SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 11-K
[ X ] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended December 31, 1993
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
Commission file number 33-39962
A. Full title of the plan and the address of the plan, if
different from that of the insurer named below:
Watkins-Johnson Employees'
Profit Sharing Investment Plan
B. Name of insurer of the securities held pursuant to the plan
and the address of its principal executive office:
Watkins-Johnson Company
3333 Hillview Avenue
Palo Alto, CA 94304
1. Financial Statements for the Watkins-Johnson Employees'
Profit Sharing Investment Plan as of December 31, 1993 and 1992
and for the years then ended and supplemental schedule for the
year ended December 31, 1993 are contained in Exhibit 1 of this
Annual Report.
2. Consent of Deloitte and Touche independent auditors, is
contained in Exhibit 2 of the Annual Report.
This Annual Report consists of 18 sequentially numbered pages.
1
<PAGE>
<PAGE>
SIGNATURES
The Plan. Pursuant to the requirements of the Securities
Exchange Act of 1934, the trustees (or other persons who
administer the employee benefit plan) have duly caused this
annual report to be signed on its behalf by the undersigned
hereunto duly authorized.
Watkins-Johnson Employees'
Profit Sharing Investment Plan
Date: June 22, 1994 /s/ Scott G. Buchanan
--------------------------------
Scott G. Buchanan
Vice President and
Chief Financial Officer
2
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<PAGE>
EXHIBIT 1
FINANCIAL STATEMENTS
Financial statements prepared by Deloitte & Touche,
independent auditors, follows on pages 4 through 16.
Exhibit 1
Form 11-K
3
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<PAGE>
WATKINS-JOHNSON EMPLOYEES'
PROFIT SHARING INVESTMENT PLAN
FINANCIAL STATEMENTS AND
SUPPLEMENTAL SCHEDULES
For the Years Ended December 31,
1993 and 1992 and
Independent Auditors' Report
4
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WATKINS-JOHNSON EMPLOYEES' PROFIT SHARING INVESTMENT PLAN
TABLE OF CONTENTS
- - --------------------------------------------------------------------
Page
----
INDEPENDENT AUDITORS' REPORT 1
FINANCIAL STATEMENTS AS OF DECEMBER 31, 1993 AND 1992 AND
FOR THE YEARS THEN ENDED:
Statements of Net Assets 2-3
Statements of Changes in Net Assets 4-5
Notes to Financial Statements 6-8
SUPPLEMENTAL SCHEDULES AS OF DECEMBER 31, 1993
AND FOR THE YEAR THEN ENDED:
Schedule 1--Assets Held For Investment Purposes 9
Schedule 2--Reportable Transactions 10-11
5
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<PAGE>
INDEPENDENT AUDITORS' REPORT
The Administrative Committee, Watkins-Johnson
Employees' Profit Sharing Investment Plan:
We have audited the accompanying statements of net assets of
Watkins-Johnson Employees' Profit Sharing Investment Plan (the
"Plan") as of December 31, 1993 and 1992, and the related
statements of changes in net assets for the years then ended.
These financial statements are the responsibility of the Plan's
management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally auditing
standards. Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, such financial statements present fairly, in all
material respects, the net assets of the Plan at December 31,
1993 and 1992, and the changes in its net assets for the years
then ended in conformity with generally accepted accounting
principles.
Our audits were conducted for the purpose of forming an opinion
on the basic financial statements taken as a whole. The
accompanying supplemental schedules, listed in the foregoing
table of contents, are presented for the purpose of complying
with the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. Theses supplemental schedules are the
responsibility of the Plan's management. Such supplemental
schedules have been subjected to the auditing procedures applied
in our audit of the basic financial statements and, in our
opinion, are fairly stated in all material respects when
considered in relation to the basic financial statements taken as
a whole.
As discussed in Note 4 to the financial statements, the Plan
changed its method of accounting for distributions to
participants in 1992.
