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<PAGE> 1
FORM 10-K
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
X ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [FEE REQUIRED]
For the fiscal year ended January 1, 1995
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from to _
Commission File No.: 0-14685
GENICOM CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 51-0271821
(State or other jurisdiction (I.R.S. Employer
of Identification No.)
incorporation or
organization)
14800 Conference Center Drive 22021-3806
Suite 400, Westfields, (Zip Code)
Chantilly, Virginia
(Address of principal
executive offices)
Registrant's telephone number, including area code: (703) 802-9200
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Common stock, $.01 par value
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 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, to the best
of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K X
As of February 3, 1995, there were 10,648,299 shares of Common
Stock of the Registrant outstanding. The aggregate market value of
the shares of Common Stock held by non-affiliates (without admitting
that any person whose shares are not included in determining such
value is an affiliate) was approximately $10,731,847 based upon the
closing price of the shares in the NASDAQ over-the-counter market on
February 3, 1995.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Registrant's Annual Report to Stockholders for
Fiscal Year Ended January 1, 1995: Parts I and II. Portions of the
Registrant's definitive proxy statement with respect to the Annual
Meeting of Stockholders to be held on April 27, 1995: Part III
GENICOM Corporation and Subsidiaries
Form 10-K Index
PART I
Item 1. Business 3
Item 2. Properties 11
Item 3. Legal Proceedings 12
Item 4. Submission of Matters to a Vote of Security 12
Holders
Executive Officers of the Registrant. 13
PART II
Item 5. Market for the Registrant's Common Stock and
Related Stockholder Matters 14
Item 6. Selected Financial Data 14
Item 7. Management's Discussion and Analysis of
Financial Condition and Results of 14
Operations
Item 8. Financial Statements and Supplementary Data 14
Item 9. Changes in and Disagreements with
Accountants on Accounting and Financial 14
Disclosure
PART III
Item 10. Directors and Executive Officers of the
Registrant 15
Item 11. Executive Compensation 15
Item 12. Security Ownership of Certain Beneficial
Owners and Management 15
Item 13. Certain Relationships and Related 15
Transactions
PART IV
Item 14. Exhibits, Financial Statement Schedules and
Reports on Form 8-K 15
Signatures 19
Index to Financial Statements and Schedules F-1
Index to Exhibits E-1
GENICOM Corporation and Subsidiaries
PART I
Item 1. BUSINESS
GENICOM Corporation ("GENICOM" or the "Company"), through its
worldwide operations, designs, manufactures, markets and services a
wide range of computer printer technologies for general purpose
applications as well as a line of hermetically sealed relays.
Through its Enterprising Service Solutions business, GENICOM provides
multivendor depot and field support, express parts and professional
services.
Printer Products
The Company offers a wide range of serial (one character at a time),
line (one or more lines at a time) and page (one page at a time)
printers, with performance features and prices suitable for a varied
range of printing applications. Besides offering a wide range of
technologies and print speeds, GENICOM's printers offer multiple
combinations of features that make them suitable for diverse
applications. Such features include multiple copy and extensive
paper handling capabilities, multiple type styles (fonts), color
printing and bar codes. GENICOM's printers are used with desktop
workstations and with various networks and stand alone configurations
in conjunction with micro, mini, super-mini and mainframe computers.
GENICOM also manufactures and sells spare parts and supplies.
Supplies include items that have a relatively short life such as
printer ribbons and cartridges, while spare parts include items that
have generally a longer life such as print heads and printed wire
boards.
The following table reports the composition of printer sales:
<TABLE>
<CAPTION>
1994 1993 1992
---- ---- ----
<S> <C> <C> <C>
Impact Printers 46.2% 53.9% 59.1%
Nonimpact Printers 9.3% 9.7% 3.4%
Spares 11.7% 9.7% 13.3%
Supplies 32.8% 26.7% 24.2%
---- ---- ----
Total Printer Products 100.0% 100.0% 100.0%
====== ====== ======
</TABLE>
In 1994, sales of printers and related products accounted for 64.8%
of GENICOM's revenues as compared to 72.3% for 1993 and 72.0% for
1992.
The following table sets forth a summary of certain performance
features of GENICOM's principal printer products. Manufacturer's
List Price Range is as of January 1995, except for the 7900 Series
which was introduced in March 1995. Sales price may vary depending
on features installed, customization, discounts and other factors.
<TABLE>
<CAPTIONS>
Year
Volume Manufacturer's
Printer Shipments Draft Suggested
Product Began Technology Print Speed Features Options List Price
Family <F1> Type Range
<S> <C> <C> <C> <C> <C> <C>
Impact -
Serial
2000 1980 9 wire 60 to 150 teleprinters paper handling $ 2,906 -
Series serial cps for desktop options, $ 3,008
matrix applications current
interface and
pedastal
3000 1983 9 or 18 240 to 400 wide range of additional $ 2,079 -
Series wire cps models for fonts, graphic $ 3,130
parallel or different buffer
staggered environments, expansion,
serial color and bar paper
matrix codes handling
options
3800 1989 18 wire 600 cps high-speed, additional $ 2,125 -
Series parallel network fonts, $ 2,499
serial printer, oversize
matrix advanced paper characters and
handling and DEC LA210,
single/dual pedestal and
path, postnet paper handling
and bar codes options
3900 1990 18 wire 600 cps designed for additional $ 2,999 -
Series parallel attachment to fonts, $ 4,520
serial IBM 3270 pedestal and
matrix controllers paper handling
(coax) and IBM options
Systems 3X or
AS/400
(twinax), high-
speed,
advanced paper
handling and
bar codes
Impact -
Line
4000 1986 shuttle 400 to heavy-duty additional $ 6,195 -
Series matrix line 1400 lpm cycle, fonts and $10,158
printer maintenance paper motion
free features, detector QMS
advanced paper bar codes
handling,
graphics and
bar codes
band line 800 to fully-formed special $ 8,685 -
printers 1200 lpm letter quality character $11,990
print, rugged bands
band printer
features and
postnet
4500 1986 shuttle 1200 to designed for additional $ 7,790 -
Series matrix line 1400 lpm attachment to fonts $11,158
printer IBM
3270 QMS bar codes
controllers
(coax), IBM
Systems 3X or
AS/400
(twinax)
and bar codes
4800 1994 shuttle 400 to reliable, low QMS & IPG $ 5,995 -
Series matrix line 800 lpm cost of graphics IBM $ 8,013
printer ownership twinax and
printer coax
designed for
connectivity
to Ethernet,
TCP/IP, Token
Ring, AT&T SSI
and LANS
4900 1994 shuttle 400 to designed for additional $ 7,047 -
Series matrix line 800 lpm attachment to fonts QMS/IGP $ 9,265
printer IBM 3270 bar codes
controllers
(coax), IBM
Systems 3X or
AS/400
(twinax) and
bar codes
Nonimpact
7000 1992 page 10 to 17 desktop, interconnec- $ 995 -
Series printers ppm most network and tion with $3,979
(laser) transfer multiuser Geniscript,
page and printer at environments, (Postscript
thermal 2.5 min per high language
transfer page resolution, compatible
printer multiple interpreter),
resident multipurpose
fonts, PCL5 & feeder,
PCL5E versatile
compatible, input/output
supports paper handling
various paper devices and
sizes duplexing
including
large format
printing up to
11" x 17"
7900 1995 page 10 to Multiuser, IBM MarkNet $ 1,399 -
Series printers 16 ppm client server internal $ 5,665
(laser) environments, network
full IBM 4028 adapter
IPDS connects up to
emulation, 18 different
PCL5E & operating
Postscript systems,
Level 2 versatile
compatible up input/output
to 1200 dpi, paper handling
bar codes, devices and
labels, duplexing,
graphics, various memory
electronic options
forms
9000 1994 page 8 to 17 ppm desktop, Interconnec- $ 4,195 -
Series printers network and tion with $ 4,395
(laser) multiuser Geniscript
environments, (Postscript
high language
resolution, compatible
multiple interpreter),
resident multipurpose
fonts, PCL5 feeder,
compatible, versatile
supports input/output
various paper paper handling
sizes devices and
including duplexing
large format
printing up to
11" x 17"
The following are trademarks or registered trademarks of their
respective companies: DEC of Digital Equipment Corporation;
Geniscript of GENICOM Corporation; IBM and IBM Proprinter of
International Business Machines Corporation; PCL5 & PCL5E of
Hewlett-Packard Company; Postscript of Adobe Systems, Inc.
Definitions: cps-characters per second, lpm-lines per
minute, ppm-pages per minute
<FN>
<F1> Represents the first year that the Printer Product
Family had volume shipments. GENICOM continues to
introduce new models within most Printer Product
Families.
</FN>
</TABLE>
Service
GENICOM performs a wide range of service solutions related
activities through its Enterprising Service Solutions
business ("ESS"). These activities include the following
services for customers of GENICOM manufactured and
distributed products as well as products manufactured by
others - multivendor services. Serviced products include
printers, peripherals, servers, personal computers,
workstations, internetworking products, systems, monitors,
terminals and storage devices.
Preventive Regularly scheduled visits to customer
maintenance sites to provide routine maintainance.
Depot repair Unit repair or refurbishment in GENICOM's
quality controlled repair facility by
qualified depot technicians.
Onsite support Repair of down equipment accomplished at
customer site by qualified field
engineers.
Technical Phone service for customers and field
support engineers providing technical and
operating information for products and
software.
Installation Installation of hardware and software
products at customer's site.
Training Hands on training for customers, field
engineers, and partners at our training
facility or at customer's site.
Documentation Training and service manuals and videos
for a broad portfolio of hardware
products.
