SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
ANNUAL REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Fiscal Year Ended June 30, 1994
Commission File Number 0-8401
CACI International Inc
-----------------------------
(Exact name of Registrant as specified in its charter)
Delaware
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(State or other jurisdiction of incorporation or organization)
54-1345888
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(I.R.S. Employer Identification No.)
1100 North Glebe Road, Arlington, VA 22201
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(Address of principal executive offices)
(703) 841-7800
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(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class Name of each exchange on which registered
-------------------- -----------------------------------------
None None
Securities registered pursuant to Section 12(g) of the Act:
CACI International Inc Common Stock, $0.10 par value
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(Title of each class)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No
----- -----
The aggregate market value of the voting stock held by non-affiliates of the
Registrant as of August 31, 1994, was approximately $64,993,000.
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Indicate the number of shares outstanding of each of the Registrant's classes
of Common Stock, as of August 31, 1994: CACI International Inc Common Stock,
$.10 par value, 9,977,000 shares.
Documents Incorporated by Reference
(1) The information relating to directors and officers contained in the proxy
statement of the Registrant to be filed in connection with its 1994 Annual
Meeting of Shareholders is incorporated by reference into Part III, Items 10,
11, 12, and 13 of this Form 10-K.
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CACI INTERNATIONAL INC AND SUBSIDIARIES
Table of Contents to Annual Report on
Form 10-K for the Fiscal Year Ended June 30, 1994
PART I
Item 1. Business
Item 2. Properties
Item 3. Legal Proceedings
Item 4. Submission of Matters to a Vote of Security Holders
PART II
Item 5. Market for the Registrant's Common Equity and Related
Stockholder Matters
Item 6. Selected Financial Data
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Item 8. Financial Statements and Supplementary Data
Item 9. Disagreements on Accounting and Financial Disclosure
PART III
Item 10. Directors and Executive Officers of the Registrant
Item 11. Executive Compensation
Item 12. Security Ownership of Certain Beneficial Owners and
Management
Item 13. Certain Relationships and Related Transactions
PART IV
Item 14. Exhibits, Financial Statements, Schedules and Reports
on Form 8-K
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BUSINESS INFORMATION
Unless the context indicates otherwise, the terms "the Company" and "CACI" as
used in Section I, include both CACI International Inc and its wholly-owned
subsidiaries. The term "the Registrant", as used in Section I, refers to CACI
International Inc only.
PART I
ITEM 1. BUSINESS
BACKGROUND
CACI International Inc (the "Registrant") was organized as a Delaware
corporation under the name of "CACI WORLDWIDE, INC." on October 8, 1985. By a
merger effected on June 2, 1986, the Registrant became the parent of CACI,
Inc., a Delaware corporation, and CACI N.V., a Netherlands corporation.
The Registrant is a holding company and its operations are conducted through
wholly-owned subsidiaries which are located in the United States and Europe.
OVERVIEW
CACI is strategically positioned in the information technology ("IT")
industry. With 1994 revenue of over $183 million, CACI serves clients in
major segments of government and commercial markets throughout North America
and Western Europe. Many of the Company's client relationships have existed
for five years or more.
Founded in 1962, CACI provides computer-based information technology, systems,
custom software, integration and operations, imaging and document management,
simulation, and proprietary database and software products. The Company
manufactures no equipment.
CACI's service and value has enabled the Company to sustain high rates of
repeat business and continuing client support. The Company believes that its
performance similarly enables it to compete effectively for new clients and
new contracts. The Company is organized to seek competitive business
opportunities and has designed its operations to support major programs.
CACI's primary markets - both domestic and international - are agencies of
national governments, major corporations, state and local governments, and
other business organizations. The client market for CACI's information
systems and high technology services is created by the need for solutions to
the complex systems and information environment in which the clients operate,
be it governmentally mandated programs, or competitively driven needs in the
commercial arena.
CACI has structured its new business development organization to respond to
the globally competitive marketplace. The Company employs full-time
marketing, sales, and proposal development specialists who support the
Company's line operations' marketing and sales responsibilities.
The Company has continued to expand its portfolio of proprietary software and
database products. The Company offers marketing systems software and database
products, targeted to clients who need systems and analysis for retail sales
of consumer products, direct mail campaigns, franchise or branch site location
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projects, and similar requirements. In CACI's simulation technology business
the Company offers both computer-based simulation languages and simulation
packages (products) that provide clients with analysis and solutions for the
manufacturing industry; for wide area communications networks (e.g., WANs,
satellites, land lines); for local area computer networks (i.e., LANs); for
the study of business processes; and for design of distributed computer
systems architectures. CACI also offers a product line targeted to the needs
of government procurement organizations and purchasing agents supporting large
volume acquisition programs or activities (see General Description, below).
The Company operates through wholly-owned subsidiaries established to serve
specific market segments, or conduct business in specific geopolitical
jurisdictions.
CACI's major operating subsidiary in Europe, CACI Limited, is headquartered in
London, England, and operates primarily in support of CACI information
systems, marketing systems, and simulation technology lines of business in the
United Kingdom and Western Europe.
CACI's American Legal Systems Corp. ("ALS") subsidiary specializes in
providing litigation support services to law firms and major corporations in
the United States, and complements the Company's other litigation support
business with government clients.
CACI currently employs approximately 3,069 people. The corporation currently
operates from its headquarters at Three Ballston Plaza, 1100 N. Glebe Road,
Arlington, Virginia. CACI also has operating offices and facilities in 46
additional locations throughout the United States, Europe and Canada.
GENERAL DESCRIPTION OF CACI SYSTEMS, TECHNOLOGIES AND
PRODUCTS
Representative Systems Applications include:
. Airport and airspace traffic planning
. Ammunition management information systems
. Automated documents and records management systems
. Computer aided logistics/data information systems
. Contracting and purchasing systems
. Executive decision support systems for military planners
. Imaging services
. Inventory levels setting and allocation systems
. Inventory management and control systems
. Litigation support systems and services
. Manufacturing requirements planning systems
. Marketing and customer database management systems
. Sales management and business support systems
. Site location and analysis systems
. Software reengineering
. State motor vehicle registration and related management information
systems
. Weapon systems/equipment configuration management systems
CACI products are installed in over 4,000 locations worldwide, and many are
designed to run on a variety of popular computers. Representative CACI
software and database products include:
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Simulation Technology:
SIMFACTORY II.5 A software product for factory planners to study
alternative plant and equipment configurations. (SIMFACTORY II.5 is a
trademark of CACI Products Company.)
COMNET II.5 A software product for communications engineers to study "wide
area networks" of satellites, land lines, switching systems and protocols.
(COMNET II.5 is a registered trademark of CACI Products Company.)
COMNET III An object-oriented software product for the prediction of local
and wide area network performance. (COMNET III is a trademark of CACI Products
Company.)
NETWORK II.5 A software product for engineers to study alternative
combinations of computers and data storage devices. (NETWORK II.5 is a
registered trademark of CACI Products Company.)
SIMSCRIPT II.5 A language designed especially for analysts to build
computer-based representations ("models") of complex activities, eg. airways
and airport traffic; maintenance procedures for fleets of ships; warfare
studies of military equipment and tactics; and communications networks.
(SIMSCRIPT is a registered trademark of CACI Products Company.)
SIMPROCESS An electronic prototyping tool for business process
reengineering, with which a manager can model a current business operation,
and then experiment with alternative approaches. (SIMPROCESS is a trademark of
CACI Products Company.)
MODSIM II A computer programming and graphics environment that provides an
object-oriented approach to structuring software. This approach provides an
intuitive development framework to programmers, one that allows code to be re-
used. (MODSIM II is a registered trademark of CACI Products Company.)
SIMOBJECT A software framework for the reduction of time and cost in
building simulation models. (SIMOBJECT is a registered trademark of CACI
Products Company.)
Marketing Systems Technology and Data and Information Systems Products:
InSite-USA (also InSite, UK version). A PC-based Geographic Information
System (GIS) combining software, data, and mapping capabilities to enable
planners to determine the location of retail outlets, branch networks, sales
territories, potential customers and competitors. (InSite-USA and InSite are
trademarks of CACI, INC.-FEDERAL and CACI Limited, respectively.)
ACORN (A Classification of Residential Neighborhoods) A tool that analyzes
consumers according to the type of residential area in which they live and is
used to identify the prime prospects for all types of consumer goods and
services. (ACORN is a registered trademark of CACI, INC.-FEDERAL in the United
States; and also a registered service mark of CACI, INC.- FEDERAL and CACI
Limited in the United States, and in the United Kingdom and Northern Ireland,
respectively.)
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MARKET*MASTER A database marketing system that enables companies to analyze
their customer files by product holding and usage for the purpose of cross
selling other products and services. (MARKET*MASTER is a trademark of CACI,
INC.-FEDERAL.)
SITE A detailed demographic and applied market research database for any
geographic area such as county, zip code, TV broadcast area, congressional
district or retail trade area. (SITE is a registered trademark of CACI
Limited.)
Prophecy A financial accounting and business software product distributed by
CACI in the United Kingdom under license from CSP Australia.
Miracle A financial accounting and business software product running on Data
General proprietary systems. (Miracle is a trademark of CACI Limited.)
FEDERAL GOVERNMENT AGENCIES
CACI provides its entire range of information systems, technical services and
proprietary products to defense and civilian agencies of the U.S. Federal
Government. These activities require CACI's expert knowledge of agency
policies and operations. These assignments most often combine the wide range
of CACI's skills in information systems, systems engineering, logistics
sciences, weapons systems, simulation, and automated document management
systems. CACI also contracts with other national governments.
STATE AND LOCAL GOVERNMENT
CACI is a technological leader in the supply of automated information systems
for state governments' management of vehicle registration, licensing, and
wheeled vehicle revenue support. The Company also offers its broadly based
software and systems integration services to this market segment.
MAJOR CORPORATIONS
CACI's commercial market base consists primarily of large corporations
(nominally characterized as the "Fortune 1000"). This market is a primary
target of CACI's proprietary software and database products in the Company's
marketing systems and simulation technology lines of business. CACI also has
target initiatives underway for the supply of reengineering of information
systems (software and integration) and configuration management systems for
manufacturers. While these latter two initiatives remain at modest investment
levels at present, the Company intends to continue them, given the current
state of the U.S. economy.
OTHER SERVICES
The Company operates electronic calibration facilities in the Norfolk,
Virginia area, which support defense and related agencies. The Company also
operates a language translation and interpreter services organization that
provides support to the Defense Language Institute, civilian agencies of the
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Federal Government, and in particular to the Company's major contracts with
the U.S. Department of Justice ("DoJ").
FOUNDATION OF THE BUSINESS, CACI PEOPLE
CACI's business success is highly correlated with the Company's ability to
attract, recruit, motivate, and retain exceptional people at all levels of the
organization. The most valuable asset and resource the Company has is its
people. The Company is in continuing competition for the recruitment and
retention of highly skilled professionals.
For these reasons, the Company has endeavored to develop and maintain
competitive salary structures, incentive compensation programs and benefits,
and other individual recognition and award programs to highlight the Company's
intense interest in the success of its people in their careers.
In order to compete effectively in attracting and retaining such personnel,
the Company and its subsidiaries provide substantial benefits to their
employees. These benefits vary among the Company and its subsidiaries, but
generally include paid vacations and holidays, medical and life insurance,
incentive bonuses, and other benefits under pension and stock purchase plans.
At the same time the Company has been forced by the current economic climate
to scrutinize and recast several of its compensation and benefit programs to
assure a competitive balance of compensation, incentives and benefits for the
costs incurred.
The Company recruits people from various market populations including
experienced industry professionals, university graduates, trade and technical
school graduates, and seasoned technicians. The Company's professional
profile includes a high percentage of college graduates, many with advanced
degrees, including those at the masters and doctorate levels. The Company
seeks professionals with academically certified credentials in computer-based
information sciences, systems engineering, management systems, market
research, economics, military sciences, the legal profession, and other
scientific and research-oriented disciplines.
The Company has structured its promotion and advancement policies to meet the
current competitively driven market environment. Individuals advance in
relation to their abilities to perform as program managers, or to demonstrate
exemplary leadership skills in technical endeavors, or managerial achievements
against specified objectives, quotas or other defined targets.
CACI advancement criteria incorporate specific requirements to demonstrate a
"client-service orientation", and the need to work synergistically within the
Company, in response to the wide range of client technical and contractual
requirements, or in development of solution approaches to new client projects.
This philosophy is consistent with CACI's current market, and is a catalyst
for individuals to support Company objectives.
As of June 30, 1994, CACI had approximately 3,069 employees. This total
includes 538 part-time employees.
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The Company also requires all of its employees, consultants, officers and
directors to subscribe annually to and affirm the Company's published Code of
Ethics and Business Standards. The Company has published policies that set
high standards for the conduct of all business with clients, suppliers,
vendors, and the public at large.
MARKETPLACE, DESCRIPTION AND SIGNIFICANT ACTIVITIES
CACI operates in an industry characterized by the presence of many highly
competitive firms. At the same time, CACI enjoys a respected position as one
of the larger public corporations in the segment of the information technology
industry that does not manufacture equipment. Although the Company is a
premier supplier of proprietary computer-based simulation technology products,
and is a major supplier of proprietary marketing systems products and services
in both the United States and the United Kingdom, CACI is not primarily a
software product developer-distributor (See discussion following on Patents,
Trademarks, Trade Secrets and Licenses).
Competition for new contracts centers on reputation, responsiveness to
proposal requests, price, and many other factors. Competition for software
products and services centers on reputation, applicability, quality, quality
of product support and maintenance services, among other elements.
The Company has developed a special position, and continues to develop its
position, in combining unique knowledge of client problems with the Company's
significant expertise in the design, development and implementation of
advanced information systems solutions. This industry niche orientation
provides CACI with important opportunities to support large equipment
manufacturers with the expert systems integration and software services they
frequently require to compete for multi-million dollar contracts issuing from
the U.S. Federal Government.
In this area, CACI has also taken active steps to develop longer-term, on-
going relationships with those industry giants -- such as Microsoft, IBM, DEC,
GE Information Systems, AT&T Global Information Solutions, Lotus Development
Corporation, Oracle, Sybase -- that have compatible business perspectives and
objectives to those of CACI. For these reasons, the Company intends to
continue the active cultivation of these relationships wherever they support
CACI's growth objectives.
The Company also seeks to expand its commercial markets for its information
systems business through these relationships.
Marketing and new business development for the Company is conducted by all the
officers and managers of the Company (the CEO, executive officers, vice
presidents, division and department managers). CACI's proprietary software
and data products are sold by full time salespeople. The Company has
established several distributor-type sales agreements for the sale of its
products in specified overseas markets. For its information systems and
services markets, the Company employs several marketing professionals who
support the Company's targeting of major contract opportunities, primarily in
the U.S. Federal government market arena.
Nonetheless, CACI faces competition from a substantial number of firms, some
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of which are larger in size and financial resources than CACI. The Company
obtains much of its business on the basis of proposals submitted in response
to requests for proposals from potential and current customers, who may also
request proposals for similar services from other firms. Additionally, the
Company may face indirect competition from certain government agencies which
may perform services for themselves similar to those marketed by CACI. The
Company knows of no single competitor which is dominant in its fields of
technology. The Company has a relatively small share of the available
worldwide market for its products and services and has a goal of achieving
growth through increased market share.
CACI's sales of proprietary software and data products are characterized by
either a purchase order sale, or a short-duration contract. The Company
generally prices its products in catalog fashion. Most often, product prices
are determined by the target computer that the product will run on, or by some
form of multiple site volume discount arrangement, or by some frequency of
usage arrangement, in the case of data products.
For CACI's information systems and professional services contracts, the
Company submits bids for work and products to be delivered. Bids are
frequently negotiated as to terms and conditions for schedules,
specifications, deliveries, and payment. CACI's contracts and subcontracts
take on a wide range of contractual agreement modes, including firm fixed
price obligations, cost reimbursement contracts, labor hours and materials
expense agreements, and variants thereof, including fixed unit price,
performance and delivery contracts. In general, revenue for this work is
accrued as a percentage of completion, which is based upon costs incurred, in
proportion to total expected costs.
Often, the form of contract and terms will be specified by the client. This
is especially the case with government contracts. In these latter situations,
the Company may seek alternative arrangements, or choose not to bid in those
cases where the contracting arrangement appears inappropriate to Company risk.
By Company policy, fixed price contracts require the approval of a senior
officer of the Company, and review and release approval by the Chief Executive
Officer.
At any one time, the Company may have several hundred separate contract
obligations being performed. In 1994, the ten top revenue producing contracts
accounted for 42% of CACI's revenue, or $76.8 million. One contract for
automated litigation support to the Civil Division of the U.S. Department of
Justice ("DoJ"), accounted for 11.6% of total FY 1994 Company revenue.