Deloitte & Touche
May 31, 1994
6
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<PAGE>
WATKINS-JOHNSON EMPLOYEES'
PROFIT SHARING INVESTMENT PLAN
STATEMENT OF NET ASSETS, DECEMBER 31, 1993
<TABLE>
<CAPTION>
Retirement Watkins-
Government Fixed Income Magellan OTC Balanced Johnson Stock
Total Money Market Fund Fund Portfolio Fund Fund
-------- ------------ ------------ -------- --------- -------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Assets:
Cash and cash $105,079 - - - - - $105,079
equivalents
Deposit contracts 50,241,350 - $50,241,350 - - - -
---------- ---------- ----------- ----------- ---------- ----------- -----------
Total 50,346,429 - 50,241,350 - - - 105,079
---------- ---------- ----------- ----------- ---------- ----------- -----------
Investments (at fair
value):
Fidelity mutual funds 46,606,070 $2,440,515 934,526 $19,780,727 $5,788,756 $17,661,546 -
Corporate stocks 1,403,035 - - - - - 1,403,035
---------- ---------- ----------- ----------- ---------- ----------- -----------
Total 48,009,105 2,440,515 934,526 19,780,727 5,788,756 17,661,546 1,403,035
---------- ---------- ----------- ----------- ---------- ----------- -----------
Receivables:
Employer 1,901,024 (31,900) 484,367 600,882 257,457 531,952 58,266
contributions
Interest and dividends 8,324 - - - - - 8,324
---------- ---------- ----------- ----------- ---------- ----------- -----------
Total 1,909,348 (31,900) 484,367 600,882 257,457 531,952 66,590
---------- ---------- ----------- ----------- ---------- ----------- -----------
Total Assets 100,264,882 2,408,615 51,660,243 20,381,609 6,046,213 18,193,498 1,574,704
---------- ---------- ----------- ----------- ---------- ----------- -----------
Liabilities:
Expenses payable 7,690 186 3,670 1,714 494 1,490 136
Purchase of securities 30,240 - - - - - 30,240
---------- ---------- ----------- ----------- ---------- ----------- -----------
Total Liabilities 37,930 186 3,670 1,714 494 1,490 30,376
---------- ---------- ----------- ----------- ---------- ----------- -----------
Net Assets $100,226,952 $2,408,429 $51,656,573 $20,379,895 $6,045,719 $18,192,008 $1,544,328
---------- ---------- ----------- ----------- ---------- ----------- -----------
---------- ---------- ----------- ----------- ---------- ----------- -----------
</TABLE>
See notes to financial statements.
7
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<PAGE>
WATKINS-JOHNSON EMPLOYEES'
PROFIT SHARING INVESTMENT PLAN
STATEMENT OF NET ASSETS, DECEMBER 31, 1992
<TABLE>
<CAPTION>
U.S. Securities Fixed Income Watkins-Johnson
Total Fund Fund General Fund Stock Fund
----------- -------------- ----------- ------------ --------------
<S> <C> <C> <C> <C> <C>
Assets:
Cash and cash equivalents $33,477,666 $2,472,042 $1,490,251 $29,452,111 $63,262
Deposit contracts 51,825,852 - 51,825,852 - -
----------- ---------- ---------- ----------- --------
Total 85,303,518 2,472,042 53,316,103 29,452,111 63,262
----------- ---------- ---------- ----------- --------
Investments (at market):
Corporate debt securities 79,871 - - 79,871 -
Corporate stocks 880,968 - - 130,650 750,318
----------- ---------- ---------- ----------- --------
Total 960,839 - - 210,521 750,318
----------- ---------- ---------- ----------- --------
Receivables:
Employer contributions 906,415 24,135 531,171 342,814 8,295
Employee contributions 86,841 3,018 52,055 30,617 1,151
Interest and dividends 446,867 6,090 374,034 60,287 6,456
----------- ---------- ---------- ----------- --------
Total 1,440,123 33,243 957,260 433,718 15,902
----------- ---------- ---------- ----------- --------
Total Assets 87,704,480 2,505,285 54,273,363 30,096,350 829,482
----------- ---------- ---------- ----------- --------
Liabilities:
Expenses payable 46,176 775 4,363 40,873 165
----------- ---------- ---------- ----------- --------
Total Liabilities 46,176 775 4,363 40,873 165
----------- ---------- ---------- ----------- --------
Net Assets $87,658,304 $2,504,510 $54,269,000 $30,055,477 $829,317
----------- ---------- ---------- ----------- --------
----------- ---------- ---------- ----------- --------
</TABLE>
See notes to financial statements.