Systems Customer tailored solutions providing
integration hardware, software and services to meet
unique customer information technology
needs.
In 1992, the Company began expanding its business in the
multivendor service market, due to combined impact of the
following: (1) the Company's rationalization efforts in the
Waynesboro printer product assembly operation, (2) the
recognition that the related labor force was adept at
servicing multivendor computer peripheral products, and (3)
the Company's existing underutilized manufacturing equipment
and quality control procedures and processes which could be
utilized in the service process to provide repeatable
quality. The Company has been successful in expanding its
multivendor service business.
As of March 1995, the Company services over 14,000 customers
and 350,000 devices through its ESS domestic operations.
The Company classifies its service business into two
distinct product lines: depot and field repair services.
For the depot repair operations in the U.S., the Company has
established two facilities: the Waynesboro, Virginia,
facility which services printers, keyboards, etc., and the
Bedford, Massachusettes, facility which services
workstations, systems and monitors. The Waynesboro facility
performs services on both GENICOM and multivendor products
in high volume, whereas the Bedford facility's primary
function is to service multivendor products with complex
technologies.
For the field repair operations in the U.S., the Company has
segregated its operations by geographic location and within
each service center by field engineer skill type. The
Company deploys over 450 field engineers and 85 service vans
from 100 service centers in all 50 states, including all
major metro areas.
GENICOM also provides its Canadian and European customers
parts and services through the Company's international
subsidiaries. GENICOM services its Latin American, Middle
Eastern, African and Pacific Rim customers through
authorized distributors of GENICOM products. ESS revenues,
as a percentage of total revenues, were 28.8%, 20.5% and
20.2% in 1994, 1993 and 1992, respectively.
Sales and Marketing
GENICOM markets its products and services through several
domestic and international channels. GENICOM's distribution
channels consist of (1) national and regional distributors
who sell to value added resellers ("VAR's") and dealers and
end users, and (2) a direct sales force which sells to
OEM's, end users and value added resellers and dealers.
Most printers are available in several standard models,
enabling the Company to serve a wide range of customer
requirements. A combination of accessories satisfies
various printing applications. In addition, standard models
are customized for OEM's and end users using GENICOM's
manufacturing and engineering design capabilities. No
customer accounted for more than 10% of GENICOM's total
sales in 1994.
ESS has enhanced its sales and marketing abilities through
the formation of alliances with its key OEM customers and
the acquisition of the business of Harris Adacom Networking
Services, Inc. in February 1995. These activities have
enabled ESS to expand its offerings to meet a broader range
of customer requirements.
GENICOM maintains international sales and marketing
subsidiaries in Australia, Canada, France, Germany, Italy
and the United Kingdom. These subsidiaries offer GENICOM
products and services to distributors, small OEM's, system
houses, VAR's and retail dealers in over 66 countries in
primarily local currencies. See "Business Segment and
Geographic Information."
Competition
Printer Products
GENICOM's printer products compete in markets characterized
by rapid technological change and strong competition. The
Company competes primarily in the medium and high-
performance segments of the printer market where users
require reliable printers principally for word processing,
shared network printing, graphics, bar codes and other
business applications. The Company competes against many
well-established companies, some with financial, technical
and operating resources greater than GENICOM. Such
competitors include large computer system manufacturers that
produce printers for their own product lines and, in certain
cases, for sale to other suppliers or end users. In
addition, there are a number of independent printer
manufacturers producing printers that compete with those
offered by GENICOM.
Competitive factors within the printer market include price,
performance, reliability, cost of ownership, versatility,
ease of maintenance, applications solutions support, after-
sales service and support and marketing channels. As the
computer industry continues to move toward product
standardization and relies less on proprietary designs,
GENICOM's challenge is to continue to provide product
differentiation based on these competitive factors. The
Company believes that its ability to maintain a competitive
market position depends on the following: development of
applications solutions to customer needs, continued growth
of nonimpact printer technologies, sustained migration to
shared printing environments, effective channels to market,
continued enhancement of the Company's product line and
improvements in the Company's productivity. In order to
enhance its competitive position in the nonimpact market,
the Company purchased Printer Systems Corporation ("PSC") in
February 1995. The Company expects this acquisition to
broaden its page printer product line, increase its
penetration in the IBM compatible market and to build on its
value added application solution strategy. See
"Management's Discussion and Analysis of Results of
Operations and Financial Condition."
The Company believes the U.S. printer market as a whole will
continue unit shipment growth and to a lesser extent revenue
growth through 1997. This growth is attributable to the
growth in the nonimpact printer market segment partially
offset by the contraction of the impact printer market
segment. This market trend should result in nonimpact
printer technologies' dominance by 1995, when it is expected
to constitute 81.0% of the printer units shipped.
Nevertheless, impact printers continue to play a significant
role in the printer industry. The serial dot matrix and
line printer markets accounted for 19.9% and 3.5%,
respectively of the $7.5 billion U.S. printer market in
1993. Serial dot matrix and line printer revenues overall
are predicted to decline an average of 23.0% and 13.0%,
respectively per year through 1998. However, the high speed
segments of the serial dot matrix and line printers markets
are expected to decrease at a slower rate than the rest of
the impact printer market. The Company is a leader and
earns a significant portion of its printer revenues in these
high performance impact printer markets, offering high-
speed, high performance serial matrix and shuttle matrix
line printers. Such printers continue to meet customer
application needs not yet satisfied by nonimpact
technologies, in such areas as multipart forms, high-volume
reliability and low cost of ownership.
The Company's nonimpact printer strategy is to compete in
the shared or network printer market segment which is
anticipated to experience compounded annual growth rate of
over 23.0% for unit shipments through 1998. Functionality,
paper handling capabilities, applications solutions support
and after sales service and support enhance the
competitiveness of the Company's product introductions.
PSC provides GENICOM's Laser Printing Solutions business
with proprietary software and hardware technology for
distributed communications, data stream management and
imaging with emphasis on complex raster image command
languages for laser printers and IBM network transmission
protocols. Raster imaging is a widely employed technology
used in translation and creation of images for nonimpact
printing and other applications. Utilizing PSC expertise,
the Company has introduced a new series of desktop laser
printer products for small workgroups or departmental
printing.
Service
ESS competes with, among others, independent providers of
repair services, the in-house repair centers of OEM's and
third party maintenance organizations (TPM's) in providing
maintenance and repair services. ESS believes it offers
cost-effective maintenance and repair solutions to OEM's and
TPM's and, therefore, considers these entities potential
customers.
In another step to expand its ESS business and to increase
its competitiveness, the Company recently acquired
substantially all of the assets and certain liabilities of
Harris Adacom Network Services, Inc. ("HANS"), including all
of the stock of HANS's Canadian subsidiary, Harris Adacom
Inc. The acquired operations include HANS's field and depot
repair services for computers and computer peripherals which
is expected to broaden ESS's core competencies and improve
its efficiency. Moreover, HANS's systems integration and
network diagnostic and monitoring operations will provide
GENICOM new opportunities to provide its customers a total
application solution. See "Management's Discussion and
Analysis of Results of Operations and Financial Condition."
ESS believes that the primary competitive factors in the
maintenance and repair industry are price, scope, and
quality of a company's maintenance and repair services. Due
in part to the capital costs necessary to maintain adequate
inventory and equipment to service large OEMs and TPMs, ESS
believes the capital constraints of small maintenance and
repair companies preclude them from competing with ESS for
large programs. ESS also believes that the scope of its
maintenance and repair operations and capabilities provides
it with competitive advantages over many of its competitors.
Relay Products
GENICOM offers a line of relays that are used primarily in
signal switching applications requiring high functional
reliability and product quality. Relay revenues, as a
percentage of total revenues, were 6.4%, 6.8% and 7.8% in
1994, 1993 and 1992, respectively.
GENICOM sells relay products primarily for aerospace and
defense applications, automatic test equipment applications
and, to a lesser extent, communication, industrial control
and transportation control applications. GENICOM believes
that its certified and proprietary designs should enable it
to continue to participate in future major space and weapons
programs. Relay revenues have declined since 1990 due to
decreased spending by defense contractors. There are
relatively few competitors in the relay market that GENICOM
serves. See "Management's Discussion and Analysis of
Results of Operations and Financial Condition."
Manufacturing and Depot Repair
GENICOM conducts its manufacturing and assembly operations
primarily at its facility in Reynosa, Mexico and to a lesser
extent at its facility in Waynesboro, Virginia. The Reynosa
facility assembles certain impact printer product lines and
produces printed circuit boards, high-speed matrix
printheads, ribbon cartridges and a variety of conventional
electromechanical assemblies. The Waynesboro facility is
used for shuttle matrix printer and relay manufacturing.
The Company utilizes a third party manufacturer located in
the Republic of India to produce certain Company designed
products.
The Company performs depot repair and distribution services
at its Waynesboro, Virginia and Bedford and Framingham,
Massachusetts facilities.
As a result of manufacturing processes, the Company
generates and manages hazardous wastes at its facilities.
The Company does not believe that compliance with Federal,
State and local regulations will have a material effect on
its capital expenditures, financial condition or results of
operations. See "Legal Proceedings."
Customer Arrangements
The major portion of GENICOM's sales of printers and relays
is made pursuant to purchase agreements, blanket purchase
orders and similar arrangements whereby products are
deliverable only after the customer issues a purchase order,
release or schedule covering specific numbers of units and
specifying firm delivery dates. These arrangements are
generally one year in duration with automatic renewal
provisions. In addition, such arrangements also contain
price protection provisions which provide that if GENICOM
decreases its prices, customers will receive the benefit of
such price decreases for products then held in inventory.
