SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
(Mark One)
(X ) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
ACT OF 1934 FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 1994.
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
COMMISSION FILE NUMBER 0-9514
ANDREW CORPORATION
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(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 36-2092797
------------------------------- -------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) identification No.)
10500 W. 153RD STREET, ORLAND PARK, ILLINOIS 60462
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(Address of principal executive offices and zip code)
(708) 349-3300
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(Registrant's telephone number, including area code:)
SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT: NONE
SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:
TITLE OF EACH CLASS
-------------------
Common Stock, $.01 par value
Common Stock Purchase Rights
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 as 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
--- ---
Indicate by check mark if disclosure of delinquent filers pursuant to item 405
of Regulation S-K is not contained herein and will not be contained, to the best
of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K, or any amendment of
this Form 10-K. (X)
The aggregate market value of voting stock held by non-affiliates of the
Registrant as of December 21, 1994 was $1,311,062,176. The number of outstanding
shares of the Registrant's common stock as of that date was 25,581,701.
DOCUMENTS INCORPORATED BY REFERENCE:
Portions of the Registrant's Annual Report to Stockholders for the year ended
September 30, 1994 are incorporated by reference into Parts I and II.
Portions of the Proxy Statement for the annual stockholders' meeting to be held
February 8, 1995 are incorporated by reference into Part III.
<PAGE>
PART I
ITEM 1-BUSINESS
GENERAL
Andrew Corporation ("Andrew" or the "Company") was reincorporated in
Delaware in 1987. The Company previously was incorporated in Illinois in 1947 as
the successor to a partnership founded in 1937. Its executive offices are
located at 10500 West 153rd Street, Orland Park, Illinois, 60462, which is
approximately 25 miles southwest of Chicago's loop. Unless otherwise indicated
by the context, all references herein to Andrew include Andrew Corporation and
its subsidiaries.
Andrew is a multinational supplier of communications products and systems
to worldwide commercial, industrial, governmental and military customers. Its
principal products include coaxial cables, microwave antennas for point-to-point
communication systems, special purpose antennas for commercial, government and
military end use, antennas and complete earth stations for satellite
communication systems, electronic radar systems, communication reconnaissance
systems, connectivity devices for use in communication systems, and related
ancillary items and services. These products are frequently sold as integrated
systems rather than as separate components. Andrew conducts manufacturing
operations, primarily from ten locations in the United States and from four
locations in other countries. Sales by non-U.S. operations and export sales from
U.S. operations accounted for approximately 44% of Andrew's net sales in 1994,
41% in 1993, and 38% in 1992.
During the year the Company operated in three strategic business areas,
Commercial, Government and Network. The Commercial business supplies coaxial
cable and antenna system equipment to telecommunications companies and agencies.
The Government business supplies specialized antenna systems, electronic radar
systems, communication reconnaissance systems, coaxial cable, standard antennas,
and fully integrated systems to various United States government agencies and
friendly foreign governments. The Network business supplies products and
services through value added and other resellers to data processing
organizations that support the interconnectivity needs of computer networks.
Information concerning Andrew's net sales (intersegment sales are
insignificant), operating profit and assets employed attributable to each
business area for fiscal 1994, 1993, and 1992, is included in the "Industry
Segment Information" note to Consolidated Financial Statements included on page
33 of the 1994 Annual Report to Stockholders and incorporated herein by
reference.
<PAGE>
PRODUCTS AND SERVICES
The following table sets forth net sales and percentages of total net sales
represented by Andrew's principal products during the last three years:
<TABLE>
<CAPTION>
Year Ended September 30
1994 1993 1992
---------------------------------------------------
(Dollars in thousands)
<S> <C> <C> <C> <C> <C> <C>
Coaxial Cable Systems and
Bulk Cables $248,613 45% $175,811 41% $162,801 37%
Microwave Antenna Systems 107,455 19 94,152 22 95,894 22
Special Antennas and Other 107,074 19 55,143 13 79,109 18
Earth Station Antennas 19,246 4 20,929 5 18,209 4
Defense Electronics 19,026 3 23,407 5 25,696 6
Network Products 52,208 9 57,681 13 55,687 12
Other 4,835 1 3,697 1 4,612 1
-------- --- -------- --- -------- ---
$558,457 100% $430,820 100% $442,008 100%
======== === ======== === ======== ===
</TABLE>
<TABLE>
Sales for the Company's business areas during the last three years were as
follows:
<CAPTION>
Year Ended September 30
1994 1993 1992
-----------------------------------------------------
(Dollars in thousands)
<S> <C> <C> <C>
Commercial $457,803 $315,484 $315,906
Government 43,611 53,958 65,803
Network 52,208 57,681 55,687
Other 4,835 3,697 4,612
-------- -------- --------
$558,457 $430,820 $442,008
======== ======== ========
</TABLE>
<PAGE>
PRINCIPAL PRODUCTS
COMMERCIAL BUSINESS
Coaxial Cable Systems and Bulk Cables:
Coaxial cable is a two-conductor, radio frequency transmission line with
the smaller of the two conductors centrally located inside the larger, tubular
conductor. It is principally used to carry radio frequency signals at
frequencies up to 2 GHz.
Waveguides are tubular conductors, the dimensions and manufacturing
tolerances of which are related to operating frequency. Waveguides find greatest
application at frequencies above 2 GHz, although they are also used in UHF-TV
broadcasting at frequencies in hundreds of megahertz. Andrew manufactures
waveguides with rectangular, circular and elliptical cross-sections. Most of
Andrew's waveguides are sold as part of its antenna systems.
Andrew sells its semi-flexible cables and waveguides under the trademark
HELIAX(R).
Microwave Antenna Systems:
A "microwave antenna system," as this term is used by Andrew, consists of
one or more microwave antennas, waveguides or coaxial cables connecting antennas
to transmitters or receivers, a tower to support the antennas, an equipment
shelter to house transmitters and receivers, various ancillary items, and field
installation services. If sold without a supporting tower, equipment shelter or
field installation, microwave antennas with their connecting cables or
waveguides are still considered by Andrew to be "microwave antenna systems."
Land-based microwave radio networks are commonly used by telecommunications
companies for intercity telephone, telex, video and data transmission. They are
also used for more specialized purposes by pipeline companies, electric
utilities and railroads.
Special Antennas and Other:
Andrew also manufactures and sells several types and configurations of
special application antennas. Applications include cellular systems, navigation,
FM and television broadcasting, multipoint distribution services and
instructional television. As with microwave antennas, Andrew considers sales of
special antennas and other various components used in the cellular market
(shelters and towers) and the installation of these components to be part of a
"cellular system."
The company also designs and installs its proprietary distributed
communication systems. These systems permit in-building and enclosed area access
for all types of wireless communications. These systems utilize the company's
semi-flexible coaxial cable sold under the tradename RADIAX(R).
<PAGE>
Earth Station Antennas:
Earth station antenna systems manufactured by Andrew are used at earth
terminals to receive signals from, and transmit signals to, communication
satellites in equatorial orbit. System elements include an antenna, from 6 to 40
feet in diameter, and may also include electronic controllers, waveguides,
polarizers, combiners, special mounting features, motor drives, position
indicators, transmitters and receivers. Andrew earth station antenna systems in
all sizes are used in various countries to broadcast and transmit programs, both
to CATV operators and to VHF or UHF broadcast stations, as well as long distance
transmission of conventional telecommunications traffic.
GOVERNMENT BUSINESS
Defense Electronics:
Andrew manufactures electronic scanning and communication receiver systems,
which are designed to search and monitor the electromagnetic spectrum from 20
MHz to 40 GHz. These systems are purchased primarily for intelligence gathering
in strategic surveillance operations which emphasize highly sensitive reception
of weak signals as well as accuracy of signal analysis data. The Company's
highly automated receiver systems are subsystems that are incorporated into
fully-integrated systems which, in addition to the Company's receiving and
analyzing equipment, include antennas and other equipment necessary to carry out
the overall electronic reconnaissance operation.
The Company is also engaged in the supply of fully integrated electronic
surveillance systems, both for military radar reconnaissance and for
non-military communications monitoring. These surveillance systems are custom
designed by the Company's engineering staff to meet customer requirements.
Other Products:
The Company also supplies specialized microwave antenna systems to
governmental agencies and the military. In addition, coaxial cables are used in
military countermeasure devices, radar and specialized instrumentation
applications.
Earth station antenna systems and special application antennas are used for
broadcasting programs and operational traffic to military bases and telemetry
traffic associated with widely dispersed environmental monitoring stations.
Andrew also manufactures pedestals and electronic controls for radio frequency
and optical systems used in military and defense markets.
NETWORK BUSINESS
Andrew designs, manufactures and markets advanced connectivity solutions
for IBM mainframe, and token ring systems. Products include protocol convertors,
local area network (LAN) gateways, terminal emulators, file transfer software,
multistation access units, adapter cards, repeaters, bridges and routers. In
addition, Andrew supplies channel interface products which provide direct
channel links between IBM or plug-compatible host computers and non-IBM devices
and networks, terminal to mainframe computer adapters and emulators for PCs and
printers, emulation for Macintosh devices and wiring products such as baluns and
star panels that provide cost-effective wiring connections for network
communications equipment.
<PAGE>
INTERNATIONAL ACTIVITIES
Andrew's international operations represent a substantial portion of its
overall operating results and asset base. Manufacturing facilities are located
in Canada, Australia, and the United Kingdom. Andrew's plants in the United
States also ship significant amounts of manufactured goods to export markets. In
Russia, Andrew participates in joint ventures that operate fiber optic
telecommunication networks and manufacture sophisticated microwave antennas.
During fiscal 1994 sales of products exported from the United States or
manufactured abroad were $244,785,000 or 44% of total sales compared with
$175,811,000 (41%) in fiscal 1993 and $167,972,000 (38%) in fiscal 1992. Exports
from the United States amounted to $101,829,000 in fiscal 1994, $54,253,000 in
fiscal 1993, and $49,482,000 in fiscal 1992.
Sales and income before income taxes on a country-by-country basis can vary
considerably year to year. Further information on Andrew's international
operations is contained in the note "Geographic Area Information" to
Consolidated Financial Statements included on page 32 of the 1994 Annual Report
to Stockholders, incorporated herein by reference.
Andrew's international operations are subject to a number of risks
including currency fluctuations, changes in foreign governments and their
policies, and expropriation or requirements of local or shared ownership. Andrew
believes that the geographic dispersion of its sales and assets tends to
mitigate these risks.
MARKETING AND DISTRIBUTION
COMMERCIAL BUSINESS
Sales engineering functions, including product application assistance, are
performed by a staff of highly trained applications engineers located at each
manufacturing facility. In addition, field sales engineers are located at or
near Atlanta, Dallas, Los Angeles, New York, San Francisco, Washington, D.C.,
Essen and Munich (Germany), London (England), Madrid (Spain), Mexico City
(Mexico), Milan (Italy), Paris (France), Tokyo (Japan), and Zurich
(Switzerland). Unlike most of its competitors, Andrew uses its own sales and
sales engineering staffs to service its principal markets, but follows the
traditional practice of using commissioned sales agents in countries with modest
sales potential.
Approximately one-half of Andrew's products are sold directly to end users.
Most of the remainder is sold to radio equipment companies which install
Andrew's products as part of a total system, with the balance being sold through
dealers and jobbers. Small or medium-size orders are normally shipped from
inventory; delivery schedules on larger orders are negotiated, but seldom exceed
five months. Andrew's sales are principally standard, proprietary items although
unique specifications or features are incorporated for special order situations.
Because most of Andrew's business is derived from large telecommunications
system operators and the radio equipment manufacturers who supply this industry,
Andrew has tailored its business strategy to serve the needs of technically
sophisticated buyers. In particular, Andrew has emphasized the compatibility of
antennas, transmission lines and related components in order to optimize their
performance as an integrated subsystem.
<PAGE>
GOVERNMENT BUSINESS
The specialized needs of the Company's customers and the technology
required to meet those needs change constantly. Accordingly, the Company
stresses its engineering, installation, service and other support capabilities
to its government and military customers. To provide close communication with
these customers and to discern developments and trends in procurement
requirements, the Company has established a team of sales engineers located in
five offices in the United States and one office in the United Kingdom. The
Company also utilizes sales representatives in the United Kingdom, Germany and
the Middle East. In addition, technical program support and direct sales
engineering are performed at each location. The Company places great emphasis in
its marketing on extensive personal contact and continuous consultation with its
customers in an attempt to meet current technical requirements and anticipated
future requirements and to learn of upcoming procurement programs in which its
products may have application.
NETWORK BUSINESS
The Company's Network business emphasizes support of three major computer
connectivity market segments: mainframe interface, microcomputer to IBM midrange
access, and token ring local area networking (LAN). Due to the specialized
customer needs within these markets, each area has distinct marketing and
distribution channels. Mainframe products are sold to Original Equipment
Manufacturers (OEMs) and a select group of specialized system integrators whose
focus is on the mainframe computer user. In the midrange area, the Company
concentrates on a large group of highly specialized midrange computer dealers,
and Value-Added Resellers (VARs). LAN products are sold through a distribution
network of VARs, resellers and telesales. In addition, Andrew maintains business
partner relationships with a select group of systems integrators in order to
provide strong high-end product support channels for customers. Service and
technical support is an integral part of the Company's sales program for all
product groups and is provided either by the VAR or directly by the factory.
MAJOR CUSTOMERS
Andrew serves more than 6,000 customers in more than 100 countries. In the
last three years, aggregate sales to the ten largest customers averaged
approximately 25% of aggregate consolidated sales. No single customer has
accounted for over 10% of consolidated annual sales in any of the last three
years.
In fiscal 1994, 1993 and 1992 direct and indirect sales to U.S.
governmental agencies amounted to $27,840,000, $31,257,000, and $38,295,000,
respectively.
MANUFACTURING AND RAW MATERIALS
Andrew generally develops, designs, fabricates, manufactures and assembles
the products which it sells. In the Commercial business, cable and waveguide
products are produced at its plants in Illinois and the United Kingdom.
Parabolic antenna reflectors are manufactured primarily in Texas.
Self-supporting and guyed towers are also manufactured in Texas. Equipment
shelters are manufactured in Texas and Georgia.
<PAGE>
Andrew's defense electronic products are manufactured in plants located in
Texas and Australia. The Company's products are manufactured from both standard
components and parts that are built to the Company's specifications by other
manufacturers. A large number of the Company's products contain multiple
microprocessors for which proprietary machine readable software is designed by
the Company's engineers and technicians.
Network products are produced at plants in California, Texas and
Washington. The production process principally entails assembly of electronic
components.
Andrew considers its sources of supply for all raw materials to be adequate
and is not dependent upon any single supplier for any significant portion of
materials used in its products.
RESEARCH AND DEVELOPMENT
Andrew believes that the successful marketing of its products depends upon
its research, engineering and production skills. Research and development
activities are undertaken for new product development and for product and
manufacturing process improvement. In fiscal 1994, 1993 and 1992 Andrew spent
$25,707,000, $22,011,000, and $20,156,000, respectively on research and
development activities.
