WATKINS-JOHNSON EMPLOYEES'
--------------------------
PROFIT SHARING INVESTMENT PLAN
------------------------------
FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
For the Years Ended December 31, 1994 and 1993 and
Independent Auditors' Report
<PAGE>
WATKINS-JOHNSON EMPLOYEES' PROFIT SHARING INVESTMENT PLAN
TABLE OF CONTENTS
- --------------------------------------------------------------------------------
Page
INDEPENDENT AUDITORS' REPORT .......................................... 1
FINANCIAL STATEMENTS AS OF DECEMBER 31, 1994 AND 1993 AND FOR THE
YEARS THEN ENDED:
Statements of Net Assets Available for Benefits with Fund
Information ..................................................... 2-3
Statements of Changes in Net Assets Available for Benefits
with Fund Information ........................................... 4-5
Notes to Financial Statements ...................................... 6-8
SUPPLEMENTAL SCHEDULES AS OF DECEMBER 31, 1994
AND FOR THE YEAR THEN ENDED:
Schedule 1--Assets Held For Investment Purposes .................... 9
Schedule 2--Reportable Transactions ................................ 10-11
<PAGE>
DELOITTE & TOUCHE LLP
- ----------------------
[LOGO]
---------------------------------------------------------------
50 Fremont Street Telephone: (415) 247-4000
San Francisco, California 94105-2230 Facsimile: (415) 247-4329
INDEPENDENT AUDITORS' REPORT
The Administrative Committee, Watkins-Johnson
Employees' Profit Sharing Investment Plan:
We have audited the accompanying statements of net assets available for benefits
of Watkins-Johnson Employees' Profit Sharing Investment Plan (the "Plan") as of
December 31, 1994 and 1993, and the related statements of changes in net assets
available for benefits 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 accepted 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 text 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, 1994 and 1993, 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. The Fund
Information in the Statement of Net Assets Available for Benefits and Statement
of Changes in Net Assets Available for Benefits is presented for purposes of
additional analysis rather than to present the net assets available for benefits
and changes in net assets available for benefits of each fund. These
supplemental schedules' fund information is 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.
DELOITTE & TOUCHE LLP
April 28, 1995
- ---------------
DELOITTE TOUCHE
TOHMATSU
INTERNATIONAL
- ---------------
<PAGE>
<TABLE>
WATKINS-JOHNSON EMPLOYEES'
PROFIT SHARING INVESTMENT PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION,
DECEMBER 31, 1994
<CAPTION>
RETIREMENT WATKINS-
GOVERNMENT FIXED INCOME MAGELLAN OTC BALANCED JOHNSON
TOTAL MONEY MARKET FUND FUND PORTFOLIO FUND STOCK FUND
------------ ---------- ----------- ----------- ---------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Assets:
Cash and cash equivalents ..... $ 190,313 -- -- -- -- -- $ 190,313
Deposit contracts ............. 48,771,667 -- $48,771,667 -- -- -- --
------------ ---------- ----------- ----------- ---------- ----------- ----------
Total ....................... 48,961,980 -- 48,771,667 -- -- -- 190,313
------------ ---------- ----------- ----------- ---------- ----------- ----------
Investments (at fair value):
Fidelity mutual funds ......... 48,457,948 $2,908,248 1,196,343 $21,518,558 $6,421,503 $16,413,296 --
Corporate stocks .............. 2,726,713 -- -- -- -- -- 2,726,713
------------ ---------- ----------- ----------- ---------- ----------- ----------
Total ....................... 51,184,661 2,908,248 1,196,343 21,518,558 6,421,503 16,413,296 2,726,713
------------ ---------- ----------- ----------- ---------- ----------- ----------
Total Investments ........... 100,146,641 2,908,248 49,968,010 21,518,558 6,421,503 16,413,296 2,917,026
Receivables:
Employer contributions ........ 3,194,198 57,908 823,131 971,749 391,467 802,049 147,894
Interest and dividends ........ 11,123 -- -- -- -- -- 11,123
------------ ---------- ----------- ----------- ---------- ----------- ----------
Total ....................... 3,205,321 57,908 823,131 971,749 391,467 802,049 159,017
------------ ---------- ----------- ----------- ---------- ----------- ----------
Total Assets ................ 103,351,962 2,966,156 50,791,141 22,490,307 6,812,970 17,215,345 3,076,043
------------ ---------- ----------- ----------- ---------- ----------- ----------
Liabilities:
Expenses payable .............. 15,065 473 7,223 3,341 1,033 2,524 471
------------ ---------- ----------- ----------- ---------- ----------- ----------
Total Liabilities ........... 15,065 473 7,223 3,341 1,033 2,524 471
------------ ---------- ----------- ----------- ---------- ----------- ----------
Net Assets Available
for Benefits.................. $103,336,897 $2,965,683 $50,783,918 $22,486,966 $6,811,937 $17,212,821 $3,075,572
============ ========== =========== =========== ========== =========== ==========
<FN>
See notes to financial statements.