In 1994, seventy-one percent (71%) of CACI's business volume stemmed from
Federal Government contracts, the remaining twenty-nine percent (29%) coming
from commercial contracts and proprietary products. Fifty-one percent (51%)
of the Company's revenue came from U.S. Department of Defense ("DoD")
contracts, sixteen percent (16%) came from contracts with DoJ, and four
percent (4%) came from other civil agency government clients.
The Company is endeavoring to continue expansion of its diversified business
portfolio. While desiring to decrease its dependence on DoD work per se, the
Company will, nonetheless, aggressively seek additional work from this large
client agency. In FY 1994, the DoD revenue grew by 20% ($15.5 million)
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primarily as a result of the December 1993 acquisition of the Government
Services business of SofTech, Inc.
The Company is expanding its contract support to DoJ, as illustrated by the
award to the Company of new contracts to provide advanced automated litigation
support services to DoJ's Environmental and Natural Resources Division and the
Executive Office of the U.S. Attorneys. This work has demanded increasingly
sophisticated project management processes and high technology infusions to
keep pace with client caseloads. In view of this requirement, the Company
developed the ADIIS automated document image indexing system which improves
the productivity for high quality litigation support for the department's
attorneys. (ADIIS is a trademark of CACI, INC.-FEDERAL.)
The Company believes it is the largest supplier of litigation support and
related automation services to the U.S. Federal Government. The Company
intends to seek additional work from the U.S. Federal Government and offer
significant economies to the government through its specialization in this
field.
During the first half of this fiscal year, the Company purchased the majority
of contracts and assets from the Government Services business of SofTech,
Inc., Pinpoint Analysis Ltd. ("Pinpoint"), and Miracle Products Ltd.
("Miracle"). The excess purchase price over the fair value of the net assets
of the SofTech purchase totalled $3.3 million. The SofTech acquisition,
completed on December 1, 1993, added approximately 210 people and
approximately $13.8 million in FY 1994 revenue to CACI's government
information technology business. The excess purchase price over the fair
value of the net assets of the Pinpoint and Miracle purchase totalled $0.333
million. The excess for these acquisitions has been recorded as Goodwill and
will be amortized for a period ranging from 3 to 15 years.
During the past fiscal year, the Company examined a number of other friendly
acquisition opportunities. Analyses of industry values and interest rates
continue to indicate favorable market timing for this strategy.
SEASONAL NATURE OF BUSINESS
The Company's business in general is not seasonal, although the summer and
winter holiday seasons do affect both sales and revenue of the Company because
of their impact on the Company's labor sales in its Federal business and on
product sales by the Company's European operations. Variations also may occur
at the expiration of major contracts until such contracts are renewed or new
contracts obtained. Although the Company derives significant revenue from
the Federal Government, the timing of the Federal budget cycle has
historically not significantly impacted the Company's revenue.
RESEARCH AND DEVELOPMENT
During fiscal years 1994, 1993 and 1992, the Company spent of $1,094,000,
$600,000, and $748,000 respectively, for research and development on current
and anticipated products.
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ENVIRONMENTAL PROTECTION REQUIREMENTS
There has been no significant adverse impact on the Company's business as a
result of laws that have been enacted for the protection of the environment.
PATENTS, TRADEMARKS, TRADE SECRETS, AND LICENSES
The Company owns three United States patents. While the Company believes that
its patent and patent applications are valid, it does not consider that its
business is dependent on patent protection in any material way.
The Company does believe that its business is dependent to a significant
extent on its technical and organizational knowledge, practices, and
procedures, in some of which it claims proprietary interests.
The Company claims copyright, trademark, and proprietary rights in each of its
proprietary computer software and data products and documentation.
The Company presently owns approximately 37 registered United States
trademarks and service marks. All of the Company's registered United States
trademarks and service marks may be renewed indefinitely. The Company is a
party to agreements which give it the right to distribute computer software
and other products owned by other companies, and receive income therefrom.
The Company has developed and holds proprietary rights in a number of computer
software packages and databases, including, but not limited to: ACORN*,
ADIIS, C-GATE,# CITYVIEWS, COMNET II.5*, COMNET III, COSTPRO*, DORIS*,
EnterpriseView, FAR-TRIEVE*, GRID-MAP#, InSite-USA#, IRIS, L-NET#,
MARKET-
AMERICA#, MARKET*MASTER, MODSIM II*, NETOBJECT, NETWORK II.5*,
OBJECT.MGR,
Perfect-Mail*#, QuickBid*, renovate, SACONS-EDI, SACONS-FEDERAL*, SIDE,
SIMANIMATION*, SIMBASE, SIMFACTORY*, SIMFACTORY II.5, SIMFLOW*,
SIMGRAPHICS*,
SIMLAB*, SIMOBJECT*, SIMPROCESS, SIMSCENARIO*, SIMSCRIPT II.5*,
SIMSNIPS*,
SIMSTRUCTOR*, SIMTrainer*, SIMVIDEO*, SITELINE*, SITE-POTENTIAL*#,
SUPERSITE*,
ULTRA RETRIEVE*, and ZIP-DEMOGRAPHICS*#.
[* The marks above indicated with an asterisk (*) are registered service
marks or trademarks of CACI International Inc or its subsidiaries. All others
are service marks or trademarks of CACI International Inc or its
subsidiaries.]
[# The marks above indicated with a pound sign (#) contain a hyphen (-) to
represent the bullet point which is an integral component of each mark and
which cannot be printed due to electronic transmission limitations.]
In addition, subsidiaries of the Company claim foreign copyright, trademark,
and proprietary rights in the Company's proprietary computer software
products. These subsidiaries hold proprietary rights in computer software
products and databases including, but not limited to, ACORN* (and the related
Arts*ACORN, Change*ACORN, Custom*ACORN, Property*ACORN,
Holiday*ACORN,
Household*ACORN, Investor*ACORN, Property*ACORN,) CACI
MARKET*MASTER*,
CATALIST*, GEO-MARKETING*, GEOMATCH*, GEOREAD, GEOTRIEVE*,
MONICA*, CACI
NATIONAL MORTGAGE DATABASE, SITE*, SITE-POTENTIAL*, and SHOPPING
CENTRE
PLANNER. Some of these subsidiaries are parties to agreements pursuant to
which they may have the right to distribute computer software products owned
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by others and obtain income therefrom.
[* The marks above indicated with an asterisk (*) are registered service
marks or trademarks of CACI International Inc or its subsidiaries. All others
are service marks or trademarks of CACI International Inc or its
subsidiaries.]
BACKLOG
The Company's backlog as of June 30, 1994 was $726.5 million, of which $77.2
million was for orders believed to be firm. Total backlog as of June 30, 1993
was $570 million, of which $53.0 million represented firm orders. The source
of backlog is primarily contracts with the U.S. Government. It is presently
anticipated that all of the firm backlog will be filled during the fiscal year
ending June 30, 1995.
BUSINESS SEGMENTS, FOREIGN OPERATIONS, AND MAJOR CUSTOMER
The business segment, foreign operations, and major customer information
provided in the Company's Consolidated Financial Statements contained in this
Report are incorporated herein by reference. In particular, see Note 14,
Segment Information, of the Notes to Consolidated Financial Statements.
The following information is provided about the amounts of revenue
attributable to firm fixed price contracts (including proprietary software
product sales), time and materials contracts, and cost reimbursable contracts
of the Company during each of the last three fiscal years:
<TABLE>
<CAPTION>
Fiscal Year Ended Firm Time and Cost
June 30, Fixed Price Materials Reimbursable Total
- - ----------------- ----------- ----------- ------------ ------------
<S> <C> <C> <C> <C>
1994 $51,428,000 $64,109,000 $68,163,000 $183,700,000
1993 47,535,000 44,690,000 52,923,000 145,148,000
1992 47,675,000 47,158,000 45,045,000 139,878,000
</TABLE>
ITEM 2. PROPERTIES
As of June 30, 1994, CACI leased office space at 47 locations containing an
aggregate of approximately 473,000 square feet of space located in 21 states
of the United States. In four countries outside the United States, CACI
leased seven offices containing about 29,000 square feet of space. CACI's
leases expire primarily over the next eight years. In most cases, CACI
anticipates that leases will be renewed or replaced by other leases.
All of CACI's offices are in modern and well-maintained buildings. The
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facilities are substantially utilized and adequate for present operations.
As of June 30, 1994, CACI International Inc maintained its corporate
headquarters in approximately 152,000 square feet of space at 1100 North Glebe
Road, Arlington, Virginia. See Note 9, Lease Commitments, of the Notes to
Consolidated Financial Statements, for additional information regarding the
Company's lease commitments.
ITEM 3. LEGAL PROCEEDINGS
Pfirman and Chrysogelos Shareholder Litigation
Reference is made to Part II, Item 1, Legal Proceedings, in the Registrant's
quarterly report on Form 10-Q for the quarter ended March 31, 1991 for a
description of the two pending shareholder suits against the Registrant, and
against the directors of the Registrant entitled "Pfirman v. London, et al"
and "Chrysogelos v. London, et al".
Since the filing of the Registrant's quarterly reports on Form 10-Q, on which
Part II, Item 1, Legal Proceedings, was current, the information reported
therein on pending legal proceedings instituted against the Registrant has
changed as set forth below and in the Registrant's current report on Form 8-K,
dated August 5, 1994:
In July, 1994, the parties in both the "Chrysogelos" and "Pfirman" lawsuits
filed with the Delaware Chancery Court a Stipulation and Agreement of
Compromise and Settlement (hereinafter "Settlement Documents") which provides
for settlement of both the "Chrysogelos" and "Pfirman" lawsuits, subject to
Court approval. The Chancery Court has given preliminary approval of the
Settlement and requested the parties to provide notice of the proposed
Settlement to the plaintiff class. The Court has set November 15, 1994 as the
date for a hearing regarding the proposed Settlement and any objections
thereto that may be made by class members. If, after such hearing, the
Chancery Court approves the settlement, the parties will then request the
United States District Court for the District of Columbia to dismiss the
"Pfirman" case. The District Court has approved this procedure for the
"Pfirman" case.
The settlement is intended to resolve all claims which have been made or could
have been asserted in the "Chrysogelos" and "Pfirman" lawsuits. If the
settlement is approved as filed, its major components will be as follows:
First, subject to the specific terms of the Settlement Documents, if the
average closing price for the Company's Common Stock for any twenty (20)
consecutive trading days between July 22, 1994 and February 28, 1995 falls
below Six Dollars ($6.00) per share, the Company has agreed to conduct a self-
tender for 1.3 million shares of its Common Stock at Six Dollars ($6.00) per
share (the Company's Common Stock has traded above Six Dollars ($6.00) per
share since January, 1994).
Second, the settlement provides that the Company seek shareholder approval of
an amendment to its By-laws increasing the size of the Board of Directors from
seven (7), to a number between five (5) and nine (9) members as a majority of
the Board plus one (1) may set. In anticipation of the settlement, the
<PAGE>
page 15
shareholders approved such an amendment to the By-laws and elected six (6) new
directors who are mutually-acceptable to the Company and the name plaintiffs
at the Company's Annual Meeting of Shareholders held on December 17, 1993.
Third, the Company will establish a fund in an amount not to exceed Six
Hundred Thousand Dollars ($600,000) to pay claims filed on behalf of class
members who sold shares of Common Stock between April 26, 1990 and December 1,
1990 at a loss as defined by the terms of the Settlement Documents.
The settlement further provides that the defendants will not oppose an
application to the Delaware Chancery Court for award of attorneys' fees in
both cases in an aggregate total not to exceed Five Hundred Fifty Thousand
Dollars ($550,000), and out-of-pocket expenses in both cases in an aggregate
total not to exceed Forty-Eight Thousand Dollars ($48,000), provided that no
other application for attorneys' fees or expenses is made in connection with
the settlement.
In reaching the settlement, the Board of Directors did not acknowledge any
wrongdoing. In its deliberations on these suits, the Board did not believe it
was productive to continue to incur legal expenses and divert senior
management's attention at a time when the Company's plan to enhance
shareholder value was proving out and revenue and operating income were
growing.
Pentagen Technologies International, Ltd. v. CACI International Inc, et al
Reference is made to Part I, Item 3, Legal Proceedings, in the Registrant's
annual report on Form 10-K for the year ended June 30, 1993, for a description
of the lawsuit filed July 1, 1993 against the Registrant by Pentagen
Technologies International, Ltd. ("Pentagen") in the Supreme Court of the
State of New York, alleging conversion of intellectual property and violation
of statutory duties as to appropriation of computer software. Reference is
also made to Part II, Item 1, Legal Proceedings, in the Registrant's quarterly
report on Form 10-Q for the quarter ended December 31, 1993 for a description
of the suit filed against the Registrant by Pentagen in the United States
District Court for the Southern District of New York alleging copyright and
trademark infringement and violation of the Major Fraud Against the United
States Act. Since the filing of the Registrant's quarterly reports on Form
10-Q, on which Part II, Item 1, Legal Proceedings, was current, the
information reported therein on pending legal proceedings instituted against
the Registrant has changed as set forth below:
Pursuant to orders entered on May 27, 1994 and August 3, 1994, the United
States District Court for the Southern District of New York has stayed both
lawsuits (93 Civ. 8512 and 94 Civ. 0441), pending further proceedings in the
matter of "CACI International Inc, et al v. Pentagen Technologies
International, Ltd., et al" described below.
<PAGE>
page 16
CACI International Inc, et al v. Pentagen Technologies International, Ltd.,
et al
Reference is made to Part II, Item 1, Legal Proceedings, in the Registrant's
quarterly report on Form 10-Q for the quarter ended December 31, 1993 for a
description of the suit filed by Registrant against Pentagen Technologies
International, Ltd.; its subsidiary, Baird Technologies, Inc.; and Pentagen's
directors and principal executive officers, John Baird and Mitchell Leiser.
Since the filing of the Registrant's quarterly reports on Form 10-Q, on which
Part II, Item 1, Legal Proceedings, was current, the information reported
therein on pending legal proceedings has changed as set forth below and in the
Registrant's current report on Form 8-K, dated June 23, 1994.
On June 16, 1994, the United States District Court for the Eastern District of
Virginia issued an order in response to Registrant's Motion for Summary
Judgment which (i) declared that CACI's marketing activity to the United
States Army Material Command did not infringe Pentagen's copyright in certain
intellectual property or infringe any trademark held by Pentagen; (ii)
declared that CACI's reengineering software methodology does not infringe
Pentagen's copyright of certain intellectual property; (iii) declared that
CACI's work on the United States Army's Sustaining Base Information Services
contract does not infringe Pentagen's copyright of certain intellectual
property; (iv) held Pentagen liable for tortious interference with CACI's
Sustaining Base Information Services contract; and (v) held Pentagen and
defendants Baird and Leiser liable for defamation per se.
Defendants Pentagen, Baird and Leiser moved for reconsideration of the Court's
order. On July 13, 1994, the Court denied that Motion for Reconsideration.
Those defendants also moved for recusal of the District Court judge. That
Motion, too, was denied on July 13, 1994, and a trial on damages was
conducted.
On July 28, 1994, defendants Pentagen, Baird and Leiser filed a petition for a
Writ of Mandamus with the United States Court of Appeals for the Fourth
Circuit seeking recusal of the trial judge based on an alleged conflict of
interest. That petition was denied by the Fourth Circuit on August 29, 1994.
By Order dated August 12, 1994, the Court awarded CACI attorney's fees of One
Hundred Ten Thousand Five Hundred Fifty Dollars ($110,550), court costs of
Sixty One Thousand Five Hundred Dollars ($61,500), compensatory damages for
defamation per se of One Thousand Dollars ($1,000) and punitive damages for
defamation per se of Ten Thousand Dollars ($10,000). The defendants have
appealed the judgment to the Fourth Circuit. On the issue of tortious
interference, the Court concluded that no real damages were sustained by CACI,
vacated its earlier judgment in CACI's favor, and entered judgment in favor of
the defendants on that count.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matter was submitted to a vote of security holders during the fourth
quarter of the Registrant's fiscal year ended June 30, 1994, through the
solicitation of proxies or otherwise.
<PAGE>
page 17
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND
RELATED STOCKHOLDER
MATTERS
The Registrant's Common Stock became publicly traded on June 2, 1986,
replacing paired units of Common Stock of CACI, Inc. and beneficial interests
in Common shares of CACI N.V. which had been traded in the over-the-counter
market.
From July 1, 1992 to June 30, 1994, Common Shares of the Registrant have been
quoted on the NASDAQ National Market System. The range of high and low sales
prices for each quarter during this period are as follows:
Fiscal 1994 Fiscal 1993
- - -------------------------- ---------------------------
Quarter High Low Quarter High Low
- - ------- ------ ----- ------- ------- ------
1st 5-1/16 4-1/4 1st 5 4-5/16
2nd 6 5 2nd 4-13/16 4
3rd 9-3/8 5-5/8 3rd 4-1/2 3-7/8
4th 10-3/8 7-7/8 4th 4-3/4 3-7/8
The Registrant has never paid a cash dividend. The present policy of the
Registrant is to retain earnings to provide funds for the operation and
expansion of its business. The Registrant does not intend to pay any cash
dividends in the foreseeable future.