8
<PAGE>
<PAGE>
WATKINS-JOHNSON EMPLOYEES'
PROFIT SHARING INVESTMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS, YEAR ENDED DECEMBER 31, 1993
<TABLE>
<CAPTION>
Fidelity
--------------------------------------------------------------------------------
Retirement
Government Fixed
Money Income Magellan OTC Balanced
Total Market Fund Fund Portfolio Fund
---------- --------- ---------- ---------- --------- ----------
<S> <C> <C> <C> <C> <C> <C>
Change in Investment Options - 2,504,510 53,455,154 14,112,561 5,107,390 10,810,726
---------- --------- ---------- ---------- --------- ----------
Investment Earnings:
Interest $4,577,173 6,654 4,568,386 2,133 - -
Dividends 4,009,329 68,740 - 1,754,276 740,848 1,415,095
---------- --------- ---------- ---------- --------- ----------
Total 8,586,502 75,394 4,568,386 1,756,409 740,848 1,415,095
---------- --------- ---------- ---------- --------- ----------
Net appreciation (depreciation) in
fair value of investments 2,343,744 - - 1,615,530 (277,450) 767,878
Trustee fees (54,038) (772) (15,400) (17,313) (5,865) (14,160)
---------- --------- ---------- ---------- --------- ----------
Total 2,289,706 (772) (15,400) 1,598,217 (283,315) 753,718
---------- --------- ---------- ---------- --------- ----------
Total investments earnings 10,876,208 74,622 4,552,986 3,354,626 457,533 2,168,813
---------- --------- ---------- ---------- --------- ----------
Contributions:
Employer 1,901,024 (31,900) 484,367 600,882 257,457 531,952
Employee 5,892,002 143,284 1,531,381 1,671,386 812,594 1,590,046
---------- --------- ---------- ---------- --------- ----------
Total 7,793,026 111,384 2,015,748 2,272,268 1,070,051 2,121,998
---------- --------- ---------- ---------- --------- ----------
Total investment earnings and
contributions 18,669,234 186,006 6,568,734 5,626,894 1,527,584 4,290,811
---------- --------- ---------- ---------- --------- ----------
Transfers between funds - (81,012) (5,125,004) 1,472,331 (314,741) 3,694,411
Distributions to participants (6,100,586) (201,075) (3,242,311) (831,891) (274,514) (603,940)
---------- --------- ---------- ---------- --------- ----------
Increase (decrease) in net assets 12,568,648 2,408,429 51,656,573 20,379,895 6,045,719 18,192,008
---------- --------- ---------- ---------- --------- ----------
Net assets, January 1 87,658,304 - - - - -
---------- --------- ---------- ---------- --------- ----------
Net assets, December 31 $100,226,952 $2,408,429 $51,656,573 $20,379,895 $6,045,719 $18,192,008
---------- --------- ---------- ---------- --------- ----------
---------- --------- ---------- ---------- --------- ----------
<PAGE>
<CAPTION>
(Continuation of table)
----------------------------------------------------------------
Watkins-
Johnson U.S. Fixed
Stock Securities Income General
Fund Fund Fund Fund
-------- ---------- ----------- ------------
<S> <C> <C> <C> <C>
Change in Investment Options - (2,504,510) (53,455,154) (30,030,677)
-------- ---------- ----------- -----------
Investment Earnings:
Interest - - - -
Dividends 30,370 - - -
-------- ---------- ----------- -----------
Total 30,370 - - -
-------- ---------- ----------- -----------
Net appreciation (depreciation) in
fair value of investments 237,786 - - -
Trustee fees (528) - - -
-------- ---------- ----------- -----------
Total 237,258 - - -
-------- ---------- ----------- -----------
Total investments earnings 267,628 - - -
-------- ---------- ----------- -----------
Contributions:
Employer 58,266 - - -
Employee 143,311 - - -
-------- ---------- ----------- -----------
Total 201,577 - - -
-------- ---------- ----------- -----------
Total investment earnings and
contributions 469,205 - - -
-------- ---------- ----------- -----------
Transfers between funds 354,015 - - -
Distributions to participants (108,209) - (813,846) (24,800)
-------- ---------- ----------- -----------
Increase (decrease) in net assets 715,011 (2,504,510) (54,269,000) (30,055,477)
-------- ---------- ----------- -----------
Net assets, January 1 829,317 2,504,510 54,269,000 30,055,477
-------- ---------- ----------- -----------
Net assets, December 31 $1,544,328 - - -
-------- ---------- ----------- -----------
</TABLE>
See notes to financial statements.