</TABLE>
-2-
<PAGE>
<TABLE>
WATKINS-JOHNSON EMPLOYEES'
PROFIT SHARING INVESTMENT PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION,
DECEMBER 31, 1993
<CAPTION>
RETIREMENT WATKINS-
GOVERNMENT FIXED INCOME MAGELLAN OTC BALANCED JOHNSON
TOTAL MONEY MARKET FUND FUND PORTFOLIO FUND STOCK FUND
------------ ---------- ----------- ----------- ---------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Assets:
Cash and cash equivalents ..... $ 105,079 -- -- -- -- -- $ 105,079
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
------------ ---------- ----------- ----------- ---------- ----------- ----------
Total Investments ........... 98,355,534 2,440,515 51,175,876 19,780,727 5,788,756 17,661,546 1,508,114
Receivables:
Employer contributions ........ 1,901,024 (31,900) 484,367 600,882 257,457 531,952 58,266
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 Available
for Benefits.................. $100,226,952 $2,408,429 $51,656,573 $20,379,895 $6,045,719 $18,192,008 $1,544,328
============ ========== =========== =========== ========== =========== ==========
<FN>
See notes to financial statements.
</TABLE>
-3-
<PAGE>
<TABLE>
WATKINS-JOHNSON EMPLOYEES'
PROFIT SHARING INVESTMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION,
YEAR ENDED DECEMBER 31, 1994
<CAPTION>
FIDELITY
------------------------------------------------------------------------------------
RETIREMENT WATKINS-
GOVERNMENT JOHNSON
MONEY FIXED INCOME MAGELLAN OTC BALANCED STOCK
TOTAL MARKET FUND FUND PORTFOLIO FUND FUND
------------ ---------- ----------- ----------- ---------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
ADDITIONS:
Investment Earnings:
Interest ................... $ 3,490,952 -- $ 3,490,952 -- -- -- --
Dividends .................. 1,645,258 $ 103,107 -- $ 864,469 $ 56,515 $ 566,511 $ 54,656
------------ ---------- ----------- ----------- ---------- ----------- ----------
Total .................... 5,136,210 103,107 $ 3,490,952 864,469 56,515 566,511 54,656
------------ ---------- ----------- ----------- ---------- ----------- ----------
Net appreciation
(depreciation) in fair
value of investments...... (2,516,210) -- -- (1,334,633) (239,116) (1,624,707) 682,246
Trustee fees ............... (30,074) (897) (14,822) (6,552) (1,930) (5,118) (755)
------------ ---------- ----------- ----------- ---------- ----------- ----------
Total .................... (2,546,284) (897) (14,822) (1,341,185) (241,046) (1,629,825) 681,491
------------ ---------- ----------- ----------- ---------- ----------- ----------
Total investments
earnings ................... 2,589,926 102,210 3,476,130 (476,716) (184,531) (1,063,314) 736,147
------------ ---------- ----------- ----------- ---------- ----------- ----------
Contributions:
Employer ................... 3,194,198 57,908 823,131 971,749 391,467 802,049 147,894
Employee ................... 6,077,422 168,832 1,351,122 1,933,889 774,002 1,649,823 199,754
------------ ---------- ----------- ----------- ---------- ----------- ----------
Total ................... 9,271,620 226,740 2,174,253 2,905,638 1,165,469 2,451,872 347,648
------------ ---------- ----------- ----------- ---------- ----------- ----------
Total additions ............. 11,861,546 328,950 5,650,383 2,428,922 980,938 1,388,558 1,083,795
------------ ---------- ----------- ----------- ---------- ----------- ----------
DEDUCTIONS:
Distributions to
participants .............. (8,751,601) (284,041) (3,444,886) (1,552,084) (493,516) (2,872,449) (104,625)
------------ ---------- ----------- ----------- ---------- ----------- ----------
Increase (decrease)