At August 31, 1994, the number of record holders of the Registrant's Common
Stock was approximately 1,463.
Pursuant to the terms of its Charter, in October 1993, the Registrant's Common
Stock ceased being classified as Class A Common Stock and Class B Common
Stock, with all shares of both Class A and Class B Common Stock being
automatically converted to an equal number of shares of Common Stock.
<PAGE>
page 18
ITEM 6. SELECTED FINANCIAL DATA
<TABLE>
<CAPTION>
Year Ended June 30
------------------
1994 1993 1992 1991 1990
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
<C>
REVENUE $183,700,000 $145,148,000 $139,878,000 $136,084,000
$148,071,000
COSTS AND EXPENSES
Direct costs 97,584,000 75,804,000 74,536,000 66,896,000
69,141,000
Indirect costs & selling expenses 71,126,000 57,797,000 55,289,000 62,644,000
70,403,000
Depreciation & amortization 4,341,000 3,367,000 2,556,000 3,029,000
2,604,000
----------- ----------- ----------- ----------- -----------
Operating expenses 173,051,000 136,968,000 132,381,000 132,569,000
142,148,000
----------- ----------- ----------- ----------- -----------
10,649,000 8,180,000 7,497,000 3,515,000
5,923,000
Interest expense 420,000 471,000 359,000 428,000
163,000
Shareholder lawsuit & merger costs 0 901,000 0 0
0
Excess facilities & lease
termination costs 0 1,921,000 0 2,428,000 0
----------- ----------- ----------- ----------- -----------
EARNINGS BEFORE
INCOME TAXES 10,229,000 4,887,000 7,138,000 659,000
5,760,000
Income taxes 3,893,000 1,907,000 2,928,000 (363,000)
1,757,000
----------- ----------- ----------- ----------- -----------
INCOME BEFORE
EXTRAORDINARY ITEM 6,336,000 2,980,000 4,210,000
1,022,000 4,003,000
Extraordinary Item:
Cost of shareholder lawsuit
settlement (net of $194,000
tax benefit) (300,000) 0 0 0 0
----------- ----------- ----------- ----------- -----------
NET INCOME $ 6,036,000 $ 2,980,000 $ 4,210,000 $ 1,022,000
$ 4,003,000
=========== ===========
=========== =========== ===========
EARNINGS PER COMMON AND
COMMON EQUIVALENT SHARE:
Income before
extraordinary item $ 0.60 $ 0.29 $ 0.40 $ 0.10 $
0.35
Extraordinary item (0.03) 0.00 0.00 0.00
0.00
Net income 0.57 0.29 0.40 0.10 0.35
AT YEAR END:
Total assets $ 70,999,000 $ 58,417,000 $ 55,835,000 $ 49,428,000 $
57,829,000
Long-term obligations 2,492,000 2,898,000 2,901,000 2,696,000
761,000
Working capital 25,327,000 21,937,000 24,055,000 21,033,000
22,008,000
Shareholders' equity 37,738,000 30,497,000 28,923,000 24,959,000
29,450,000
</TABLE>
<PAGE>
page 19
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND
RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
The following table sets forth the relative percentages that certain items of
expense and earnings bear to revenue for the fiscal years ended June 30, 1994,
1993 and 1992.
Percentage of Revenue
----------------------------
FY 1994 FY 1993 FY 1992
------- ------- -------
Revenue 100.0% 100.0% 100.0%
Costs and expenses
Direct costs 53.1% 52.3% 53.3%
Indirect costs & selling expenses 38.7% 39.8% 39.5%
Depreciation and amortization 2.4% 2.3% 1.8%
------ ------ ------
Operating Expenses 94.2% 94.4% 94.6%
------ ------ ------
5.8% 5.6% 5.4%
Interest expense 0.2% 0.3% 0.3%
Shareholder lawsuit & merger costs 0.0% 0.6% 0.0%
Excess facilities &
lease cancellation cost 0.0% 1.3% 0.0%
------ ------ ------
Earnings before income taxes 5.6% 3.4% 5.1%
Income taxes 2.1% 1.3% 2.1%
Extraordinary item: settlement of
shareholder suits (net of tax) 0.2% 0.0% 0.0%
------ ------ ------
Net Income 3.3% 2.1% 3.0%
====== ====== ======
FY 1994 COMPARED WITH FY 1993
Revenue increased by 26.6% or $38.6 million to $183.7 million from last year's
$145.1 million. The increase was the result of a $15.5 million (19.6%)
increase in revenue from the U.S. Department of Defense ("DoD"), an $8.3
million increase (40.5%) in revenue from contracts with the U.S. Department of
Justice ("DoJ"), an $8.7 million increase (22.7%) in revenue from commercial
customers, a $4.0 million increase (139.0%) in revenue from Federal agencies
other than DoD and DoJ, and a $2.1 million increase (47.8%) in revenue from
state governments.
The $15.5 million (19.6%) increase in revenue from DoD contracts was primarily
the result of the $4.2 million acquisition of the Government Services business
of SofTech, Inc. on December 1, 1993 for $3.3 million of goodwill and $919,000
for the book value of assets used in the business (primarily fixed assets).
This acquisition has added revenues of $13.8 million in FY 1994. The
acquisition is expected to continue to add revenues of approximately $25
million per year and annual earnings of approximately $750,000. DoD-derived
<PAGE>
page 20
revenue accounted for 51% of total revenue during the year, down from 55% of
last year's total revenue. This percentage reduction is the result of the
Company's focus on diversification which resulted in larger proportional
increases in the other business areas discussed below.
The DoJ growth was a result of new contract awards for automated litigation
support services which the Company won competitively in the spring and summer
of 1993. For the year, DoJ revenue accounted for 15.7% of total company
revenue versus last year's 14.2%. Although revenue from DoJ is dependent upon
the level of DoJ litigation case load the Company is supporting at any period
in time, the Company believes DoJ-derived revenue will continue to increase
during the upcoming fiscal year.
The 22.7% ($8.7 million) increase in commercial revenue is the result of a 48%
increase in revenue from the U.K. operation. The substantial growth in U.K.
revenue is the result of (i) an increase in the size of the sales force; (ii)
acquisitions in the first and second quarter of the year (see Liquidity and
Capital Resources below); and (iii) an improvement in the U.K. economy which
had been in a deep and lasting recession. In fact, in Pound Sterling, U.K.
revenue for the year was up by 59%, but this growth was offset by a marginal
(6.8%) depreciation of the Pounds Sterling against the U.S. Dollar. The
Company expects the Pound Sterling sales to continue to increase relative to
last year, but cannot predict the impact of currency fluctuations on the
conversion of Pounds Sterling into U.S. Dollars for financial reporting
purposes.
Direct contract costs grew by 29% ($21.8 million) from $75.8 million to $97.6
million. Direct labor, the principal driving component of contract revenue,
was up $13.8 million, or 28%, while non-labor direct costs increased $8.0
million or 30%. Direct costs as a percentage of revenue were up slightly to
53.1% from 52.3%. This increase was primarily attributable to the increasing
competition in Federal contracts which is driving down the markups over direct
cost, and a relative increase in less profitable non-labor direct costs, which
increased from 18.4% to 18.9% of revenue.
Indirect costs grew by $13.3 million or 23% to $71.1 million from $57.8
million but, as a percentage of revenue, declined to 38.7% from 39.8%. The
decrease reflects the Company's continuing emphasis on reducing administrative
indirect costs while increasing funds for marketing and bid and proposal
("B&P") efforts. As a result of this management emphasis and despite the 27%
increase in revenue, indirect labor increased by only $0.6 million or 4% and,
as a percentage of revenue, decreased from 9.6% to 7.9%.
Indirect costs also increased in B&P labor, incentive compensation and fringe
benefits. B&P labor increased in response to increases in the volume of
actual and planned proposals for the year. Incentive compensation (sales
commission and other pay for performance) grew because of the increased
revenue and profit, particularly in the commission-oriented U.K. operation.
Fringe benefits, the largest category of indirect expenses (32% of total),
increased in proportion with the total payroll (direct labor, B&P labor,
indirect labor and incentive compensation), and an increase in the overall
payroll tax rates.
<PAGE>
page 21
Depreciation and amortization increased by $974,000 to $4.3 million from $3.4
million. An increased level of fixed assets (primarily computing and network
equipment), necessitated by internal growth and obtained through acquisitions,
accounted for 75% of the growth. The other 25% of the growth was the result
of the Goodwill amortization associated with the acquisitions discussed in
Note 1 of the financial statements.
Income before interest, shareholder lawsuit and merger costs, and lease
litigation settlement expenses grew $2.4 million or 29% from $8.2 million to
$10.6 million. The increase results from the increase in revenue and a
decrease in operating costs, principally indirect costs as discussed above.
Interest costs totalled $420,000 (0.2% of revenue) and were down $51,000 (11%)
from last year's $471,000. The decrease reflects a 17% or $1.8 million
decrease in average borrowings from $10.14 million down to $8.38 million.
However, the effect of this decrease was partially offset by an increase in
the effective interest rate.
Income before income taxes and extraordinary items rose to $10.23 million from
last year's earnings of $4.89 million. As discussed in the FY 1993 vs. FY
1992 comparison below, last year's income before income taxes and
extraordinary items included $0.9 million shareholder lawsuit and merger costs
and $1.9 million excess facilities and lease termination costs. Excluding
these costs from last year's results, the income before income taxes and
extraordinary items would have been $7.7 million, an increase of $2.5 million
(33%). This 33% increase was attributable to the growth in operating income,
and the decline in interest expense.
The Company's effective tax rate decreased to 38% from 39% last year because
of an increase in earnings from the Company's U.K. Subsidiary, where the
Company enjoys a lower tax rate, coupled with realizing the tax benefits from
the recent establishment of a Foreign Sales Corporation assigned to sell
certain U.S.-developed computer software products abroad.
During the first quarter of the year, the Company recognized a provision for
an extraordinary item to cover the costs of the outstanding shareholder
lawsuits. The provision equates to a $494,000 pre-tax expense, and $300,000
net of tax. See Note 13 to the Consolidated Financial Statements. Also see
comments under Liquidity below.
Earnings per share increased $0.28 (97%) for the reasons discussed above.
FY 1993 COMPARED WITH FY 1992
Revenue increased $5.3 million (3.8%) as a result of a $7.2 million (23.3%)
increase in commercial revenue, a $3.2 million (4.2%) increase in DoD revenue,
offset by a $5.1 million (18%) decline in revenue from non-DoD Federal
agencies. The growth in commercial revenue came from the acquisition of
American Legal Systems Corp. on July 30, 1992, which generated $5.6 million in
revenue, and from a $2.1 million (15.8%) growth in United Kingdom based
marketing systems sales. The growth in U.K. based revenue would have
increased by 25.7% but for a 8% decline in the Pound Sterling average value in
U.S. Dollars this year compared to last year. The growth in revenue in the
<PAGE>
page 22
U.K. is the result of a recovery in the U.K. economy coupled with an increase
in sales staff and marketing resources. The decline in non-DoD Federal
Government revenue is primarily in DoJ revenue. The Company provides
automated litigation support services to DoJ, and the service level is
dependent upon the litigation case load of the elements of DoJ which the
Company supports. Such case loads were down in 1993 compared to 1992. The
Company won two new contracts for automated litigation support services to
elements of DoJ. The $3.2 million growth in DoD revenue was primarily from
existing contracts; however, the Company was awarded several new DoD contracts
in the last quarter of the year.
Direct costs increased $1.3 million (1.7%), but decreased from 53.3% to 52.3%
as a function of revenue. The dollar increase was the result of the ALS
acquisition, offset by a decrease in direct cost on U.S. Government contracts.
The decrease as a percentage of revenue was primarily attributable to improved
margins in both DoD contract revenue and the U.K.-based marketing systems
revenue.
Indirect costs and selling expenses increased $2.5 million (4.5%), and as
percent of sales grew from 39.5% to 39.8%. The dollar increase was primarily
attributable to the ALS acquisition. The increase as a percentage of revenue
was the result of a growth in sales, bid and proposal, and marketing resources
applied in all areas of the Company, which offset a reduction in
administrative costs.
Depreciation and amortization grew by $.9 million (31.7%) because of a growth
in capital expenditures necessitated by the Company transformation to an
Information Technology company, and an increase in the amortization of
capitalized software enhancement costs as described in Note 3 to Consolidated
Financial Statements.
Interest expense grew by $112,000 (31%) as a result of a $3.7 million increase
in average borrowings offset by 15% decrease in the average effective interest
rate. The increase in borrowings was attributable to the ALS acquisition
including its purchase price and working capital needs. The decrease in
borrowing rates was consistent with an overall market decline in short term
rates.
In FY 1993, the Company spent $699,000 (0.5% of revenue) in outside legal fees
and expenses to defend against two shareholder lawsuits that have been ongoing
since FY 1991. Similar expenses totalling $470,000 incurred in FY 1992 and FY
1991 were reimbursed under the terms of a settlement of litigation between the
Company and its Directors and Officer's liability insurance carrier. In
September 1993, the Company announced a settlement agreement with the
plaintiffs, subject to approval by the Courts. Under the terms of the
settlement, the Company would (i) reimburse the plaintiff for certain legal
fees and expenses; (ii) establish a "fund" to be available on a claims-made
basis to cover certain defined losses suffered by shareholders who sold their
stock during the covered period; and (iii) make a self-tender offer for a
limited number of shares of the Company's Common Stock at a price described in
the agreement. Certain legal fees and expenses of the settlement would be
eligible for reimbursement from the Company's insurance carrier. As described
previously in detail under Item 3, Legal Proceedings, an agreement was
subsequently reached to amend the self-tender offer included in the settlement
agreement.
<PAGE>
page 23
During the fourth quarter of the year, the Company spent $201,000 in outside
fees and expenses to pursue a potential merger with COMARCO Inc. of Anaheim,
California. By mutual agreement, the companies decided it was not in their
best interest to merge, and discussions were terminated in August 1993.
During the second quarter of the year, the Company paid a former landlord $1.7
million and incurred outside legal fees of $221,000 to settle litigation
resulting from the Company's cancellation of a facility lease. The payment
resolved all outstanding issues surrounding the lease and the Company has no
further liability.
Earnings before income taxes fell $2.25 million because an increase from the
earnings generated by the Company's contracts and sales of software and
services was offset by the cost of shareholder lawsuits, a potential merger,
and settlement of the facility lease litigation.
The Company's effective tax rate decreased to 39% from 41% last year because
of an increase in earnings from the Company's U.K. subsidiary, where the
Company enjoys a lower effective tax rate.
Earnings per share decreased $.11 (27.5%) as a result of the expenses of the
shareholder lawsuits, the potential merger, and the lease litigation
settlement. These expenses in the aggregate reduced earnings per share by
$.16. Accordingly, in the absence of these expenses earnings per share would
have increased by $.05 (12.5%).
LIQUIDITY AND CAPITAL RESOURCES
The Company's excess cash is primarily in CACI Limited, a wholly-owned U.K.
subsidiary. The Company's principal source of cash for U.S. operations is
from operating activities and bank borrowings. The Company's primary
requirement for working capital is to carry billed and unbilled receivables, a
majority of which are due under prime contracts with the U.S. Federal
Government, or subcontracts thereunder.
In addition, the Company is pursuing a policy of small, synergistic, niche
acquisitions designed to broaden its client and product base in its
Information Technology business portfolio. In July 1992, the Company
purchased all of the outstanding common stock of American Legal Systems Corp.
for an initial purchase price of approximately $2.8 million (also see Note 12
to Consolidated Financial Statements). ALS provides litigation support to
commercial customers and its acquisition was for the purpose of providing a
commercial outlet for the technologies and capabilities developed by the
Company in support of its DoJ contracts. In September 1993, the Company's
U.K. subsidiary purchased the Pinpoint geodemographic business for
approximately $750,000. Pinpoint is a $1.5 million revenue per year U.K.-
based market analysis business and was a competitor of the Company's U.K.
operations. In October 1993, the Company's U.K. subsidiary purchased the
Miracle accounting system for approximately $640,000. Miracle is a U.K.-based
accounting system and associated client base which complements certain of the
Company's existing product offerings in the U.K. On December 1, 1993, the
Company acquired the Government Services business of SofTech, Inc. for $4.2
million. The Company did not purchase receivables in this SofTech transaction,
and will utilize approximately $3.0 million of additional working capital to
<PAGE>
page 24
support receivables net of payables generated by the acquired business.
