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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_______________
FORM 11-K
ANNUAL REPORT
Pursuant to Section 15 (d) of the
Securities Exchange Act of 1934
(Mark One)
[ X ] ANNUAL REPORT PURSUANT TO SECTION 15 (d) OF THE SECURITIES EXCHANGE ACT
OF 1934 [ FEE REQUIRED ].
For the fiscal year ended December 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15 (d) OF THE SECURITIES EXCHANGE
ACT OF 1934 [ NO FEE REQUIRED ].
For the transition period from _______________ to _______________
Commission file number 0-11402
A. Full title of the plan and the address of the plan, if different from
that of the issuer named below:
TELXON CORPORATION
1995 EMPLOYEE STOCK PURCHASE PLAN
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
TELXON CORPORATION
3330 WEST MARKET STREET
AKRON, OHIO 44333
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TELXON CORPORATION
1995 Employee Stock Purchase Plan
Index of Financial Statements
<TABLE>
<CAPTION>
Pages
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<S> <C>
Report of Independent Accountants 2
Statement of Financial Condition as of December 31, 1995 3
Statement of Income and Changes in Participants' Equity for the period
from inception (October 1, 1995) through December 31, 1995 4
Notes to Financial Statements 5-7
</TABLE>
1
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REPORT OF INDEPENDENT ACCOUNTANTS
To the Stock Option and Restricted Stock Committee
of the Board of Directors of Telxon Corporation
and Participants of the Telxon Corporation 1995
Employee Stock Purchase Plan
We have audited the accompanying statement of financial condition of the Telxon
Corporation 1995 Employee Stock Purchase Plan (the "Plan") as of December 31,
1995 and the related statement of income and changes in participants' equity
for the period from inception (October 1, 1995) through December 31, 1995.
These financial statements are the responsibility of the Plan's management.
Our responsibility is to express an opinion on these financial statements based
on our audit.
We conducted our audit 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 audit provides a reasonable basis
for our opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of the Telxon Corporation 1995
Employee Stock Purchase Plan as of December 31, 1995 and the results of its
operations and changes in its participants' equity for the period from
inception (October 1, 1995) through December 31, 1995, in conformity with
generally accepted accounting principles.
/s/ Coopers & Lybrand L.L.P.
COOPERS & LYBRAND L.L.P.
Akron, Ohio
March 26, 1996
2
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TELXON CORPORATION
1995 Employee Stock Purchase Plan
Statement of Financial Condition
as of December 31, 1995
<TABLE>
<S> <C>
ASSETS
- ------
Employer account receivable $ 157,200
Employer contribution receivable 27,437
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Total assets $ 184,637
=======
LIABILITIES
- ------------
Payable for stock purchases $ 184,560
Amounts due to former participants 77
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Total liabilities $ 184,637
=======
</TABLE>
The accompanying notes are an integral
part of the financial statements.
3
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TELXON CORPORATION
1995 Employee Stock Purchase Plan
Statement of Income and Changes in Participants' Equity
for the period from inception (October 1, 1995) through December 31, 1995
<TABLE>
<S> <C>
Participant contributions $ 157,200
Employer contributions 27,437
------
Total additions 184,637
-------
Amounts reserved for future stock purchases 184,560
Participant withdrawals 77
-------
Total deductions 184,637
-------
Net additions -
Participants' equity, beginning of period -
-------
Participants' equity, end of period $ -
=======
</TABLE>
The accompanying notes are an integral
part of the financial statements.
4
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TELXON CORPORATION
1995 Employee Stock Purchase Plan
Notes to Financial Statements
1. Description of the Plan:
------------------------
The following description of the Telxon Corporation's (the "Company")
1995 Employee Stock Purchase Plan, as amended (the "Plan"), provides only
general information. Participants should refer to the Plan for a more
complete statement of the Plan's provisions.
General
-------
The Plan is an employee stock purchase plan that allows participants to
purchase shares of Telxon Common Stock ("Stock") through payroll
deductions. The Plan's fiscal year is divided into two, six-month periods
("Payment Periods"). The Payment Periods are January 1 to June 30 and July
1 to December 31 (under the Plan provisions for its initial implementation,
a three month transitional Payment Period ending December 31, 1995 applied
at inception) and represent the periods during which participant payroll
deductions are accumulated. At the end of each Payment Period, the
participants' accumulated payroll deductions are used to purchase whole
shares of Stock. Participants may purchase shares of Stock for an amount
equal to 85% of the lesser of (1) the closing price of a share of Stock on
the first trading day of the Payment Period (under the Plan provisions for
its initial implementation, the closing price on September 1, 1995 was
specified to be used for this purpose) and (2) the closing price of a share
of Stock on the last trading day of the Payment Period ("Option Price").
The Plan, which was approved by the Company's stockholders during their
August 31, 1995 meeting, authorized the sale of up to 500,000 unissued or
treasury shares of Stock to participants through the Plan. At December 31,
1995, the participants had accumulated payroll deductions sufficient to
purchase 8,815 shares of Stock, leaving 491,185 shares of Stock available
for future purchases by Plan participants.
The Plan is neither qualified under Section 401(a) of the Internal Revenue
Code of 1986, as amended, nor subject to any of the provisions of the
Employee Retirement Income Security Act of 1974 (commonly known as
"ERISA").
Eligibility
-----------
All full-time employees of the Company or any of its participating
subsidiaries who have completed 12 months of continuous employment and all
part-time employees of the Company or its participating subsidiaries
who satisfy certain service requirements and who have completed 12 months
of continuous employment are eligible to participate in the Plan. Eligible
employees may only enroll in the Plan at the beginning of a Payment
Period.
