the quarter ended August 31, 1983.
[3] Registrant's Annual Report on Form 10-K
for fiscal year ended February 28, 1985.
[4] Registrant's Annual Report on Form 10-K
for fiscal year ended February 28, 1987.
[5] Registrant's Registration on Form 8-A
dated January 11, 1988.
[6] Registrant's Amendment No. 2 on Form 8
dated April 14, 1988 to Registration on Form 8-A.
[7] Registrant's Annual Report on Form 10-K
for fiscal year ended February 29, 1988.
[8] Registrant's Annual Report on Form 10-K
for fiscal year ended February 28, 1989.
[9] Registrant's Annual Report on Form 10-K
for fiscal year ended February 28, 1991.
[10] Registrant's Current Report on Form 8-K
filed October 31, 1991.
[11] Registrant's Annual Report on Form 10-K
for fiscal year ended February 29, 1992.
[12] Registrant's Current Report on Form 8-K
filed January 13, 1993.
[13] Registrant's Annual Report on Form 10-K
for fiscal year ended February 28, 1995.