As discussed in Note 13 to the Consolidated Financial Statements, under the
terms of the shareholder litigation settlement agreement the Company agreed to
initiate a contingent self-tender for 1.3 million of its common shares at a
price of $6.00 per share in the event that the average closing price for the
Company's shares for twenty consecutive trading days, between July 22, 1994
and February 28, 1995, is below $6.00 per share. If the Company's shares do
not trade below $6.00 per share in twenty consecutive days prior to February
28, 1995, the offer to self-tender will expire. If the tender is accomplished
as announced and fully subscribed, the Company's debt will increase by
approximately $7.8 million, and its shareholder equity will decrease by a like
amount. Hence, the Company's capital structure will be significantly changed
if the self-tender is fully subscribed. As of August 31, 1994, the Company's
stock price was substantially above the $6.00 per share tender price. Under
the terms of the agreement, the Company is under no obligation to increase the
tender price and has no current plans to do so. Moreover, in view of (i) the
substantial difference between the present price of the Company's stock and
the $6.00 per share contingent tender price, and (ii) the fact that the
reviewing Court must approve a settlement including a proposed contingent
self-tender on the terms set forth above, the Company cannot at this time
predict with assurance that a self-tender will be part of the final, court-
approved settlement. Accordingly, the Company cannot now predict how many
shares, if any, it will obtain through the tender, or whether a tender will
occur.
As discussed in Note 4 to the Consolidated Financial Statements, the Company's
principal source of cash, other than from operations, is its $20 million
unsecured line of credit with Signet Bank. On January 31, 1994, this line was
renewed for one year and expires on January 1, 1995. Under the agreement,
interest is charged at lower of the bank's prime lending rate, or the Federal
Funds rate plus 1.25%. In addition, a commitment fee is paid on the unused
portion of the line of credit. The Company believes the line can be amended
as necessary to cover the self tender, albeit at an increased rate.
Accordingly, the Company believes that the combination of internally generated
funds, available bank credit and cash on hand will provide the required
liquidity and capital resources for the foreseeable future.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
On the following pages are the Consolidated Financial Statements and Financial
Statement Schedules of CACI International Inc and subsidiaries for the years
ended June 30, 1994, 1993 and 1992, and Independent Auditors' Report.
<PAGE>
page 25
Independent Auditor's Report
To the Board of Directors and Shareholders of
CACI International Inc
Arlington, Virginia
We have audited the accompanying consolidated balance sheets of CACI
International Inc and subsidiaries as of June 30, 1994 and 1993, and the
related consolidated statements of income, shareholders' equity, and cash
flows for each of the three years in the period ended June 30, 1994. These
financial statements are the responsibility of the Company'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 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 consolidated financial statements present fairly, in all
material respects, the financial position of CACI International Inc and
subsidiaries as of June 30, 1994 and 1993, and the results of their operations
and their cash flows for each of the three years in the period ended June 30,
1994 in conformity with generally accepted accounting principles.
/s/
- - -----------------------------
Deloitte & Touche LLP
Washington, D.C.
August 11, 1994
<PAGE>
page 26
CACI INTERNATIONAL INC AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
ASSETS
June 30
-------------------------
1994 1993
----------- ----------
CURRENT ASSETS
Cash and equivalents $ 941,000 $ 2,725,000
Accounts receivable:
Billed 35,668,000 30,209,000
Unbilled 14,420,000 9,434,000
Prepaid expenses and other 5,067,000 4,591,000
---------- ----------
TOTAL CURRENT ASSETS 56,096,000 46,959,000
---------- ----------
PROPERTY AND EQUIPMENT, NET
Equipment and furniture 18,476,000 16,036,000
Leasehold improvements 1,648,000 1,276,000
---------- ----------
Property and equipment, at cost 20,124,000 17,312,000
Less accumulated depreciation
and amortization (12,369,000) ( 9,625,000)
---------- ----------
TOTAL PROPERTY AND EQUIPMENT, NET 7,755,000 7,687,000
---------- ----------
OTHER ASSETS 1,001,000 1,084,000
GOODWILL 5,921,000 2,687,000
INCOME TAXES 226,000 0
---------- ----------
TOTAL ASSETS $70,999,000 $58,417,000
========== ==========
See notes to Consolidated Financial Statements
[/TABLE]
<PAGE>
page 27
CACI INTERNATIONAL INC AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET (cont'd)
LIABILITIES AND SHAREHOLDERS' EQUITY
June 30
-----------------------
1994 1993
----------- ----------
CURRENT LIABILITIES
Note payable $ 2,745,000 $ 7,223,000
Accounts payable & accrued expenses 14,848,000 8,878,000
Accrued compensation & benefits 10,712,000 7,139,000
Deferred rent expense 454,000 324,000
Income taxes payable 1,829,000 1,135,000
Deferred income taxes 181,000 323,000
---------- ----------
TOTAL CURRENT LIABILITIES 30,769,000 25,022,000
---------- ----------
DEFERRED RENT EXPENSES 2,353,000 2,509,000
DEFERRED INCOME TAXES 139,000 389,000
SHAREHOLDERS' EQUITY
Common Stock 1,349,000 0
$.10 par value,
13,490,000 shares issued
Common Stock - Class A
$.10 par value,
13,130,000 shares issued 0 1,313,000
Common Stock - Class B
$.10 par value,
115,000 shares issued 0 12,000
Capital in excess of par 4,591,000 3,454,000
Retained earnings 44,621,000 38,585,000
Cumulative currency
translation adjustments (1,315,000) (1,516,000)
Treasury stock, at cost
(3,251,000 shares
and 3,233,000 shares) (11,508,000) (11,351,000)
---------- ----------
TOTAL SHAREHOLDERS' EQUITY 37,738,000 30,497,000
---------- ----------
TOTAL LIABILITIES
AND SHAREHOLDERS' EQUITY $70,999,000 $58,417,000
========== ==========
See notes to Consolidated Financial Statements.
<PAGE>
page 28
CACI INTERNATIONAL INC AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
<TABLE>
<CAPTION>
Year Ended June 30
----------------------------------------
1994 1993 1992
------------ ----------- ------------
<S> <C> <C> <C>
REVENUE $183,700,000 $145,148,000 $139,878,000
----------- ----------- -----------
COSTS AND EXPENSES
Direct costs 97,584,000 75,804,000 74,536,000
Indirect costs & selling expenses 71,126,000 57,797,000 55,289,000
Depreciation and amortization 4,341,000 3,367,000 2,556,000
----------- ----------- -----------
Total Operating Expenses 173,051,000 136,968,000 132,381,000
----------- ----------- -----------
10,649,000 8,180,000 7,497,000
Interest expense 420,000 471,000 359,000
Shareholder lawsuit
& merger costs 0 901,000 0
Lease litigation
settlement expenses 0 1,921,000 0
----------- ---------- -----------
INCOME BEFORE INCOME TAXES
AND EXTRAORDINARY ITEM 10,229,000 4,887,000 7,138,000
Income taxes 3,893,000 1,907,000 2,928,000
----------- ----------- -----------
INCOME BEFORE EXTRAORDINARY ITEM 6,336,000 2,980,000
4,210,000
Extraordinary item: cost of
shareholder lawsuit settlement
(net of $194,000 tax benefit) (300,000) 0 0
------------ ----------- -----------
NET INCOME $ 6,036,000 $ 2,980,000 $ 4,210,000
=========== ===========
===========
EARNINGS PER COMMON AND
COMMON EQUIVALENT SHARE:
Income before extraordinary item $ 0.60 $ 0.29 $ 0.40
Extraordinary item (0.03) 0.00 0.00
Net income 0.57 0.29 0.40
AVERAGE NUMBER OF SHARES AND
EQUIVALENT SHARES OUTSTANDING 10,615,000 10,361,000 10,604,000
=========== ===========
===========
See notes to Consolidated Financial Statement.
</TABLE>
<PAGE>
page 29
CACI INTERNATIONAL INC AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
<TABLE>
<CAPTION>
Year Ended June 30
------------------
1994 1993 1992
------------ ------------ ------------
<S> <C> <C> <C>
CASH FLOWS
FROM OPERATING ACTIVITIES
Net earnings $ 6,036,000 $ 2,980,000 $ 4,210,000
Reconciliation of
net earnings to net cash
provided by (used in)
operating activities:
Depreciation & amortization 4,341,000 3,367,000 2,556,000
Loss on sale of property
& equipment 54,000 44,000 152,000
Provision for deferred
income taxes (816,000) (731,000) (233,000)
Changes in operating
assets & liabilities:
Accounts receivable (10,122,000) 911,000 (2,989,000)
Prepaid expenses & other assets (593,000) (1,615,000) 626,000
Accounts payable & accrued expenses 5,902,000 (919,000) (910,000)
Accrued compensation & vacation 3,637,000 (81,000) 772,000
Deferred rent expense (26,000) (150,000) 395,000
Income taxes payable 715,000 256,000 304,000
---------- ---------- ----------
Net cash provided by
operating activities 9,128,000 4,062,000 4,883,000
---------- ---------- ----------
CASH FLOWS
FROM INVESTING ACTIVITIES:
Acquisitions of property
& equipment (2,671,000) (3,330,000) (3,542,000)
Proceeds from sale of
property & equipment 103,000 33,000 349,000
Payments for Acquisitions (4,508,000) (2,831,000) 0
Other (411,000) (718,000) (692,000)
---------- ---------- ---------
Net cash used in
investing activities (7,487,000) (6,846,000) (3,885,000)
---------- ---------- ----------
See Notes to Consolidated Financial Statements
</TABLE>
<PAGE>
page 30
CACI INTERNATIONAL INC AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS (cont'd)
<TABLE>
<CAPTION>
Year Ended June 30
------------------
1994 1993 1992
------------ ------------ ------------
<S> <C> <C> <C>
CASH FLOWS
FROM FINANCING ACTIVITIES:
Proceeds under line-of-credit 86,982,000 61,438,000 51,945,000
Payments under line-of-credit (91,460,000) (59,057,000) (50,233,000)
Issuance of common stock 1,161,000 139,000 1,803,000
Purchase of common stock
for treasury (157,000) (111,000) (2,942,000)
---------- ---------- ----------
Net cash provided by (used in)
by financing activities (3,474,000) 2,409,000 573,000
---------- ---------- ----------
EFFECT OF EXCHANGE RATES
ON CASH AND EQUIVALENTS: 49,000 (259,000) 8,000
---------- ---------- ----------
Net increase (decrease) in
cash & equivalents (1,784,000) (634,000) 1,579,000
Cash & equivalents,
beginning of period 2,725,000 3,359,000 1,780,000
---------- ---------- ----------
Cash & equivalents,
end of period $ 941,000 $ 2,725,000 $ 3,359,000
========== ==========
==========
SUPPLEMENTAL DISCLOSURES
OF CASH FLOW INFORMATION:
Cash paid during the year for:
Income taxes, net of refunds $ 1,784,000 $ 2,149,000 $ 2,339,000
=========== ==========
==========
Interest $ 410,000 475,000 $ 335,000
=========== ==========
==========
See notes to Consolidated Financial Statements.
</TABLE>
<PAGE>
page 31
CACI INTERNATIONAL INC AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
<TABLE>
<CAPTION>
Common Stock
-------------------------------------------
Class A * Class B
Cumulative
--------------------- ------------------ Capital in Currency
Shares Shares Excess of Retained
Translation Treasury
Issued Amount Issued Amount Par
Earnings Adjustments Stock
---------- ---------- ------- ------- ---------- ---------- -----------
- - ------------
<S> <c <C> <C> <C> <C> <C>
<C> <C>
BALANCE, July 1, 1991 12,311,000 $1,231,000 109,000 $11,000 $1,595,000
$31,395,000 $(975,000) $(8,298,000)
Net Earnings 4,210,000
Currency translation
adjustments
894,000
Stock Rights Redemption (105,000)
Exercise of Stock Options
(including $444,000
income tax benefit) 778,000 78,000 0 0 1,829,000
Treasury Shares purchased
(598,000 Class A &
4,000 Class B shares)
(2,942,000)
---------- --------- ------- ------ --------- ---------- -------
- - ---------
BALANCE, June 30, 1992 13,089,000 $1,309,000 109,000 $11,000 $3,319,000
$35,605,000 $ (81,000) $(11,240,000)
Net Earnings 2,980,000
Currency translation
adjustments
(1,435,000)
Exercise of Stock Options
(including $47,000
income tax benefit) 41,000 4,000 6,000 1,000 135,000
Treasury Shares purchased
(23,000 Class A)
(111,000)
---------- --------- ------- ------ --------- ---------- ----------
- - ----------
BALANCE, June 30, 1993 13,130,000 $1,313,000 115,000 $12,000 $3,454,000
$38,585,000 $(1,516,000) $(11,351,000)
Net Earnings 6,036,000
Currency translation
adjustments
201,000
Exercise of Stock Options
(including $494,000
income tax benefit) 245,000 24,000 1,137,000
Conversion of Class B
shares 115,000 12,000 (115,000) (12,000)
Treasury Shares purchased
(18,923 shares)
(157,000)
---------- --------- ------- ------ --------- ---------- ---------
- - ---------
BALANCE, June 30, 1994 13,490,00 $1,349,000 0 $ 0 $4,591,000
$44,621,000 $(1,315,000) (11,508,000)
* As of June 30, 1994, all Class A Common Stock was classified as Common Stock.
See notes to Consolidated Financial Statements.
</TABLE>
<PAGE>
page 32
CACI INTERNATIONAL INC AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
YEARS ENDED JUNE 30, 1994, 1993 AND 1992
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Business Activities
The Company is an international information systems and high technology
services corporation. It is a world leader in computer-based information
technology systems, custom software, integration and operations, imaging and
document management, simulation, and proprietary database and software
products. The Company provides worldwide services in support of United States
national defense and civilian agencies, state governments and commercial
enterprises.
Principles of Consolidation
The consolidated financial statements include the statements of CACI
International Inc and its wholly-owned subsidiaries (the "Company"). All
significant intercompany balances and transactions have been eliminated in
consolidation.
Revenue Recognition
Revenue on cost-plus-fee contracts is recognized to the extent of costs
incurred plus a proportionate amount of the fee earned. Revenue on fixed-
price contracts is recognized on the percentage of completion method based on
costs incurred in relation to total estimated costs. Revenue on time and
materials contracts is recognized to the extent of billable rates times hours
delivered plus materials expense incurred. Revenue from software license
sales is recognized upon delivery when there is no significant obligation to
perform after the sale, but is recognized under the percentage-of-completion
method when there is significant obligation for production, modification or
customization after the sale. Revenue from maintenance support services on
these products is nonrefundable and generally recognized on a straight-line
basis over the term of the service agreement. Provisions for estimated losses
on uncompleted contracts are recorded in the period such losses are
determined.
The Company's United States Government contracts (approximately 71% of total
revenue) are subject to subsequent government audit of direct and indirect
costs. All such incurred cost audits have been completed through June 30,
1989. Management does not anticipate any material adjustment to the
consolidated financial statements for later periods.
Property and Equipment
Property and equipment is recorded at cost. Depreciation of equipment has
been provided over the estimated useful lives of three to ten years of the
respective assets, using primarily the straight-line method. Leasehold
improvements are generally amortized over the respective remaining lease term
using the straight-line method.
<PAGE>
page 33
Capitalized Software Costs
The Company capitalizes certain product-related software development costs
after technological feasibility and marketability have been demonstrated.
These costs are amortized on a product-by-product basis over their estimated
economic useful lives, which range from 3 to 5 years.
Income Taxes
The Company adopted Statement of Financial Accounting Standards ("SFAS") No.
109 "Accounting for Income Taxes", effective July 1, 1993. This accounting
standard requires the use of the asset and liability approach for financial
accounting and reporting for income taxes. There was no material cumulative
effect on income in the financial statements from the adoption of SFAS 109 for
the twelve month period ended June 30, 1994. The provision for income taxes
includes taxes currently payable and those deferred because of the differences
between the financial statements and tax bases of assets and liabilities.
U.S. income taxes have not been provided on $14,854,000 in undistributed
earnings of foreign subsidiaries that have been permanently reinvested outside
the United States.
Currency Translation
The assets and liabilities of the Company's foreign subsidiaries whose
functional currency is other than the U.S. Dollar are translated at the
exchange rates in effect on the reporting date, and income and expenses are
translated at the weighted average exchange rate during the period. The net
effect of such translation gains and losses are not included in determining
net income but are accumulated as a separate component of shareholders'
equity. Foreign currency transaction gains and losses are included in
determining net income.
Earnings per Share
Earnings per share is computed by dividing net earnings by the weighted
average number shares and equivalent shares outstanding during each of the
years ended June 30, 1994, 1993 and 1992 of 10,615,000, 10,361,000, and
10,604,000, respectively. The weighted averages include the number of shares
issuable upon exercise of stock options granted under the employee stock
incentive plan after the assumed repurchase of shares with the related
proceeds.