Andrew holds approximately 241 active patents expiring at various times
between 1995 and 2011, relating to its products and attempts to obtain patent
protection for significant developments whenever possible. The Company does not
consider patents to be material to its operations nor would the loss of any
patents have a materially adverse effect on operations.
COMPETITION
COMMERCIAL
Many large manufacturers of electrical or radio equipment, some of which
have substantially greater financial resources than Andrew, compete with a
portion of Andrew's antenna systems equipment and coaxial cable product lines.
In addition, there are a number of small independent companies that compete with
portions of these product lines. Andrew has traditionally focused on specific
specialized fields within the marketplace which require sophisticated technology
and support services. Andrew competes principally on the basis of product
quality, service, and continual technological enhancement of its products.
GOVERNMENT
There are numerous manufacturers of electronic radar systems, communication
reconnaissance systems and specialized antenna systems that supply their
equipment to United States government agencies and friendly foreign governments.
There is substantial competition within the market and the Company is not a
major competitor. Due to fixed-price contracts and pre-defined contract
specifications prevalent within this market, the Company competes primarily on
the basis of its ability to provide state-of-the-art solutions in this
technologically demanding marketplace while maintaining its competitive pricing.
NETWORK
Within the corporate network communications market, Andrew's principal
competitor is IBM which provides similar products across Andrew's product line.
There are also numerous other manufacturers that compete with portions of
Andrew's product line. Andrew's principal bases of competition within this
market are product quality and reliability and product support.
<PAGE>
BACKLOG AND SEASONALITY
The following table sets forth the backlog of orders believed to be firm in
each of Andrew's businesses (government orders included herein are funded
orders):
<TABLE>
<CAPTION>
$000
Orders to be Shipped as of September 30
1994 1993
---------------------- ----------------------
After After
12 Months 12 Months 12 Months 12 Months
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Commercial $65,200 $ 600 $62,900 $ 700
Government 16,900 0 20,200 900
Network 900 0 1,200 0
Other 900 0 1,200 0
------- ------- ------- -------
$83,900 $ 600 $85,500 $ 1,600
======= ======= ======= =======
</TABLE>
In the Commercial and Government businesses, Andrew can experience
quarterly fluctuations in the level of sales. The variability in recent years
has been demonstrated by typically higher sales and net income in the second six
months of the fiscal year, particularly in the fiscal fourth quarter. The
primary reason for this pattern is the need of northern hemisphere customers to
complete installations during warm weather months. The fiscal fourth quarter can
also be affected by the timing of sales to U.S. governmental agencies. Other
factors which can cause quarterly fluctuations in net sales and net income
include variability of shipments under large contracts and variations in product
mix and in profitability of individual orders. These variations can be expected
to continue in the future. Consequently, it is more meaningful to focus on
annual rather than interim results.
ENVIRONMENT
The Company engages in a variety of activities to comply with various
federal, state and local laws and regulations involving the protection of the
environment. Compliance with such regulations does not currently have a
significant effect on the Company's capital expenditures, earnings, or
competitive position. In addition, the Company has no knowledge of any
environmental condition(s) which might individually or in the aggregate have a
material adverse effect on the Company's financial condition.
EMPLOYEES
At September 30, l994, Andrew had 3096 employees, of whom 2445 were located
in the United States. None of Andrew's employees are subject to collective
bargaining agreements. As a matter of policy, Andrew seeks to maintain good
relations with employees at all locations and believes that such relations are
good.
<PAGE>
REGULATION
Andrew is not directly regulated by any governmental agency in the United
States. Most of its customers and the telecommunications industry generally, are
subject to regulation by the Federal Communications Commission (the "FCC"). The
FCC controls the allocation of transmission frequencies and the performance
characteristics of earth station antennas. As a result of these controls,
Andrew's antenna design specifications must be conformed on an ongoing basis to
meet FCC requirements. This regulation has not adversely affected Andrew's
operations.
Outside of the United States, where many of Andrew's customers are
government owned and operated entities, changes in government economic policy
and communications regulation have affected in the past, and may be expected to
affect in the future, the volume of Andrew's non-U.S. business. However, the
effect of regulation in countries other than the U.S. in which Andrew does
business has generally not been detrimental to Andrew's non-U.S. operations
taken as a whole.
GOVERNMENT CONTRACTS
Andrew performs work for the United States Government primarily under
fixed-price prime contracts and subcontracts. Under fixed-price contracts,
Andrew realizes any benefit or detriment occasioned by lower or higher costs of
performance. Total direct and indirect sales to agencies of the United States
Government, which are generally fixed-price contracts, were $27,840,000 in 1994,
$31,257,000 in 1993, and $38,295,000 in 1992. These contracts are typically less
than 12 months in duration.
Andrew, in common with other companies which derive a portion of their
revenues from the United States Government, is subject to certain basic risks,
including rapidly changing technologies, changes in levels of defense spending,
and possible cost overruns. Recognition of profits is based upon estimates of
final performance which may change as contracts progress. Contract prices and
costs incurred are subject to Government Procurement Regulations, and costs may
be questioned by the Government and are subject to disallowance.
All United States Government contracts contain a provision that they may be
terminated at any time for the convenience of the Government. In such event, the
contractor is entitled to recover allowable costs plus any profits earned to the
date of termination.
<PAGE>
ITEM 2-PROPERTIES
Andrew has fourteen manufacturing facilities, thirty-four engineering and
sales administration locations and two distribution facilities. All are equipped
with appropriate office space. Andrew's executive offices are located at the
facility in Orland Park, Illinois. The following table sets forth certain
information regarding significant facilities:
<TABLE>
<CAPTION>
Approximate
floor area in
Location square feet Principal Use Owned/Leased
- - - -------- --------- ------------- ------------
<S> <C> <C> <C>
Orland Park, Illinois 554,000 Commercial and Government Owned
Denton, Texas 190,000 Commercial and Government Owned
Newnan, Georgia 103,000 Commercial Owned
Garland, Texas 85,000 Government Owned
Torrance, California 43,000 Network Leased
-------
U.S. sub-total 975,000
Whitby, Ontario, Canada 92,000 Commercial and Government Owned
Campbellfield, Victoria, Australia 115,000 Commercial and Government Owned
Lochgelly, Fife, United Kingdom 132,000 Commercial and Government Owned
Bachenbulach, Switzerland 6,000 Commercial and Government Leased
-------
Non U.S. sub-total 345,000
---------
TOTAL 1,320,000
=========
<FN>
The Company's properties are in good condition and are suitable for the purpose
for which they are used.
</FN>
</TABLE>
Andrew owns a total of 664 acres of land. Of this total, 565 acres are
unimproved, including 181 acres in Orland Park, Illinois, 137 acres in Floyd,
Texas, l43 acres in Denton, Texas, and 98 acres in Ashburn, Ontario, Canada.
Andrew also leases sales offices and facilities in the United States and in
eleven countries outside the United States.
ITEM 3-LEGAL PROCEEDINGS
Andrew is not involved in any pending legal proceedings which are expected to
have a materially adverse effect on its financial position, nor is it aware of
any proceedings of this nature or relating to the protection of the environment
contemplated by governmental authorities.
ITEM 4-SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
There were no matters which required a vote of security holders during the
three months ended September 30, l994.
<PAGE>
PART II
ITEM 5-MARKET FOR THE REGISTRANT'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS
The Company's Common Stock is traded over-the-counter on the Nasdaq National
Market.
The Company had 2,113 holders of common stock of record at December 14, 1994.
Information concerning the Company's stock price during the years ended
September 30, l994 and 1993 is incorporated herein by reference from Andrew's
l994 Annual Report to Stockholders, page 34. All prices represent high and low
sales prices as reported by the Nasdaq National Market.
It is the present policy of Andrew's Board of Directors to retain earnings in
the business to finance the Company's operations and investments; and the
Company does not anticipate payment of cash dividends in the foreseeable future.
Long-term debt agreements include restrictive covenants which, among other
things, provide restrictions on dividend payments. At September 30, l994,
$138,000,000 was not restricted for purposes of such payments.
ITEM 6-SELECTED FINANCIAL DATA
Selected financial data for the last five fiscal years is incorporated herein
by reference to the l994 Annual Report to Stockholders, pages 36 and 37.
ITEM 7-MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Information concerning this item is incorporated herein by reference from the
l994 Annual Report to Stockholders, pages 16 through 20.
ITEM 8-FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The Consolidated Financial Statements of the Company, Notes to Consolidated
Financial Statements, Selected Quarterly Financial Information and the report
theron of the independent auditors are incorporated herein by reference to the
1994 Annual Report to Stockholders, pages 21 through 35.
ITEM 9-CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURES
None
PART III
ITEM 10-DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
Information concerning directors and executive officers of the Registrant is
incorporated herein by reference from the Company's l994 Proxy Statement under
the captions "Election of Directors" and "Executive Officers."
ITEM 11-EXECUTIVE COMPENSATION
Information concerning management compensation is incorporated herein by
reference from the Company's l994 Proxy Statement under the caption "Executive
Compensation."
<PAGE>
ITEM 12-SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Information concerning security ownership of certain beneficial owners and
management is incorporated herein by reference from the Company's l994 Proxy
Statement under the caption "Security Ownership."
ITEM 13-CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Information concerning certain relationships and related transactions is
incorporated herein by reference from the Company's 1994 Proxy Statement under
the caption "Security Ownership."
<PAGE>
PART IV
ITEM 14-EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a) (1)The following consolidated financial statements of Andrew
Corporation and subsidiaries, included in the l994 Annual Report to
Stockholders, are incorporated by reference in Item 8:
Consolidated Statements of Income
years ended September 30, l994, 1993 and l992..................page 21
Consolidated Balance Sheets
September 30, l994 and 1993............................pages 22 and 23
Consolidated Statements of Cash Flows
years ended September 30, l994, l993 and l992..................page 24
Consolidated Statements of Stockholders' Equity
years ended September 30, l994, 1993 and l992..................page 25
Notes to Consolidated Financial Statements...........pages 26 through 33
Selected Quarterly Financial Information.........................page 34
Report of Independent Auditors...................................page 35
(2)The following consolidated financial statement schedules of
Andrew Corporation and subsidiaries are included in Item l4(d):
Schedule VIII--Valuation and Qualifying Accounts and Reserves
Schedule IX--Short-Term Borrowings
Schedule X--Supplementary Income Statement Information
All other schedules for which provision is made in the applicable
accounting regulation of the Securities and Exchange Commission are not
required under the related instructions or are inapplicable and,
therefore, have been omitted.
<PAGE>
ITEM 14 CONT.
(3) EXHIBIT LISTING:
<TABLE>
<CAPTION>
Exhibit No. Description Reference
----------- ----------- ---------
<S> <C> <C>
3.1(i) Certificate of Incorporation
3.1(ii) By-Laws of Registrant
4.(a) Note Agreement dated Filed as Exhibit 4(a) to Form 10-K for fiscal year ended
September 1, 1990 September 30, 1990 and incorporated herein by reference.
4.(a)a First Amendment to Note Filed as Exhibit 4(a)a to Form 10-K for fiscal year ended
Agreement dated September 30, 1992 and incorporated herein by reference.
September 1, 1990
4.(b) Stockholder Rights Agreement Filed as Exhibit 4(b) to Form 10-K for fiscal year ended September
dated September 22, 1988 30, 1993 and incorporated herein by reference.
9 Voting Trust Agreement Filed as Exhibit 9 to Form 10-K for fiscal year ended September 30, 1991
and incorporated herein by reference.
10.(a) Executive Severance Benefit Plan Filed as Exhibit 10(b)a to Form 10-K for fiscal year ended
(i) Agreement with Floyd L. English September 30, 1991 and incorporated herein by reference.
(ii) Agreement with Eric L. Brooker
(iii) Agreement with Charles R. Nicholas
(iv) Agreement with Ernest T. Weber
10.(a)a Executive Severance Benefit Plan Filed as Exhibit 10(a)a to Form 10-K for fiscal year ended
(i) Agreement with Thomas E. Charlton September 30, 1993 and incorporated herein by reference.
(ii) Agreement with John B. Scott
(iii) Agreement with William L. Shockley
10.(b) Management Incentive Plan Filed as Exhibit 10(c) to Form 10-K for fiscal year ended
dated February 4, 1988 September 30, 1993 and incorporated herein by reference.
10.(c) Non-employee Directors' Filed as Exhibit 10(d) to Form 10-K for fiscal year ended
Stock Option Plan dated September 30, 1993 and incorporated herein by reference.
February 4, 1988
10.(d) Credit Agreement dated as of Filed as Exhibit 10(e) to Form 10-K for fiscal year ended
June 16, 1993 September 30, 1993 and incorporated herein by reference.
10.(e) 1994 Employee Stock Purchase Filed with Proxy statement in connection with
Plan Annual Meeting held February 2, 1994.
11 Computation of Earnings
per Share
l3 l994 Annual Report to Those portions of the 1994 Annual Report to Shareholders
Stockholders expressly incorporated herein by reference.
21 List of Significant Subsidiaries
22 Proxy Statement in connection
with Annual Meeting to be held
on February 8, 1995 (To be
filed within 120 days of the
Registrant's fiscal year end.)
23 Independent Auditors' Consent
27 Financial Data Schedules
</TABLE>
(b) There were no reports on Form 8-K filed during the three months ended
September 30, 1994.
<PAGE>
REPORT OF INDEPENDENT AUDITORS
To the Stockholders and Board of Directors
Andrew Corporation
We have audited the consolidated financial statements and related schedules of
Andrew Corporation and subsidiaries listed in Item 14(a)(1) and (2) of the
annual report on Form 10-K of Andrew Corporation for the year ended September
30, 1994. These financial statements and related schedules are the
responsibility of the Company's management. Our responsibility is to express
an opinion on these financial statements and related schedules 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 and related
schedules are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements and related schedules. 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, the consolidated financial statements referred to above present
fairly, in all material respects, the consolidated financial position of Andrew
Corporation and subsidiaries at September 30, 1994 and 1993, and the
consolidated results of their operations and their cash flows for each of the
three years in the period ended September 30, 1994 in conformity with generally
accepted accounting principles. Also, in our opinion, the related financial
statement schedules, when considered in relation to the basic financial
statements taken as a whole, present fairly in all material respects the
information set forth therein.
/s/ Ernst & Young LLP
Chicago, Illinois
November 17, 1994
<PAGE>
SCHEDULE VIII--VALUATION AND QUALIFYING ACCOUNTS AND RESERVES
ANDREW CORPORATION AND SUBSIDIARIES
(Dollars in thousands)
<TABLE>
<CAPTION>
COL. A COL. B COL. C COL. D COL.E
Additions
---------
Charged
Balance Charged to to Other Balance
Beginning Costs and Accounts-- Deductions-- at End
of Period Expenses Describe Describe<F1> of Period
--------- ---------- ---------- ------------ ---------
<S> <C> <C> <C> <C> <C>
Year ended
September 30, l994:
Allowance for
doubtful accounts $3,167 $1,571 $ - $1,969 $2,769
====== ====== ====== ====== ======
Year ended
September 30, 1993:
Allowance for
doubtful accounts $3,190 $1,636 $ - $1,659 $3,167
====== ====== ====== ====== ======
Year ended
September 30, l992:
Allowance for
doubtful accounts $2,460 $1,740 $ - $1,010 $3,190
====== ====== ====== ====== ======
<FN>
<F1>
Note A: Represents write-offs, net of recoveries.