in net assets before
interfund transfers ....... 3,109,945 44,909 2,205,497 876,838 487,422 (1,483,891) 979,170
Transfers between funds ..... -- 512,345 (3,078,152) 1,230,233 278,796 504,704 552,074
------------ ---------- ----------- ----------- ---------- ----------- ----------
Net Increase (decrease) ..... 3,109,945 557,254 (872,655) 2,107,071 766,218 (979,187) 1,531,244
Net assets available
for benefits, January 1 .... 100,226,952 2,408,429 51,656,573 20,379,895 6,045,719 18,192,008 1,544,328
------------ ---------- ----------- ----------- ---------- ----------- ----------
Net assets available
for benefits, December 31 .. $103,336,897 $2,965,683 $50,783,918 $22,486,966 $6,811,937 $17,212,821 $3,075,572
============ ========== =========== =========== ========== =========== ==========
<FN>
See notes to financial statements.
</TABLE>
-4-
<PAGE>
<TABLE>
WATKINS-JOHNSON EMPLOYEES'
PROFIT SHARING INVESTMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS WITH FUND INFORMATION,
YEAR ENDED DECEMBER 31, 1993
<CAPTION>
FIDELITY
---------------------------------------------------------------------
RETIREMENT
GOVERNMENT
MONEY FIXED INCOME MAGELLAN OTC BALANCED
TOTAL MARKET FUND FUND PORTFOLIO FUND
------------ ---------- ----------- ----------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C>
ADDITIONS:
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) (5,863) (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 additions .......... 18,669,234 186,006 6,568,734 5,626,894 1,527,584 4,290,811
------------ ---------- ----------- ----------- ---------- -----------
DEDUCTIONS:
Distributions to
participants ............ (6,100,586) (201,075) (3,242,311) (831,891) (274,514) (603,940)
------------ ---------- ----------- ----------- ---------- -----------
Increase (decrease) in net
assets before interfund
transfers ............... 12,568,648 (15,069) 3,326,423 4,795,003 1,253,070 3,686,871
Transfers between funds... -- 2,423,498 48,330,150 15,584,892 4,792,649 14,505,137
------------ ---------- ----------- ----------- ---------- -----------
Net increase (decrease)... 12,568,648 2,408,429 51,656,573 20,379,895 6,045,719 18,192,008
Net assets available for
benefits, January 1...... 87,658,304 -- -- -- -- --
------------ ---------- ----------- ----------- ---------- -----------
Net assets available for
benefits, December 31 ... $100,226,952 $2,408,429 $51,656,573 $20,379,895 $6,045,719 $18,192,008
============ ========== =========== =========== ========== ===========
</TABLE>
<TABLE>
<CAPTION>
FIB
-------------------------------------------------------------
WATKINS- U.S. FIXED
JOHNSON SECURITIES INCOME GENERAL
STOCK FUND FUND FUND FUND
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
ADDITIONS:
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 additions .......... 469,205 -- -- --
----------- ----------- ----------- -----------
DEDUCTIONS:
Distributions to
participants ............ (108,209) -- ($813,846) ($24,800)
----------- ----------- ----------- -----------
Increase (decrease) in net
assets before interfund
transfers ............... 360,996 -- (813,846) (24,800)
Transfers between funds .. 354,015 ($2,504,510) (53,455,154) (30,030,677)
----------- ----------- ----------- -----------
Net increase (decrease) .. 715,011 (2,504,510) (54,269,000) (30,055,477)
Net assets available for
benefits, January 1 ..... 829,317 2,504,510 54,269,000 30,055,477
----------- ----------- ----------- -----------
Net assets available for
benefits, December 31 ... $ 1,544,328 -- -- --
=========== =========== =========== ===========
<FN>
See notes to financial statements.