Statement of Cash Flows
Short-term investments with an original maturity of three months or less are
considered cash equivalents.
<PAGE>
page 34
Goodwill
The excess costs over fair market value of net assets acquired is being
amortized, using the straight line method, for a period ranging from 3 to 15
years. Accumulated amortization was $529,000 and $143,000 at June 30, 1994 and
June 30, 1993, respectively.
Statement Presentation
Certain prior period amounts have been reclassified to conform with the
current year's presentation.
NOTE 2. ACCOUNTS RECEIVABLE
Unbilled accounts receivable consist of unbilled costs and estimated profits
on uncompleted contracts which include retainage and other amounts arising
from contracts with long-term completion and realization periods.
The components of unbilled accounts receivable are as follows:
June 30,
----------------------------
1994 1993
----------- ----------
Amounts currently billable $11,099,000 $6,977,000
Long-term completion contracts 1,490,000 1,119,000
Retainages 1,831,000 1,338,000
---------- ---------
Total Unbilled Accounts Receivable $14,420,000 $9,434,000
========== =========
Contracts with long-term completion periods are billable upon completion,
which is generally estimated to be within one year. Generally, retainages
will not be billed within one year; consistent with industry practice,
however, these receivables are classified as current.
Billed accounts receivable are net of allowance for doubtful accounts of
$1,664,000 and $2,312,000 at June 30, 1994 and June 30, 1993, respectively.
NOTE 3. CAPITALIZED SOFTWARE DEVELOPMENT COSTS
The costs capitalized and amortized for the years ended June 30, 1994, 1993,
and 1992 were as follows:
<PAGE>
page 35
Annual Activity Year Ended June 30,
- - --------------- ------------------------------------
1994 1993 1992
--------- --------- --------
Balance beginning of year $ 775,000 $ 555,000 $ 18,000
Capitalized during year 332,000 412,000 559,000
Amortized during year (242,000) (192,000) (22,000)
-------- -------- --------
Balance, end of year $ 865,000 $ 775,000 $555,000
======== ======== =======
Amounts included in:
Current assets $275,000 $254,000 $192,000
Other assets $590,000 $521,000 $363,000
NOTE 4. NOTE PAYABLE
The Company has a $20 million revolving credit agreement with Signet Bank
which expires on January 31, 1995. Under this agreement, the Company had
outstanding borrowings of $2,745,000 at June 30, 1994 and $7,223,000 at June
30, 1993. Interest is charged on the outstanding borrowings at the lower of
the bank's daily prime commercial lending rate or the Federal Funds rate plus
1.25%. The applicable interest rate on the loan balance was 7.21% and 5.17% at
June 30, 1994 and 1993, respectively. The credit agreement requires, among
other provisions, the maintenance of certain levels of net worth and working
capital and places certain restrictions on cash dividends and additional debt.
Throughout FY 1994 and FY 1993, the Company was in compliance with all bank
covenants.
NOTE 5. INCOME TAXES
The provision (benefit) for income taxes consists of:
State
Year End and
June 30 Federal Local Foreign Total
- - ------- ---------- -------- ---------- ----------
1994
Current $1,894,000 $696,000 $1,151,000 $3,741,000
Deferred 97,000 21,000 34,000 152,000
--------- ------- --------- ---------
$1,991,000 $717,000 $1,185,000 $3,893,000
========= ======= =========
=========
1993
Current $2,311,000 $260,000 $ 610,000 $3,181,000
Deferred (1,042,000) (85,000) (147,000) (1,274,000)
---------- ------- --------- ---------
$1,269,000 $175,000 $ 463,000 $1,907,000
========= ======= =========
=========
1992
Current $2,434,000 $501,000 $ 199,000 $3,134,000
Deferred (296,000) (67,000) 157,000 (206,000)
--------- ------- --------- ---------
$2,138,000 $434,000 $ 356,000 $2,928,000
========= ======= =========
=========
<PAGE>
page 36
A reconciliation of the income tax provision (benefit) and the amount computed
by applying the statutory U.S. income tax rate of 34% is as follows:
Year Ended June 30,
--------------------------------------
1994 1993 1992
---------- ---------- ----------
Amount at statutory U.S. rate $3,478,000 $1,662,000 $2,427,000
Other taxes, net of U.S.
income tax benefit 450,000 116,000 287,000
Other expenses not deductible
for tax purposes 80,000 76,000 6,000
Taxes on foreign earnings at
different effective rates 209,000 48,000 191,000
Extraordinary item (194,000) 0 0
Other (130,000) 5,000 17,000
--------- --------- ---------
Income taxes (benefit) $3,893,000 $1,907,000 $2,928,000
========= ========= =========
The net current and non-current components of the deferred income tax accounts
as shown on the consolidated balance sheet at June 30, 1994 are:
Total
--------
Current deferred tax liability $181,000
Net non-current deferred tax asset (87,000)
-------
Net deferred tax liability $ 94,000
=======
The deferred tax assets and tax liabilities at June 30, 1994 are:
Assets: 1994
----------
Accrued vacation & other expenses $ 2,314,000
Deferred rent 1,084,000
Foreign currency conversion 182,000
Pension 168,000
---------
Total deferred assets $ 3,748,000
---------
Liabilities:
Unbilled revenue $(2,745,000)
Foreign transactions (613,000)
Depreciation (435,000)
Other (49,000)
----------
Total deferred liabilities $(3,842,000)
----------
Net deferred tax liability: $ (94,000)
==========
<PAGE>
page 37
Commencing July 1, 1987, the Company adopted the accrual net of unbillable
revenue method of accounting for tax purposes. Under this method, only
revenue that is contractually billable is used to compute taxable income while
certain expenses are not currently deductible.
The Company adopted SFAS No. 109 "Accounting for Income Taxes" effective July
1, 1993. Prior years financial statements were not restated. There was no
material cumulative effect on the financial statements as the result of
adoption of this standard.
NOTE 6. COMMON STOCK
At June 30, 1993, the Company's common stock consisted of Class A and Class B
Common Stock, each with a $.10 par value, and each with 40,000,000 shares
authorized. There were 13,130,000 Class A shares and 115,000 Class B shares
outstanding at June 30, 1993, of which 3,194,000 Class A shares and 39,000
Class B shares were carried in Treasury at their acquisition cost. In October
1993, by the provisions of the Company's Charter, the Class B shares
automatically converted to Class A Common Stock on a one-for-one basis, after
which the Company had only one class of Common Stock. As of June 30, 1994,
there were 13,490,000 shares of Common Stock outstanding of which 3,251,000
shares are held in Treasury and are carried at their acquisition cost.
NOTE 7. STOCK INCENTIVE PLAN
The Company has an employee stock incentive plan (the "Plan") which provides
that key employees may be awarded some or all of the following: nonqualified
stock options; incentive stock options within the meaning of the Internal
Revenue Code; and the option to purchase Common Stock. The stock option
exercise prices would generally be at fair market value on the date of grant.
The period during which each option is exercisable is determined when granted,
but in no event are they exercisable later than ten years from the date of
grant or after December 31, 2000. Any debt securities awarded under the Plan
would be subordinate to existing and future secured debt of the Company and
would be offered to the employees for purchase at their fair market value.
The maximum number of shares which may be issued under the Plan is 5,200,000.
As discussed in Note 6 above, the Class B Common Stock was converted
automatically to Common Stock in 1993, and no further options for Class B will
be issued.
<PAGE>
page 38
Stock option activity and price information regarding the Plan follows:
Number Exercise
of shares Price
--------- -----------
Shares Under Option, July 1, 1991 2,056,000 $1.87-$3.34
Granted 380,000 $3.50-$5.09
Exercised (778,000) $1.87-$2.56
Forfeited (28,000) $1.87-$3.34
---------
Shares Under Option, June 30, 1992 1,630,000 $1.87-$5.09
Granted 28,000 $4.44-$4.75
Exercised (41,000) $1.87-$2.59
Forfeited (98,000) $1.87-$5.09
---------
Shares Under Option, June 30, 1993 1,519,000 $1.87-$5.03
Granted 108,000 $5.875-$5.94
Exercised (244,000) $1.875-$4.75
Forfeited (2,000) $3.50
----------
Shares Under Option, June 30, 1994 1,381,000 $1.87-$5.94
==========
Options Exercisable, June 30, 1994 766,000 $1.87-$5.94
==========
Exercise prices are based on the market price of the Company's Common Stock at
the date the options are granted.
NOTE 8. PENSION PLAN
The Company has a defined contribution pension plan covering approximately 60%
of its employees. The total consolidated pension expense for each of the
years ended June 30, 1994, 1993, and 1992 was $1,939,000, $1,690,000, and
$1,537,000 respectively. The Company funds current pension costs as they
accrue annually. The plan is qualified under the United States Internal
Revenue Code, as determined by the United States Internal Revenue Service.
NOTE 9. LEASE COMMITMENTS
The Company conducts its operations from leased office facilities, all of
which are classified as operating leases and expire primarily over the next
eight years.
The following is a schedule of future minimum lease payments under non-
cancelable leases with a remaining term greater than one year as of June 30,
1994:
<PAGE>
page 39
Year Ending Operating
June 30, Leases
- - ----------- ---------
1995 $8,658,000
1996 7,626,000
1997 6,027,000
1998 4,966,000
1999 3,507,000
Later Years 8,246,000
---------
Total minimum
lease payments $39,030,000
==========
Operating leases reflect the minimum lease payments for office facilities net
of a minimal amount of sublease income. The Company has no significant long-
term operating leases for office equipment.
Rent expense incurred from operating leases of real estate for 1994, 1993 and
1992 amounted to $6,708,000, $8,132,000, and $7,295,000 respectively. Rent
expense arising from operating leases of equipment amounted to approximately
$494,000, $466,000, and $429,000 in 1994, 1993, and 1992, respectively.
NOTE 10. EXCESS FACILITIES AND LEASE TERMINATION COST
The excess facilities and lease termination costs incurred during the year
ended June 30, 1993 consisted of the lease termination cost of $1.921 million.
In April, 1991, the Company entered into a new lease agreement in an effort to
consolidate various operations into one location. In connection with this
agreement, the Company canceled an existing lease for its office space located
in Fairfax, Virginia and, as a result, paid a lease termination penalty of
$1,418,000. The lessor of the new facility reimbursed the Company for the
termination penalty. The Company was required to expense the termination cost
in 1991 and allocate the benefit of the reimbursement as a reduction in the
rent expense over the future life of the new lease. The Company moved to
their new location in fiscal year 1992. The unamortized balance of this
amount is included in deferred rent in the accompanying consolidated balance
sheets.
As a result of the Company's cancellation of the office lease in Fairfax,
Virginia discussed above, the landlord sued the Company for breach of the
lease. To settle this litigation, the Company paid the landlord $1.7 million
and incurred legal fees of $221,000 during the FY93 Second Quarter.
NOTE 11. CONTINGENCIES AND LITIGATION
Pentagen Technologies International, Ltd. ("Pentagen") filed two suits against
CACI International Inc and two of its subsidiaries (collectively, "CACI").
One suit sought damages of $8 million and the other sought damages of $78
million and punitive damages of $234 million. In order to provide an
expeditious redress of Pentagen's unfounded allegations and to compensate the
<PAGE>
page 40
Company for any damage it may have suffered, the Company subsequently filed
suit against Pentagen. In March 1994, the United States District Court for
the Southern District of New York granted the Company's request that
Pentagen's pending suit against the Company that had been previously removed
from the New York Supreme Court be combined with the suit pending in the
Southern District and be designated as "related" suits. Subsequently, these
suits were both stayed pending further proceedings in the Company's suit in
the Virginia Court. In June 1994, the Virginia Court issued an order
declaring among other things, that CACI had not infringed Pentagen's copyright
nor any trademark held by Pentagen, that Pentagen is liable for damages for
tortious interference with CACI's business, and that Pentagen and the two
Pentagen and Baird principals are liable for damages for defamation. In a
subsequent order by the Virginia Court, CACI was awarded attorneys' fees of
$110,550, court costs of $61,500, compensatory damages for defamation of
$1,000, and punitive damages for defamation of $10,000. While the New York
cases are still pending, it is expected that they will be resolved in the
Company's favor. In any event, management is of the opinion that the ultimate
resolution of this matter will not have a material adverse effect on the
Company's financial statements.
The Company is involved in various other lawsuits, claims, and administrative
proceedings arising in the normal course of business. Management is of the
opinion that any liability or loss associated with such matters will not have
a material adverse effect on the Consolidated Financial Statements.
NOTE 12. ACQUISITIONS
SofTech, Inc.
On December 1, 1993, the Company purchased certain contracts and assets
consisting of the Government Services business of SofTech, Inc. for an initial
purchase price of $4.2 million which has been allocated as $0.9 million for
the fair value of fixed assets acquired and $3.3 million to Goodwill. The
results of this acquisition have been included in the Company's operating
results beginning December 1, 1993. If the acquisition had occurred at the
beginning of fiscal 1994, revenues would have increased by approximately $10
million and $0.3 million in net income, which would have increased earnings
per share by $0.03. Given that this acquisition represents only a limited
number of contracts and assets of SofTech, Inc., it is impractical to impute
accurately the comparable revenues and/or earnings this acquisition would have
had on the Company's 1993 fiscal period.
American Legal Systems Corp.
On July 30, 1992, the Company acquired all of the outstanding stock of ALS for
an initial purchase price of approximately $2.8 million. ALS is a service
company providing litigation support to commercial customers. The transaction
was accounted for as a purchase. The Company financed the transaction with
bank borrowings under its existing unsecured line of credit. ALS's financial
statements have been consolidated beginning August 1, 1992. Had the
acquisition occurred at the beginning of 1993 or 1992 fiscal periods, the
effect on the Company's financial statements would not have been material.
<PAGE>
page 41
The purchase price is subject to an increase of up to $3 million provided
significant performance objectives are reached during each of the three
measurement years beginning October 1, 1992. Management is of the opinion
that the Company has adequately provided for any contingent payments.
Other Acquisitions
During the first half of this fiscal period, the Company purchased a majority
of the contracts and assets from Pinpoint Analysis Ltd. and Miracle Products
Ltd. The excess purchase price over the net book value of the net assets
acquired from these acquisitions equaled $330,000. This excess has been
recorded as Goodwill and will be amortized for periods ranging from 3 to 15
years. Had the acquisitions occurred at the beginning of 1993 or 1992 fiscal
periods, the effect on the Company's financial statements would not have been
material.
NOTE 13. SETTLEMENT OF SHAREHOLDER LAWSUITS
In September 1993, the Company announced an agreement, subject to approval by
the courts, to settle its outstanding shareholder lawsuits. Under the terms
of the agreement, the Company would reimburse the plaintiffs for certain legal
fees and expenses. The Company would also establish a "fund" which would be
available on a claims-made basis to cover certain defined losses by
shareholders who sold their stock during the covered period. The Company also
agreed to make a self-tender offer for a limited number of shares of its
Common Stock at a price determined in the agreement.
The Company and the plaintiffs subsequently agreed to amend the terms of the
self-tender because of the increase in the price of the Company's Common Stock
since the original agreement was announced. Under the amended terms, the
Company will offer a contingent self-tender for 1.3 million shares of Common
Stock at $6.00 per share in the event that the average closing price for the
Company's shares for twenty consecutive trading days during an approximate
seven month period is below $6.00 per share. If the average closing price of
the Company's shares does not fall below $6.00 per share for twenty
consecutive trading days prior to February 28, 1995, the offer to self-tender
will expire.
In July 1994, all parties to both suits filed with the Delaware Chancery Court
a Stipulation and Agreement of Compromise and Settlement which provides for
the settlement of both suits, subject to court approval. The Delaware
Chancery Court has scheduled a hearing in November 1994 to consider the
proposed settlement and any objection thereto that might be filed by a member
of the plaintiff class.
Since January 1994, the Company's Common Stock has traded above the $6.00 per
share tender price. Under the terms of the agreement, the Company is under no
obligation to increase the tender price and has no current plans to do so.
Accordingly, the Company cannot now predict how many shares, if any, it will
obtain through the tender.
The Company accrued $300,000 (net of $194,000 tax benefit) as of September 30,
1993 to cover the estimated future costs of the settlement after reimbursement
<PAGE>
page 42
of certain costs by the Company's liability insurance carrier. This charge
was reported as an extraordinary item in the first quarter of FY 1994.
In reaching the settlement, the Board of Directors did not acknowledge any
wrongdoing. In its deliberations on these suits, the Board did not believe it
was productive to continue to incur legal expenses and divert senior
managements' attention at a time when the Company's revenue and operating
income was growing.
NOTE 14. SEGMENT INFORMATION
Revenue from contracts with the United States government for 1994, 1993, and
1992 amounted to approximately $130,000,000 (71% of revenues), $103,000,000
(71% of revenues), and $103,000,000 (74% of revenues), respectively.