</FN>
</TABLE>
<PAGE>
SCHEDULE IX--SHORT-TERM BORROWINGS
ANDREW CORPORATION AND SUBSIDIARIES
(Dollars in thousands)
<TABLE>
<CAPTION>
COL. A COL. B COL. C COL. D COL. E COL. F
Maximum Average Weighted
Weighted Amount Amount Average
Balance Average Outstanding Outstanding Interest
Category of Aggregate at End Interest During the During the Rate During
Short-Term Borrowings of Period Rate Period Period the Period
- - - --------------------- --------- ----- ------ ------ ----------
<S> <C> <C> <C> <C> <C>
<F1> <F2>
Year ended September 30, l994:
Notes payable to banks
$ - - $ 21,000 $ 3,433 4.0%
Year ended September 30, 1993:
Notes payable to banks
$ - - $ 12,500 $ 3,400 3.8%
Year ended September 30, l992:
Notes payable to banks
$ 8,000 3.8% $ 19,000 $ 1,788 3.8%
<FN>
<F1>
Represents average daily balance.
<F2>
Computed by dividing actual interest on notes payable to banks by
the average amount of notes payable outstanding during the period.
</FN>
</TABLE>
<PAGE>
SCHEDULE X--SUPPLEMENTARY INCOME STATEMENT INFORMATION
ANDREW CORPORATION AND SUBSIDIARIES
(Dollars in thousands)
<TABLE>
<CAPTION>
Year ended September 30
1994 1993 1992
---- ---- ----
<S> <C> <C> <C>
Maintenance and repairs $6,335 $4,439 $4,812
Rental expense 6,977 6,179 6,236
<FN>
Note: Depreciation and amortization of intangible assets; preoperating costs and
similar deferrals; taxes, other than payroll and income taxes; royalties;
and advertising did not exceed l% of net sales.
</FN>
</TABLE>
<PAGE>
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 December 22, 1994.
Andrew Corporation
By \s\ Floyd L. English
--------------------
Floyd L. English
Chairman, President and
Chief Executive Officer
By \s\ Charles R. Nicholas
-----------------------
Charles R. Nicholas
Vice President, Finance
and Administration and
Chief Financial Officer
By \s\ Gregory F. Maruszak
-----------------------
Gregory F. Maruszak
Vice President and Controller
Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below on December 22, 1994, by the following persons on behalf
of the Registrant in the capacities indicated.
\s\ John G. Bollinger \s\ Donald N. Frey
- - - --------------------------- -----------------------------------
John G. Bollinger Donald N. Frey
Director Director
\s\ Jon L. Boyes \s\ Carole M. Howard
- - - --------------------------- -----------------------------------
Jon L. Boyes Carole M. Howard
Director Director
\s\ George N. Butzow \s\ Ormand J. Wade
- - - --------------------------- -----------------------------------
George N. Butzow Ormand J. Wade
Director Director
\s\ Kenneth J. Douglas
- - - ---------------------------
Kenneth J. Douglas
Director
<PAGE>
ANDREW CORPORATION
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Description
- - - ----------- -----------
<S> <C>
3.1(i) Certificate of Incorporation
3.1(ii) By-Laws
11. Computation of Earnings per Share
13. Portions of 1994 Annual Report to Stockholders
Incorporated by Reference
21. List of Significant Subsidiaries
23. Independent Auditors' Consent
27. Financial Data Schedule
</TABLE>
CERTIFICATE OF INCORPORATION
OF
ANDREW MERGING CORPORATION
ARTICLE I
The name of the corporation (hereinafter called the "Corporation") is
Andrew Merging Corporation.
ARTICLE II
The address of the Corporation's registered office in the State of
Delaware is 1209 Orange, City of Wilmington, County of New Castle. The name of
the Corporation's registered agent at such address is The Corporation Trust
Company.
ARTICLE III
The purpose for which the corporation is organized is: to engage in any
lawful act or activity for which a corporation may be organized under the
General Corporation Law of Delaware.
ARTICLE IV
The total number of shares of all classes of stock which the Corporation
shall have authority to issue is 1,000 shares of Common Stock, $.01 par value
("Common Stock"). Holders of Common Stock shall have one vote in respect of
each share held by them.
ARTICLE V
BOARD OF DIRECTORS
SECTION 1. NUMBER. The business and affairs of the Corporation shall be
managed under the direction of the Board of Directors which shall consist of not
less than six and not more than eleven persons, with the specific number to be
determined by resolution of the Board of Directors.
SECTION 2. TERMS. Each director shall hold office until the next Annual
Meeting of Stockholders after his election or until his successor is elected
and qualified or until his earlier resignation or removal.
<PAGE>
SECTION 3. STOCKHOLDER NOMINATIONS OF DIRECTOR CANDIDATES. Advance
notice of stockholder nominations for the election of directors shall be given
in the manner provided in the By-Laws of the Corporation.
SECTION 4. NEWLY CREATED DIRECTORSHIPS AND VACANCIES. Newly created
directorships resulting from any increase in the authorized number of directors
or any vacancies in the Board of Directors resulting from death, resignation,
retirement, disqualification, removal from office or other cause shall be filled
by a majority vote of the directors then in office, though less than a quorum,
and directors so chosen shall hold office for a term expiring at the next Annual
Meeting of Stockholders.
SECTION 5. REMOVAL. Any director, or the entire Board of Directors, may be
removed from office at any time, with or without cause, by the affirmative vote
of the holders of a majority of the voting power of all of the shares of the
Corporation entitled to vote generally in the election of directors, voting
together as a single class.
ARTICLE VI
STOCKHOLDER ACTION
Any action required or permitted to be taken by the stockholders of the
corporation must be effected at a duly called annual or special meeting of
stockholders of the Corporation and may not be effected by consent in writing by
such stockholders. Except as otherwise required by law, special meetings of
stockholders of the Corporation may be called only by the Board of Directors
pursuant to a resolution approved by a majority of the entire Board of
Directors.
ARTICLE VII
BY-LAWS AMENDMENTS
The Board of Directors shall have power to make, alter, amend and repeal
the By-Laws of the Corporation (except so far as the By-Laws of the Corporation
adopted by the Stockholders shall otherwise provide). Any By-Laws made by the
Board of Directors under the powers conferred hereby may be altered, amended or
repealed by the Board of Directors or by the stockholders.
<PAGE>
ARTICLE VIII
ACQUISITIONS PROPOSALS
In determining whether an "acquisition proposal" is in the best interests
of the Corporation and its stockholders, the Board of Directors shall consider
all factors it deems relevant including, without limitation:
A. the consideration being offered in the acquisition proposal, not only
in relation to the then current market price, but also in relation to the
then current value of the Corporation in a freely negotiated transaction
and in relation to the Board of Directors' estimate of the future value of
the Corporation as an independent entity, and
B. the social, legal and economic effects upon employees, suppliers,
customers and on the communities in which the Corporation is located, as
well as the long-term business prospects of the Corporation.
"Acquisitions proposal" means any proposal of any person (i) for a tender offer,
exchange offer or any other method of acquiring any equity securities of the
Corporation with a view to acquiring control of the Corporation, (ii) to merge
or consolidate the Corporation with another corporation, (iii) to purchase or
otherwise acquire all or substantially all the properties and assets of the
Corporation.
This Section shall not be interpreted to create any rights on behalf of third
persons, such as employees, suppliers or customers.
ARTICLE IX
SECTION 1. ELIMINATION OF CERTAIN LIABILITY OF DIRECTORS. A director of
the Corporation shall not be personally liable to the Corporation or its
stockholders for monetary damages for the breach of fiduciary duty as a
director, except for liability (i) for any breach of the director's duty of
loyalty to the Corporation or its stockholders, (ii) for acts or omissions not
in good faith or which involve intentional misconduct or a knowing violation of
law, (iii) under Section 174 of the Delaware General Corporation Law, or (iv)
for any transaction from which the director derived an improper personal
benefit.
SECTION 2. INDEMNIFICATION AND INSURANCE.
A. RIGHT TO INDEMNIFICATION. Each person who was or is made 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
(hereinafter a "proceeding"), by reason of the fact that he or she, or a
person of whom he or she is the legal representative, is or was a
director or officer of the Corporation or, if a director or officer of
the Corporation, is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation or of a
partnership, joint venture, trust or other enterprise, including service
with respect to employee benefit plans, whether the basis of such
proceeding is alleged action in an official capacity as a director or
officer or in any other capacity while serving as a director or officer,
shall be indemnified and held harmless by the Corporation to the fullest
extent authorized by the Delaware General Corporation Law, as the same
exists or may hereafter be amended (but, in the case of any such
amendment, only to the extent that such amendment permits the Corporation
to provide broader indemnification rights than said law permitted the
Corporation to provide prior to such amendment), against all expense,
liability and loss (including attorneys' fees, judgments, fines, ERISA
excise taxes or penalties and amounts paid or to be paid in settlement)
reasonably incurred or suffered by such person in connection therewith
and such indemnification shall continue as to a person who has ceased to
be a director or officer and shall inure to the benefit of his or her
heirs, executors and administrators; provided, however, that, except as
provided in paragraph B hereof, the Corporation shall indemnify any such
person seeking indemnification in connection with a proceeding (or part
thereof) initiated by such person only if such proceeding (or part
thereof) was
<PAGE>
authorized by the Board of Directors of the Corporation. The right to
indemnification conferred in this Section shall be a contract right and
shall include the right to be paid by the Corporation the expenses
incurred in defending any such proceeding in advance of its final
disposition; provided, however, that, if the Delaware General Corporation
Law requires, the payment of such expenses incurred by a director or
officer in his or her capacity as a director or officer (and not in any
other capacity in which service was or is rendered by such person while a
director or officer, including, without limitation, service to an employee
benefit plan) in advance of the final disposition of a proceeding, shall
be made only upon delivery to the Corporation of an undertaking, by or on
behalf of such director or officer, to repay all amounts so advanced if it
shall ultimately be determined that such director or officer is not
entitled to be indemnified under this section or otherwise. The
Corporation may, by action of its Board of Directors, provide
indemnification to employees and agents of the Corporation with the same
scope and effect as the foregoing indemnification of directors and
officers.
B. RIGHT OF CLAIMANT TO BRING SUIT. If a claim under paragraph A of
this Section is not paid in full by the Corporation within thirty days
after a written claim has been received by the Corporation, the Claimant
may at any time thereafter bring suit against the Corporation to recover
the unpaid amount of the claim and, if successful in whole or in part,
the claimant shall be entitled to be paid also the expense of prosecuting
such claim. It shall be a defense to any such action (other than an
action brought to enforce a claim for expenses incurred in defending any
proceeding in advance of its final disposition where the required
undertaking, if any is required, has been tendered to the Corporation)
that the claimant has not met the standards of conduct which make it
permissible under the Delaware General Corporation Law for the
Corporation to indemnify the claimant for the amount claimed, but the
burden of providing such defense shall be on the Corporation. Neither the
failure of the Corporation (including its Board of Directors,
stockholders or independent legal counsel) to have made a determination
prior to the commencement of such action that indemnification of the
claimant is proper in the circumstances because he or she has met the
applicable standard of conduct set forth in the Delaware General
Corporation Law, nor an actual determination by the Corporation
(including its Board of Directors, stockholders or independent legal
counsel) that the claimant has not met such applicable standard of
conduct, shall be a defense to the action or create a presumption that
the claimant has not met the applicable standard of conduct.
C. NON-EXCLUSIVITY OF RIGHTS. The right to indemnification and the
payment of expenses incurred in defending a proceeding in advance of its
final disposition conferred in this Section shall not be exclusive of any
other right which any person may have or hereafter acquire under any
statute, provision of the Certificate of Incorporation, By-law,
agreement, vote of stockholders or disinterested directors or otherwise.
D. INSURANCE. The corporation may maintain insurance, at its
expense, to protect itself and any director, officer, employee or agent
of the Corporation or another corporation, partnership, joint venture,
trust or other enterprise against any such expense, liability or loss,
whether or not the Corporation would have the power to indemnify such
person against such expense, liability or loss under the Delaware General
Corporation Law.
ARTICLE X
The name and mailing address of the incorporator of the Corporation is
Robin Mariella, Suite 3300, One First National Plaza, Chicago, Illinois
60603.
The undersigned, being the sole incorporator hereinafter named, for the
purpose of forming a corporation pursuant to the General Corporation Law
of the State of Delaware, does make this Certificate of Incorporation,
hereby declaring and certifying that this is her act and deed and the
facts herein stated are true, and accordingly has set her hand this 20th
day of November, 1986.
/s/ Robin Mariella
------------------
Robin Mariella
<PAGE>
CERTIFICATE OF MERGER
OF
ANDREW CORPORATION
INTO
ANDREW MERGING CORPORATION
Andrew Merging Corporation, a Delaware corporation, hereby certifies that:
FIRST: The name and state of incorporation of each of the constituent
corporations is as follows:
State of
Name Incorporation
---- -------------
Andrew Corporation Illinois
Andrew Merging Corporation Delaware
SECOND: An Agreement and Plan of Merger dated December 18, 1986 has been
approved, adopted, certified, executed and acknowledged by each of the
constituent corporations in accordance with the requirements of Section
252(c) of the General Corporation Law of the State of Delaware.
THIRD: The name of the surviving corporation is Andrew Merging
Corporation, which shall be changed herein to Andrew Corporation.
FOURTH: The Certificate of Incorporation of Andrew Merging Corporation as
in effect on the date of filing of this certificate shall be the
Certificate of Incorporation of the surviving corporation, with the
following amendments:
(a) Article I of the Certificate of Incorporation of Andrew
Merging Corporation shall be amended to read in its entirety as
follows: "The name of the corporation (hereinafter called the
"Corporation") is Andrew Corporation."
(b) Article IV of the Certificate of Incorporation of Andrew Merging
Corporation shall be amended to read in its entirety as follows: "The
total number of shares of all classes of stock which the Corporation
shall have authority to issue is 30,000,000 shares of Common Stock,
$.01 par value ("Common Stock"). Holders of Common Stock shall have
one vote in respect of each share held by them."
FIFTH: The executed Agreement and Plan of Merger is on file at the
principal place of business of the surviving corporation, the address of
which is 10500 West 153rd Street, Orland Park, Illinois 60462.
SIXTH: A copy of the Agreement and Plan of Merger will be furnished by
the surviving corporation, on request and without cost, to any stockholder
of either constituent corporation.
SEVENTH: The authorized capital stock of Andrew Corporation is 30,000,000
shares of Common Stock, $1.00 par value.
IN WITNESS WHEREOF, Andrew Merging Corporation has caused this certificate
to be duly executed by its officers thereunto duly authorized this 3rd
day of February, 1987.