-5-
</TABLE>
<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 added 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 after 90 days of service.
Participant and Company contributions are fully vested.
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:
1994 1993
------------ -----------
Bankers Trust Company,
interest at 8.48%, matures in June 1995 .... $13,415,630 $13,440,245
Continental Assurance Company,
interest at 7.72%, matures in June 1994 .... -- 4,406,787
Continental Assurance Company,
interest at 4.90%,
50%, matures in December 1995
50% matures in June 1997 .................... 4,071,426 4,086,907
Continental Assurance Company,
interest at .7.43%, matures in
December 1999 ............................... 3,944,043 --
Life Insurance Company of Virginia,
Interest at 9.43%, matures in June 1994...... -- 4,487,895
Metropolitan Life Insurance Company,
interest at 9.59%, matures in June 1994...... -- 10,944,467
New York Life Insurance Company,
interest at 7.00%,
50% matures in December 1998
50% matures in June 1999 .................... 7,752,411 --
-6-
<PAGE>
1994 1993
------------ -----------
Protective Life Insurance Company,
interest at 8.46%, matures in June 1995 ..... 6,709,673 6,724,371
Provident Life and Accident Insurance
Company, interest at 5.10%, 50%,
matures in July 1996
50% matures in June 1997 .................... 6,369,304 6,150,678
Sun Life Insurance Company of America,
interest at 7.07%, matures in June 1998 ..... 2,449,093 --
Transamerica Occidental Life Insurance
Company, interest at 6.74%,
50%, matures in December 1996
50% matures in December 1997 ................ 4,060,087 --
----------- -----------
Total deposit contracts ..................... 48,771,667 50,241,350
Fidelity Fixed Income Fund .................. 1,196,343 934,526
----------- -----------
Total Fixed Income Fund ..................... $49,968,010 $51,175,876
=========== ===========
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, 1994.
-7-
<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 $57,668 and $92,266 for 1994 and 1993,
respectively.
3. CHANGE IN INVESTMENT OPTIONS
In January 1993, the Plan changed administrator and recordkeeper to Fidelity
Investments ("Fidelity") from First Interstate Bank (FIB). As a result of
this change, Plan participants were allowed to choose investment options
among certain Fidelity mutual funds.
4. SUBSEQUENT EVENTS
In January 1995, the Plan changed its name to the Watkins-Johnson Employees'
Investment Plan and added a Matching Contribution to the 401K Plan. The
Matching Contribution replaces the Company Contribution, based on company
profits, that was allocated to eligible participants on an annual basis.
-8-
<PAGE>
<TABLE>
WATKINS-JOHNSON COMPANY SCHEDULE 1
PROFIT SHARING INVESTMENT PLAN
ITEM 27A--SUPPLEMENTAL SCHEDULE OF ASSETS
HELD FOR INVESTMENT PURPOSES
AS OF DECEMBER 31, 1994
<CAPTION>
IDENTITY OF ISSUE DESCRIPTION OF INVESTMENT COST FAIR VALUE
- ---------------------------------- ------------------------------------- ----------- -----------
<S> <C> <C> <C>
Fidelity Management Trust Company Retirement Government Money Market $ 2,908,248 $ 2,908,248
Bankers Trust Company Fixed Income Fund (Deposit Contracts) 13,415,631 13,415,631
Continental Assurance Company Fixed Income Fund (Deposit Contracts) 8,015,469 8,015,469
New York Life Insurance Company Fixed Income Fund (Deposit Contracts) 7,752,411 7,752,411
Protective Life Insurance Company Fixed Income Fund (Deposit Contracts) 6,709,673 6,709,673
Provident Life and Accident Fixed Income Fund (Deposit Contracts) 6,369,304 6,369,304
Insurance Company
Sun Life Insurance Company Fixed Income Fund (Deposit Contracts) 2,449,093 2,449,093
Transamerica Occidental Life Fixed Income Fund (Deposit Contracts) 4,060,087 4,060,087
Insurance Company
Fidelity Management Trust Company Fixed Income Fund 1,196,343 1,196,343
Fidelity Management Trust Company Magellan Fund 21,308,063 21,518,557
Fidelity Management Trust Company OTC Portfolio 6,849,876 6,421,503
Fidelity Management Trust Company Balanced Fund 17,132,221 16,413,296
Watkins-Johnson Company Common Stock 2,664,431 2,917,026
------------ ------------
Total Investments $100,830,850 $100,146,641
============ ============
<FN>
(1) See Note 1 to the financial statements.