GENICOM's agreements with larger OEM's for printer sales
generally require the customer to provide GENICOM with
continuously updated forecasts of its requirements and to
issue firm orders for deliveries for up to a twelve-month
period.
Besides revenue from individually negotiated arrangements
with companies such as Computervision Corporation, Canon
U.S.A., Motorola Computer Group, service contracts comprise
the major portion of ESS revenue. The contracts typically
cover one or two years, with payment due monthly, quarterly
or annually, in advance. Service is available Monday
through Friday, during normal working hours, with response
times ranging from 4 to 8 working hours in metro areas and
less than 16 working hours outside metro areas. Standard
depot repair time is five working days.
The Company's order backlog at January 1, 1995 was
approximately $48.9 million, compared with approximately
$34.1 million at January 2, 1994. GENICOM's reportable
backlog includes all orders associated with relays, service
and those orders for printers, spare parts and supplies for
which a delivery date within approximately six months has
been specified by the customer. The Company expects to ship
substantially all printer, spares and supplies orders in
reported backlog within fiscal year 1995. The Company
experiences lower sales each year in its third quarter due
to European holidays and the two week vacation shutdown of
the Company's manufacturing facilities. See "Management's
Discussion and Analysis of Results of Operations and
Financial Condition", for further analysis of product
revenue and backlog trends.
GENICOM's working capital practices are consistent with the
working capital practices of the printer industry.
GENICOM's customer payment terms generally require invoices
to be paid within thirty days of the date of issue. To
support its ESS business and spare parts business, the
Company is required to carry significant levels of spare
parts, which were approximately $13.3 million and $14.4
million at January 1, 1995 and January 2, 1994,
respectively.
Engineering, Research and Product Development
GENICOM incurs engineering, research and product development
costs for the following purposes: development of new
products; applications solutions development; modification,
enhancement and achievement of cost reductions for existing
product lines; customization of products for OEM's; market
research; and development of process inspection criteria to
ensure new products are built to specification. GENICOM's
expenditures for engineering, research and product
development were $7.7 million, $9.8 million and $10.6
million in 1994, 1993 and 1992, respectively. $0.5 million
of the 1993 amount related to restructuring costs. In 1994,
1993 and 1992 the Company expended 4.6%, 5.6% and 5.9% of
products revenue, respectively, in engineering research and
product development. See "Management's Discussion and
Analysis of Results of Operations and Financial Condition."
GENICOM maintains in-house capabilities and facilities
available to support its engineering and design activities.
The Company also engages a number of highly specialized
independent firms to supplement its own engineering
capabilities and to design certain software and components
for its products.
Proprietary Rights
GENICOM relies on patent, copyright and trade secret laws to
protect its proprietary and technology rights. GENICOM
obtained certain patents, licenses and cross-licenses when
it acquired the Data Communication Products Business
Department from General Electric Company (collectively
"G.E.") in 1983 and when it acquired the Printer related
assets of Ekco Group, Inc. (formerly Centronics Data
Computer Corporation, "Centronics") in 1987. GENICOM
continues to patent certain developments, holds certain
patents pending and retains numerous patents expiring at
various times between 1995 and 2011. In addition, the
Company has a cross-licensing agreement with IBM that
expires 17 years after the date of issue of certain patents
pending prior to January 1, 1991.
"GENICOM" and certain other marks used in connection with
the sale of the Company's products are registered trademarks
of GENICOM in the United States and, in some cases, certain
foreign countries. Under United States law, a registered
trademark remains valid for 10 years if affirmed at the end
of the sixth year. There is no limit to the number of times
the registration may be renewed for additional 10-year
periods. Thereafter, each registration may be renewed for
additional 10 year periods; otherwise the registration will
expire automatically.
GENICOM's Laser Printing Solutions strategic business unit
specializes in raster imaging technology and has numerous
related patents and trademarks such as "Rastek,"
"MIRROR_5," and "RASTOS." The combined technologies of
MIRROR_5, an HP Laserjetr III emulation software package;
RASTOS, a printer operating system; and GENICOM's
GeniScriptr, a PostScriptr compatible interpreter, will
assist in GENICOM's continued penetration into the nonimpact
market in 1995.
In connection with the acquisition of the printer-related
assets of Centronics, GENICOM acquired a license to use the
name "Centronics" as a trademark, tradename and service
name.
______________
HP Laserjet is a registered trademark of Hewlett-Packard
Company.
Suppliers
GENICOM currently purchases raw materials, components and
printers from various domestic and foreign suppliers.
GENICOM utilizes supply agreements and other arrangements
whereby volume discounts can be obtained.
GENICOM purchases certain products -- printers, options,
supplies and component parts, including print engines, from
sole suppliers who have developed proprietary processes that
the Company incorporates into its products. In the event
that those suppliers were unable or unwilling to supply
these products, the Company believes it could establish
alternate sources for these products or similar products.
The time required to establish an alternate source could
disrupt the manufacture or distribution of these products,
thus causing delays that could adversely affect revenues.
Currently, the Company considers its relationships with
these vendors to be good and does not anticipate any
disruption in the supply of these products.
For other purchases the Company utilizes multiple suppliers,
thus it is unlikely that the loss of any one supplier would
have a material impact upon the manufacture or assembly of
printer or relay products.
In 1994, GENICOM procured 13% of its total purchases from
Toshiba Corporation ("Toshiba") which supplies the Company
with certain nonimpact printer products. No other supplier
accounted for a significant portion of GENICOM's total 1994
purchases. In 1993, no supplier accounted for a significant
portion of GENICOM's total purchases.
Employees
As of January 1, 1995, the Company and its subsidiaries
employed 2,382 employees. The Company believes its
relations with its employees are satisfactory.
The Company's production and maintenance employees at its
Waynesboro facility are represented by the United
Electrical, Radio and Machine Workers of America Local 124,
under a collective bargaining agreement which expires in
July 1996.
Business Segment and Geographic Information
Operation of the Company's subsidiaries in Australia,
Canada, Europe and Mexico is subject to various risks
associated with political and economic developments in such
countries, such as tariffs imposed to discourage imports,
varying product standards and specifications, and value
added and excise taxes. In addition, GENICOM is exposed to
currency fluctuation risks as a result of its international
sales and sourcing of products from foreign vendors.
Accordingly, sales or cost of components may decrease or
increase as the value of the United States dollar
appreciates or depreciates relative to the currency of the
source country. The Company usually hedges these currency
risks through the purchase of forward exchange contracts and
expects to continue this practice in the future.
In December 1994, the Mexican peso suffered a devaluation of
approximately 30%. The impact on the Company's financial
position, results of operations and liquidity was
immaterial. The peso devaluation is expected to lower the
Company's manufacturing costs, but inflation in Mexico is
expected to largely offset the benefits of the peso
devaluation.
Reference is hereby made to Notes 1 and 10 of the Notes to
Consolidated Financial Statements incorporated by reference
in Item 8 of this report for further financial information
by business segment and geographic location.
Item 2. Properties
The following table sets forth certain information with respect
to the Company's owned or leased property as of January 1, 1995:
<TABLE>
<CAPTION>
Square Owned Year
Location Principal Uses Feet or Lease
Leased Expires
<S> <C> <C> <C> <C>
- -------- ---------- ------ ------ ----
Chantilly, Corporate 23,000 Leased 1998
Virginia Headquarters
Waynesboro, Service, 377,000 Owned --
Virginia Manufacturing,
Office
Waynesboro, Service and 50,000 Leased 1995
Virginia Manufacturing
Reynosa, Manufacturing 120,000 Owned --
Mexico
Reynosa, Manufacturing 48,000 Leased 1995
Mexico
McAllen, Distribution 37,500 Leased 1997
Texas
Bedford, Service 155,000 Leased 1995
Mass.
Framingham, Distribution 40,500 Leased 1995
Mass.
</TABLE>
GENICOM's leased property is occupied under standard industrial
leases. Each lease generally contains an optional renewal
provision.
The combined capacity of GENICOM's service and manufacturing
facilities is 24,000 labor hours per day, of which approximately
32% is utilized. Productive capacity is based on the operation
of two shifts at Reynosa, Mexico, Bedford and Framingham,
Massachusetts and three shifts at Waynesboro, Virginia.
The Company's Waynesboro property is subject to a lien in favor
of the Company's lender under its revolving loan agreement.
Item 3. Legal Proceedings
The Company and the former owner of its Waynesboro facility,
G.E., have generated and managed hazardous wastes at the facility
for many years as a result of their use of materials such as
industrial solvents and heavy metals, like chromium, in
manufacturing processes. As a result of permit applications
filed by the Company in connection with these activities, the
United States Environmental Protection Agency ("EPA") conducted a
Resource Conservation and Recovery Act ("RCRA") facility
assessment at the site. The EPA determined that releases and
potential releases of hazardous wastes into the environment had
or potentially could have occurred at the facility and, as a
result, a corrective action order process was initiated. The
Company and the EPA have agreed to a corrective action consent
order (the "Order") issued under section 3008(h) of the RCRA,
which became effective on September 14, 1990. The Order requires
the Company to undertake an investigation of solid waste
management units at its Waynesboro, Virginia facility and to
conduct a study of any necessary corrective measures that may be
required. Although the Order is currently being implemented, it
is not possible for the Company to reliably estimate the total
cost of the investigation and the study required by the order.
If, as a result of the investigation and study, corrective
measures are required, the Company expects that it will then
enter into discussions with the EPA concerning a further order
for that purpose.
On December 9, 1993, the Company entered into a Cooperation
Agreement ("Agreement") with G.E. covering certain environmental
matters at the Company's Waynesboro, Virginia site. One of the
matters covered is the cost of responding to the Order. The
Agreement provides that G.E. will bear 70.0% of the allocable
costs relating to the Order. In 1993, the Company recorded a
$1.2 million recovery from G.E. of previously incurred allocable
costs relating to the Order. A dispute has arisen between the
Company and G.E. concerning the Agreement. Management believes
that the dispute will not have a material effect upon the
financial condition, results of operations or liquidity of the
Company.