Information about operations in the United States and foreign countries
(primarily in Western Europe), after the elimination of intercompany
transactions, consists of:
Earnings
Before Identifiable
Income Net Assets at
Revenue Taxes * Earnings** Year End
------------ ---------- ---------- ------------
1994
- - ----
United States $156,775,000 $6,651,000 $4,137,000 $56,568,000
Foreign 26,925,000 3,084,000 1,899,000 14,431,000
----------- --------- --------- ----------
Combined $183,700,000 $9,735,000 $6,036,000 $70,999,000
=========== ========= =========
==========
1993
- - ----
United States $127,413,000 $3,639,000 $2,195,000 $48,826,000
Foreign 17,735,000 1,248,000 785,000 9,591,000
----------- --------- --------- ----------
Combined $145,148,000 $4,887,000 $2,980,000 $58,417,000
=========== ========= =========
==========
1992
- - ----
United States $124,070,000 $6,505,000 $3,933,000 $45,757,000
Foreign 15,808,000 633,000 277,000 10,078,000
----------- --------- --------- ----------
Combined $139,878,000 $7,138,000 $4,210,000 $55,835,000
=========== ========= =========
==========
* 1994 includes extraordinary loss of $494,000.
** Contributions to consolidated net earnings after income tax effects.
<PAGE>
page 43
NOTE 15. QUARTERLY FINANCIAL DATA (UNAUDITED)
<TABLE>
<CAPTION>
Quarter 1ST 2ND 3RD 4TH
------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Year Ended June 30, 1994
- - ------------------------
Revenue $38,200,000 $43,966,000 $48,953,000 $52,581,000
Costs and Expenses 35,975,000 41,586,000 46,178,000 49,732,000
Income Taxes 867,000 924,000 1,089,000 1,013,000
Income before
Extraordinary Item 1,358,000 1,456,000 1,686,000 1,836,000
Extraordinary item:
Cost of Shareholder
Lawsuit Settlement
(Net of $194,000
Tax Benefit) (300,000) 0 0 0
Net Income 1,058,000 1,456,000 1,686,000 1,836,000
========== ========== ==========
==========
Earnings per share
Income before
Extraordinary Item $ 0.13 $ 0.14 $ 0.16 $ 0.17
Extraordinary Item (0.03) 0.00 0.00 0.00
Net Income 0.10 0.14 0.16 0.17
Year Ended June 30, 1993
- - ------------------------
Revenue $34,885,000 $37,339,000 $36,337,000 $36,587,000
Costs and Expenses 33,171,000 37,628,000 34,561,000 34,901,000
Income Taxes 668,000 (112,000) 683,000 668,000
Net Earnings 1,046,000 (177,000) 1,093,000 1,018,000
Earnings per Share $ 0.10 $ (0.02) $ 0.11 $ 0.10
Year Ended June 30,1992
- - -----------------------
Revenue $33,219,000 $35,791,000 $35,037,000 $35,831,000
Costs and Expenses 31,541,000 33,988,000 33,296,000 33,916,000
Income Taxes 693,000 777,000 699,000 759,000
Net Earnings 985,000 1,026,000 1,042,000 1,156,000
Earnings per Share $ 0.10 $ 0.10 $ 0.10 $ 0.11
</TABLE>
The above quarterly financial data is unaudited, but in the opinion of
management, all adjustments necessary for a fair presentation of the selected
data for these interim periods have been included.
<PAGE>
page 44
CACI INTERNATIONAL INC AND SUBSIDIARIES
SCHEDULES TO BE INCLUDED IN FORM 10-K
JUNE 30, 1994, 1993 AND 1992
<PAGE>
page 45
SCHEDULE V
CACI INTERNATIONAL INC AND SUBSIDIARIES
PROPERTY, PLANT AND EQUIPMENT
FOR YEARS ENDED JUNE 30, 1994, 1993 AND 1992
<TABLE>
<CAPTION>
Balance Other
at Changes Balance
Beginning Additions Add at End of
Description of Period at Cost Retirements (Deduct) Period
- - ----------- --------- --------- ----------- -------- ---------
<S> <C> <C> <C> <C> <C>
1994
- - ----
Equipment &
Furniture $16,036,000 $3,028,000 $(2,208,000) $1,620,000 $18,476,000
Leasehold
Improvements 1,276,000 342,000 0 30,000 1,648,000
---------- ---------- ---------- --------- ----------
$17,312,000 $3,370,000 $(2,208,000) $1,650,000 $20,124,000
========== ========= ==========
========= ==========
1993
- - ----
Equipment &
Furniture $14,034,000 $3,146,000 $ (697,000) $ (447,000) $16,036,000
Leasehold
Improvements 1,177,000 219,000 (14,000) (106,000) 1,276,000
---------- --------- ---------- --------- ----------
$15,211,000 $3,365,000 $ (711,000) $ (553,000) $17,312,000
========== ========= ==========
========= ==========
1992
- - ----
Equipment &
Furniture $13,421,000 $2,875,000 $(2,804,000) $ 542,000 $14,034,000
Leasehold
Improvements 3,284,000 632,000 (2,898,000) 159,000 1,177,000
---------- --------- ---------- --------- ----------
$16,705,000 $3,507,000 $(5,702,000) $ 701,000 $15,211,000
========== ========= ==========
========= ==========
</TABLE>
<PAGE>
page 46
SCHEDULE VI
CACI INTERNATIONAL INC AND SUBSIDIARIES
ACCUMULATED DEPRECIATION AND AMORTIZATION OF
PROPERTY, PLANT AND EQUIPMENT
FOR YEARS ENDED JUNE 30, 1994, 1993 AND 1992
<TABLE>
<CAPTION>
Balance Additions Other
at Charged to Changes Balance
Beginning Cost and Add at End of
Description of Period Expenses Retirements (Deduct) Period
- - ----------- --------- ---------- ----------- -------- ---------
<S> <C> <C> <C> <C> <C>
1994
- - ----
Equipment &
Furniture $ 9,032,000 $2,953,000 $(2,060,000) $1,703,000 $11,628,000
Leasehold
Improvements 593,000 138,000 0 10,000 741,000
---------- --------- ---------- --------- ----------
$ 9,625,000 $3,091,000 $(2,060,000) $1,713,000 $12,369,000
========== ========= ==========
========= ==========
1993
- - ----
Equipment &
Furniture $ 7,630,000 $2,657,000 $ (621,000) $ (634,000) $ 9,032,000
Leasehold
Improvements 520,000 120,000 (14,000) (33,000) 593,000
---------- --------- ---------- --------- ----------
$ 8,150,000 $2,777,000 $ (635,000) $ (667,000) $ 9,625,000
========== ========= ==========
========= ==========
1992
- - ----
Equipment &
Furniture $ 7,691,000 $2,232,000 $(2,497,000) $ 204,000 $ 7,630,000
Leasehold
Improvements 2,956,000 157,000 (2,704,000) 111,000 520,000
---------- --------- ---------- --------- ----------
$10,647,000 $2,389,000 $(5,201,000) $ 315,000 $ 8,150,000
========== ========= ==========
========= ==========
</TABLE>
<PAGE>
page 47
SCHEDULE VIII
CACI INTERNATIONAL INC AND SUBSIDIARIES
VALUATION AND QUALIFYING ACCOUNTS
FOR YEARS ENDED JUNE 30, 1994, 1993 AND 1992
<TABLE>
<CAPTION>
Balance Other
at Changes Balance
Beginning Additions Add at End of
Description of Period at Cost Retirements (Deduct) Period
- - ----------- --------- --------- ----------- -------- ---------
<S> <C> <C> <C> <C> <C>
1994
- - ----
Reserves deducted
from assets to
which they apply:
Allowances for
doubtful
receivables $2,312,000 $294,000 $(1,105,000) $ 163,000 $1,664,000
========= ======= ==========
======== =========
1993
- - ----
Reserves deducted
from assets to
which they apply:
Allowances for
doubtful
receivables $2,030,000 $274,000 $ 640,000 $(632,000) $2,312,000
========= ======= ==========
======== =========
1992
- - ----
Reserves deducted
from assets to
which they apply:
Allowances for
doubtful
receivables $1,985,000 $230,000 $ 59,000 $(244,000) $2,030,000
========= ======= ==========
======== =========
</TABLE>
<PAGE>
page 48
SCHEDULE IX
CACI INTERNATIONAL INC AND SUBSIDIARIES
SHORT-TERM BORROWINGS
FOR YEARS ENDED JUNE 30, 1994, 1993 AND 1992
<TABLE>
<CAPTION>
Column A Column B Column C Column D Column E Column F
- - -------- -------- -------- -------- -------- --------
Maximum Average Weighted
Category of Weighted Amount Amount Average
Aggregate Balance Average Outstanding Outstanding Interest
Short-Term at End of Interest During the During the Rate During
Borrowings Period Rate* Period Period the Period*
- - ----------- --------- -------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
Year Ended
June 30, 1994:
Note Payable
$2,745,000 7.21% $14,494,000 $ 8,375,000 4.98%
Year Ended
June 30, 1993:
Note Payable $7,223,000 5.17% $15,708,000 $10,144,000 4.6%
Year Ended
June 30, 1992:
Note Payable $4,843,000 5.05% $11,679,000 $6,457,000 5.3%
* The rates shown in Column C are based on the balances shown in Column B.
The rates shown in Column F are based on the balances shown in Column E. The
average amount of short-term borrowings outstanding during the period is
computed by dividing the weighted average monthly balances in the period by
the number of months in the period.
</TABLE>
<PAGE>
page 49
ITEM 9. DISAGREEMENTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
The Company had no disagreements with its independent accountant on accounting
principles, practices or financial statement disclosure during the two years
prior to the date of the most recent financial statements included in this
Report.
<PAGE>
page 50
PART III
The Information required by Items 10, 11, 12, and 13 of Part III of Form 10-K
has been omitted in reliance on General Instruction G(3) and is incorporated
herein by reference to the Company's definitive proxy statement to be filed
with the SEC pursuant to Regulation 14A promulgated under the Securities
Exchange Act of 1934, as amended.
<PAGE>
page 51
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES, AND REPORTS
ON FORM 8-K
(a)(1) Financial Statements (Refer to Item 8 above)
Independent Auditors' Report
Consolidated Balance Sheet as of June 30, 1994 and 1993
Consolidated Statement of Operations for the Years Ended June 30,
1994, 1993 and 1992
Consolidated Statement of Cash Flows for the Years Ended June 30,
1994, 1993 and 1992
Consolidated Statement of Shareholders' Equity for the Years Ended
June 30, 1994, 1993 and 1992
Notes to Consolidated Financial Statements
(a)(2) Financial Statement Schedules (Refer to Item 8 above)
Schedule V: Property, Plant, and Equipment for the Years Ended
June 30, 1994,1993 and 1992
Schedule VI: Accumulated Depreciation and Amortization of Property,
Plant, and Equipment for the Years Ended June 30,
1994, 1993 and 1992
Schedule VIII: Valuation and Qualifying Accounts for the Years Ended
June 30, 1994, 1993 and 1992
Schedule IX: Short-Term Borrowings for the Years Ended June 30,
1994, 1993 and 1992
(a)(3) Exhibits and Exhibit Index (listed by numbers corresponding to the
exhibit table of Item 601 regulation S-K)
(3) Articles of Incorporation and By-laws:
3.1 Certificate of Incorporation of the Registrant, as amended
December 17, 1993.
3.2 By-laws of CACI International Inc, as amended to date
(incorporated by reference from Exhibit 3.2 of the Registrant's
Annual Report on Form 10-K filed with the Securities and Exchange
Commission for the fiscal year ended June 30, 1993).
(4) Instruments Defining the Rights of Security Holders:
4.1 Clause FOURTH of the Registrant's Certificate of Incorporation,
incorporated above as Exhibit 3.1.
4.2 Shareholders' Agreement dated as of December 1, 1985 (incorporated
herein by reference to Appendix D to the Proxy Statement included
in the S-4).
(10) Material Contracts:
10.1 The 1986 Employee Stock Incentive Plan of the Registrant is
<PAGE>
page 52
incorporated by reference to the Registration Statement on Form S-
8 filed with the Commission on October 13, 1987 (File No. 33-
17864).
10.2 The CACI Monthly Stock Investment Plan is incorporated by
reference to the Registration Statement on Form S-8 filed with the
Commission on June 24, 1988 (File No. 33-22766).
10.3 Employment Agreement between the Registrant and Dr. J. P. London
(incorporated herein by reference from Exhibit 10.3 of the
Registrant's Annual Report on Form 10-K filed with the Securities
and Exchange Commission for the fiscal year ended June 30, 1992).
10.4 Stock Purchase Agreement between the Registrant and Executor of
the Estate of Herbert W. Karr (incorporated herein by reference
from Exhibit 10.3 of the Registrant's Annual Report on Form 10-K
filed with the Securities and Exchange Commission for the fiscal
year ended June 30, 1992).
10.5 Form of Stock Option Agreement between the Registrant and certain
employees (incorporated herein by reference from Exhibit 10.3 of
the Registrant's Annual Report on Form 10-K filed with the
Securities and Exchange Commission for the fiscal year ended June
30, 1992).
10.6 Merger Agreement dated July 30, 1992 between the Registrant,
American Legal Systems Corporation, Michael McIntosh, A. Martin
Erim and certain other parties (incorporated herein by reference
from Exhibit 10.7 of the Registrant's Annual Report on Form 10-K
filed with the Securities and Exchange Commission for the fiscal
year ended June 30, 1992).
10.7 Letter of Intent dated September 1, 1993 to settle shareholder
litigation denominated "Pfirman v. London, et al" and "Chrysogelos
v. London, et al" (incorporated herein by reference from Exhibit
10.7 of the Registrant's Annual Report on Form 10-K filed with the
Securities and Exchange Commission for the fiscal year ended June
30, 1993).
(11) Computation of Earnings per Common and Common Equivalent Share
(21) Significant subsidiaries of the Registrant, as defined in Section 1-
02(v) of regulation S-X.
(27) Financial Data Schedule
(b) . Form 8-K as of September 9, 1993, in which the Registrant reported
the termination, by mutual consent, of continued exploratory
discussions to merge a subsidiary of the Registrant and COMARCO, Inc.
. The Registrant filed a Current Report on Form 8-K as of November 30,
1993, in which the Registrant reported plans for a self-tender of
shares of its Common Stock and settlement of shareholder lawsuits.
. The Registrant filed a Current Report on Form 8-K as of June 23,
<PAGE>
page 53
1994, in which the Registrant reported the decision by the United
States District Court for the Eastern District of Virginia which
exonerated the Registrant of infringement allegations and found
liability against the accusers for defamation and interference with
business.
<PAGE>
page 54
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, on the 23th day of
September, 1994.
CACI International Inc
By /s/
-------------------------------------
J. P. London
Chairman of the Board and President
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 capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
/s/ September 23, 1994
- - ------------------------ ------------------
J.P. London Chairman of the Board,
President, and Director
(Principal Executive Officer)
/s/ September 23, 1994
- - ------------------------ Executive Vice President, Chief ------------------
Samuel R. Strickland Financial Officer, and Treasurer
(Chief Financial and Accounting
Officer)
/s/ September 23, 1994
- - ------------------------ Director ------------------
Paul J. Coleman, Jr.
/s/ Director September 23, 1994
- - ------------------------ ------------------
Alan S. Parsow
/s/ Director September 23, 1994
- - ------------------------ ------------------
Larry L. Pfirman
/s/ Director September 23, 1994
- - ------------------------ ------------------
Warren R. Phillips
<PAGE>
page 55
/s/ Director September 23, 1994
- - ------------------------ ------------------
Charles P. Revoile
/s/ Director September 23, 1994
- - ------------------------ ------------------
William K. Sacks
/s/ Director September 23, 1994
- - ------------------------ ------------------
John M. Toups
Revised as of December 17, 1993
BY-LAWS
of
CACI International Inc
(A Delaware Corporation)
ARTICLE I. OFFICES
Section 1. PRINCIPAL OFFICE
The principal office for the transaction of business of the Corporation is
hereby fixed and located at 1100 North Glebe Road, County of Arlington,
Commonwealth of Virginia. The Board of Directors is hereby granted full power
and authority to change said principal office from one location to another in
said County.
Section 2. OTHER OFFICES
Branch of subordinate offices may at any time be established by the Board of
Directors at any place or places where the Corporation is qualified to do
business.
ARTICLE II. MEETING OF SHAREHOLDERS
Section 1. PLACE OF MEETINGS
All annual and other meetings of shareholders shall be held either at the
principal office of the Corporation or at any other place which may be
designated either by the Board of Directors pursuant to authority hereafter
granted to said Board, or by written consent of all shareholders entitled to
vote thereat, given either before or after the meeting and filed with the
Secretary of the Corporation.