9
<PAGE>
<PAGE>
WATKINS-JOHNSON EMPLOYEES'
PROFIT SHARING INVESTMENT PLAN
STATEMENT OF CHANGE IN NET ASSETS, YEAR ENDED DECEMBER 31, 1992
<TABLE>
<CAPTION>
U.S. Securities Fixed Income Watkins-Johnson
Total Fund Fund General Fund Stock Fund
--------- -------------- ------------ ------------ ---------------
<S> <C> <C> <C> <C> <C>
Investment Earnings:
Interest $4,915,737 $113,397 $4,377,780 $422,091 $2,469
Dividends 410,235 - - 387,377 22,858
---------- -------- ---------- ---------- --------
Total 5,325,972 113,397 4,377,780 809,468 25,327
---------- -------- ---------- ---------- --------
Net appreciation (depreciation) in fair 1,201,702 - - 1,021,367 180,335
value of investments
Trustee and investment fees (382,517) (3,998) (38,285) (339,680) (554)
---------- -------- ---------- ---------- --------
Total 819,185 (3,998) (38,285) 681,687 179,781
Total investment earnings 6,145,157 109,399 4,339,495 1,491,155 205,108
Contributions:
Employer 906,415 24,135 531,171 342,814 8,295
Employee 4,573,180 121,771 2,679,941 1,729,616 41,852
---------- -------- ---------- ---------- --------
Total contributions 5,479,595 145,906 3,211,112 2,072,430 50,147
---------- -------- ---------- ---------- --------
Total investment earnings and contributions 11,624,752 255,305 7,550,607 3,563,585 255,255
---------- -------- ---------- ---------- --------
Transfers between funds 0 (1,361,981) 1,350,404 (60,130) 71,707
Distributions to participants (8,798,727) (284,732) (5,699,771) (2,777,077) (37,147)
---------- -------- ---------- ---------- --------
Increase (decrease) in net assets 2,826,025 (1,391,408) 3,201,240 726,378 289,815
Net assets, January 1 83,327,903 3,826,921 49,955,447 29,006,719 538,816
Change in accounting for distributions 1,504,376 68,997 1,112,313 322,380 686
(Note 4)
---------- -------- ---------- ---------- --------
Net assets, December 31 $87,658,304 $2,504,510 $54,269,000 $30,055,477 $829,317
---------- -------- ---------- ---------- --------
---------- -------- ---------- ---------- --------
</TABLE>
See notes to financial statements.
10
<PAGE>
<PAGE>
WATKINS-JOHNSON COMPANY
EMPLOYEES' PROFIT SHARING INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
1. DESCRIPTION OF PLAN
The Watkins-Johnson Employees' Profit Sharing Investment Plan (the Plan)
was created by Watkins-Johnson Company effective January 1, 1967. The
Plan, amended as of January 1, 1991, conforms to the requirements of the
Employee Retirement Income Security Act of 1974 (ERISA), and is in
compliance with the Tax Reform Act of 1986. The Plan provides for Company
contributions based on profits and voluntary contributions by employees.
In addition, on April 1, 1983, Watkins-Johnson Company established the
Salary Deferral Plan, known as a 401(k) Plan in reference to the Internal
Revenue Code Section 401(k).
Employees of Watkins-Johnson Company on a U.S. payroll are generally
eligible to participate upon one year of service.
Participant contributions are fully vested. Company contributions
generally begin to vest after three years of employee service and become
fully vested after seven years of service or upon retirement, death or
permanent disability. In the event of Plan termination, the value of
participants' accounts would immediately vest 100%.
The Fidelity Retirement Government Money Market Portfolio invests in
obligations issued or guaranteed as to principal and interest by the U.S.
Government, its agencies or instrumentalities, and in repurchase
agreements secured by these obligations.
The Fixed Income Fund principally consists of the following deposits for
unsecured contracts with a fixed interest rate:
1993 1992
----------- -----------
Bankers Trust Company,interest at
8.48%, matures in June 1995 $13,440,245 $12,857,378
Commonwealth Life Insurance
Company, interest at 7.44%,
matures in June 1993 - 4,121,343
Continental Assurance
Company, interest at 7.72%,
matures in June 1994 4,406,787 4,246,593
Life Insurance Company of
Virginia, interest at 9.70%,
matures in June 1993 - 4,476,629
Life Insurance Company of
Virginia, Interest at 9.43%,
matures in June 1994 4,487,895 4,251,457
Metropolitan Life Insurance
Company, interest at 9.59%,
matures in June 1994 10,944,467 11,402,210
New York Life Insurance
Company, interest at 9.05%,
matures in June 1993 - 4,038,219
11
<PAGE>
<PAGE>
1993 1992
--------- ---------
Continental Assurance
Company, interest at 4.90%, 50%,
matures in December 1995 50%
matures in June 1997 4,086,907 -
Protective Life Insurance
Company, interest at 8.46%,
matures in June 1995 6,724,371 6,432,023
Provident Life and Accident
Insurance Company,interest at
5.10%, 50%, matures in July
1996 50% matures in June 1997 6,150,678 -
----------- ----------
Total deposit contracts 50,241,350 51,825,852
Fidelity Fixed Income Fund 934,526 -
----------- ----------
Total Fixed Income Fund $51,175,876 $51,825,852
----------- ----------
----------- ----------
The Fidelity Magellan Fund is a growth fund and invests in stock of both
well-known and lesser-known foreign and domestic companies with above-
average growth potential.