ANDREW MERGING CORPORATION
By:/s/ Floyd L. English
--------------------
Floyd L. English
President
ATTEST:
/s/ Charles R. Nicholas
- - - -----------------------
Charles R. Nicholas
Secretary
-2-
<PAGE>
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
ANDREW CORPORATION
ANDREW CORPORATION, a corporation organized and existing under and by
virtue of the General Corporation Law of the State of Delaware (the
"Corporation"), DOES HEREBY CERTIFY:
FIRST: That at a meeting of the Board of Directors of the Corporation
held on November 11, 1993, resolutions were adopted setting forth a proposed
amendment of the Certificate of Incorporation of the Corporation, declaring said
amendment to be advisable and directing that the amendment be considered at the
Annual Meeting of Stockholders of the Corporation to be held February 2, 1994.
The resolution setting forth the proposed amendment is as follows:
"RESOLVED: That Article IV of the Certificate of Incorporation of this
corporation be amended to read in its entirety as follows:
The total number of shares of stock of all classes which
the Corporation shall have authority to issue is 100,000,000 shares
of Common Stock, $.01 par value ('Common Stock'). Holders of Common
Stock shall have one vote in respect of each share held by them."
SECOND: That thereafter, pursuant to resolution of its Board of
Directors, the Annual Meeting of the Stockholders of the Corporation was fully
called and held, upon notice in accordance with Section 222 of the General
Corporation Law of the State of Delaware at which meeting the necessary number
of shares required by Section 242 of the General Corporation Law of the State of
Delaware were voted in favor of the amendment.
THIRD: That said amendment was duly adopted in accordance with the
provisions of Section 242 of the General Corporation Law of the State of
Delaware.
IN WITNESS WHEREOF, ANDREW CORPORATION has caused this certificate to be
signed by Gregory F. Maruszak, its Vice President, Controller, and James F.
Petelle, its Secretary, this 2nd day of February 1994.
ANDREW CORPORATION
By:/s/ Gregory F. Maruszak
------------------------------
Gregory F. Maruszak
Vice President, Controller
ATTEST:
By:/s/ James F. Petelle
--------------------
James F. Petelle
Secretary
BY-LAWS
OF
ANDREW CORPORATION
EFFECTIVE FEBRUARY 5, 1987
AMENDED NOVEMBER 12, 1992
<PAGE>
BY-LAWS
OF
ANDREW CORPORATION
ARTICLE I
OFFICES
SECTION 1. REGISTERED OFFICE AND AGENT. The registered office of the corporation
in the State of Delaware shall be located at 1209 Orange, City of Wilmington,
County of New Castle, and the registered agent at such address is The
Corporation Trust Company. The address of the registered office may be changed
from time to time by the board of directors.
SECTION 2. PRINCIPAL BUSINESS OFFICE. The principal business office of the
corporation shall be located in the State of Illinois at 10500 West 153rd
Street, Orland Park. The address of the principal business office may be changed
from time to time by the board of directors.
SECTION 3. OTHER OFFICES. The corporation may have such other offices from time
to time, either within or without the State of Delaware, as the board of
directors may determine or the business of the corporation may require.
ARTICLE II
STOCKHOLDERS
SECTION 1. ANNUAL MEETING. The annual meeting of the stockholders shall be held
at the hour of 1:30 p.m. on the second Wednesday in January of each year, or, if
such day be a legal holiday, on the next business day following; provided, that
if the board of directors shall determine that in any year it is not advisable
or convenient to hold the meeting at such time on such day, then in such year
the annual meeting shall instead be held at such time and on such other day as
the board of directors shall prescribe. At each annual meeting, the stockholders
shall elect the directors and transact such other business as may properly come
before the meeting. If the election of directors shall not be held on the day
designated herein for any annual meeting, or at any adjournment thereof, the
board of directors shall cause the election to be held at a special meeting of
the stockholders as soon thereafter as conveniently may be.
SECTION 2. SPECIAL MEETINGS. Special meetings of the stockholders may be
called only by the board of directors pursuant to a resolution approved by a
majority of the entire board of directors.
SECTION 3. PLACE OF MEETING. The board of directors may designate any place,
either within or without the State of Delaware, as the place of meeting for any
annual or special meeting of stockholders. If no designation is made, the place
of meeting shall be the principal business office of the corporation, except as
otherwise provided in Section 5 of this Article II.
SECTION 4. NOTICE OF MEETING. Written or printed notice stating the place, day
and hour of the meeting and, in case of a special meeting or a meeting at which
a proposal to merge or consolidate or sell, lease or exchange all or
substantially all of the property and assets of the corporation will be
considered, the purpose or purposes for which the meeting is called, shall be
delivered not less than ten nor more than sixty days before the date of the
meeting, or in the case of a proposal for a merger or consolidation or sale,
lease or exchange of all or substantially all of the property and assets of the
corporation, not less than twenty nor more than sixty days before the date of
the meeting, by or at the direction of the board of directors, the president or
the secretary to each stockholder of record entitled to vote at such meeting. If
mailed, such notice shall be deemed to be delivered when deposited in the United
States mail in a sealed envelope addressed to the stockholder at his address as
it appears on the records of the corporation, with postage thereon prepared.
SECTION 5. WAIVER OF NOTICE. Whenever any notice whatever is required to be
given under the provisions of any statute, the certificate of incorporation or
by-laws of the corporation, a waiver thereof in writing signed by the person or
persons entitled to such notice, whether before or after the time stated
therein, shall be deemed equivalent to the giving of such notice. Attendance at
any meeting shall constitute waiver of notice thereof unless the person attends
the meeting for the express purpose of objecting, at the beginning of the
meeting, to the transaction of any business because the meeting is not lawfully
called or convened.
SECTION 6. NOTICE OF STOCKHOLDER BUSINESS. At any meeting of the stockholders,
only such business may be conducted as shall have been properly brought before
the meeting, and as shall have been determined to be lawful and appropriate for
consideration by stockholders at the meeting. To be properly brought before a
meeting business must be (i) specified in the notice of meeting given in
accordance with Section 4 of this Article II, (ii) otherwise properly brought
before the meeting by or at the direction of the board of directors, the
chairman of the board or the president, or (iii) otherwise properly brought
before the 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
principal business office of the corporation, not later than (i) ninety days in
advance of the anniversary of the prior year's annual meeting with respect to
business to be transacted or an election to be held at an annual meeting of
stockholders, or (ii) the close of business on the tenth day following the date
on which notice of such meeting is first given to stockholders with respect to
business to be transacted or an election to be held at a special meeting of
stockholders. A stockholder's notice to the secretary shall set forth as to each
matter the stockholder proposes to bring before the meeting (i) a brief
description of the business desired to be brought before the meeting, (ii) the
name and address, as they appear on the corporation's stock records, 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
interest of the stockholder in such business. Notwithstanding anything in these
by-laws to the contrary, no business shall be conducted at a meeting except in
accordance with the procedures set forth in this Section 6. The person presiding
at the 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
by-laws, or that business was not lawful or appropriate for consideration by
stockholders at the meeting, and if he should so determine, he shall so declare
to the meeting and any such business shall not be transacted.
SECTION 7. FIXING RECORD DATE. For the purpose of determining stockholders
entitled to notice of or to vote at any meeting of stockholders, or stockholders
entitled to receive payment of any dividend or other distribution or allotment
of any rights, or stockholders entitled to exercise any rights in respect of any
change, conversion or exchange of stock, or in order to make a determination of
stockholders for any other proper purpose, the board of directors of the
corporation may fix, in advance, a date as the record date for any such
determination of stockholders, such date in any case to be not more than sixty
days and, for a meeting of stockholders, not less than ten days, or in the case
of a merger, consolidation, sale, lease or exchange of all or substantially all
of the property and assets of the corporation, not less than twenty days,
immediately preceding such meeting. If no record date is fixed for the
determination of stockholders entitled to notice of or to vote at a meeting of
stockholders, the close of business on the date next preceding the date on which
notice is given, or, if notice is waived, at the close of business on the date
next preceding the date on which the meeting is held, shall be the record date
for such determination of stockholders. If no record date is fixed for the
determination of stockholders for any other purpose, the close of business on
the day on which the board of directors adopts the resolution relating thereto
shall be the record date. When a determination of stockholders entitled to vote
at any meeting of stockholders has been made as provided in this Section 7, such
determination shall apply to any adjournment thereof.
SECTION 8. VOTING LIST. The officer or agent having charge of the stock ledger
for shares of the corporation shall make, at least ten days before each meeting
of stockholders, a complete list of the stockholders entitled to vote at such
meeting, arranged in alphabetical order, with the address of and the number of
shares held by each, which list, for a period of ten days prior to such meeting,
shall be open to the examination of any stockholder, for any purpose germane to
the meeting, during usual business hours. Such list shall also be produced and
kept open at the time and place of the meeting and shall be subject to the
examination of any stockholder during the whole time of the meeting. The stock
ledger shall be the only evidence as to who are the stockholders entitled to
examine such list, stock ledger or books of the corporation, or to vote at any
meeting of stockholders.
SECTION 9. QUORUM. The holders of a majority of the outstanding shares of the
corporation, entitled to vote on a matter, present in person or represented by
proxy, shall constitute a quorum for consideration of such matter at any meeting
of stockholders, unless a greater or lesser number is required by the
certificate of incorporation. In no event shall a quorum consist of less than
one-third of the outstanding shares entitled so to vote; provided, however, that
if less than a majority of the outstanding shares entitled to vote on a matter
are represented at said meeting, a majority of the shares so represented may
adjourn the meeting from time to time without further notice.
SECTION 10. MANNER OF ACTING. The affirmative vote of the holders of a majority
of shares present in person or represented by proxy at a meeting and entitled to
vote on the subject matter shall be the act of the stockholders, unless the vote
of a greater number or voting by class is required by law or the certificate of
incorporation.
SECTION 11. PROXIES. At all meetings of stockholders, a stockholder may vote
by proxy executed in writing by the stockholder or by another person duly
authorized by such stockholder. Such proxy shall be filed with the secretary of
the corporation before or at the time of the meeting. No proxy shall be valid
after three years from the date of its execution, unless otherwise provided
in the proxy.
SECTION. 12. VOTING OF SHARES. Each outstanding share of common stock shall be
entitled to one vote upon each matter submitted to a vote at a meeting of
stockholders.
SECTION 13. VOTING OF SHARES BY CERTAIN HOLDERS. Persons holding stock in a
fiduciary capacity shall be entitled to vote the shares so held. Persons whose
stock is pledged shall be entitled to vote, unless in the transfer by the
pledgor on the books of the corporation he has expressly empowered the pledgee
to vote thereon, in which case only the pledgee, or his proxy, may represent
such stock and vote thereon.
SECTION 14. NO ACTION BY WRITTEN CONSENT. Any action required or permitted to be
taken by the stockholders of the corporation must be effected at a duly called
annual or special meeting of stockholders of the corporation and may not be
effected by consent in writing by such stockholders.
ARTICLE III
DIRECTORS
SECTION 1. NUMBER. The business and affairs of the corporation shall be
managed under the direction of the board of directors which shall consist of not
less than six and not more than eleven persons, with the specific number to be
determined by resolution of the board of directors without further amendment to
these by-laws.
SECTION 2. TERMS. Each director shall hold office until the next annual meeting
of stockholders after his election or until his successor is elected and
qualified or until his earlier resignation or removal.
SECTION 3. NOMINATIONS OF DIRECTOR CANDIDATES. Nominations of persons for
election to the board of directors of the corporation may be made at any meeting
of stockholders by or at the direction of the board of directors or by any
stockholder of the corporation entitled to vote for the election of directors at
the meeting. Stockholder nominations shall be made pursuant to timely notice
given in writing to the secretary of the corporation in accordance with Section
6 of Article II of these by-laws. Such stockholder's notice shall set forth, in
addition to the information required by Section 6 of Article II, as to each
person whom the stockholder proposes to nominate for election or re-election as
a director, (i) the name, age, business address and residence address of such
person; (ii) the principal occupation or employment of such person; (iii) the
class and number of shares of the corporation which are beneficially owned by
such person, if any; and (iv) any other information regarding such person as
would be required to be disclosed in a proxy statement soliciting proxies for
election of directors filed pursuant to Regulation 14A under the Securities
Exchange Act of 1934, as amended (including without limitation such person's
written consent to being named in the proxy statement as a nominee and to
serving as a director if elected). In addition, such stockholder's notice shall
set forth a description of all arrangements or understandings between the
stockholder and each nominee and any other person or persons, naming such person
or persons, pursuant to which the nomination or nominations are to be made by
the stockholder and a representation that the stockholder intends to appear in
person or by proxy at the meeting to nominate the person or persons specified in
the notice.
No stockholder nomination shall be effective unless made in accordance with
the procedures set forth in this Section 2. The person presiding at the meeting
shall, if the facts warrant, determine and declare to the meeting that a
stockholder nomination was not made in accordance with the by-laws, and if he
should so determine, he shall so declare to the meeting and the defective
nomination shall be disregarded.
SECTION 4. REGULAR MEETINGS. A regular meeting of the board of directors shall
be held without notice other than this by-law immediately following the annual
meeting of the stockholders. The board of directors may provide, by resolution,
the date, time and place for holding of additional regular meetings of the board
of directors without other notice than such resolution.
SECTION 5. SPECIAL MEETINGS. Special meetings of the board of directors may be
called by or at the request of the president or any two directors. The person or
persons authorized to call special meetings of the board of directors may fix
the place for holding any special meeting of the board of directors called by
them.
SECTION 6. NOTICE. Notice of any special meeting of the board of directors shall
be given at least two days prior thereto by written notice delivered personally,
by mail, telegram or telex to each director at his business address. If mailed,
such notice shall be deemed to have been delivered when deposited in the United
States mail in a sealed envelope so addressed, with postage thereon prepaid. If
notice is given by telegram, such notice shall be deemed to have been delivered
when the telegram is delivered to the telegraph company. If notice is given by
telex, such notice shall be deemed to have been delivered when the telex message
is delivered to the telex operator. Any director may waive notice of any
meeting. The attendance of a director at any meeting shall constitute a waiver
of notice of such meeting, except when a director attends a meeting for the
express purpose of objecting to the transaction of any business because the
meeting is not lawfully called or convened. Neither the business to be
transacted at, nor the purpose of, any regular or special meeting of the board
of directors need be specified in the notice or waiver of notice of such
meeting.
SECTION 7. QUORUM. A majority of the directors then in office, but not less than
four directors, shall constitute a quorum for the transaction of business at any
meeting of the board of directors, provided, that if less than a majority of the
directors then in office or less than four directors are present at said
meeting, a majority of the directors present may adjourn the meeting from time
to time without further notice.
SECTION 8. MANNER OF ACTING. The act of a majority of the directors present at a
meeting at which a quorum is present shall be the act of the board of directors
unless the act of a greater number is required by the certificate of
incorporation.