As a result of the continuing financial obligation which G.E. has
with respect to releases at the facility both under the Agreement
and by law and the protracted nature of the investigation, the
Company believes that the costs of the investigation and study
and any corrective action that may be required are not likely to
have a material effect upon the financial condition, results of
operations or liquidity of the Company.
On January 9, 1992, the Company was notified by the EPA that it
is one of 700 potentially responsible parties under the
Comprehensive Environmental Response, Compensation and Liability
Act of 1980, for necessary corrective action at a hazardous waste
disposal site in Greer, South Carolina. In prior years, the
Company arranged for the transportation of wastes to the site for
treatment or disposal. Based on information currently available,
the Company believes its share of the costs of the investigation
and any necessary corrective action is not likely to have a
material effect upon the financial condition, results of
operations or liquidity of the Company.
In the ordinary course of business, the Company is party to
various environmental, administrative and legal proceedings. In
the opinion of management, the Company's liability, if any, in
all pending litigation or other legal proceedings, other than
those discussed above, will not have a material effect on its
financial condition, results of operations or liquidity of the
Company.
Item 4. Submission of Matters to a Vote of Security Holders
Not Applicable.
Executive Officers of the Registrant
The following table sets forth certain information with respect
to the Company's executive officers as of January 1, 1995:
<TABLE>
Name Age Title
<S> <C> <C>
- ----------- --- ----------------
Paul T. Winn 50 Director, President and Chief Executive
Officer
James C. Gale 53 Senior Vice President Finance and Chief
Financial Officer
Raymond D. 55 Senior Vice President, International
Stapleton Service Market Development
James A. Jones 37 Vice President, Corporate Controller and
Treasurer
C. Bruce Meyer 45 Vice President Human Resources and
Corporate Communications
B. Garrett 46 Vice President and General Manager,
Buttner Supplies and Service Marketing & Sales
Michael J. 46 ESS Vice President and General Manager
Shelor Service Logistics & Operations
</TABLE>
Mr. Winn joined the Company in April 1990 as President and Chief
Executive Officer and became a director in May 1990. Previously,
Mr. Winn was employed by IBM Corporation, where he served for 22
years in various capacities, most recently as Vice President of
Graphics Systems in the Advanced Work Station Division. Prior to
that position, Mr. Winn served as Vice President of Worldwide
System Printers, responsible for technology, software, product
development and manufacturing.
Mr. Gale joined the Company as Senior Vice President Finance and
Chief Financial Officer in August 1991. Previously, Mr. Gale was
employed by General Foods Corporation, where he served for 25
years in various capacities, most recently as Vice President of
Finance for General Foods Corporation and in that role acted as
Chief Financial Officer of General Foods, USA.
Mr. Stapleton became Senior Vice President International Service
Market Development in August 1994 after serving the Company and
its predecessor, G.E., in various capacities for 30 years, most
recently as Senior Vice President and General Manager
Enterprising Service Solutions Division.
Mr. Jones has served the Company as Corporate Controller since
November 1988, and Treasurer since March 1990.
Mr. Meyer was appointed Vice President of Human Resources in
September 1991 after serving the Company, and its predecessor,
G.E., in various human resources capacities since 1973.
Mr. Buttner was appointed Vice President and General Manager,
Supplies and Service Marketing & Sales in August 1994 after
having served as Vice President and General Manager Supplies
Business Unit since April 1993. Prior to his appointment as a
corporate officer, Mr. Buttner had served in sales, marketing and
business management positions with GENICOM since 1988.
Previously, Mr. Buttner was employed by G.E. for 15 years.
Mr. Shelor was appointed ESS Vice President and General Manager
Service Logistics & Operations in August 1994 after serving the
Company and its predecessor, G.E., in various operating positions
since 1969.
PART II
Item 5. Market for the Registrant's Common Stock and Related
Stockholder Matters
The information set forth under the caption "Stock Trading" on
page 28 of the registrant's 1994 Annual Report to Stockholders is
incorporated herein by reference. Additionally, GENICOM has not
paid a cash dividend on its common stock. The Company intends to
retain earnings from operations for use in its business, and
therefore does not anticipate paying any cash dividends in the
foreseeable future. Certain of the Company's debt arrangements
restrict the payment of dividends unless certain tests are met.
Reference is hereby made to Note 3 of the Notes to Consolidated
Financial Statements incorporated by reference in Item 8 of this
report for further financial information regarding the Company's
debt arrangements.
Item 6. Selected Financial Data
The information set forth under the caption "Eleven Year History"
on pages 6 and 7 of the registrant's 1994 Annual Report to
Stockholders is incorporated herein by reference.
Item 7. Management's Discussion and Analysis of Financial
Condition and Results of Operations
The information set forth under the caption "Management's
Discussion and Analysis of Results of Operations and Financial
Condition" on pages 9 through 11 and 13 through 14 of the
registrant's 1994 Annual Report to Stockholders is incorporated
herein by reference.
Item 8. Financial Statements and Supplementary Data
The information set forth under the captions "Consolidated
Statements of Income," "Consolidated Balance Sheets,"
"Consolidated Statements of Cash Flows," "Consolidated Statements
of Changes in Stockholders' Equity," and "Notes to Consolidated
Financial Statements" on pages 8, 12, and 15 through 26 of the
registrant's 1994 Annual Report to Stockholders is incorporated
herein by reference.
The supplementary data regarding quarterly results of operations
set forth in Note 11 of the "Notes to Consolidated Financial
Statements" on page 26 of the registrant's 1994 Annual Report to
Stockholders is incorporated herein by reference.
Item 9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure
Not applicable.
PART III
Item 10. Directors and Executive Officers of the Registrant
The information required by this item is set forth under the
caption "Election of Directors" in the registrant's Proxy
Statement for its 1994 annual meeting of stockholders, to be
mailed to each stockholder on or about March 31, 1995, which
information is incorporated herein by reference and under the
heading "Executive Officers of the Registrant" appearing on page
14 of this report.
Item 11. Executive Compensation
The information required by this item is set forth on pages 5
through 15 of the registrant's Proxy Statement for its 1995
annual meeting of stockholders, to be mailed to each stockholder
on or about March 31, 1995, which information is incorporated
herein by reference.
Item 12. Security Ownership of Certain Beneficial Owners and
Management
The information required by this item is set forth under the
caption "Principal Stockholders of the Company" in the
registrant's Proxy Statement for its 1995 annual meeting of
stockholders, to be mailed to each stockholder on or about March
31, 1995, which information is incorporated herein by reference.
Item 13. Certain Relationships and Related Transactions
The information required by this item is set forth under the
caption "Certain Transactions" in the registrant's Proxy
Statement for its 1995 annual meeting of stockholders, to be
mailed to each stockholder on or about March 31, 1995, which
information is incorporated herein by reference.
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on
Form 8-K
(a) Financial Statements and Schedules
The financial statements incorporated by reference into this
report and the financial statement schedules filed as part
of this report are listed in the Index to Financial
Statements and Schedules on page F-1 immediately following
the signatures to this report.
Exhibits Included in Response to Item 601 of Regulation S-K
<TABLE>
<CAPTION>
Number Description
- ------ ------------
<S> <C> <C>
3.1 Restated Certificate of Incorporation effective as of June
15, 1992, incorporated by reference to Exhibit 4.1 to Form
S-8 Registration Statement (No. 33-49472) filed with the
Commission on July 10, 1992.
3.2 By-laws, dated June 1, 1983, as amended January 23, 1989 -
incorporated by reference to Exhibit 3.2 to Form 10-K filed
with the Commission on March 29, 1989.
4.1 Indenture, between GENICOM Corporation and Bankers Trust
Company (the "Trustee"), dated February 13, 1987 - filed
herewith. First Supplemental Indenture dated as of March
22, 1991 - incorporated by reference to Exhibit 4.1 to
Form S-1 Registration Statement (No. 33-23007) filed with
the Commission on May 14, 1991.
10.1 Loan and Security Agreement, dated September 25, 1990
between GENICOM Corporation and The CIT Group/Credit
Finance, Inc. (as successor by assignment to Fidelcor
Business Credit Corporation) - incorporated by reference to
Exhibit 4.1 to Form 10-Q filed with the Commission on
November 13, 1990. First Amendment dated May 1, 1991 and
Second Amendment dated March 3, 1992 - incorporated by
reference to Exhibit 10.1 to Form 10-K filed with the
Commission on March 24, 1992. Extension of and Amendment
to Financing Agreements dated September 23, 1992 in
reference to the Loan and Security Agreement, dated
September 25, 1990 between GENICOM Corporation and The CIT
Group/Credit Finance, Inc. - incorporated by reference to
Exhibit 10.1 to Form 8-K filed with the Commission on
October 6, 1992. Extension of and Amendment to Financing
Agreements dated June 9, 1994 in reference to the Loan and
Security Agreement, dated September 25, 1990 between
GENICOM Corporation and The CIT Group/Credit Finance, Inc.
- incorporated by reference to Exhibit 10.1 to Form 8-K/A
filed with the Commission on July 15, 1994.
10.2 Registration Rights Agreement, dated October 21, 1983,
among the Company and the several Purchasers named therein
- incorporated by reference to Exhibit 10.2 to the Form S-1
Registration Statement (No. 33-5458) filed with the
Commission on June 25, 1986 (the "June 25, 1986 Registration
Statement").