Stock Purchases
---------------
On the last trading day of each Payment Period, the amount of each
participant's accumulated payroll deductions is applied towards the
purchase of the number of whole shares of Stock determined by dividing the
participant's total contribution by the Option Price of the shares for that
Payment Period. Purchased shares of Stock are then issued by the
Company and transferred to a brokerage account outside of the Plan in the
name of the participant.
5
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TELXON CORPORATION
1995 Employee Stock Purchase Plan
Notes to Financial Statements
1. Description of the Plan, Continued:
------------------------
Participant Contributions
-------------------------
Participants in the Plan may elect to have 1% to 15% of their "Covered
Compensation", as defined in the Plan, deducted, on an after-tax basis, for
the purchase of Stock. Participants may only change their deduction
percentages at the beginning of a Payment Period. No interest accrues or
is paid on participants' accumulated payroll deductions. Once made, the
Company may use the payroll deductions for any corporate purpose, and the
Company has no obligation to segregate employees' payroll deductions
from any other funds of the Company or to hold funds representing the same
pending the application thereof to the purchase of shares at the end of
each Payment Period in accordance with the Plan. Any accumulated
contribution amount that is insufficient to purchase a whole share of Stock
at the end of a Payment Period will be carried forward and applied to the
purchase of shares in future Payment Periods or refunded to the participant
upon withdrawal from the Plan.
Company Contributions
---------------------
The 15% discount from market value granted to Plan participants on the
purchase of shares of Stock at the end of each Payment Period represents
the Company's non-cash contribution to the Plan. These non-cash
contributions amounted to $27,437 for the period ended December 31, 1995.
Participant Refunds
-------------------
Plan participants may withdraw from the Plan at any time by properly
notifying the Company. However, a participant's accumulated payroll
deductions prior to withdrawal from the Plan will continue to be applied
towards the purchase of whole shares of Stock on the last trading day
of the Payment Period.
Participants who terminate their employment relationship with the Company
are not eligible to continue in the Plan. All payroll deductions
accumulated during the Payment Period through the date of such cessation of
employment will be refunded to the employee or, in the event of the
employee's death, to his or her estate.
Administrative Expenses
-----------------------
The Company bears all costs in connection with the Plan including
administrative fees and all fees associated with the issuance of Stock.
Administrative expenses related to the Plan amounted to approximately
$11,000 for the period ended December 31, 1995.
Plan Termination
----------------
Although it has not expressed any intent to do so, the Company has the
right under the Plan to terminate the Plan at any time. The Plan will also
terminate when all or substantially all of the shares of Stock reserved for
the purposes of the Plan (initially 500,000 shares) have been purchased.
Upon termination of the Plan, all payroll deductions not used to
purchase Stock would be refunded to Plan participants.
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TELXON CORPORATION
1995 Employee Stock Purchase Plan
Notes to Financial Statements
2. Income Tax Status:
------------------
The Plan fulfills the requirements of an "employee stock purchase plan" as
defined in Section 423 of the Internal Revenue Code. As such, the Plan is
not required to file income tax returns or pay income taxes. Under Section
423, a participating employee will recognize no income, and the Company
will be entitled to no deduction, for federal income tax purposes when
the employee enrolls in the Plan or when the participant purchases whole
shares of Stock under the Plan.
3. Subsequent Event:
-----------------
Plan participants' accumulated payroll deductions for the Payment Period
ended December 31, 1995 amounted to $157,200, and have been recorded
as an account receivable from the Company at December 31, 1995. Subsequent
to year end, $155,474 of these accumulated deductions were sufficient to
purchase 8,815 shares of Stock which were issued by the Company to
participants on January 11, 1996. The 8,815 shares of Stock purchased had
a market value of $182,911 as of the Option Price date which has been
included in the liability "Payable for stock purchases" at December 31,
1995. Participants' accumulated payroll deductions insufficient to
purchase whole shares of Stock totaled $1,649, and have been included in
the liability "Payable for stock purchases" at December 31, 1995.
7
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CONSENT OF INDEPENDENT ACCOUNTANTS
----------------------------------
We consent to the incorporation by reference in Registration No. 33-62957 on
Form S-8, dated September 26, 1995, pertaining to the Telxon Corporation 1995
Employee Stock Purchase Plan of our report dated March 26, 1996 on the audit of
the Telxon Corporation 1995 Employee Stock Purchase Plan as of December 31,
1995 and for the period from inception (October 1, 1995) through December 31,
1995 which report is included in this Annual Report on Form 11-K of Telxon
Corporation.
/s/ Coopers & Lybrand L.L.P.
COOPERS & LYBRAND L.L.P.
Akron, Ohio
March 26, 1996
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Stock
Option and Restricted Stock Committee, the administrator of the Telxon
Corporation 1995 Employee Stock Purchase Plan, has duly caused this annual
report to be signed on its behalf by the undersigned hereunto duly authorized.
TELXON CORPORATION
1995 EMPLOYEE STOCK PURCHASE PLAN
April 1, 1996
By: /s/ Margaret E. Pais
-----------------------
Margaret E. Pais, Vice President,
Employee Services - Administration
of Telxon Corporation
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April 1, 1996
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Telxon Corporation 1995 Employee Stock Purchase Plan
Gentlemen:
We transmit herewith for electronic filing with the Securities and
Exchange Commission, pursuant to the Securities Act of 1934, as amended, an
annual report on Form 11-K of the Telxon Corporation 1995 Employee Stock
Purchase Plan. On March 27, 1996, the Company paid the filing fee related to
this Form 11-K by means of wire transfer.
Please address any comments regarding the above to the undersigned at
3330 West Market Street, Akron, Ohio 44333 (330) 867-3700.
Very truly yours,
TELXON CORPORATION
By: /s/ Gary L. Grand
------------------
Gary L. Grand
Assistant Corporate Controller