SECTION 9. NEWLY CREATED DIRECTORSHIPS AND VACANCIES. Newly created
directorships resulting from any increase in the authorized number of directors
or any vacancies in the board of directors resulting from death, resignation,
retirement, disqualification, removal from office or other cause shall be
filled by a majority vote of the directors then in office, though less than a
quorum, and directors so chosen shall hold office for a term expiring at the
next annual meeting of stockholders.
SECTION 10. COMPENSATION. Directors as such shall not receive any stated
salaries for their services, but by resolution of the board of directors, a
fixed sum and expenses of attendance, if any, may be allowed for attendance at
any regular or special meetings of the board of directors; provided that nothing
herein contained shall be construed to preclude any director from serving the
corporation in any other capacity and receiving compensation therefor.
SECTION 11. REMOVAL. Any director, or the entire board of directors, may be
removed from office at any time, with or without cause, by the affirmative vote
of the holders of a majority of the voting power of all of the shares of the
corporation entitled to vote generally in the election of directors, voting
together as a single class.
SECTION 12. COMMITTEES. The board of directors may, by resolution passed by a
majority of the whole board, designate one or more committees, each committee to
consist of one or more of the directors of the corporation, which to the extent
provided in the resolution and within the limitations prescribed by statute,
shall have and may exercise the powers and authority of the board of directors
in the management of the business and affairs of the corporation and may
authorize the seal of the corporation to be affixed to all papers which may
require it.
SECTION 13. INTERESTED DIRECTORS. (A) No contract or transaction between the
corporation and one or more of its directors or officers, or between the
corporation and any other corporation, partnership, association or other
organization in which one or more of its directors or officers are directors or
officers, or have a financial interest, shall be void or voidable solely for
this reason, or solely because the director or officer is present at or
participates in the meeting of the board or committee thereof which authorizes
the contract or transaction, or solely because his vote is counted for such
purpose, if:
(1) The material facts as to his relationship or interest and as to the
contract or transaction are disclosed or are known to the board of
directors or the committee, and the board or committee in good faith
authorizes the contract or transaction by the affirmative vote of a
majority of the disinterested directors, even though the disinterested
directors be less than the quorum; or
(2) The material facts as to his relationship or interest and as to the
contract or transaction are disclosed or are known to the stockholders
entitled to vote thereon, and the contract or transaction is
specifically approved in good faith by vote of the stockholders; or
(3) The contract or transaction is fair as to the corporation as of the
time it is authorized, approved or ratified, by the board of directors,
a committee thereof, or the stockholders.
(B) Common or interested directors may be counted in determining the
presence of a quorum at a meeting of the board of directors or of a
committee which authorizes the contract or transaction.
SECTION 14. CONSENT IN LIEU OF MEETING. Any action required or permitted to be
taken at any meeting of the Board of Directors or of any committee thereof may
be taken without a meeting if all members of the board or committee, as the case
may be, consent thereto in writing, and the writing or writings are filled with
the minutes of the proceedings of the board or committee.
SECTION 15. MEETING BY CONFERENCE TELEPHONE. Members of the board of directors
or any committee designated by the board may participate in a meeting of such
board or committee by means of conference telephone or similar communications
equipment by means of which all persons participating in the meeting can hear
each other. Participation in a meeting pursuant hereto shall constitute presence
in person at such meeting.
ARTICLE IV
OFFICERS
SECTION 1. NUMBER. The officers of the corporation shall be a president, one
or more vice presidents, one or more of whom may be designated "senior vice
president" by the board of directors, a secretary and a treasurer, and such
assistant secretaries and assistant treasurers or other officers, including one
or more vice chairmen, as may be elected by the board of directors. Any two or
more offices may be held by one person, except that no person shall hold the
offices of president and secretary or assistant secretary simultaneously.
SECTION 2. ELECTION AND TERM OF OFFICE. The officers of the corporation shall
be elected annually by the board of directors at the first meeting of the board
of directors held after each annual meeting of the stockholders. If the election
of officers shall not be held at such meeting, such election shall be held as
soon thereafter as conveniently may be. Vacancies may be filled or new offices
created and filled at any meeting of the board of directors. Each officer shall
hold office until his successor shall have been duly elected and qualified or
until his earlier death, resignation or removal.
SECTION 3. REMOVAL. Any officer or agent elected or appointed by the board of
directors may be removed by the board of directors, with or without cause,
whenever in its judgment the best interests of the corporation would be served
thereby, but such removal shall be without prejudice to the contract rights, if
any, of the person so removed.
SECTION 4. VACANCIES. A vacancy in any office because of death, resignation,
removal, disqualification or otherwise may be filled by the board of directors
for the unexpired portion of the term.
SECTION 5. DUTIES. (A) CHAIRMAN OF THE BOARD. The board of directors may elect
one of its members chairman of the board. The chairman of the board shall
preside at the meetings of the stockholders and directors, and shall provide
leadership to the board of directors in reviewing and advising upon matters
which exert major influence on the manner in which the corporation's business is
conducted. The chairman of the board shall act in an advisory capacity to the
president in all matters concerning the interest and management of the
corporation, and, in the event of the absence or the disability of the
president, the chairman of the board shall assume all the duties and
responsibilities of that office. He may sign, with the secretary or treasurer or
any other proper officer of the corporation thereunto authorized by the board of
directors, certificates for shares of the corporation, and any deeds, mortgages,
bonds, contracts, or other instruments which the board of directors has
authorized to be executed, except in cases where the signing or execution
thereof shall be expressly delegated by the board of directors or these by-laws
to some other officer or agent of the corporation or shall be required by law to
be otherwise signed or executed. The chairman of the board also may execute
proxies on behalf of the corporation with respect to the voting of any shares
owned by the corporation. In general, the chairman of the board shall perform
all duties incident to the office of chairman and such other duties as may be
prescribed by the board of directors.
(B) VICE CHAIRMEN OF THE BOARD. The board of directors may elect one or more of
its members vice chairman of the board. In the event of the absence or
disability of the chairman of the board, the vice chairmen, if more than one, in
the order designated by the board of directors, or by the chairman if the board
of directors has not made such a designation, shall assume all of the duties and
responsibilities of the office of chairman. The vice chairmen shall perform such
duties not inconsistent with these by-laws as are assigned to them by the
chairman. The vice chairmen may sign, with the secretary or treasurer or any
other proper officer of the corporation thereunto authorized by the board of
directors, certificates for shares of the corporation, and any deeds, mortgages,
bonds, contracts, or other instruments which the board of directors has
authorized to be executed, except in cases where the signing or execution
thereof shall be expressly delegated by the board of directors or these by-laws
to some other officer or agent of the corporation or shall be required by law to
be otherwise signed or executed. The vice chairmen also may execute proxies on
behalf of the corporation with respect to the voting of shares owned by the
corporation.
(C) PRESIDENT. The president shall be the chief executive officer of the
corporation, and shall have general supervision over all of the affairs of the
corporation and shall determine and administer the policies of the corporation
as established by the board of directors. If there is no chairman of the board,
or in his absence, the president shall preside at all meetings of stockholders
and at all meetings of directors. He may sign, with the secretary or treasurer
or any other proper officer of the corporation thereunto authorized by the board
of directors, certificates for shares of the corporation, and any deeds,
mortgages, bonds, contracts, or other instruments which the board of directors
has authorized to be executed, except in cases where the signing or execution
thereof shall be expressly delegated by the board of directors or these by-laws
to some other officer or agent of the corporation or shall be required by law to
be otherwise signed or executed. The president also may execute proxies on
behalf of the corporation with respect to the voting of shares owned by the
corporation. In general, the president shall perform all duties incident to the
office of president and such other duties as may be prescribed by the board of
directors. In connection therewith, the president shall be authorized to
delegate to the chairman of the board and other executive officers of the
corporation such of the powers and duties of the president at such times and in
such manner as he may deem advisable.
(D) VICE PRESIDENTS. Each vice president shall assist the president in the
discharge of his duties as the president may direct and shall perform such other
duties as from time to time may be assigned to him by the president or by the
board of directors. In the absence or disability of the chairman, vice chairmen,
if any, and president, the vice presidents, if more than one, in the order
designated by the board of directors, or by the president if the board of
directors has not made such a designation, shall perform the duties of the
president, and when so acting, shall have all the powers of and be subject to
the restrictions upon the president. The board of directors may designate any
vice president as a senior vice president, in which case such person shall be
first in order of seniority relative to the other officers except for the
chairman, vice chairmen, if any, and president. Each vice president may sign,
with the secretary or treasurer or any other proper officer of the corporation
thereunto authorized by the board of directors, certificates for shares of the
corporation, and any deeds, mortgages, bonds, contracts, or other instruments
which the board of directors has authorized to be executed, except in cases
where the signing or execution thereof shall be expressly delegated by the board
of directors or these by-laws to some other officer or agent of the corporation
or shall be required by law to be otherwise signed or executed.
(E) SECRETARY. The secretary shall: (1) attend all meetings of the stockholders
and the board of directors, and keep the minutes of the stockholders' and the
board of directors' meetings in one or more books provided for that purpose; (2)
see that all notices are duly given in accordance with the provisions of these
by-laws or as required by law; (3) be custodian of the corporate records and the
seal of the corporation and see that the seal of the corporation, if required,
is affixed to all certificates for shares prior to the issuance thereof and to
all documents, the execution of which on behalf of the corporation is duly
authorized in accordance with the provisions of these by-laws; (4) keep or have
kept a register of the post office address of each stockholder which shall be
furnished to the secretary by such stockholder; and (5) have general charge of
and supervision over the stock ledger of the corporation. The secretary may
sign, with the chairman of the board, a vice chairman of the board, if any, the
president, or any vice president, certificates for shares of the corporation,
and any deeds, mortgages, bonds, contracts, or other instruments which the board
of directors has authorized to be executed, except in cases where the signing or
execution thereof shall be expressly delegated by the board of directors or
these by-laws to some other officer or agent of the corporation or shall be
required by law to be otherwise signed or executed. In general, the secretary
shall perform all duties incident to the office of the secretary and such other
duties as from time to time may be assigned to him by the president or the board
of directors.
(F) TREASURER. If required by the board of directors, the treasurer shall give a
bond for the faithful discharge of his duties in such sum and with such surety
or sureties as the board of directors determines. He shall: (1) have charge of
and be responsible for the maintenance of adequate books of account for the
corporation; and (2) have charge and custody of all funds and securities of the
corporation, and be responsible therefor and for the receipt and disbursement
thereof. The treasurer may sign, with the chairman of the board, a vice chairman
of the board, if any, the president, or any vice president, certificates for
shares of the corporation, and any deeds, mortgages, bonds, contracts, or other
instruments which the board of directors has authorized to be executed, except
in cases where the signing or execution thereof shall be expressly delegated by
the board of directors or these by-laws to some other officer or agent of the
corporation or shall be required by law to be otherwise signed or executed. In
general, the treasurer shall perform all duties incident to the office of the
treasurer and such other duties as from time to time may be assigned to him by
the president or by the board of directors.
(G) ASSISTANT SECRETARIES AND ASSISTANT TREASURERS. The assistant secretaries,
if any, or the assistant treasurers, if any, may sign, with the chairman of the
board, a vice chairman of the board, if any, the president or any vice
president, certificates for shares of the corporation, and any deeds, mortgages,
bonds, contracts, or other instruments which the board of directors has
authorized to be executed, except in cases where the signing or execution
thereof shall be expressly delegated by the board of directors or these by-laws
to some other officer or agent of the corporation or shall be required by law to
be otherwise signed or executed. If required by the board of directors, the
assistant treasurers, if any, shall give bonds for the faithful discharge of
their duties in such sums and with such surety or sureties as the board of
directors determines. The assistant secretaries and assistant treasurers, if
any, shall perform, in general, such duties as are assigned to them by the
secretary or the treasurer, respectively, or by the president of the board of
directors.
(H) OTHER OFFICERS. Other officers, howsoever designated, shall have such
duties as the board of directors prescribes.
SECTION 6. INTERIM CHANGES. In case of the absence or disability of any officer
of the corporation and of any person hereby authorized to act in his place
during such period of absence or disability, the board of directors may from
time to time delegate the powers and duties of such officer to any other
officer, or any director, or any other person whom it may select.
SECTION 7. COMPENSATION. The salaries of the officers shall be fixed from time
to time in the manner specified by the board of directors and no officer shall
be prevented from receiving such salary by reason of the fact that he is also a
director of the corporation. Any payments made to an officer of the corporation,
such as salary, commission, bonus, interest or rent, or entertainment expense
incurred by him, which shall be disallowed in whole or in part as a deductible
expense by the Internal Revenue Service, shall be reimbursed by such officer to
the corporation to the full extent of such disallowance. It shall be the duty of
the board of directors to enforce payment of each such amount disallowed. In
lieu of payment by the officer, subject to the determination of the board of
directors, proportionate amounts may be withheld from his future compensation
payments until the amount owed to the corporation has been fully recovered.
ARTICLE V
CONTRACTS, LOANS, CHECKS AND DEPOSITS
SECTION 1. CONTRACTS. The board of directors may authorize any officer or
officers, agent or agents, to enter into any contract or execute and deliver any
instrument in the name of and on behalf of the corporation and such authority
may be general or confined to specific instances.
SECTION 2. LOANS. No loans shall be contracted on behalf of the corporation
and no evidences of indebtedness shall be issued in its name unless authorized
by a resolution of the board of directors. Such authority may be general or
confined to specific instances.
SECTION 3. CHECKS, DRAFTS, ETC. All checks, drafts or other orders for payment
of money, notes or other evidences of indebtedness issued in the name of the
corporation shall be signed by such officer or officers, agent or agents of the
corporation and in such manner as shall from time to time be determined by
resolution of the board of directors.
SECTION 4. DEPOSITS. All funds of the corporation not otherwise employed
shall be deposited from time to time to the credit of the corporation in such
banks, trust companies or other depositaries as the board of directors may from
time to time select.
ARTICLE VI
CERTIFICATES FOR SHARES AND THEIR TRANSFER
SECTION 1. STOCK CERTIFICATES. Certificates representing shares of stock of the
corporation shall be in such form as may be determined by the board of
directors, shall be numbered and shall be entered in the books of the
corporation as they are issued. They shall exhibit the holder's name and number
of shares and shall be signed by the chairman of the board, a vice chairman of
the board, if any, the president or any vice president and by the secretary or
an assistant secretary, if any, or the treasurer or an assistant treasurer, if
any, and may be sealed with the seal or a facsimile seal of the corporation. Any
or all of the signatures on the certificate may be a facsimile. In case any
officer, transfer agent or registrar who has signed or whose facsimile signature
has been placed upon a certificate shall have ceased to be such officer,
transfer agent or registrar before such certificate is issued, it may be issued
by the corporation with the same effect as if he were such officer, transfer
agent or registrar at the date of issue.
SECTION 2. LOST CERTIFICATES. The board of directors may from time to time
make such provision as it deems appropriate for the replacement of lost, stolen
or destroyed stock certificates, including the requirement to furnish an
affidavit and an indemnity.