Section 2. ANNUAL MEETING
The annual meetings of the shareholders shall be held on the third Friday of
October of each year, at 9:00 o'clock a.m. or at such other date and time, not
inconsistent with Delaware law, as may be approved by the Board of Directors;
provided, however, should said day fall upon a legal holiday, then such annual
meeting of shareholders shall be held at the same time and place on the next
day thereafter which is not a legal holiday.
Written notice of each annual meeting shall be given to each shareholder
entitled to vote thereat, either personally or by mail or other means of
written communication, charges prepaid, addressed to such shareholder at his
or her address appearing on the books of the Corporation or given by him or
her to the Corporation for the purpose of notice. If a shareholder gives no
address, notice shall be deemed to have been given him or her if sent by mail
or other means of written communication addressed to the place where the
principal office of the Corporation is situated, or if published at least once
in some newspaper of general circulation in the county in which said office is
located. All such notices shall be sent to such shareholder entitled thereto,
not less than twenty (20) days nor more than sixty (60) days before such
annual meeting, and shall specify the place, day, and hour of such meeting,
and shall also state the general nature of the business or proposal to be
considered or acted upon at such meeting before action may be taken at such
meeting on:
(a) A proposal to sell, lease, convey, exchange, transfer, or otherwise
dispose of all or substantially all of the property or assets of the
Corporation, except under Section 272 of the Delaware General Corporation Law,
and except for a transfer to a wholly-owned subsidiary;
(b) A proposal to merge or consolidate with another corporation, domestic
or foreign;
(c) A proposal to reduce the stated capital of the Corporation;
(d) A proposal to amend the Articles of Incorporation;
(e) A proposal to wind up and dissolve the Corporation; and
(f) A proposal to adopt a plan of distribution of shares, securities, or
any consideration other than money in the process of winding up.
Advance Notice of Stockholder Proposed Business at Annual Meeting: At an
Annual Meeting of the Shareholders, only such business shall be conducted as
shall have been properly brought before the meeting:
(a) As specified in the notice of the meeting (or any supplement thereto);
(b) By, or at the direction of, the Board of Directors; or
(c) Otherwise properly brought before the meeting by a stockholder.
In addition to any other applicable requirements, for business to be properly
brought before an Annual Meeting by a stockholder, the stockholder must have
given timely notice thereof in writing to the Secretary of the Corporation. To
be timely, a stockholder's notice must be delivered to or mailed and received
at the offices of the Secretary of the Corporation, not less than sixty (60)
days prior to the first anniversary of the date of the last Annual Meeting of
stockholders of the Corporation. A stockholder's notice to the Secretary shall
set forth as to each matter the stockholder purposes to bring before the
Annual Meeting (i) a brief description of the business desired to be brought
before the Annual Meeting and reasons for conducting such business at the
Annual Meeting; (ii) the name and record address of the stockholder proposing
such business; (iii) the class and number of shares of the Corporation which
are beneficially owned by the stockholder; and (iv) any material interest of
the stockholder in such business.
Notwithstanding anything in the By-laws to the contrary, no business shall be
conducted at the Annual Meeting except in accordance with the procedures set
forth in this section, provided, however, that nothing in this section shall
be deemed to preclude discussion by any stockholder of any business properly
brought before the Annual Meeting in accordance with said procedure.
The Chairman of the Annual Meeting shall, if the facts warrant, determine and
declare to the meeting that business was not properly brought before the
meeting in accordance with the provisions of this section, and if he should so
determine, he shall so declare to the meeting that any such business not
properly brought before the meeting shall not be transacted.
Section 3. SPECIAL MEETINGS
Special Meetings of the shareholders, for any propose or purposes whatsoever,
may be called any time by the Chairman of the Board, the President, or by the
Board of Directors. Except in special cases where other express provision is
made by statute, notice of such special meetings shall be given in the same
manner as for annual meetings of shareholders.
Notices of any special meeting shall specify, in addition to the place, day
and hour of such meeting, the general nature of the business to be transacted.
Section 4. ADJOURNED MEETINGS AND NOTICE THEREOF
Any shareholders' meeting, annual or special, whether or not a quorum is
present, may be adjourned from time to time by vote of a majority of the
shares, the holders of which are either present in person or by proxy, but in
the absence of a quorum, no other business may be transacted at such meeting.
When any shareholders' meeting, either annual or special, is adjourned for
thirty (30) days or more, notice of the adjourned meeting shall be given as in
the case of an original meeting. In all other instances of adjournment, it
shall not be necessary to give any notice of an adjournment or of the business
to be transacted ad an adjourned meeting, other than by announcement at the
meeting at which such adjournment is taken.
Section 5. ENTRY OF NOTICE
Whenever any shareholder entitled to vote has been absent from any meeting or
shareholders, whether annual or special, an entry in the minutes to the effect
that notice has been duly given shall be sufficient evidence that due notice
of such meeting was given to such shareholder, as required by the law and the
By-laws of the Corporation.
Section 6. VOTING
At all meetings of shareholders, every shareholder entitled to vote shall have
the right to vote in person or by proxy the number of shares standing in his
or her name on the stock records of the Corporation. Such vote may be given
viva voce or by ballot; provided, however, that all elections for directors
must be by ballot upon demand made by a shareholder at any election and before
the voting begins.
Section 7. QUORUM.
The presence in person or by proxy of the holders of a majority of the shares
entitled to vote at any meeting shall constitute a quorum for the transaction
of business. The shareholders present at a duly called or held meeting at
which a quorum is present may continue to do business until adjournment,
notwithstanding the withdrawal of enough shareholders to leave less than a
quorum. When a quorum is present at any meeting, a majority in interest of the
stock represented thereat shall decide any question brought before such
meeting, unless the question is one upon which by express provision of law,
the Articles of Incorporation, or these By-laws, a larger or different vote is
required, in which case such express provision shall govern and control the
decision of such question.
Section 8. CONSENT OF ABSENTEES
The proceedings and transactions of any meeting of shareholders, either annual
or special, however called and noticed, shall be as valid as though had at a
meeting duly held after regular call and notice, if a quorum be present either
in person or by proxy, and if, either before or after the meeting, each of the
shareholders entitled to vote, not present in person or by proxy, sign a
written waiver of notice, a consent to the holding of such meeting, or an
approval of the minutes thereof. All such waivers, consents, or approvals
shall be filed with the corporate records or made apart of the minutes of the
meeting.
Section 9. ACTION WITHOUT MEETING
Any action, which under the provisions of Section 228 of the Delaware General
Corporation Law may be taken at a meeting of the shareholders, may be taken
without a meeting if authorized by a writing signed by the holders of
outstanding shares having not less than the minimum number of votes that would
be necessary to authorize or take such action at any meeting at which all
shares entitled to vote thereon were present and voted, and filed with the
Secretary of the Corporation.
Section 10. PROXIES
Every person entitled to vote or execute consents shall have the right to do
so either in person or by an agent or agents authorized by a written proxy
executed by such person or his or her duly authorized agent and filed with the
Secretary of the Corporation; provided, that no such proxy shall be valid
after the expiration of eleven (11) months from the date of its execution,
unless the shareholder executing it specifies therein the length of time for
which such proxy is to continue in force, which in no case shall exceed seven
(7) years from the date of its execution.
ARTICLE III. DIRECTORS
Section 1. POWERS
Subject to limitations of the Articles of Incorporation, of the By-laws, and
particularly Article II, Section 6 of these By-laws, and Section 141 of the
Delaware General Corporation Law as to action to be authorized or approved by
the shareholders, and subject to the duties of directors as prescribed by the
By-laws, all corporate power shall be exercised by or under the authority of,
and the business and affairs of the Corporation shall be controlled by, the
Board of Directors. Without prejudice to such general powers, but subject to
the same limitations, it is hereby expressly declared that the directors shall
have the following powers, to-wit:
First: To select and remove all other officers, agent, and employees of the
Corporation, prescribe such powers and duties for them as may not be
inconsistent with law, the Articles of Incorporation or by By-laws, fix their
compensation, and require from them security for faithful service.
Second: To conduct, manage, and control the affairs and business of the
Corporation, and to make such rules and regulations therefore not inconsistent
with law, the Articles of Incorporation or the By-laws, as they may deem best.
Third: To change the principal office for the transaction of the business of
the Corporation from one location to another within the same county as
provided in Article I, Section 1 hereof; to fix and locate from time to time,
one or more branch or subsidiary offices of the Corporation within or without
the State of Delaware as provided in Article I, Section 2 hereof; to designate
any place within or without the State of Delaware for the holding of any
shareholders' meetings; and to adopt, make, and use a corporate seal, and to
prescribe the form of certificates of stock, and to alter the form of such
seal and of such stock certificates from time to time, as in their judgment
they may deem best; provided, such seal and such certificates shall at all
times comply with the provisions of the law.
Fourth: To authorize the issuance of stock of the Corporation from time to
time, upon such terms as may be lawful, in consideration of money paid, labor
done, or services actually rendered, debts or securities canceled, or tangible
or intangible property actually received, or in case of shares issued as a
dividend, against amounts transferred from surplus to stated capital.
Fifth: To borrow money and incur indebtedness for the purposes of the
Corporation and to cause to be executed and delivered therefore, in the
corporate name, promissory notes, bonds, debentures, deeds of trust,
mortgages, pledges, hypothecations, or other evidence of debt and securities
therefore.
Sixth: To appoint an executive committee and other committees, and to
delegate to the executive committee any of the powers and authority of the
Board in the management of the business and affairs of the Corporation, except
the power to declare dividends and to adopt, amend, or repeal By-laws. The
executive committee shall be composed of two or more directors.
Seventh: To impose such restriction(s) on the transfer of the stock of the
Corporation, specifically including by way of illustration only, and not of
limitation, e.g., the requirement that such stock not be transferable on the
books of the Corporation except with a simultaneous transfer of the stock of
any other corporation(s), as is or may be permitted by law, and to remove any
such restriction(s) thereon.
Section 2. NUMBER AND QUALIFICATIONS OF DIRECTORS
The authorized number of directors of the Corporation shall be a number
between five (5) and nine (9) inclusive, as the Board of Directors from time
to time by vote of a supermajority (a majority plus one) may set, until
changed by amendment of the Articles of Incorporation or by a by-law amending
this Section 2, Article III of these By-laws duly adopted by the vote or
written assents of the shareholders entitled to exercise fifty-one percent
(51%) of the voting power of the Corporation.
Section 3. ELECTION AND TERM OF OFFICE
The directors shall be elected at each annual meeting of the shareholders, but
if any such annual meeting is not held, or the directors are not elected
thereat, the directors may be elected at any special meeting of the
shareholders held for that purpose. All directors shall hold office at the
pleasure of the shareholders or until their respective successors are elected.
The shareholders may at any time, either at a regular or special meeting,
remove any director and elect his or her successor.
NOMINATIONS OF DIRECTORS
Only persons who are nominated in accordance with the following procedures
shall be eligible for election as directors. Nominations of candidates for
election as directors of the Corporation at any meeting of shareholders may be
made (a) by, or at the direction of, a majority of the Board of Directors, or
(b) by any shareholder of that class of stock entitled to vote for the
election of directors of that class of stock. Only persons nominated in
accordance with the procedures set forth in this section shall be eligible for
election as directors. Such nomination, other than those made by, or at the
direction of the board, shall be made pursuant to timely notice in writing to
the Secretary of the Corporation. To be timely, a stockholder's notice shall
be delivered to or mailed and received at the office of the Secretary of the
Corporation not less than sixty (60) days prior to the first anniversary of
the date of the last meeting of stockholders of the Corporation called for the
election of directors. Such stockholder's notice to the Secretary shall set
forth (a) as to each person whom the stockholder proposes to nominate for
election or reelection as a director: (i) the name, age, business address, and
residence address of the person; (ii) the principal occupation of the
employment of the person; (iii) the class and number of shares of capital
stock of the Corporation which are beneficially owned by the person; and (iv)
any other information related to the person that is required to be disclosed
in solicitations for proxies for elections of directors pursuant to Rule 14a
under the Securities Exchange Act of 1934, as amended; and (b) as to the
stockholder giving the notice: (i) the name and record address of the
stockholder, and (ii) the class and number of shares of capital stock of the
Corporation which are beneficially owned by the stockholder. The Corporation
may require any proposed nominee to furnish such other information as may
reasonably be required by the Corporation to determine the eligibility of such
proposed nominee to serve as director of the Corporation. No person shall be
eligible for election as a director of the Corporation unless nominated in
accordance with the procedures set forth herein.
The Chairman of the meeting shall, if the facts warrant, determine and declare
to the meeting that a nomination was not made in accordance with the foregoing
procedure, and if he should so determine, he shall so declare to the meeting
that the defective nomination shall be disregarded.
Section 4. VACANCIES
Vacancies in the Board of Directors may be filled by the remaining directors,
though less than a quorum, or by a sole remaining director, and each director
so elected shall hold office until his or her successor is elected at an
annual or special meeting of the shareholders.
A vacancy or vacancies in the Board of Directors shall be deemed to exist in
case of the death, resignation, or removal of any director, or if the
authorized number of directors be increased, or if the shareholders fail at
any annual or special meeting of the shareholders at which any director or
directors are elected, to elect the full authorized number of directors to be
voted for at that meeting.
The shareholders may elect a director of directors at any time to fill any
vacancy or vacancies of a director tendered to take effect at a future time;
the Board or the shareholders shall have the power to elect a successor to
take office when the resignation is to become effective.
No reduction of the authorized number of directors shall have the effect of
removing any director prior to the expiration of his or her term of office.
Section 5. PLACE OF MEETING
Regular meetings of the Board of Directors shall be held at any place within
or without the State of Delaware which has been designated from time to time
by resolution of the Board or by written consent of all members of the Board.
In the absence of such designation, regular meetings shall be held at the
principal office of the Corporation. Special meetings of the Board may be held
either at a place so designated or at the principal office.
Section 6. ORGANIZATION MEETING
Immediately following each annual meeting of shareholders, the Board of
Directors shall hold a regular meeting for the purpose of organization,
election of officers, and the transaction of other business. Notice of such
meetings is hereby dispensed with.
Section 7. OTHER REGULAR MEETINGS
Other regular meetings of the Board of Directors shall be held on the third
Friday of January, April, and July of each year at 9:00 o'clock a.m. thereof;
provided, however, that should said day fall upon a legal holiday, then said
meeting shall be held at the same time and place on the next day thereafter
which is not a legal holiday. Notice of regular meetings of the Board of
Directors is required and shall be given in the same manner as notice of
special meetings of the Board of Directors.
Section 8. SPECIAL MEETINGS
Special meetings of the board of Directors for any purpose or purposes may be
called at any time by the President, by the Executive Committee, or by any
three (3) members of the Board.
Written notice of the time and place of special meetings shall be delivered
personally to the directors or sent to each director by mail or other form or
written communication, charges prepaid, addressed to him or her at his or her
address as it is shown upon the records of the Corporation, or if it is not
shown on such records or is not readily ascertainable, at the place in which
the meetings of the directors are regularly held. In case such notice is
mailed or telegraphed, it shall be deposited in the U.S. Mail or delivered to
the telegraph company in the place in which the principal office of the
Corporation is located at least one hundred twenty (120) hours prior to the
time of holding of the meeting. In case such notice is delivered personally as
above provided, it shall be so delivered at least forty eight (48) hours prior
to the time of the holding of the meeting. Such mailing, telegraphing, or
delivery as above provided, shall be due, timely, legal and personal notice to
such director.
NOTICE FOR A PARTICULAR SPECIFIED ACTION
Notwithstanding the above requirements for regular or special meetings, the
Chairman of the Board, the Chief Executive Officer, or any two directors may
require at least thirty (30) calendar days notice of any action, by writing
delivered to the Secretary of the Corporation, before or during any regular or
special meeting, and if such notice is given, no vote or written consent may
be taken upon such action until the passage of such time (at another special
meeting or by written consent). Provided, however, if eighty percent (80%) of
the directors agree to waive such notice, the meeting or vote of consent on
such action shall proceed without the requirement for extended notice.
Section 9. NOTICE OF ADJOURNMENT
Notice of the time and place of holding an adjourned meeting need not be given
to absent directors if the time and place be fixed at the meeting adjourned.
Section 10. ENTRY OF NOTICE
Whenever any director has been absent from any special meeting of the Board of
Directors, any entry in the minutes as to the effect that notice has been duly
given shall be sufficient evidence that due notice of such special meeting was
given to such director, as required by law and the By-laws of the Corporation.
Section 11. WAIVER OF NOTICE
The transactions of any meeting of the Board of Directors, however called and
noticed or wherever held, shall be as valid as though had at a meeting duly
held after regular call and notice, if a quorum be present, and if either
before or after the meeting, each of the directors not present, signs a
written waiver of notice or a consent to holding such meeting or an approval
of the minutes thereof. All such waivers, consents, or approvals shall be
filed with the corporate records or made a part of the minutes of the meeting.