The Fidelity OTC Portfolio is a growth fund and invests primarily in
securities traded on the over-the-counter securities market including
common stocks, preferred stocks, securities convertible into common stocks
and debt securities.
The Fidelity Balanced Fund is a growth and income fund and invests in
investment grade or higher bonds and other high-yielding securities,
including common and preferred stocks.
The Watkins-Johnson Stock Fund invests primarily in Watkins-Johnson
Company's common stock.
The U.S. Securities Fund invested in U.S. Government obligations,
primarily treasury bills.
The General Trust Fund invested primarily in corporate stocks and debt
securities.
The Plan, as amended, allows all participants to direct future
contributions to the funds of their choice daily.
The Plan obtained its latest determination letter in December 1985, in
which the Internal Revenue Service stated that the Plan, as then designed,
was in compliance with the applicable requirements of the Internal Revenue
Code. The Plan has been amended since receiving the determination letter.
However, the Plan administrator and the Plan's tax counsel believe that
the Plan is currently designed and being operated in compliance with the
applicable requirements of the Internal Revenue Code. Therefore, they
believe that the Plan was qualified and was tax-exempt as of December 31,
1993.
12
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<PAGE>
2. SIGNIFICANT ACCOUNTING POLICIES
Cash and cash equivalents are highly liquid investments with a maturity of
-------------------------
three months or less.
Deposit contracts are stated at cost plus accumulated interest.
-----------------
Investments are stated at fair value based on quoted market prices; the
-----------
unrealized difference between cost and market is included in determining
Plan net assets.
Dividend and interest income are recorded on the accrual basis.
---------------------
Administrative expenses incurred on behalf of the Plan are paid by Watkins-
-----------------------
Johnson Company except for trustee fees which are paid by the Plan. Such
fees are recorded on the accrual basis.
Contributions are allocated to individual, eligible participants in the
-------------
ratio that each such participant's regular compensation bears to the
aggregate of such regular compensation for all eligible Plan participants
for the Plan year.
Forfeitures are allocated to individual active participants in the ratio
-----------
that each such participant's regular compensation bears to the aggregate
of such regular compensation for all eligible Plan participants for the
Plan year. Total forfeitures were $92,266 and $323,588 for 1993 and 1992,
respectively.
3. CHANGE IN INVESTMENT OPTIONS
In January 1993, the Plan changed administrator and recordkeeper to
Fidelity Investments ("Fidelity") from First Interstate Bank. As a result
of this change, certain investment options were also changed to allow for
investing in Fidelity mutual funds.
4. CHANGE IN ACCOUNTING
In 1992, the Plan changed its method of accounting for distributions to
participants from the accrual basis to the cash basis in accordance with
new guidance contained in the May 1, 1993 Audit Guide for Employee Benefit
Plans published by the American Institute of Certified Public Accountants.
The effect of this accounting change was an increase in net assets as of
January 1, 1992 of $1,504,376. This accounting change also results in
differences between net assets of the Plan's financial statements and the
Plan's Form 5500 as filed with the Internal Revenue Service by the amount
of distributions due to participants of $278,159 as of December 31, 1993.