SECTION 3. TRANSFER OF STOCK. Upon surrender to the corporation or the transfer
agent of the corporation of a stock certificate duly endorsed or accompanied by
proper evidence of succession, assignment or authority to transfer, it shall be
the duty of the corporation to issue a new certificate to the person entitled
thereto, cancel the old certificate and record the transaction upon the books of
the corporation. The person in whose name shares of stock stand on the books of
the corporation shall be deemed the owner thereof for all proposes as regards
the corporation.
SECTION 4. TRANSFER AGENTS AND REGISTRARS. The board of directors may appoint
one or more transfer agents and registrars and may thereafter require all stock
certificates to bear the signature or facsimile thereof of any transfer agent
and registrar.
SECTION 5. RULES OF TRANSFER. The board of directors shall have the power and
authority to make all such rules and regulations as they may deem expedient
concerning the issuance, transfer and registration of stock certificates of the
corporation.
ARTICLE VII
FISCAL YEAR
The fiscal year of the corporation shall begin on the first day of October,
and end on the thirtieth day of September in each year.
ARTICLE VIII
DIVIDENDS
The board of directors may from time to time declare, and the corporation
may pay, dividends on its outstanding shares in the manner and upon the terms
and conditions provided by law and its certificate of incorporation.
ARTICLE IX
SEAL
The board of directors may provide a corporate seal which shall be in the
form of a circle and shall have inscribed thereon the name of the corporation
and the words "CORPORATE SEAL, DELAWARE." The use of the corporate seal,
however, is not mandatory.
ARTICLE X
WAIVER OF NOTICE
Whenever any notice is required to be given under the provisions of law,
the certificate of incorporation or these by-laws, waiver thereof in writing,
signed by the person or persons entitled to such notice, whether before or after
the time stated therein, shall be deemed equivalent to the giving of such
notice.
ARTICLE XI
AMENDMENTS
These by-laws may be altered, amended or repealed and new by-laws may be
adopted by the board of directors or by the stockholders.
EXHIBIT 11
ANDREW CORPORATION AND SUBSIDIARIES
Computation of Earnings Per Share
(Amounts in thousands,
except per share data)
<TABLE>
<CAPTION>
Year Ended September 30
1994 1993 1992
------ ------ ------
<S> <C> <C> <C>
PRIMARY EARNINGS PER SHARE
Average shares outstanding 25,342 24,854 28,050
Net effect of dilutive stock options--
based on the treasury stock method
using average market price 698 604 588
------- ------- -------
TOTAL 26,040 25,458 28,638
------- ------- -------
Net income $44,395 $27,862 $24,987
======= ======= =======
Per share amount $ 1.70 $ 1.09 $ .87
======= ======= =======
FULLY DILUTED EARNINGS PER SHARE
Average shares outstanding 25,342 24,854 28,050
Net effect of dilutive stock options--
based on the treasury stock method
using the year-end market price 776 768 714
------- ------- -------
TOTAL 26,118 25,622 28,764
------- ------- -------
Net income $44,395 $27,862 $24,987
======= ======= =======
Per share amount $ 1.70 $ 1.09 $ .87
======= ======= =======
<FN>
Note: The fully diluted earnings per share calculation is submitted in
accordance with the Securities Exchange Act of 1934 Release No. 9038
although not required by footnote 2 to paragraph 14 of APB Opinion No. 15
because it results in dilution of less than 3%.
</FN>
</TABLE>
Operations review
Andrew Corporation reported record sales, net income and earnings per share
during the fiscal year ended September 30, 1994. The company's commercial
business segment continues to benefit from strong demand for wireless
communication products and systems, especially cellular. The success of the
commercial business segment was partially offset by lower than expected results
from the government and network business segments. Cost controls and changes in
product mix were the major contributors to earnings increasing faster than
sales.
Sales
Andrew's 1994 sales increased 30% to $558.5 million due to increased commercial
sales. Sales to international markets increased to 44% of 1994 sales, compared
to 41% in 1993. The commercial business segment sales increased to $457.8
million during 1994, a 45% increase over 1993. Higher sales of coaxial cable and
terrestrial microwave products resulted from strong demand in the global
wireless communications market. The commercial segment 1994 sales include $42.8
million in coaxial cable, towers, installation, program management and other
services delivered to a consortium that developed a major cellular system in
Argentina. Excluding the Argentina contract, the largest in the company's
history, commercial sales still increased nearly 32%. Government business
segment sales declined 19% to $43.6 million as a result of the continued
downsizing and decreased spending by the U.S. and foreign governments and other
customers. Network business segment sales decreased 10% to $52.2 million in
1994, from $57.7 million in 1993 as a result of lower sales to midrange and
mainframe markets.
Cost of products sold
Cost of products sold as a percent of sales was 58.4% in 1994, compared with
58.5% in 1993 and 61.7% in 1992. Increased sales of coaxial cable resulting in
favorable product mix, as well as cost reduction programs and productivity
gains, drove costs lower in the commercial and government businesses during 1994
and 1993. These gains during 1994 were largely offset by lower margins in the
network business and on the Argentina contract.
Operating expenses
Selling and administrative expenses were $130.00 million in 1994, $109.9 million
in 1993 and $105.3 million in 1992. Continued support of the Russian joint
ventures, increased profit sharing expense and increased marketing expenses for
the company's new line of wireless telephone expenses for the company's new line
of wireless telephone accessories caused the increase in 1994 and 1993. As a
percentage of sales, selling and administrative expenses were 23.3% in 1994,
25.5% in 1993 and 23.8% in 1992.
<PAGE>
Research and development
Research and development expenses increased to $25.7 million in 1994, compared
to $22.0 million in 1993 and $20.2 million in 1992. Development spending within
the commercial segment for a new line of wireless telephone accessories and
research related to VSAT technology accounted for most of the increase in
1994. As a percentage of sales, research and development expense was 4.6% in
1994, compared to 5.1% in 1993 and 4.6% in 1992.
Other income and expense
Net interest expense was $3.9 million in 1994, continuing a downward trend from
$4.6 million in 1993 and $4.8 million in 1992. Net other expense was $3.3
million in 1994, compared to net other income of $1.5 million in 1993 and $.9
million in 1992. The increase in expense was due to the recognition of foreign
exchange losses of $2.0 million in 1994. Other income during 1993 included
foreign exchange gains of $1.3 million. Besides foreign exchange losses, Andrew
recorded $.9 million for its share of losses by the Russian joint ventures in
1994.
Income taxes
The company's effective tax rate was 36.0% in 1994. The rate was 36.1% in 1993
and 37.5% in 1992. The lower rates in 1994 and 1993 are primarily due to a
benefit from the company's Foreign Sales Corporation.
Net income
Net income increased 59% to $44.4 million. Increased sales and changes in
product mix, coupled with improved productivity and cost containment, caused the
significant income growth in 1994 and 1993. Net income per share was $1.70,
a 56% increase.
Net income grew faster than net income per share due to higher average shares
outstanding during 1994. Net income was $27.9 million in 1993 and $25.0 million
in 1992. Net income per share was $1.09 in 1993 and $0.87 in 1992.
Liquidity and capital resources
The company continued to generate significant cash, internally funding its
investment and working capital needs. Cash generated from operations was $51.8
million in 1994, compared to $55.0 million in 1993 and $50.9 million in 1992.
Increases in accounts receivables and inventory were the primary reasons for the
5% decline in net cash from operations. Accounts receivable were higher in 1994
due to higher revenues, especially in the fourth quarter. The increase in
inventory was primarily for coaxial cable and the new wireless telephone
products business.
The company invested $17.1 million in its Russian joint ventures in 1994, up
from $15.5 million in 1993. Funds for operations and for the completion of
construction of the basic systems for three of the fiber optic joint ventures
caused the increase in 1994. Capital expenditures were higher by $9.2 million in
1994. The significant increase was due to expansion of the equipment building
manufacturing in Newnan, Georgia, capacity increases for the coaxial cable
business and new computer systems for the commercial business segment. In
addition, company-owned distribution warehouses were set up in Hong Kong and
Japan, along with subcontracted warehouses in Saudi Arabia and South Africa to
support the growing demand for Andrew communication products in those regions.
Capital expenditures were $27.1 million in 1994, $17.9 million in 1993 and $17.8
million in 1992.
<PAGE>
During 1992, the company purchased 1,528,000 shares of its common stock at a
cost of $52.2 million. The purchase was financed using internally generated
funds and short-term borrowings.
The company has a $50 million available line of credit, under which there were
no amounts outstanding at September 30, 1994. Andrew had $50 million of senior
notes payable outstanding at September 30, 1994, of which $4.5 million is due in
September 1995.
Andrew has never paid cash dividends. It is the present policy of the Board of
Directors to retain earnings in the business to finance investments and
operations.
Changes in accounting principles
The company adopted SFAS (Statement of Financial Accounting Standard) No. 106,
"Employers' Accounting for Postretirement Benefits Other Than Pensions," SFAS
No. 109, "Accounting for Income Taxes" and SFAS No. 112, "Employers' Accounting
for Postemployment Benefits" during the first quarter of 1994. The adoption of
these statements did not have a material effect on the company's financial
statements.
<PAGE>
ANDREW CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
<TABLE>
<CAPTION>
Year ended September 30
1994 1993 1992
---- ---- ----
(In Thousands, Except Per Share Amounts)
<S> <C> <C> <C>
SALES $ 558,457 $ 430,820 $ 442,008
Cost of products sold 326,261 252,186 272,670
------------ ------------ ------------
GROSS PROFIT 232,196 178,634 169,338
OPERATING EXPENSES
Sales and administrative 129,971 109,947 105,342
Research and development 25,707 22,011 20,156
------------ ------------ ------------
155,678 131,958 125,498
------------ ------------ ------------
OPERATING INCOME 76,518 46,676 43,840
OTHER
Interest expense 5,200 5,445 6,133
Interest income (1,343) (830) (1,328)
Other expense (income) 3,295 (1,530) (944)
------------ ------------ ------------
7,152 3,085 3,861
------------ ------------ ------------
INCOME BEFORE INCOME TAXES 69,366 43,591 39,979
Income taxes 24,971 15,729 14,992
------------ ------------ ------------
NET INCOME $ 44,395 $ 27,862 $ 24,987
============ ============ ============
NET INCOME PER AVERAGE SHARE OF
COMMON STOCK OUTSTANDING $ 1.70 $ 1.09 $ .87
============ ============ ============
AVERAGE SHARES OUTSTANDING 26,118 25,622 28,764
============ ============ ============
<FN>
See Notes to Consolidated Financial Statements.
</FN>
</TABLE>
<PAGE>
ANDREW CORPORATION
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
September 30
1994 1993
---- ----
(In Thousands)
ASSETS
<S> <C> <C>
CURRENT ASSETS
Cash and cash equivalents $ 40,267 $ 21,729
Accounts receivables, less allowances
(1994-$2,769; 1993-$3,167) 126,821 107,276
Inventories
Finished products 31,413 18,611
Materials and work in process 56,174 51,695
----------- -----------
87,587 70,306
Miscellaneous current assets 5,974 3,309
----------- -----------
TOTAL CURRENT ASSETS 260,649 202,620
OTHER ASSETS
Costs in excess of net assets of businesses acquired,
less accumulated amortization
(1994-$13,919; 1993-$11,310) 38,272 40,881
Investments in and advances to affiliates 27,119 16,493
Investments and other assets 14,157 8,996
PROPERTY, PLANT AND EQUIPMENT
Land and land improvements 8,496 8,351
Buildings 52,422 49,835
Equipment 169,716 149,325
Allowances for depreciation and amortization (155,668) (139,398)
----------- -----------
74,966 68,113
----------- -----------
TOTAL ASSETS $ 415,163 $ 337,103
=========== ===========
<FN>
See Notes to Consolidated Financial Statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
ANDREW CORPORATION
CONSOLIDATED BALANCE SHEETS
<CAPTION>
September 30
1994 1993
---- ----
(Dollars in Thousands)
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
<S> <C> <C>
Accounts payable $ 24,902 $ 18,561
Accrued expenses and other liabilities 24,354 19,170
Compensation and related expenses 22,928 15,950
Income taxes 14,899 10,250
Current portion of long-term debt 4,545 --
----------- -----------
TOTAL CURRENT LIABILITIES 91,628 63,931
DEFERRED LIABILITIES 5,226 3,602
LONG-TERM DEBT, less current portion 45,455 50,000
STOCKHOLDERS' EQUITY
Common stock (par value, $.01 a share:
100,000,000 shares authorized;
30,435,882 shares issued, including treasury) 304 203
Additional paid-in capital 31,205 28,448
Foreign currency translation (1,283) (5,410)
Retained earnings 294,929 250,534
Treasury stock, at cost (4,891,160 shares
in 1994; 5,243,517 shares in 1993) (52,301) (54,205)
----------- -----------
272,854 219,570
----------- -----------
TOTAL LIABILITIES AND EQUITY $ 415,163 $ 337,103
=========== ===========
<FN>
See Notes to Consolidated Financial Statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
ANDREW CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
<CAPTION>
Year ended September 30
1994 1993 1992
---- ---- ----
(In Thousands)
<S> <C> <C> <C>
CASH FLOWS FROM OPERATIONS
Net Income $ 44,395 $ 27,862 $ 24,987
ADJUSTMENTS TO NET INCOME
Depreciation and amortization 22,387 21,186 20,863
Increase in accounts receivable (17,329) (17) (946)
(Increase) decrease in inventories (15,950) (4,045) 11,713
Increase in prepaid expenses
and other assets (1,859) (1,290) (483)
Increase in receivable from affiliates (6,467) 0 0
Increase (decrease) in accounts
payable and other liabilities 26,572 9,754 (5,225)
Other 72 1,568 (49)
----------- ----------- -----------
NET CASH FROM OPERATIONS 51,821 55,018 50,860
INVESTING ACTIVITIES
Capital expenditures (27,095) (17,876) (17,844)
Investments in and advances to affiliates (10,626) (15,513) (1,175)
Sale of investment in Alliance
Acquisition Corporation 0 0 6,511
Proceeds from sale of property,
plant and equipment 405 697 739
----------- ----------- -----------
NET CASH USED IN INVESTING ACTIVITIES (37,316) (32,692) (11,769)
FINANCING ACTIVITIES
Payments on long-term debt 0 (4,025) (8,432)
Short-term borrowings (payments)-net 0 (8,000) 8,000
Stock plans 3,255 5,464 2,181
Purchase of treasury stock 0 0 (52,232)
----------- ----------- ------------
NET CASH FROM (USED IN) FINANCING ACTIVITIES 3,255 (6,561) (50,483)
Foreign currency translation adjustments 778 (1,469) 1,744
----------- ----------- -----------
Increase (decrease) for the year 18,538 14,296 (9,648)
Cash and equivalents at beginning of year 21,729 7,433 17,081
----------- ----------- -----------
CASH AND EQUIVALENTS AT END OF YEAR $ 40,267 $ 21,729 $ 7,433
=========== =========== ===========
<FN>
See Notes to Consolidated Financial Statements.