</FN>
</TABLE>
-9-
<PAGE>
<TABLE>
WATKINS-JOHNSON COMPANY SCHEDULE 2
PROFIT SHARING INVESTMENT PLAN
ITEM 27D--SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1994
(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
IDENTITY OF PARTY DESCRIPTION OF PURCHASE SELLING COST OF OF ASSET ON NET GAIN
INVOLVED ASSET PRICE PRICE ASSET TRANSACTION DATE OR (LOSS)
- ----------------------- ------------------ ----------- --------- ---------- ---------------- ---------
<S> <C> <C> <C> <C> <C> <C>
Single Transactions:(1)
- -----------------------
CNA Insurance Company Fixed Income Fund $4,000,000 -- $ 4,000,000 $ 4,000,000 *
(Deposit Contract)
CNA Insurance Company Fixed Income Fund -- $4,945,156 4,945,156 4,945,156 *
(Deposit Contract)
Metropolitan Life Fixed Income Fund -- 11,391,435 11,391,435 11,391,435 *
Insurance Company (Deposit Contract)
New York Life Fixed Income Fund 7,600,000 -- 7,600,000 7,600,000 *
Insurance Company (Deposit Contract)
New York Life Fixed Income Fund -- 101,814 101,814 101,814 *
Insurance Company (Deposit Contract)
FMTC U.S. Fixed Income Fund 28,019,274 -- 28,019,274 28,019,274 *
Government Reserve (Deposit Contract)
FMTC U.S. Fixed Income Fund -- 27,847,762 27,847,762 27,847,762 *
Government Reserve (Deposit Contract)
<FN>
(1) No expenses were incurred with any reportable transaction.
*For each transaction, fair value was equal to cost.
</FN>
</TABLE>
-10-
<PAGE>
<TABLE>
WATKINS-JOHNSON COMPANY SCHEDULE 2 (CONTINUED)
PROFIT SHARING INVESTMENT PLAN
ITEM 27D--SCHEDULE OF REPORTABLE TRANSACTIONS
FOR THE YEAR ENDED DECEMBER 31, 1994
(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
IDENTITY OF PARTY DESCRIPTION OF PURCHASE SELLING COST OF OF ASSET ON NET GAIN
INVOLVED ASSET PRICE PRICE ASSET TRANSACTION DATE OR (LOSS)
- ----------------------- ------------------ ----------- --------- ---------- ---------------- ---------
<S> <C> <C> <C> <C> <C> <C>
Series of Transactions:(1)
- -----------------------
Various(2) Fixed Income Fund $39,619,274 -- $39,619,274 $39,619,274 --
(Deposit Contracts)
(235 Transactions)
Various(2) Fixed Income Fund -- $44,286,167 -- 44,286,167 *
(Deposit Contracts)
(203 Transactions)
Fidelity Management Magellan Fund 7,323,902 -- 7,323,902 7,323,902 --
Trust Company (206 Transactions)
Fidelity Management Magellan Fund -- 4,251,438 4,181,036 4,251,438 $70,402
Trust Company (148 Transactions)
Fidelity Management Balanced Fund 6,862,187 -- 6,862,187 6,862,187 --
Trust Company (211 Transactions)
Fidelity Management Balanced Fund -- 6,485,730 6,623,633 6,485,730 (137,903)
Trust Company (175 Transactions)
Fidelity Management Watkins-Johnson 4,111,424 -- 4,111,424 4,111,424 --
Trust Company Company Fund
(193 Transactions)
Fidelity Management Watkins-Johnson -- 3,406,376 2,994,765 3,406,376 411,611
Trust Company Company Fund
(99 Transactions)
Fidelity Management Retirement 3,173,643 -- 3,173,643 3,173,643 --
Trust Company Government Money Market
(157 Transactions)
Fidelity Management Retirement -- 2,705,910 -- 2,705,910 *
Trust Company Government Money Market
(111 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.
</FN>
</TABLE>
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