Section 12. QUORUM A majority of the authorized number of directors shall be
necessary to constitute a quorum for the transaction of business, except to
adjourn as hereinafter provided. With the exception of Section 4 of this
Article, an action of the directors shall be regarded as the act of the Board
of Directors only if a majority of the entire authorized number of directors
shall vote affirmatively on such action.
Section 13. ADJOURNMENT
A quorum of the directors may adjourn any directors' meeting to meet again at
a stated time, place, and hour; provided, however, that in the absence of a
quorum, the directors present at any directors' meeting, either regular or
special, may adjourn from time to time, until the time fixed for the next
regular meeting of the Board.
Section 14. ACTION WITHOUT MEETING
Any action required or permitted to be taken by the Board of Directors under
any provision of law or these By-laws may be taken without a meeting if all
members shall individually or collectively consent in writing to such action.
Such written consent or consents shall be filed with the minutes of the
proceedings of the Board. Such action by written consent shall have the same
force and effect as a unanimous vote of such directors, any certificate or
other document filed under any provisions of the Delaware General Corporation
Law which related to action so taken shall state that the action was taken by
unanimous written consent of the Board of Directors without a meeting and that
the By-laws authorize the directors to so act, and such statement shall be
prima facie evidence of such authority.
Section 15. FEES AND COMPENSATION
Directors shall not receive any stated salary for their services as directors,
but, by resolution of the Board of Directors, a fixed fee, with or without
expenses of attending, may be allowed for attendance at each meeting. Nothing
herein contained shall be construed to preclude any director from serving the
Corporation in any other capacity as an officer, agent, employee, or
otherwise, and receiving compensation therefore.
ARTICLE IV. OFFICERS
Section 1. OFFICERS
The officers of the Corporation shall be:
1. Chairman of the Board
2. President
3. Vice President
4. Secretary
5. Treasurer
The Corporation may also have, at the discretion of the Board of Directors,
one or more additional vice presidents, one or more assistant secretaries, one
or more assistant treasurers, and such other officers as may be appointed in
accordance with the provisions of Section 3 of this Article. Officers other
than the President and Chairman of the Board of Directors need not be
directors. One person may hold two or more offices, except those of President
and Secretary.
Section 2. ELECTIONS
The officers of the Corporation, except such officers as may be appointed in
accordance with the provisions of Sections 3 or 5 of this Article, shall be
chosen annually by the Board of Directors, and each shall hold his or her
office at the pleasure of the Board of Directors, who may, either at a regular
or special meeting, remove any such officers and appoint his or her successor.
Section 3. SUBORDINATE OFFICERS, ETC
The Board of Directors may appoint such other officers as the business of the
Corporation may require, each of whom shall hold office for such period, have
such authority, and perform such duties as are provided in the By-laws or as
the Board of Directors may from time to time determine.
Section 4. REMOVAL AND RESIGNATION
Any officer may be removed, either with or without cause, by a majority of the
directors at the time in office, at a regular or special meeting of the Board,
or, except in the case of an officer chosen by the Board of Directors, by any
officer upon whom such power of removal may be conferred by the Board of
Directors.
Any officer may resign at any time by giving written notice to the Board of
Directors or to the President, or to the Secretary of the Corporation. Any
such resignation shall take effect at the date of the receipt of such notice
or at any later time specified therein; and unless otherwise specified
therein, the acceptance of such resignation shall not be necessary to make it
effective.
Section 5. VACANCIES
A vacancy in any office because of death, resignation, removal,
disqualification, or any other cause shall be filled in the manner prescribed
in the By-laws for regular appointments to such office.
Section 6. CHAIRMAN OF THE BOARD
The Chairman of the Board, if there shall be such an officer, shall, if
present, preside at all meetings of the Board of Directors, and exercise and
perform such other powers and duties as may be from time to time assigned to
him or her by the Board of Directors as prescribed by the By-laws.
Section 7. PRESIDENT
Subject to such supervisory powers, if any, as may be given by the Board of
Directors to the Chairman of the Board, if there be such an officer, the
President shall be the Chief Executive Officer of the Corporation and shall,
subject to the control of the Board of Directors, have general supervision,
direction, and control of the business and affairs of the Corporation. He
shall preside at all meetings of the shareholders, and in the absence of the
Chairman of the Board, or if there be none, at all meetings of the Board of
Directors. He shall be ex-officio a member of all the standing committees,
including the Executive Committee, if any, and shall have the general powers
and duties of management usually vested in the office of president of a
Corporation, and shall have such other powers and duties as may be prescribed
by the Board of Directors or by the By-laws.
Section 8. VICE PRESIDENT
In the absence or disability of the President, the Chairman of the Board or in
the event of his absence or disability, the Vice Presidents in order of their
rank as fixed by the Board of Directors, or if not ranked, the Vice President
designated by the Board of Directors, shall perform all the duties of the
President, and when so acting shall have all the powers of, and be subject to
all restrictions upon, the President. Absence and disability are defined as
follows: absence is physical absence from the Corporation's principal place of
business and unreachable by telephone for a period of forty-eight (48) hours.
Disability is the inability of the President to perform his duties on an
ongoing basis.
The Senior Vice President and each other Vice President shall have such other
powers and perform such duties as are authorized by the laws of Delaware and
as are delegated to them respectively from time to time by the board of
Directors or the By-laws.
Section 9. SECRETARY
The Secretary shall keep, or cause to be kept, a book of minutes at the
principal office or such other place as the Board of Directors may order, of
all meetings of directors and shareholders, with the time and place of
holding, whether regular or special, and if special, how authorized, the
notice thereof given, the names of those directors and shareholders present,
the names of those present at the directors' meeting, the number of shares
present or represented at shareholders' meetings, and the proceedings thereof.
The Secretary shall keep or cause to be kept, at the principal office or at
the office of the Corporation's transfer agent, a share register or a
duplicate share register showing the names of the shareholders and their
addresses; the number and classes of shares held by each; the number and the
date of certificates issued for the same; and the number and date of
cancellation of every certificate surrendered for cancellation.
The Secretary shall give or cause to be given, notice of all meetings of
shareholders and the Board of Directors, as required by the By-laws or by law
to be given, and he or she shall keep the seal of the Corporation in safe
custody, and shall have such other powers and perform such other duties as may
be prescribed by the Board of Directors or the By-laws.
Section 10. TREASURER
The Treasurer shall keep and maintain, or cause to be kept and maintained,
adequate and correct accounts of the properties and business transactions of
the Corporation, including accounts of its assets, liabilities, receipts,
disbursements, gains, losses, capital surplus, and surplus shares. Any
surplus, including earned surplus, paid-in surplus, and surplus arising from a
reduction of stated capital, shall be classified according to source and shown
in a separate account. The books of account shall at all times be open for
inspection by any director.
The Treasurer shall deposit all monies and other valuables in the name and to
the credit of the Corporation with such depositories as may be designated by
the Board of Directors. He or she shall disburse the funds of the Corporation
as may be ordered by the Board of Directors and shall render to the President
and directors, when they request it, an account of all of his or her
transactions as Treasurer and of the financial condition of the Corporation,
and shall have such other powers and perform such other duties as may be
prescribed by the Board of Directors or the By-laws.
ARTICLE V. MISCELLANEOUS
Section 1. RECORD DATE AND CLOSING STOCK BOOKS
A. Fixed Date
The Board of Directors may fix a time, in the future, not less than twenty
(20) nor more than sixty (60) days preceding the date of any meeting of
shareholders, and not more than sixty (60) days preceding the date fixed for
the payment of any dividend or distribution, or for the allotment of rights,
or when any change, conversion, or exchange of shares shall go into effect, as
a record date for the determination of the shareholders entitled to notice of
and to vote at any such meeting, or entitled to receive any such dividend or
distribution, or any such allotment of rights, or to exercise the rights in
respect to any such change, conversion, or exchange of shares, and in such
case only shareholders of record on the date so fixed shall be entitled to
notice of and to vote at such meeting, or to receive such rights, as the case
may be, notwithstanding any transfer of any shares on the books of the
Corporation after any record date fixed as aforesaid. The Board of Directors
may close the books of the Corporation against transfer of shares during the
whole, or any part of any such period.
B. No Fixed Date
As an alternative to an action taken under Subsection A of this Section 1 of
Article V, if no record date has been or is fixed for the purpose of
determining shareholders entitled to receive payment of any dividend, the
record date for such purpose shall be at the close of business of the date on
which the Board of Directors adopts the resolution relating thereto.
Section 2. INSPECTION OF CORPORATE RECORDS
The share register or duplicate share register, the books of account, and
minutes of proceedings of the shareholders and directors shall be open to
inspection upon the written demand of any shareholder or the holder of a
voting trust certificate, at any reasonable time, and for a purpose reasonably
related to his or her interests as a shareholder, and shall be exhibited at
any time when required by the demand of ten percent (10%) of the shares
represented at any shareholders' meeting. Such inspection may be made in
person or by an agent or attorney, and shall include the right to make
extracts. Demand of inspection other than at a shareholders' meeting shall be
made in writing upon the President, Secretary, or Assistant Secretary of the
Corporation.
Section 3. CHECKS, DRAFTS, ETC.
All checks, drafts, or other orders for payment of money, notes, or other
evidence of indebtedness issued in the name of or payable to the Corporation,
shall be signed or endorsed by such person or persons and in such manner as,
from time to time, shall be determined by resolution of the Board of
Directors.
Section 4. CONTRACTS, ETC.: HOW EXECUTED
The Board of Directors, except as the By-laws or Articles of Incorporation
otherwise provide, may authorize any officer or officers, agent or agents, to
enter into any contract or execute any instrument in the name of and on behalf
of the Corporation, and such authority may be general or confined to specific
instances; and unless so authorized by the Board of Directors, no officer,
agent, or employee shall have any power or authority to bind the Corporation
by any contract or agreement or to pledge its credit to render it liable for
any purpose or to any amount.
Section 5. ANNUAL REPORTS
The Board of Directors shall cause an annual report or statement to be sent to
the shareholders of this Corporation not later than one hundred and twenty
(120) days after the close of the fiscal or calendar year.
Section 6. CERTIFICATES OF STOCK
A certificate or certificates for shares of the capital stock of the
Corporation shall be issued to each shareholder when any such shares are fully
paid up. All such certificates shall be signed by the President or a Vice
President and the Secretary or an Assistant Secretary. Such certificates may
be paired with, deemed to represent, and subjected to restrictions on transfer
without simultaneous transfer of, certificates for: (a) shares of stock of
any other corporation(s), (b) beneficial interests in such shares, (c)
interests in voting trust(s), or (d) other kinds of interests in any other
kind of entity.
Certificates for shares may be issued prior to full payment thereof, under
such restrictions and for such purposes as the Board of Directors or the
By-laws may provide; provided, however, that any such certificate so issued
prior to full payment shall state the amount remaining unpaid and the terms of
payment thereof.
Section 7. REPRESENTATION OF SHARES OF OTHER CORPORATIONS
The President or any Vice President and the Secretary or Assistant Secretary
of this Corporation are authorized to vote, represent, and exercise on behalf
of this Corporation all rights incident to any and all shares of any other
corporation or corporations standing in the name of this Corporation. The
authority herein granted to said officers to vote or represent on behalf of
this Corporation any and all shares held by this Corporation or corporations,
may be exercised either by such officers in person or by any person authorized
to do so by proxy or power of attorney.
Section 8. INSPECTION OF BY-LAWS
The Corporation shall keep in its principal office for the transaction of
business the original or a copy of the By-laws as amended or otherwise altered
to date, certified by the Secretary, which shall be open to inspection by the
shareholders at all reasonable times during business hours.
Section 9. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Every person who was or is a party or is threatened to be made a party to or
is involved in any action, suit, or proceeding, whether civil, criminal,
administrative, or investigative, by reason of the fact that he or a person of
whom he is the legal representative is or was a director or officer of the
Corporation or is or was serving at the request of the Corporation as a
director or officer of another corporation, shall be indemnified and held
harmless to the fullest extent legally permissible under the General
Corporation Law of the state of Delaware from time to time against all
expense, liability, and loss (including attorneys' fees, judgments, fines,
and, if approved by the Board of Directors, amounts paid or to be paid in
settlement) reasonably incurred or suffered by him in connection therewith.
If authorized by the Board of Directors, expenses incurred in connection with
the defense of any civil or criminal action, suit, or proceeding may be paid
by the Corporation in advance of the disposition of the action, suit, or
proceeding, upon receipt of an undertaking by or on behalf of the director or
officer to repay such amounts if it shall be ultimately determined that he is
not entitled to be indemnified by the Corporation.
The foregoing right of indemnification shall be in addition to, and not
exclusive of, all other rights to which such director or officer may be
entitled. Payments pursuant to the Corporation's indemnification of any person
hereunder shall be reduced by any amounts such person may collect as
indemnification under any policy of insurance purchased and maintained on his
behalf by this or any other Corporation.
ARTICLE VI. AMENDMENTS
Section 1. POWER OF SHAREHOLDERS
New By-laws may be adopted or these By-laws may be amended or repealed by the
vote of shareholders entitled to exercise fifty-one percent (51%) of the
voting power of the Corporation or by the written assent of such shareholders.
Section 2. POWERS OF DIRECTORS
Subject to the right of shareholders as provided in Section 1 of this Article
VI to adopt, amend, or repeal By-laws, By-laws other than a By-law or
amendment thereof changing the authorized number of directors may be adopted,
amended, or repealed by the Board of Directors.
ARTICLE VII. SEAL
The Corporation shall have a common seal, and shall have inscribed thereon the
name of the Corporation, the year of its incorporation, and the word Delaware.
EXHIBIT 11
CACI INTERNATIONAL INC AND SUBSIDIARIES
COMPUTATION OF EARNINGS PER COMMON
AND COMMON EQUIVALENT SHARE
<TABLE>
<CAPTION>
Year Ended June 30
--------------------------------------
1994 1993 1992
----------- ----------- -----------
<S> <C> <C> <C>
Net Income before
extraordinary item $ 6,336,000 $ 2,980,000 $ 4,210,000
Extraordinary item (300,000) 0 0
---------- ---------- ----------
Net income $ 6,036,000 $ 2,980,000 $ 4,210,000
========== ========== ==========
Average shares
outstanding
during the period 10,098,000 10,004,000 10,242,000
Dilutive effect of
stock options after
application of
treasury stock
method 517,000 357,000 2,000
---------- ---------- ----------
Average number of shares
and equivalent shares
outstanding during
the period 10,615,000 10,361,000 10,604,000
---------- ---------- ----------
Earnings per common
and common equivalent
share
Before extraordinary
item $ 0.60 $ 0.29 $ 0.40
Extraordinary item $ (0.03) $ 0.00 $ 0.00
Net income $ 0 .57 $ 0.29 $ 0.40
======= ======= =======
</TABLE>
EXHIBIT 21
SIGNIFICANT SUBSIDIARIES OF THE REGISTRANT
(as defined in Section 1-02(v) of Regulation S-X)
CACI, Inc., a Delaware Corporation
CACI, INC.-FEDERAL, a Delaware Corporation
CACI, INC.-COMMERCIAL, a Delaware Corporation
CACI Products Company, a Delaware Corporation
American Legal Services Corp., a Delaware Corporation
CACI Field Services, Inc., a Delaware Corporation
CACI N.V., a Netherlands Corporation
CACI Limited, a U.K. Corporation
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM
10-K FOR FY94 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> JUN-30-1994
<PERIOD-END> JUN-30-1994
<CASH> 941,000
<SECURITIES> 0
<RECEIVABLES> 37,332,000
<ALLOWANCES> (1,664,000)
<INVENTORY> 0
<CURRENT-ASSETS> 56,096,000
<PP&E> 20,124,000
<DEPRECIATION> (12,369,000)
<TOTAL-ASSETS> 70,999,000
<CURRENT-LIABILITIES> 30,769,000
<BONDS> 0
<COMMON> 1,349,000
0
0
<OTHER-SE> 36,389,000
<TOTAL-LIABILITY-AND-EQUITY> 70,999,000
<SALES> 0
<TOTAL-REVENUES> 183,700,000
<CGS> 0
<TOTAL-COSTS> 97,584,000
<OTHER-EXPENSES> 70,832,000
<LOSS-PROVISION> 294,000
<INTEREST-EXPENSE> 4,761,000
<INCOME-PRETAX> 10,229,000
<INCOME-TAX> 3,893,000
<INCOME-CONTINUING> 6,336,000
<DISCONTINUED> 0
<EXTRAORDINARY> (300,000)<F1>
<CHANGES> 0
<NET-INCOME> 6,036,000
<EPS-PRIMARY> 0.57
<EPS-DILUTED> 0.57
<FN>
<F1>Net of $194,000 tax benefit
</FN>
</TABLE>