10.3 Registration Rights Agreement, dated December 20, 1984,
among the Company and the several Purchasers named therein
- incorporated by reference to Exhibit 10.3 to the June 25,
1986 Registration Statement.
10.4 Registration Rights Agreement, dated December 20, 1984,
among the Company and the several Purchasers named therein
- incorporated by reference to Exhibit 10.4 to the June 25,
1986 Registration Statement.
10.5 Registration Rights Agreement, dated January 3, 1985, among
the Company and the several Purchasers named therein -
incorporated by reference to Exhibit 10.5 to the June 25,
1986 Registration Statement.
10.6 Registration rights provisions contained in a Stock Purchase
Warrant dated October 21, 1983 granted by the Company in
favor of General Electric Company, which Stock Purchase
Warrant became void after October 21, 1988 - incorporated
by reference to Exhibit 10.6 to the June 25, 1986
Registration Statement.
</TABLE>
<TABLE>
<CAPTION>
Number Description
- ------ ------------
<S> <C> <C>
10.7# Stock Option Plan, as amended and restated, effective as of
February 7, 1991 - incorporated by reference to Exhibit 10
to the Registrant's Quarterly Report on Form 10Q (File No.
0-14685) for the quarter ended March 31, 1991 filed with
the Commission on May 15, 1991. First Amendment to the
Registrant's Stock Option Plan, dated February 3, 1992 -
incorporated by reference to Exhibit 4.2 to Form S-8
Registration Statement (No. 33-49472) filed with the
Commission on July 10, 1992. Second Amendment to the
Registrant's Stock Option Plan, dated January 17, 1994 -
incorporated by reference to Exhibit 4 to Form S-8
Registration Statement (No. 33-53843) filed with the
Commission on May 27, 1994.
10.8# Deferred Compensation and Savings Plan, as amended and
restated, effective as of January 2, 1989 - incorporated by
reference to Exhibit 10.8 to Form 10-K filed with the
Commission on March 29, 1991. First Amendment to the
Deferred Compensation and Savings Plan, dated as of
November 1, 1993 - incorporated by reference to Exhibit
10.1 to Form 8-K filed with the Commission on March 30,
1995. Second Amendment to the Deferred Compensation and
Savings Plan, dated as of January 20, 1994 - incorporated
by reference to Exhibit 10.2 to Form 8-K filed with the
Commission on March 30, 1995.
10.9# Defined Benefit Pension Plan for Hourly Employees, as
amended and restated, effective as of January 1, 1989 -
incorporated by reference to Exhibit 10.9 to Form 10-K
filed with the Commission on March 29, 1991.
10.10# Incentive Compensation Plan, as amended - incorporated by
reference to Exhibit 10.13 to the June 25, 1986
Registration Statement.
10.11 Lease agreement with respect to the Company's customer
service facilities in Waynesboro dated August 1, 1988 -
incorporated by reference to Exhibit 10.10 to Form 10-K
filed with the Commission on March 29, 1989. Lease
agreement with respect to the Company's manufacturing
facilities in Waynesboro - incorporated by reference to
Exhibit 10.11 to Form 10-K filed with the Commission on
March 24, 1992.
10.12 Lease of McAllen, Texas facility, dated January 20, 1992 -
incorporated by reference to Exhibit 10.12 to Form 10-K
filed with the Commission on March 24, 1992.
10.13# Terms of employment of Paul T. Winn dated March 26, 1990 -
incorporated by reference to Exhibit 10.15 to Form S-1
Registration Statement (No. 33-23007) filed with the
Commission on May 17, 1990.
10.14Y Agreement Between GENICOM Corporation and TOSHIBA
Corporation Relating to Laser Printer G751, Laser Printer
G750 and Related Options, Supplies and Service Parts, dated
March 31, 1992 - incorporated by reference to Exhibit 10.17
to Form 10-K filed with the Commission on March 31, 1993.
10.15 Agreement with the General Electric Company regarding
environmental matters at the Registrants Waynesboro,
Virginia facility, dated December 9, 1993 - incorporated by
reference to Exhibit 10.1 to Form 8-K filed with the
Commission on February 23, 1994.
10.16 Lease of Bedford and Framingham, Massachutsettes
facilities, dated March 11, 1994 - incorporated by
reference to Exhibit 10.1 and 10.2, respectively to Form 8-
K filed with the Commission on May 31, 1994
</TABLE>
<TABLE>
<CAPTION>
Number Description
- ------ ------------
<S> <C> <C>
10.17 Consulting agreement between GENICOM Corporation and W.
Allen Surber, dated October 11, 1994 - incorporated by
reference to Exhibit 10.17 to Form 10-K filed with the
Commission on March 31, 1995 - filed herewith.
10.18# Consulting agreement between GENICOM Corporation and Edward
E. Lucente, dated December 6, 1994 - incorporated by
reference to Exhibit 10.18 to Form 10-K filed with the
Commission on March 31, 1995 - filed herewith.
11 Statement regarding the Company's computation of earnings
per share - filed herewith.
13 Portions of Annual Report to Stockholders of GENICOM
Corporation for the Fiscal Year Ended January 1, 1995 -
incorporated herein - filed herewith.
22 Subsidiaries of the Registrant - filed herewith.
24 Consent of Independent Accountants - filed herewith.
27 Financial Data Schedule - Filed only with EDGAR version.
(b) Reports on Form 8-K
The Company did not file a Form 8-K during the quarter
ended January 1, 1995.
Y Confidential treatment granted with respect to certain provisions
pursuant to 17 C.F.R. 200.80 (b) (4).
# Management contracts or compensatory plans.
SIGNATURES
Pursuant to the requirement 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.
GENICOM Corporation
BY: Paul T. Winn
--------------
Paul T. Winn
President and Chief Executive
Officer
Pursuant to the requirement of the Securities Exchange Act of
1934, this report has been signed below by the following persons
on behalf of the registrant and in the capacities and on the
dates indicated.
</TABLE>
<TABLE>
<S> <C> <C>
Signature Title Date
- ----------- -------------- -----
Don E. Ackerman Chairman of the Board and March 31, 1995
- --------------- Director
Don E. Ackerman
Paul T. Winn President and Chief March 31, 1995
- --------------- Executive Officer
Paul T. Winn and Director (Principal
Executive Officer)
James C. Gale Senior Vice President March 31, 1995
- --------------- Finance and Chief
James C. Gale Financial Officer
(Principal Financial
Officer)
Bruce K. Anderson Director March 31, 1995
- ---------------
Bruce K. Anderson
Edward E. Lucente Director March 31, 1995
- ---------------
Edward E. Lucente
James A. Jones Vice President, Corporate March 31, 1995
- --------------- Controller and
James A. Jones Treasurer
</TABLE>
GENICOM Corporation and Subsidiaries
INDEX TO FINANCIAL STATEMENTS AND SCHEDULES
The consolidated balance sheets of GENICOM Corporation and
subsidiaries as of January 1, 1995 and January 2, 1994, and the
related consolidated statements of income, changes in
stockholders' equity and cash flows for each of the three years
in the period ended January 1, 1995, including the notes thereto,
are included on pages 8, 12 and 15 through 26 of the Registrant's
1994 Annual Report to Stockholders and are incorporated herein by
reference. With the exception of the aforementioned information,
and the information incorporated by reference in numbered Items
5, 6, 7 and 8, no other data appearing in the Annual Report to
Stockholders is deemed to be "filed" as part of this Form 10-K.
The following additional financial data should be read in
conjunction with these consolidated financial statements.
<TABLE>
<S> <C> <C>
Page
Independents F-2
Accountants' Report
Financial Statement
Schedules:
Schedule II Valuation and Qualifying Accounts F-3
and Reserves
</TABLE>
1. All other schedules have been omitted
since the required information is not present in amounts
sufficient to require submission of the schedules.
F - 1
INDEPENDENT ACCOUNTANTS' REPORT
The Board of Directors and Stockholders of GENICOM Corporation:
We have audited the accompanying consolidated balance sheets of
GENICOM Corporation and Subsidiaries (the "Company") as of
January 1, 1995 and January 2, 1994, and the related consolidated
statements of income, changes in stockholders' equity and cash
flows for each of the three fiscal years in the period ended
January 1, 1995, which financial statements are included on pages
8, 12 and 15 through 26 of the Company's 1994 Annual Report to
Stockholders and incorporated by reference herein. We have also
audited the financial statement schedules listed in the index on
page F-1 of this Form 10-K. These financial statements and
financial statement schedules are the responsibility of the
Company's management. Our responsibility is to express an opinion
on these financial statements and financial statement 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 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 GENICOM Corporation and subsidiaries as of
January 1, 1995 and January 2, 1994, and the consolidated results
of their operations and their cash flows for each of the three
fiscal years in the period ended January 1, 1995 in conformity
with generally accepted accounting principles. In addition, in
our opinion, the financial statement schedules referred to above,
when considered in relation to the basic financial statements
taken as a whole, present fairly, in all material respects, the
information required to be included therein.
As discussed in Note 4 to the financial statements, effective
January 4, 1993, the Company changed its method of accounting for
postretirement benefits other than pensions.
Coopers & Lybrand L.L.P.
- ------------------------
Coopers & Lybrand L.L.P.
Washington, D.C.
January 31, 1995
except Note 12,
for which the date is March 1, 1995.