</FN>
</TABLE>
<PAGE>
<TABLE>
ANDREW CORPORATION
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
<CAPTION>
Year Ended September 30
1994 1993 1992
---- ---- ----
(Dollars in thousands)
<S> <C> <C> <C>
COMMON STOCK ISSUED
Balance at beginning of year $ 203 $ 101 $ 101
Three-for-two stock split 101 0 0
Two-for-one stock split 0 102 0
---------- ---------- ----------
BALANCE AT END OF YEAR $ 304 $ 203 $ 101
========== ========== ==========
ADDITIONAL PAID-IN CAPITAL
Balance at beginning of year $ 28,448 $ 28,343 $ 28,248
Three-for-two stock split (101) 0 0
Two-for-one stock split 0 (102) 0
Stock option and purchase plans 2,858 207 95
---------- ---------- ----------
BALANCE AT END OF YEAR $ 31,205 $ 28,448 $ 28,343
========== ========== ==========
RETAINED EARNINGS
Balance at beginning of year $ 250,534 $ 222,672 $ 197,685
Net Income 44,395 27,862 24,987
---------- ---------- ----------
BALANCE AT END OF YEAR $ 294,929 $ 250,534 $ 222,672
========== ========== ==========
TREASURY STOCK
Balance at beginning of year $ (54,205) $ (61,144) $ (11,188)
Repurchase of shares 0 0 (52,232)
Stock option and purchase plans 1,904 6,939 2,276
---------- ---------- ----------
BALANCE AT END OF YEAR $ (52,301) $ (54,205) $ (61,144)
========== ========== ==========
<FN>
See Notes to Consolidated Financial Statements.
</FN>
</TABLE>
<PAGE>
ANDREW CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
PRINCIPLES OF CONSOLIDATION. The consolidated financial statements include the
accounts of the company and its majority-owned subsidiaries. All significant
intercompany accounts and transactions have been eliminated.
CASH EQUIVALENTS. The company considers all highly liquid investments
purchased with maturities of three months or less to be cash equivalents. The
carrying amount of cash equivalents approximates fair value due to the relative
short-term maturity of these investments.
INVENTORIES. Inventories are stated at the lower of cost or market.
Inventories stated under the last-in, first-out (LIFO) method represent 44% of
total inventories in 1994 and 46% of total inventories in 1993. The remaining
inventories are valued on the first-in, first-out (FIFO) method.
If the FIFO method, which approximates current replacement cost, had been used
for all inventories, the total amount of inventories would have been
increased by $11,610,000 and $12,232,000 at September 30, 1994 and 1993,
respectively.
DEPRECIATION AND AMORTIZATION. The company provides for depreciation and
amortization of property, plant and equipment, all of which are recorded at
cost, principally using accelerated methods based on estimated useful lives of
the assets for both financial reporting and tax purposes. Costs in excess of net
assets of businesses acquired are amortized on the straight-line basis over
periods ranging from 10 to 40 years.
INVESTMENTS IN AFFILIATES. Investments in affiliates are accounted for
using the equity method, under which the company's share of earnings or losses
of these affiliates is reflected in income as earned and dividends are credited
against the investment in affiliates when received.
REVENUE RECOGNITION. Revenue is recognized from sales, other than
long-term contracts, when a product is shipped or a service is performed.
Sales under long-term contracts generally are recognized under the
percentage of completion method and include a portion of the earnings expected
to be realized on the contract in the ratio that costs incurred bear to
estimated total costs. Contracts in progress are reviewed monthly, and sales
and earnings are adjusted in current accounting periods based on revisions in
contract value and estimated costs at completion. Estimated losses on contracts
are provided when identified.
<PAGE>
ANDREW CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONT'D.)
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES CONT'D.)
FOREIGN CURRENCY TRANSLATION. The functional currency for the company's
foreign operations is predominantly the applicable local currency. Accounts of
foreign operations are translated into U.S. dollars using year-end exchange
rates for assets and liabilities and average monthly exchange rates for revenues
and expenses. Adjustments resulting from translation are included as a
separate component of stockholders' equity. Gains or losses resulting from
foreign currency transactions are included in determining net income.
INCOME TAXES. Deferred income taxes reflect the impact of temporary
differences between the amounts of assets and liabilities recognized for
financial reporting purposes and such amounts recognized for tax purposes. In
accordance with Statement of Financial Accounting Standards ("SFAS") No. 109
"Accounting for Income Taxes," these deferred taxes are measured by applying
currently enacted tax laws. In years prior to fiscal year 1994, deferred
taxes were accounted for in accordance with Accounting Principles Board ("APB")
Opinion No. 11.
NET INCOME PER SHARE. Net income per share is based on the weighted
average number of common shares outstanding during each year after giving effect
to stock options considered to be dilutive common stock equivalents. Fully
diluted net income per share is not materially different from primary earnings
per share.
ACCOUNTING CHANGES. The company adopted SFAS No. 106 "Employers'
Accounting for Postretirement Benefits Other Than Pensions," SFAS No. 109
"Accounting for Income Taxes," and SFAS No. 112 "Employers' Accounting for
Postemployment Benefits" during the first quarter of 1994. The adoption of
these statements did not have a material effect on the company's financial
statements.
<PAGE>
ANDREW CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONT'D.)
INVESTMENTS IN AFFILIATES
The company's investments in affiliates represents 40 to 50 percent
interests in several network telecommunications joint ventures in Russia. The
combined operating results of the ventures and the company's share thereof were
not material to the company's 1994 operating results.
During 1992, the company sold its interest in Alliance Acquisition
Corporation for cash, Convertible Subordinated Debentures of Allen
Telecommunications Corporation and other considerations totalling $13,170,000; a
nominal gain was recorded on this sale.
UNBILLED RECEIVABLES
At September 30, 1994, unbilled receivables of $14,207,000 are included in
accounts receivable, compared to $8,936,000 at September 30, 1993. These amounts
will be billed to customers in accordance with contract terms and delivery
schedules and are generally expected to be collected within one year.
PROFIT SHARING PLANS
Most employees of Andrew Corporation and its subsidiaries participate in
various retirement plans, principally defined contribution profit sharing plans.
The amounts charged to earnings for these plans in 1994, 1993 and 1992 were
$10,915,000, $7,020,000 and $6,587,000, respectively.
<PAGE>
BORROWINGS
The company has a $50 million revolving credit agreement under which there
were no amounts outstanding at September 30, 1994. The maximum amount
outstanding during 1994 was $21 million for which the weighted average
interest rate was 4.0%.
<TABLE>
Long-term debt at September 30 consisted of the following:
<CAPTION>
In thousands
1994 1993
---- ----
<S> <C> <C>
9.52% senior notes payable to insurance companies
in annual installments from 1995 to 2005 $50,000 $50,000
Less: Current Portion 4,545 0
------- -------
TOTAL LONG-TERM DEBT $45,455 $50,000
======= =======
</TABLE>
Under the most restrictive terms of the loan agreement, the company has
agreed to maintain certain levels of net current assets and net worth. At
September 30, 1994 consolidated net current assets and consolidated tangible net
worth exceeded the required amounts by approximately $123,207,000 and
$151,964,000, respectively. The most restrictive requirement relating to the
ratio of current assets to current liabilities (1.50 to 1) had been fulfilled.
The loan agreement further provides restriction on dividend payments.
Approximately $138,000,000 of retained earnings was not restricted for the
purpose of such payments at September 30, 1994.
<TABLE>
The principal amounts of long-term debt maturing after September 30, 1994 are:
<CAPTION>
1995 1996 1997 1998 1999 Thereafter
---- ---- ---- ---- ---- ----------
<S> <C> <C> <C> <C> <C> <C>
In Thousands $4,545 $4,545 $4,545 $4,545 $4,545 $27,275
</TABLE>
Cash payments for interest on all borrowings were $5,024,000, $5,166,000
and $5,897,000 in 1994, 1993, and 1992 respectively.
The carrying amount of long-term debt as of September 30, 1994
approximates fair value. The fair value was determined by discounting the future
cash outflows based upon the current market rates for instruments with a similar
risk and term to maturity.
<PAGE>
INCOME TAXES
<TABLE>
The composition of the provision for income taxes follows:
<CAPTION>
Year Ended September 30
1994 1993 1992
---- ---- ----
(In Thousands)
<S> <C> <C> <C>
CURRENTLY PAYABLE:
Federal $ 13,504 $ 3,986 $ 4,863
Non-United States 12,779 10,817 8,534
State 2,867 1,223 1,266
--------- --------- ---------
29,150 16,026 14,663
DEFERRED (CREDIT):
Federal and State (3,659) (260) 676
Non-United States (520) (37) (347)
--------- --------- ---------
(4,179) (297) 329
--------- --------- ---------
$ 24,971 $ 15,729 $ 14,992
========= ========= =========
INCOME TAXES PAID $ 18,474 $ 7,230 $ 12,607
========= ========= =========
COMPONENTS OF INCOME
BEFORE INCOME TAXES:
United States $ 30,923 $ 11,969 $ 14,516
Non-United States 38,443 31,622 25,463
--------- --------- ---------
$ 69,366 $ 43,591 $ 39,979
========= ========= =========
</TABLE>
<TABLE>
The company's effective income tax rate varied from the statutory United
States federal income tax rate because of the following:
<CAPTION>
1994 1993 1992
---- ---- ----
<S> <C> <C> <C>
Statutory United States
federal tax rate 35.0% 35.0% 34.0%
Foreign Sales Corporation (FSC) (2.7) (2.5) 0.0
State income taxes, net of
federal tax effect 2.4 1.8 2.1
Goodwill amortization 1.3 2.1 2.3
Other items 0.0 (.3) (.9)
----- ----- -----
EFFECTIVE TAX RATE 36.0% 36.1% 37.5%
===== ===== =====
</TABLE>
<PAGE>
INCOME TAXES (CONT'D.)
The tax effects of temporary differences have given rise to gross
deferred tax assets of $8,601,000, primarily accrued expenses and inventory, and
gross deferred tax liabilities of $4,675,000, primarily depreciation, as of
September 30, 1994. The company has not recorded a valuation allowance for
deferred tax assets, because the existing net deductible temporary differences
will reverse during periods in which the company expects to generate taxable
income.
No provision has been made for income taxes of approximately $3,550,000
at September 30, 1994, which would be payable should undistributed net income of
$56,886,000 of subsidiaries located outside the United States be distributed as
dividends, since any tax resulting from such a distribution could be
substantially offset by resulting tax credits.
<PAGE>
STOCKHOLDERS' EQUITY
Each outstanding common share has attached to it a one Share Purchase
Right which, until exercisable, cannot be transferred apart from the company's
Common Stock. The Rights will only become exercisable if a person or group
acquires 27% or more of the company's Common Stock or announces an offer to
acquire 30% or more of the company's Common Stock. In the event the Rights
become exercisable, each Right may entitle the holder to purchase Common Stock
of either the surviving or acquired company at one-half its market price.
The company currently maintains a long-term Management Incentive Program
which provides for the issuance of up to 2,700,000 common shares in the form of
stock options and awards and the awarding of performance units payable in cash
or stock to key officers and other employees. Substantially all options granted
under this plan become fully exercisable at the end of a four-year period and
expire five years after grant.
The company also maintains a Stock Option Plan for non-employee
Directors that provides for the issuance of up to 300,000 common shares. Options
issued under this plan vest over a five-year period and expire ten years after
grant.
Information on options for the last three years ended September 30 is as
follows:
<PAGE>
<TABLE>
ANDREW CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONT'D.)
<CAPTION>
1994 1993 1992
---- ---- ----
<S> <C> <C> <C>
Outstanding at beginning of year 1,124,952 1,746,582 2,049,000
Granted 308,100 150,000 48,750
Expired (42,540) (124,482) (36,120)
Exercised (347,312) (647,148) (315,048)
--------- --------- ---------
OUTSTANDING AT END OF YEAR 1,043,200 1,124,952 1,746,582
========= ========= =========
EXERCISABLE AT END OF YEAR 340,330 311,100 571,614
========= ========= =========
</TABLE>
<TABLE>
Price range of options:
<CAPTION>
1994 1993 1992
---- ---- ----
<S> <C> <C> <C>
Outstanding at end of year $ 4.42-32.33 $ 4.42-18.17 $ 4.42-13.21
Granted during the year $ 23.50-32.33 $ 14.09-18.17 $ 10.00-10.67
Exercised during the year $ 4.67-18.17 $ 4.42-13.21 $ 4.42-13.21
</TABLE>
The company also has an Employee Stock Purchase Plan which expires
February 1, 1999. All employees with six months of service as of the annual
offering date are eligible to participate in this Plan. The Plan authorizes up
to 525,000 shares of Common Stock to be sold to employees at 85% of market
value. Through September 30, 1994, 72,633 shares have been issued under the
Plan.
<PAGE>
ANDREW CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONT'D.)
STOCKHOLDERS' EQUITY (CONT'D.)
At September 30, 1994, 2,371,000 shares of Common Stock were reserved for
the various stock plans described above.
On February 3, 1993, the company's Board of Directors approved a
two-for-one stock split effected in the form of a dividend to stockholders of
record on February 17,1993, payable on March 3, 1993. On February 2, 1994 the
company's Board of Directors declared a three-for-two stock split to
stockholders of record on February 16, 1994, payable on March 2, 1994. On
February 2, 1994 the stockholders approved an increase in the Common Stock
authorized from 30,000,000 to 100,000,000.
Common Stock issued and outstanding and held in treasury is summarized in the
table below:
<TABLE>
<CAPTION>
1994 1993 1992
---- ---- ----
<S> <C> <C> <C>
SHARES OF COMMON STOCK-ISSUED
Balance at beginning of year 20,290,588 10,145,294 10,145,294
Three-for-two stock split 10,145,294 0 0
Two-for-one stock split 0 10,145,294 0
---------- ---------- ----------
BALANCE AT END OF YEAR 30,435,882 20,290,588 10,145,294
========== ========== ==========
SHARES OF COMMON STOCK-HELD IN TREASURY
Balance at beginning of year 3,495,678 1,982,452 589,261
Three-for-two stock split 1,747,839 0 0
Two-for-one stock split 0 1,825,057 0
Repurchase of shares 0 0 1,528,000
Stock option and purchase plans (352,357) (311,831) (134,809)
---------- ---------- ----------
BALANCE AT END OF YEAR 4,891,160 3,495,678 1,982,452
========== ========== ==========
</TABLE>
Foreign currency translation adjustments increased equity by $4.1 million
during the year ended September 30, 1994. Foreign currency translation
adjustments decreased equity $7.6 million and $.4 million during the years
ended September 30, 1993 and 1992, respectively.