13
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<TABLE>
WATKINS-JOHNSON COMPANY Schedule 1
PROFIT SHARING INVESTMENT PLAN
ITEM 27a--SUPPLEMENTAL SCHEDULE OF ASSETS
HELD FOR INVESTMENT PURPOSES
AS OF DECEMBER 31, 1993
<CAPTION>
Identity of Issue Description of Investment Cost Fair Value
- - ----------------------------- ------------------------- ---------- -----------
<S> <C> <C> <C>
Fidelity Management Trust Co. Retirement Government $2,440,515 $2,440,515
Money Market
Bankers Trust Company Fixed Income Fund (Deposit 13,440,245 13,440,245
Contracts)
Continental Assurance Company Fixed Income Fund (Deposit 4,406,787 4,406,787
Contracts)
Life Insurance Company of Fixed Income Fund (Deposit 4,487,895 4,487,895
Virginia Contracts)
Metropolitan Life Insurance Fixed Income Fund (Deposit 10,944,467 10,944,467
Company Contracts)
Continental Assurance Company Fixed Income Fund (Deposit 4,086,907 4,086,907
Contracts)
Protective Life Insurance Fixed Income Fund (Deposit 6,724,371 6,724,371
Company Contracts)
Provident Life and Accident Fixed Income Fund (Deposit 6,150,678 6,150,678
Insurance Company Contracts)
Fidelity Management Trust Co. Fixed Income Fund 934,526 934,526
Fidelity Management Trust Co. Magellan Fund 18,165,197 19,780,727
Fidelity Management Trust Co. OTC Portfolio 6,066,206 5,788,756
Fidelity Management Trust Co. Balanced Fund 16,893,668 17,661,546
Fidelity Management Trust Co. U.S. Government Reserve 105,079 105,079
Pool
Watkins-Johnson Company Common Stock 1,165,249 1,403,035
----------- -----------
Total Investments $96,011,790 $98,355,534
----------- -----------
----------- -----------
</TABLE>
(1) See Note 1 to the financial statements.
14
<PAGE>
<PAGE>
<TABLE>
WATKINS-JOHNSON COMPANY Schedule 2
PROFIT SHARING INVESTMENT PLAN
ITEM 27d-- SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1993
(One or a Series of Transactions Exceeding 5% of the Fair Value of the Plan
Assets at the Beginning of the Year)
<CAPTION> Fair Value
of Asset on
Identity of Party Purchase Selling Cost of Transaction Net Gain
Involved Description of Asset Price Price Asset Date or (Loss)
- - ------------------------ ------------------------- --------- ------------ --------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C>
Single Transactions: (1)
Pacific American Fund Master Notes - $10,761,435 $10,761,4 $10,761,435 *
35
First Interstate Bank Short-Term Investment Fund - 22,716,231 22,716,23 22,716,231 *
1
Life Insurance Company Fixed Income Fund (Deposit - 4,521,044 4,521,044 4,521,004 *
of Virginia Contract)
Provident Life and Fixed Income Fund (Deposit $6,000,000 - 6,000,000 6,000,000 -
Accident Insurance Co. Contract)
<FN>
(1) No expenses were incurred with any reportable transaction.
*For each transaction, fair value was equal to cost.
</TABLE>
15
<PAGE>
<PAGE>
<TABLE>
WATKINS-JOHNSON COMPANY Schedule 2 (continued)
PROFIT SHARING INVESTMENT PLAN
ITEM 27d-- SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1993
(One or a Series of Transactions Exceeding 5% of the Fair Value of the Plan
Assets at the Beginning of the Year)
<CAPTION>
Fair Value
of Asset on
Identity of Party Purchase Selling Cost of Transaction Net Gain
Involved Description of Asset Price Price Asset Date or (Loss)
- - ------------------------ ------------------------- --------- ------------ --------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C>
Series of Transactions: (1)
Various (2) Fixed Income Fund $6,637,112 - $6,637,112 $6,637,112 -
(Deposit Contracts)
(112 Transactions)
Fidelity Management Magellan Fund 8,387,247 - 8,387,247 8,387,247 -
Trust Company (161 Transactions)
Fidelity Management Balanced Fund 8,438,392 - 8,438,392 8,438,392 -
Trust Company (152 Transactions)
Various (2) Fixed Income Fund - $8,020,687 - 8,020,687 *
(Deposit Contracts)
(70 Transactions)
<FN>
(1) No expenses were incurred with any reportable transaction.
(2) See Note 1 to the financial statements.
*For each transaction, fair value was equal to cost.
</TABLE>
16
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<PAGE>
EXHIBIT 2
INDEPENDENT AUDITORS' REPORT
The consent of Deloitte & Touche, independent auditors,
follows on page 18.
Exhibit 2
Form 11-K
17
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<PAGE>
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration
Statement No. 33-39962 of the Watkins-Johnson Employees'
Profit Sharing Investment Plan (the Plan) on Form S-8 of our
report dated May 31, 1994, appearing in this Annual Report
on Form 11-K of the Plan for the year ended December 31,
1993.
Deloitte & Touche
June 22, 1994
18