F - 2
GENICOM Corporation and Subsidiaries
Schedule II - Valuation and Qualifying Accounts and Reserves
(In thousands)
<TABLE>
<CAPTION>
Additions
Balance at Charged to Deductions Balance
Description Beginning Costs from at End
of Period and Reserves of
Period Expenses Period
-------- -------- -------- -------
<S> <C> <C> <C> <C>
Allowance for
doubtful accounts
Year ended:
January 3, 1993 $ 1,527 $ 494 $ 773 $ 1,248
<F1>
January 2, 1994 $ 1,248 $ 812 $ 580 $ 1,480
<F1>
January 1, 1995 $ 1,480 $ 365 $ 366 $ 1,479
<F1>
Allowance for
inventory
obsolescence
Year ended:
January 3, 1993 $13,390 $ 2,690 $ 9,227 $ 6,853
<F2>
January 2, 1994 $ 6,853 $ 2,367 $ 2,483 $ 6,737
<F2>
January 1, 1995 $ 6,737 $ 2,723 $ 3,302 $ 6,158
<F2>
<FN>
<F1> "Additions" to the allowance for doubtful accounts include a
foreign currency translation adjustment of $56, $(48) and
$(100) in 1994, 1993 and 1992, respectively. Net bad debt
expense for 1994, 1993 and 1992 was $309, $859 and $594,
respectively.
<F2> Foreign currency translation adjustments were immaterial in
1994, 1993 and 1992.
</FN>
</TABLE>
F - 3
GENICOM Corporation and Subsidiaries
INDEX TO EXHIBITS TO FORM 10-K
FOR THE FISCAL YEAR ENDED JANUARY 1, 1995
<TABLE>
<CAPTIONS>
Exhibit
Number Description Page
- ------ ---------------------------------------- -------
<S> <C> <C>
10.17 Consulting agreement between GENICOM Corporation E2-E6
and W. Allen Surber, dated October 11, 1994
10.18 Consulting agreement between GENICOM Corporation E7-E12
and Edward E. Lucente, dated December 6, 1994
11 Statement regarding computation of per share E13
earnings
13 Annual Report to Stockholders of GENICOM E14-E35
Corporation for fiscal year ended January 1, 1995.
22 Subsidiaries of the Registrant E36
24 Consent of Independent Accountants E37
27 Financial Data Schedule Filed
only
with
EDGAR
version
</TABLE>
E - 1
Consulting Agreement Between
GENICOM Corporation
and W. Allen Surber
This agreement, by and between the GENICOM Corporation, a
Delaware Corporation (hereinafter called the Company) and W.
Allen Surber (hereinafter called Consultant).
WITNESSETH THAT:
IN CONSIDERATION of the mutual promises hereinafter set forth,
the Company and Consultant do hereby agree as follows:
1. This agreement pertains to consulting services as set
forth in Attachment A and advice to be furnished to
the Company at its request from time to time by the
Consultant during the period commencing October 17,
1994 and ending April 14, 1995 inclusive.
The amount paid for said services under this agreement
exclusive of travel and living expenses and computer
service expenses shall not exceed the sum of seventy-
five thousand and 00/100 dollars ($75,400).
Assignment of this agreement or of any interest
therein or any payment due or to become due hereunder,
without prior written consent of the Company shall be
void.
2. Consultant will participate, as requested by the
Company, as a consultant and advisor in the fields and
technologies pertaining to relays as set forth in
Attachment A as amended from time to time. Prior
approval of hours to be worked/travel and living
expenses must be received from the President/CEO of
GENICOM Corporation or his designee.
3. Within the maximum sum stated in paragraph (1) above
and with prior approval as set forth in paragraphs (2)
and (9), the Company will reimburse Consultant for
services rendered at the rate of seventy-two dollars
and 12/100 ($72.12) per hour worked hereunder. The
first 26 weeks of this agreement (October 17, 1994,
running through April 14, 1995) will be guaranteed for
payment unless Consultant accepts other employment
during this period. Should Consultant accept other
employment during this period, this agreement becomes
null and void. The Company will, in addition,
reimburse the Consultant for reasonable travel and
living expenses incurred while traveling at the
request of the Company in the performance of tasks
under this agreement. Statements in duplicate will be
submitted by the Consultant at the first of each month
itemizing hours worked each month with documentation
of travel and living expenses.
4. The work contemplated under this agreement requires
that Consultant have access to information which is
proprietary and/or confidential to the Company.
Consultant agrees no to publish or otherwise disclose
to persons outside the Company, without specific
permission from the Company, any Company information
acquired by Consultant as a result of participation in
studies or work under this agreement, not to use said
information in any ways which might be injurious to
the interests of the Company.
5. Consultant agrees to promptly disclose to the Company
any information, ideas, or inventions made or
conceived by Consultant which may result from or be
suggested by work performed by Consultant under this
agreement, and to assign to the Company all rights
pertaining to such information, ideas, or inventions.
Knowledge or information of any kind disclosed by
Consultant to the Company shall be deemed to have been
disclosed without obligation on the part of the
Company to hold the same in confidence, and the
Company shall have the full right to use and disclose
such knowledge and information without compensation to
Consultant beyond that specifically provided by this
agreement.
6. Consultant will furnish, on request, written reports
of the work performed by Consultant under this
agreement, including findings, conclusions,
recommendations, and supporting data and analysis, and
any such reports shall become the sole property of the
Company.
7. Consultant is an independent contractor under this
contract. Consultant is not an employee of the
Company and will not be entitled to participate in, or
receive any benefits, privileges, or rights given or
extended by the Company to its employees including
without limitation, Company employee insurance,
pension, savings plans, etc.
8. This agreement may be terminated by either party by
written notice provided, however, the obligations of
Consultant under paragraph 4 and 5 herein shall
survive any termination of this agreement. In the
event of such termination, Consultant shall be paid
pursuant to the provisions of paragraph (3) above for
services rendered and costs incurred up to the date of
such termination shall be accepted by Consultant in
full satisfaction of all claims and demands against
the Company based upon or arising out of the
performance of this agreement. However, in the event
termination is made by the Company prior tot he
expiration of the "guaranteed for payment" period
specified in paragraph (3), payment for the remaining
unexpired portion of said "guaranteed for payment"
period will be paid to the Consultant in lump sum
fashion by the Company.
9. The President/CEO of GENICOM Corporation, shall
represent the Company in the administering of this
agreement and must approve all requests for
Consultant's payment pursuant to paragraph (3) of the
agreement. The Company may, by written notice,
appoint another Company representative for the above
purposes.
10. This agreement is the sole agreement between
Consultant and the Company with respect to consulting
services to be performed during the term of this
agreement and it supersedes all prior arrangements and
understandings with respect thereto. No change,
modification, alteration or addition to any provisions
hereof shall be binding unless in writing and signed
by both Consultant and Chief Financial Officer of the
Company.
11. This agreement shall be construed, interpreted, and
applied in accordance with the law of the Commonwealth
of Virginia.
P.T. Winn 10/10/94
--------------------------------------- --------
P.T. Winn, President/Chief Executive Officer Date
W. Allen Surber 10/11/94
--------------------------------------- --------
W. Allen Surber, Consultant Date
Approvals:
C.B. Meyer 10/14/94
--------------------------------------- --------
C.B. Meyer, Vice President, Human Resources Date
J.A. Jones 10/17/94
--------------------------------------- --------
J.A. Jones, Corporate Controller Date
Attachment A
Consulting Agreement Between
GENICOM Corporation and
W. Allen Surber
A brief description of work assignment:
Provide consultant services on non-impact printer technology
and printer industry matters and issues under direction of the
President/CEO of GENICOM Corporation or his designee.
Consulting Agreement Between
GENICOM Corporation
and Edward Lucente
This agreement, by and between the GENICOM Corporation, a
Delaware Corporation (hereinafter called the Company) and
Edward Lucente (hereinafter called Consultant).
WITNESSETH THAT:
IN CONSIDERATION of the mutual promises hereinafter set
forth, the Company and Consultant do hereby agree as follows:
1. This agreement pertains to consulting services as set
forth in Attachment A and advice to be furnished to
the Company at request from time to time by the
Consultant during the period commencing
November, 1994 and ending March 31, 1995 inclusive.
The amount paid for said services under this
agreement exclusive of travel and living expenses and
computer service expenses shall not exceed the sum of
One hundred thousand and 00/100 dollars ($100,000).
Assignment of this agreement or of any interest
therein or any payment due or to become due
hereunder, without prior written consent of the
Company shall be void.
2. Consultant will participate, as requested by the
Company, as a consultant and advisor in Marketing and
Sales as set forth in Attachment A as amended from
time to time. Prior approval of hours to be worked
must be received from Paul T. Winn, President & CEO.
3. Within the maximum sum stated in paragraph (1) above,
the Company will reimburse Consultant for services
rendered at the rate of two thousand dollars and
00/100 ($2,000) per day worked hereunder. The
Company will, in addition, reimburse the Consultant
for reasonable travel and living expenses incurred
while traveling at the request of the Company in the
performance of tasks under this agreement.
Statements in duplicate will be submitted by the
Consultant at the first of each month itemizing hours
worked each month with documentation of travel and
living expenses. No minimum number of days are
guaranteed by the Company, and no portal expense is
involved.
4. The work contemplated under this agreement requires
that Consultant have access to information which is
proprietary and/or confidential to the Company.
Consultant agrees no to publish or otherwise disclose
to persons outside the Company, without specific
permission from the Company, any Company information
acquired by Consultant as a result of participation
in studies or work under this agreement, not to use
said information in any ways which might be injurious
to the interests of the Company.
5. Consultant agrees to promptly disclose to the Company
any information, ideas, or inventions made or
conceived by Consultant which may result from or be
suggested by work performed by Consultant under this
agreement, and to assign to the Company all rights
pertaining to such information, ideas, or inventions.
Knowledge or information of any kind disclosed by
Consultant to the Company shall be deemed to have
been disclosed without obligation on the part of the
Company to hold the same in confidence, and the
Company shall have the full right to use and disclose
such knowledge and information without compensation
to Consultant beyond that specifically provided by
this agreement.