<PAGE>
GEOGRAPHIC AREA INFORMATION
<TABLE>
Principal financial data by major geographic area:
<CAPTION>
1994 1993 1992
---- ---- ----
(In Thousands)
<S> <C> <C> <C>
SALES
United States:
Customers $ 415,501 $ 309,262 $ 323,518
Intercompany 42,754 34,539 28,966
--------- --------- ---------
458,255 343,801 352,484
Europe:
Customers 94,620 79,614 72,643
Intercompany 5,462 2,510 3,016
--------- --------- ---------
100,082 82,124 75,659
Canada:
Customers 19,082 24,743 31,192
Intercompany 3,449 3,008 3,570
--------- --------- ---------
22,531 27,751 34,762
Australasia:
Customers 29,254 17,201 14,655
Intercompany 390 228 251
--------- --------- ---------
29,644 17,429 14,906
Eliminations 52,055 40,285 35,803
--------- --------- ---------
CONSOLIDATED SALES $ 558,457 $ 430,820 $ 442,008
========= ========= =========
UNITED STATES - EXPORT SALES $ 101,829 $ 54,253 $ 49,482
========= ========= =========
OPERATING INCOME:
United States $ 42,436 $ 17,260 $ 19,452
Europe 17,440 17,910 14,616
Canada 4,195 5,034 5,287
Australasia 12,447 6,472 4,485
--------- --------- ---------
CONSOLIDATED OPERATING INCOME $ 76,518 $ 46,676 $ 43,840
========= ========= =========
ASSETS IDENTIFIABLE TO:
United States $ 313,121 $ 253,059 $ 234,939
Europe 75,257 59,922 50,736
Canada 15,379 16,849 21,646
Australasia 11,406 7,273 6,611
--------- --------- ---------
CONSOLIDATED ASSETS $ 415,163 $ 337,103 $ 313,932
========= ========= =========
<FN>
Sales and transfers between geographic areas are made at amounts which
approximate manufacturing cost and generally consist of products which require
additional processing and with respect to which related selling, marketing and
engineering expenses are incurred prior to shipment to customers.
</FN>
</TABLE>
<PAGE>
INDUSTRY SEGMENT INFORMATION
The company operates in three strategic business segments: commercial,
government and network. The commercial segment serves commercial markets,
including telecommunications companies, radio equipment companies, television
stations, utilities and distributors. Products include antennas and antenna
systems, and coaxial cable. The government segment serves government
markets--federal, foreign and local. Products include specialized antennas and
communication reconnaissance systems sold to various United States government
agencies and friendly foreign governments. Products also include coaxial cable
and standard antennas sold to government customers. The network segment provides
products and services supporting the integration of voice, data and video in
corporate telecommunication networks. The corporate and other category includes
certain expenses for corporate administration; long-range research and
development; costs related to unconsolidated affiliates; and results of
operations which do not relate to business segments, as well as the assets
associated therewith. Corporate identifiable assets also include cash and
equivalents. In 1994 direct and indirect sales to agencies of the United States
federal government totaled $27,840,000 compared to $31,257,000 in 1993 and
$38,295,000 in 1992.
<TABLE>
Financial information by industry segment is as follows:
<CAPTION>
Corporate
(In Thousands) Commercial Government Network and Other Total
<S> <C> <C> <C> <C> <C>
1994:
Sales $457,803 $ 43,611 $ 52,208 $ 4,835 $558,457
Operating income (loss) 112,020 1,067 (5,409) (31,160) 76,518
Identifiable assets 228,560 66,800 42,502 77,301 415,163
Capital expenditures 22,986 1,527 655 1,927 27,095
Depreciation and
amortization 13,574 3,256 3,494 2,063 22,387
1993:
Sales $315,484 $ 53,958 $ 57,681 $ 3,697 $430,820
Operating income (loss) 71,258 2,547 (1,586) (25,543) 46,676
Identifiable assets 170,560 65,109 52,131 49,303 337,103
Capital expenditures 10,850 2,614 1,975 2,437 17,876
Depreciation and
amortization 12,451 3,531 3,440 1,764 21,186
1992:
Sales $315,906 $ 65,803 $ 55,687 $ 4,612 $442,008
Operating income (loss) 59,511 5,598 99 `(21,368) 43,840
Identifiable assets 176,006 66,749 47,605 23,572 313,932
Capital expenditures 12,360 2,450 2,255 779 17,844
Depreciation and
amortization 13,135 3,880 3,232 616 20,863
</TABLE>
<PAGE>
ANDREW CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONT'D.)
SELECTED QUARTERLY FINANCIAL INFORMATION (UNAUDITED)
Due to variability of shipments under large contracts, customers' seasonal
installation considerations, variations in product mix and in profitability of
individual orders, the company can experience wide quarterly fluctuations in net
sales and income. Consequently, it is more meaningful to focus on annual rather
than quarterly results.
<TABLE>
<CAPTION>
December March June September Total
-------- ----- ---- --------- -----
(In thousands, except per share amounts)
<S> <C> <C> <C> <C> <C>
1994:
Sales $121,746 $142,159 $135,970 $158,582 $558,457
Gross profit 48,820 52,683 58,738 71,955 232,196
Income before income taxes 10,042 14,206 17,294 27,824 69,366
Net income 6,427 9,092 11,068 17,808 44,395
Net income per share .25 .35 .42 .68 1.70
Common Stock Price Range:
High 29 34 3/4 39 1/2 50 1/4
Low 19 3/4 24 1/4 30 3/4 36
1993:
Sales $101,032 $ 99,886 $110,474 $119,428 $430,820
Gross profit 39,747 39,502 46,129 53,256 178,634
Income before income taxes 7,572 7,203 10,240 18,576 43,591
Net income 4,770 4,534 6,456 12,102 27,862
Net income per share .19 .18 .25 .47 1.09
Common Stock Price Range:
High 16 1/4 20 1/8 19 26 1/8
Low 11 13 7/8 13 17 7/8
</TABLE>
<PAGE>
FIVE YEAR FINANCIAL SUMMARY
ANDREW CORPORATION
<TABLE>
<CAPTION>
In Thousands, except per share amounts 1994 1993 1992 1991 1990
- - - -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
OPERATIONS<F1>
- - - ----------
Sales $ 558,457 $ 430,820 $ 442,008 $ 416,229 $ 365,990
Employee compensation 166,850 147,323 145,632 145,079 128,425
Materials, supplies and services 279,868 214,711 246,338 202,706 187,692
Depreciation 19,271 18,065 17,911 17,255 15,141
Increase (decrease) in inventory 15,950 4,045 (11,713) 10,707 197
Interest expense 5,200 5,445 6,133 6,552 5,181
Interest income 1,343 830 1,328 961 1,054
Other income (expense) (3,295) 1,530 944 985 (1,191)
Non-recurring items<F2> 0 0 0 0 0
Income tax 24,971 15,729 14,992 13,698 11,450
Net income 44,395 27,862 24,987 22,178 18,161
Net income per share 1.70 1.09 .87 .76 .60
FINANCIAL POSITION
- - - ------------------
Working capital 169,021 138,689 124,864 150,330 136,068
Property, plant and equipment, net 74,966 68,113 70,829 72,436 64,638
Total assets 415,163 337,103 313,932 343,018 319,542
Long-term debt 45,455 50,000 52,556 58,261 63,447
Stockholders' equity 272,854 219,570 192,224 217,471 198,524
RATIOS AND OTHER DATA
- - - ---------------------
Current ratio 2.8 3.2 2.9 3.5 3.6
Return on sales 7.9% 6.5% 5.7% 5.3% 5.0%
Return on average assets 11.8% 8.6% 7.6% 6.7% 6.2%
Return on average stockholders' equity 18.0% 13.5% 12.2% 10.7% 9.5%
Stockholders' equity per ending share outstanding $ 10.68 $ 8.72 $ 7.85 $ 7.59 $ 6.88
Foreign exchange gain (loss)<F3> (2,021) 1,340 17 593 (541)
Research and development 25,707 22,011 20,156 20,341 22,564
Additions to property, plant and equipment 27,095 17,876 17,844 25,002 25,151
Net assets located outside U.S. at year end 129,300 89,300 64,500 70,000 59,800
Orders entered 555,000 436,300 418,300 419,900 361,100
Order backlog to be shipped in 12 months 83,900 85,500 83,900 107,600 111,000
Order backlog over 12 months 600 1,600 5,500 8,300 9,300
Number of employees at year end:
Outside United States 666 577 591 713 738
Total employees 3,096 2,924 3,040 3,370 3,200
Average shares of stock outstanding (thousands) 26,118 25,622 28,764 29,199 30,237
Stockholders' of record at year end 1,482 1,133 1,057 1,137 1,300
<FN>
<F1>
All acquired businesses have been accounted for as purchases. Pro forma
information is provided on individual acquisitions in the financial
statements of the year of acquisition.
<F2>
In 1984 $1,300 provision for estimated costs of closing a manufacturing
plant in Brazil. In 1987 pre-tax charge of $19,000 for restructuring
less pre-tax gain of $5,941 on sale of land.
<F3>
Total foreign exchange gain or loss, realized and unrealized, before
provision for applicable taxes.
</FN>
</TABLE>
<PAGE>
REPORT OF INDEPENDENT AUDITORS
To the Stockholders and Board of Directors
Andrew Corporation
We have audited the accompanying consolidated balance sheets of Andrew
Corporation and subsidiaries as of September 30, 1994 and 1993, and the related
consolidated statements of income, stockholders' equity and cash flows for each
of the three years in the period ended September 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, the financial statements referred to above present fairly, in
all material respects, the consolidated financial position of Andrew Corporation
and subsidiaries at September 30, 1994 and 1993, and the consolidated results of
their operations and their cash flows for each of the three years in the period
ended September 30, 1994 in conformity with generally accepted accounting
principles.
/s/ Ernst & Young LLP
Chicago, Illinois
November 17, 1994
<PAGE>
APPENDIX A
<TABLE>
<CAPTION>
PAGES WHERE GRAPHIC DESCRIPTION OF GRAPHIC AND IMAGE MATERIAL
IMAGE APPEARS (In thousands, except per share data)
<S> <C>
16 Bar graph of Gross Profit (Percent to Sales).
Data points: 1990-38.4%, 1991-38.2%, 1992-38.3%, 1993-41.5%, 1994-41.6%
16 Sales and Administrative Expenses (Percent to Sales).
Data points: 1990-22.7%, 1991-23.6%, 1992-23.8%, 1993-25.5%, 1994-23.3%
16 Bar graph of Research and Development Expenses (Percent to Sales).
Data points: 1990-6.2%, 1991-4.9%, 1992-4.6%, 1993-5.1%, 1994-4.6%
16 Bar graph of Operating Income (Percent to Sales).
Data points: 1990-9.5%, 1991-9.7%, 1992-9.9%, 1993-10.8%, 1994-13.7%
17 Bar graph of Net Income (Percent of Sales).
Data points: 1990-5.0%, 1991-5.3%, 1992-5.7%, 1993-6.5%, 1994-7.9%
17 Bar graph of Return on Equity (Percent).
Data points: 1990-9.5%, 1991-10.7%, 1992-12.2%, 1993-13.5%, 1994-18.0%
17 Bar graph of Return on Assets (Percent).
Data points: 1990-6.2%, 1991-6.7%, 1992-7.6%, 1993-8.6%, 1994-11.8%
18 Bar graph of Non-U.S. Sales (In millions).
Data points: 1990-$155, 1991-$168, 1992-$168, 1993-$176, 1994-$245
18 Bar graph of Export Sales (In millions).
Data points: 1990-$47, 1991-$50, 1992-$49, 1993-$54, 1994-$102
19 Bar graph of 12 Month Backlog (In millions).
Data points: 1990-$111, 1991-$108, 1992-$84, 1993-$85, 1994-$84
19 Bar graph of Net Cash from Operations (In millions).
Data points: 1990-$35, 1991-$32, 1992-$51, 1993-$55, 1994-$52
19 Bar graph of Capital Expenditures (In millions).
Data points: 1990-$25, 1991-$25, 1992-$18, 1993-$18, 1994-$27
19 Bar graph of Total Debt (In millions).
Data points: 1990-$67, 1991-$62, 1992-$54, 1993-$50, 1994-$50
</TABLE>
EXHIBIT 21
ANDREW CORPORATION AND SUBSIDIARIES
List of Significant Subsidiaries
Significant subsidiaries of the registrant, all of which are wholly-owned unless
otherwise indicated, are as follows:
Jurisdiction
Name of Subsidiary of Incorporation
- - - ------------------ ----------------
Andrew AG..........................................................Switzerland
Andrew Canada Inc.......................................................Canada
Andrew Communications B.V..........................................Netherlands
Andrew Corporation (Australia) Pty. Ltd..............................Australia
Andrew Data Corporation......................................State of Delaware
Andrew Espana, S.A.......................................................Spain
Andrew GmbH............................................................Germany
Andrew International Corporation.............................State of Illinois
Andrew KMW Systems Inc.......................................State of Delaware
Andrew Kommunikationssysteme AG....................................Switzerland
Andrew Corporation (Mexico), S.A. de C.V................................Mexico
Andrew NPG Ltd..................................................United Kingdom
Andrew SciComm Inc..............................................State of Texas
Andrew S.A.R.L..........................................................France
Andrew S.R.L.............................................................Italy
Andrew Systems Inc...........................................State of Delaware
Andrew VSAT Systems Inc....................................State of California
(owned 90%)
Andrew Wireless Products, S.A......................................Switzerland
Emerald Technology, Inc....................................State of Washington
UCI/Unified Communications, Inc.............................State of Minnesota
(owned 80%)
EXHIBIT 23
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in Registration Statement
No. 2-86070 on Form S-8 dated August 23, 1983; Registration Statement
No. 33-30364 on Form S-8 dated August 7, 1989; Registration Statement
No. 33-58750 on Form S-8 dated February 24, 1993; Registration Statement
No. 33-58752 on Form S-8 dated February 24, 1993; Registration Statement
No. 33-52487 on Form S-8 dated March 2, 1994; and Post-Effective Amendment No. 1
to Registration Statement No. 33-52487 on Form S-8 dated March 3, 1994 of our
report dated November 17, 1994, with respect to the consolidated financial
statements and schedules of Andrew Corporation incorporated by reference in the
Annual Report (Form 10-K) for the year ended September 30, 1994.
/s/ Ernst & Young LLP
Chicago, Illinois
December 21, 1994
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1994
<PERIOD-END> SEP-30-1994
<CASH> 40,267
<SECURITIES> 0
<RECEIVABLES> 126,821
<ALLOWANCES> 2,769
<INVENTORY> 87,587
<CURRENT-ASSETS> 260,649
<PP&E> 74,966
<DEPRECIATION> 155,668
<TOTAL-ASSETS> 415,163
<CURRENT-LIABILITIES> 91,628
<BONDS> 45,455
<COMMON> 304
0
0
<OTHER-SE> 272,550
<TOTAL-LIABILITY-AND-EQUITY> 415,163
<SALES> 558,457
<TOTAL-REVENUES> 558,457
<CGS> 326,261
<TOTAL-COSTS> 326,261
<OTHER-EXPENSES> 155,678
<LOSS-PROVISION> 1,571
<INTEREST-EXPENSE> 5,200
<INCOME-PRETAX> 69,366
<INCOME-TAX> 24,971
<INCOME-CONTINUING> 44,395
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 44,395
<EPS-PRIMARY> 1.70
<EPS-DILUTED> 1.70
</TABLE>