6. Consultant will furnish, on request, written reports
of the work performed by Consultant under this
agreement, including findings, conclusions,
recommendations, and supporting data and analysis,
and any such reports shall become the sole property
of the Company.
7. Consultant is an independent contractor under this
contract. Consultant is not an employee of the
Company and will not be entitled to participate in,
or receive any benefits, privileges, or rights given
or extended by the Company to its employees including
without limitation, Company employee insurance,
pension, savings plans, etc.
8. This agreement may be terminated by either party by
written notice provided, however, the obligations of
Consultant under paragraph 4 and 5 herein shall
survive any termination of this agreement. In the
event of such termination, Consultant shall be paid
pursuant to the provisions of paragraph (3) above for
services rendered and costs incurred up to the date
of such termination shall be accepted by Consultant
in full satisfaction of all claims and demands
against the Company based upon or arising out of the
performance of this agreement.
9. Paul T. Winn, President & CEO, shall represent the
Company in the administering of this agreement and
must approve all requests for Consultant's payment
pursuant to paragraph (3) of the agreement. The
Company may be written notice appoint another Company
representative for the above purposes.
10. This agreement is the sole agreement between
Consultant and the Company with respect to consulting
services to be performed during the term of this
agreement and it supersedes all prior arrangements
and understandings with respect thereto. No change,
modification, alteration or addition to any
provisions hereof shall be binding unless in writing
and signed by both Consultant and Chief Financial
Officer of the Company.
11. This agreement shall be construed, interpreted, and
applied in accordance with the law of the State of
Virginia.
GENICOM Corporation
By:
Date
P.T. Winn 12/6/94
_______________________________________ ________
P.T. Winn, President & Chief Executive Date
Officer
Edward Luncente 2/21/95
_______________________________________ ________
Edward Lucente, Consultant Date
Approvals:
C.B. Meyer 12/6/94
_______________________________________ ________
C.B. Meyer, Vice President, Human Resources Date
J.A. Jones, Corporate Controller Date
Attachment A
Consulting Agreement Between
GENICOM Corporation and
Edward Lucente
A brief description of work assignment:
See attached description.
A brief description of work assignment:
Assessments and recommendations for restructuring of
GENICOM's worldwide marketing and sales function to
increase overall productivity. As we conclude the
Americas, progress to EMEA and then to the Asia Pacific
group.
Assess and recommend direction on three key issues; are
there business/customers benefits to (1) integrating all
business segment marketing and sales functions in the
Americas (printers, supplies, service, parts), (2) having
one worldwide marketing and sales organization and (3)
multi-vendor service sufficiently different to warrant a
separate marketing and sales organization.
Provide interim operational direction to all of GENICOM's
marketing and sales activities until a Vice President of
the Americas is named and we conclude on an International
structure.
After our agreement, implement structural changes
resulting from the above.
GENICOM Corporation and Subsidiaries
STATEMENT REGARDING THE COMPANY'S COMPUTATION OF EARNINGS PER
SHARE
<TABLE>
<CAPTION>
Twelve Months
Ended
-----------------
January 1, January 2,
1995 1994
--------- ---------
<S> <C> <C>
Shares used in this computation:
Weighted average common shares outstanding 10,630 10,621
Shares applicable to stock options, net of
shares assumed to be purchased from
proceeds at average market 715 0
--------- ---------
Total shares for earnings per common share
and common share equivalents (primary) 11,345 10,621
Shares applicable to stock options in addition
to those used in primary computation due to
the use of period-end market price when
higher than average 71 0
--------- ---------
Total fully diluted shares 11,416 10,621
========= =========
</TABLE>
E-13
EXHIBIT 13
<TABLE>
GENICOM CORPORATION AND
SUBSIDIARIES
ELEVEN YEAR FINANCIAL HISTORY (Unaudited)
HISTORY
<CAPTION>
Fiscal year, <1> 1994 1993 1992 1991 1990 1989 1988 1987 1986 1985 1984
(In thousands, except per
share and other data)
Income Statement Data:
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Revenues $233,797 $221,865 $222,692 $217,021 $255,298 $256,873 $291,429 $302,151 $157,463 $126,456 $136,661
Operating costs and 224,629 219,220 214,176 224,363 240,844 271,438 279,455 271,108 138,455 119,042 117,884
expenses <2>
Operating income (loss) 9,168 2,645 8,516 (7,342) 14,454 (14,565) 11,974 31,043 19,008 7,414 18,777
Interest expense, net 7,458 7,559 7,742 9,122 12,497 13,814 12,930 11,866 2,997 4,245 6,900
Other income <3> 1,908 1,741
Income (loss) before
income taxes, extra-
ordinary gain and
cumulative effect of
accounting change 3,618 (3,173) 774 (16,464) 1,957 (28,379) (956) 19,177 16,011 3,169 11,877
Income tax expense (benefit)
1,048 56 450 275 857 (4,119) (1,960) 8,640 7,403 1,364 5,787
Income (loss) before
extraordinary gain and
cumulative effect of
accounting change 2,570 (3,229) 324 (16,739) 1,100 (24,260) 1,004 10,537 8,608 1,805 6,090
Extraordinary gain <4> 1,273 3,691 5,528
Cumulative effect on
prior years of change
in accounting principles <5> 4,300 2,018
Net income (loss) $ 2,570 $(3,229) $ 1,597 $(13,048) $6,628 $(24,260) $ 5,304 $12,555 $ 8,608 $1,805 $6,090
Earnings (loss) per share:
Income (loss) before
extraordinary gain and
cumulative effect of
accounting change $ 0.23 $ (0.30) $ 0.03 $ (1.58) $ 0.11 $ (2.27) $ 0.09 $ 0.92 $ 0.83 $ 0.20 $ 0.89
Extraordinary gain 0.12 0.35 0.52
Cumulative effect on
prior years of change
in accounting 0.37 0.17
principles
Net income (loss) $ 0.23 $ (0.30) $ 0.15 $ (1.23) $ 0.63 $ (2.27) $ 0.46 $ 1.09 $ 0.83 $ 0.20 $ 0.89
Weighted average shares 11,416 10,621 10,833 10,592 10,811 10,710 11,582 11,555 10,414 9,246 6,862
Balance Sheet Data:
Working capital $40,780 $33,642 $54,915 $47,193 $77,965 $78,284 $104,880 $105,861 $39,801 $29,981 $25,158
Total assets 127,267 141,159 146,806 137,299 167,142 190,395 223,909 228,528 97,790 79,974 77,927
Total debt obligations 47,563 69,020 69,311 64,027 85,723 112,004 108,115 108,998 21,021 41,034 38,000
Stockholders' equity 28,083 24,575 28,524 27,804 41,528 34,487 61,565 58,510 45,664 18,735 15,135
Other Data:
Employees 2,382 2,147 2,488 2,512 2,896 3,259 3,692 3,587 2,507 2,135 2,194
Price range per common
share: <6>
Low $1 $1 1/8 $ 7/8 $ 7/8 $ 7/8 $ 7/8 $ 4 1/4 $ 5 3/4 $ 6 1/8
High 3 1/4 3 1/2 2 2 3/4 3 5 10 7/8 16 1/4 13
</TABLE>
(1) The Company's fiscal year ends on the Sunday nearest December 31.
Accordingly, the Company is reporting for 52-week periods for all
years presented, except for fiscal years 1992 and 1987 which are 53-
week periods.
(2) Includes restructuring costs of $1.0 million, $15.0 million,
$14.1 million and $6.0 million in 1993, 1991, 1989 and 1988,
respectively.
(3) The Company recognized gains of $0.9 million and $1.7 million in
1994 and 1993, respectively, from the sale of its investment in a
Belgian printer development and manufacturing company. The Company
also recognized a gain of $1.0 million on the early extinguishment of
$9.2 million principal amount of its Senior Subordinated Notes in
1994.
(4) The Company recognized extraordinary gains of $1.3 million, $3.7
million and $5.5 million, net of taxes of $0.1 million, $0.5 million
and $0.6 million, on the early extinguishment of $4.0 million, $13.3
million and $13.0 million principal amount of its Senior Subordinated
Notes in 1992, 1991 and 1990, respectively.
(5) Effective as of the beginning of 1988, the Company adopted
Statement of Financial Accounting Standards No. 96 "Accounting for
Income Taxes". Effective as of the beginning of 1987, the Company
changed its method of capitalizing certain costs in the valuation of
substantially all inventories.
(6) The Company began trading on the over-the-counter market on June
26, 1986, the date of its initial public offering.
<TABLE>
GENICOM CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
<CAPTION>
January 1, January 2, January 3,
Year Ended, 1995 1994 1993
(In thousands, except per share data)
<S> <C> <C> <C>
Revenues, net:
Products $ 166,518 $ 176,432 $ 177,690
Services 67,279 45,433 45,002
233,797 221,865 222,692
Operating costs and expenses:
Cost of revenues:
Products 120,455 129,274 125,150
Services 53,439 36,537 34,381
Selling, general and administration 43,015 43,584 44,085
Engineering, research and product
development 7,720 9,825 10,560
224,629 219,220 214,176
Operating income 9,168 2,645 8,516
Interest expense, net 7,458 7,559 7,742
Other income 1,908 1,741
Income (loss) before income taxes
and extraordinary gain 3,618 (3,173) 774
Income tax expense 1,048 56 450
Income (loss) before extraordinary gain 2,570 (3,229) 324
Extraordinary gain on early extinguishment 1,273
of debt (net of taxes of $141)
Net income (loss) $ 2,570 $ (3,229) $ 1,597
Earnings (loss) per common share and common
share equivalent (primary and fully
diluted):
Income (loss) before extraordinary gain $ 0.23 $ (0.30) $ 0.03
Extraordinary gain, net of taxes 0.12
Net income (loss) $ 0.23 $ (0.30) $ 0.15
Weighted average number of common shares
and common share equivalents outstanding:
Primary 11,345 10,621 10,605
Fully diluted 11,416 10,621 10,833
</TABLE>
GENICOM Corporation and Subsidiaries
Management's Discussion and Analysis of Results of Operations and
Financial Condition
(Unaudited)
Results of Operations
Net Revenue
In 1994, GENICOM Corporation ("GENICOM" or the "Company") reported
revenue growth of 5.4%. This growth is primarily attributable to
the favorable performance of the strategic businesses of
Enterprising Service Solutions ("ESS") and Supplies, which were
partially offset by the decline in the Impact Printing Solutions
business.
Printer revenues decreased $18.7 million or 18.2% in 1994 as
compared with 1993. This decrease is attributable to the decline in
the Impact Printing Solutions business. In 1994, revenues from the
Company's shuttle matrix line impact printers, mature serial matrix
and band line impact printers and high-speed serial matrix impact
printers decreased $5.8 million, $5.3 million and $4.0 million,
respectively, as compared with 1993. Management expects printer
revenues to increase in 1995 due to, among others, new
introductions of laser printer products and a full year of volume
shipments of its new shuttle matrix line impact printers.
Printer revenues increased $2.4 million or 2.3% in 1993 as compared
with 1992. This increase is attributable to growth in the Company's
Laser Printing Solutions business partially offset by declines in
mature impact printer products and reduced sales to OEM customers.
In 1993, revenues from the Company's laser printer products and
high-speed serial matrix impact printers increased $10.5 million
and $5.6 million, respectively, as compared with 1992. Partially
offsetting the 1993 revenue increases were revenue declines in
shuttle matrix line impact printers and mature serial matrix and
band line impact printers of $7.5 million and $4.7 million,
respectively.
[Graphic material near the above paragraph has been omitted from
this electronic filing. This bar chart image displayed printer
revenues (in millions) for the following years: 1992 - $100, 1993
- - $103 and 1994 - $84.]
ESS revenues increased $22.5 million or 51.0% in 1994 as compared
with 1993 and $0.4 million in 1993 as compared with 1992. The
Computervision Corporation, Canon U.S.A. and Motorola Computer
Group depot and field service contracts comprised most of the 1994
revenue growth. Revenues increased in 1993 due to the expansion of
multivendor service activities. Management anticipates that 1995
ESS revenue will be above fiscal 1994 levels as a result of a full
year's effect of the revenue associated with the new contract
business referred to above and the Company's anticipated expansion
of its multivendor field and depot operations.
[Graphic material near the above paragraph has been omitted from
this electronic filing. This bar chart image displayed supplies
revenues (in millions) for the following years: 1992 - $39, 1993 -
$43 and $50.]
[Graphic material near the above paragraph has been omitted from
this electronic filing. This bar chart image displayed ESS
revenues (in millions) for the following years: 1992 - $45, 1993 -
$45 and 1994 - $67.]
Supplies revenues increased $6.6 million or 15.3% in 1994 as
compared with 1993 and increased $4.4 million or 10.2% in 1993 as
compared with 1992. The revenue growth in the Supplies business is
attributable to increased market share achieved by increasing the
number of product offerings, including laser printer supplies, and
aggressive marketing in established markets. Management anticipates
that 1995 supplies revenues will approximate those of fiscal 1994.
Spares revenues increased $2.0 million or 12.8% in 1994 as compared
with 1993 and decreased $5.7 million or 36.6% in 1993 as compared
with 1992. Spares revenues rebounded from the 1993 decline
partially due to the success of the Company's printhead and print
module marketing programs. Management anticipates that 1995 spares
revenues will approximate those of fiscal 1994.
Relay revenues decreased $0.1 million in 1994 as compared with 1993
and decreased $2.3 million or 15.2% in 1993 as compared with 1992.
The 1993 revenue decline was a result of soft market conditions in
the aerospace and defense industries. Management believes that 1995
relay revenues will approximate those of fiscal 1994.
[Graphic material near the above paragraph has been omitted from
this electronic filing. This bar chart image displayed relays
revenues (in millions) for the following years: 1992 - $17, 1993 -
$15 and 1994 - $15.]
Order Backlog
Order backlog increased $14.8 million or 43.2% in 1994 as compared
with 1993 and decreased $5.9 million or 14.7% in 1993 as compared
with 1992. The 1994 increase in order backlog is primarily due to
the higher backlog in the ESS business. The 1993 decline in order
backlog was due to a decline in the backlog from the Company's
largest laser printer customer and lower orders from the Company's
original equipment manufacturer customers who generally place
longer lead time orders. The Company's backlog as of any particular
date should not be the sole measurement used in determining sales
for any future period.
[Graphic material near the above paragraph has been omitted from
this electronic filing. This bar chart image displayed order
backlog (in millions) for the following years: 1992 - $40, 1993 -
$34 and 1994 - $49.]
Gross Profit Margin
Gross margin, as a percentage of revenue, increased slightly in
1994 as compared with 1993 as a result of a larger proportion of
consolidated revenues being associated with higher margin products
such as supplies and spares which was largely offset by lower
margins in the Impact Printing Solutions businesses, start-up costs
incurred in the ESS business and unfavorable production costs in
the Relay business.
Gross margin, as a percentage of revenue, had decreased in 1993 as
compared with 1992 due to price competition and higher costs in the
Laser Printing Solutions business and lower revenues in the
Company's higher margin spares and relay products. Two other events
caused lower gross margins in 1993: the adoption of Statement of
Financial Accounting Standards ("SFAS") No. 106 "Employers'
Accounting for Postretirement Benefits Other Than Pensions" in the
first quarter of 1993; and unfavorable foreign currency movements.
Meanwhile, revenue growth achieved in the Company's higher margin
Supplies business favorably impacted the Company's 1993 gross
margin.
Operating Expense
Operating expenses in 1994 as compared with 1993 decreased overall
and as a percentage of revenue, due to the favorable impact of the
Company's January 1994 cost reduction program that included
personnel, salary and benefit reductions for the Company's
worldwide operations, partially offset by increased costs
associated with the growth in ESS operations. Management estimates
that the cost reduction program lowered expenses by approximately
$1.7 million. In addition, engineering, research and product
development expenses decreased significantly due to the completion
of the development of a new high speed shuttle matrix line impact
printer and lower software development costs.
Operating expenses in 1993 as compared with 1992 also decreased,
both in amount and as a percentage of revenue. This decrease
occurred despite the increase in operating expenses due to the
adoption of SFAS No. 106 and incurring restructuring costs
associated with the reorganization of sales and marketing,
development and administrative operations including the formation
of an application solutions' function. Favorably impacting
operating expenses was recognition of an amount due from the
General Electric Company ("G.E.") relating to prior costs for
environmental matters at the Company's Waynesboro, Virginia
facility.
Interest Expense
The Company's interest expense decreased $0.7 million or 8.7% in
1994 as compared with 1993, however, the 1993 expense was favorably
impacted by a first quarter interest payment receipt from the
Internal Revenue Service of $0.6 million related to the settlement
of prior year tax matters. The 1994 decrease resulted from the
impact of the Company's repurchase of its 12.5% Senior Subordinated
Notes ("Notes") in the second and fourth quarter of 1994 and the
decrease in borrowings from its senior credit facility, partially
offset by the interest rate increases on the same senior credit
facility.
The Company's interest expense increased $0.4 million or 4.5% in
1993 as compared with 1992, however, the 1993 expense was favorably
impacted by the interest payment from the Internal Revenue Service
of $0.6 million mentioned earlier. The increase in interest expense
relates primarily to the Company's working capital investment
requirements.
[Graphic material near the above paragraph has been omitted from
this electronic filing. This bar chart image displayed net
interest expense (in millions) for the following years: 1992 - $8,
1993 - $8 and 1994 - $7.]
Other Income
During 1994, the Company recognized a pre-tax gain of $1.0 million
from the repurchase of the Notes. During the 1994 first quarter,
the Company recognized a pre-tax gain of $0.9 million on the sale
of its remaining investment in Xeikon N.V., ("Xeikon") a Belgian
printer development and manufacturing company.
In the fourth quarter of 1993, the Company recognized a pre-tax
gain of $1.7 million from the sale of approximately 65.0% of its
investment in Xeikon.
Income Tax
The Company's effective income tax rate for fiscal year 1994 was
29.0% compared with (1.8)% and 58.1% in fiscal years 1993 and 1992,
respectively. These rates are significantly affected by foreign
income taxes and the utilization of net operating losses.
On January 4, 1993, the Company adopted SFAS No. 109 "Accounting
for Income Taxes". The Company had previously accounted for income
taxes under the liability method in accordance with SFAS No. 96.
The adoption of SFAS No. 109 did not have a material effect on the
Company's financial condition or results of operations.
Extraordinary Gain
The extraordinary gains resulted from the financial effect of the
Company's open market purchases of $4.0 million in 1992 principal
amounts of its Notes at a discount from par value. The
extraordinary gains were net of income taxes of $0.1 million and
the write-off of unamortized debt issuance costs.
<TABLE>
GENICOM CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<CAPTION>
January 1, January 2,
1995 1994
(In thousands, except share data)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 673 $ 1,797
Accounts receivable, less allowance for
doubtful accounts of $1,479 and $1,480 37,846 35,932
Other receivables 2,711 7,202
Inventories 43,368 53,831
Prepaid expenses and other assets 2,329 1,594
Total current assets 86,927 100,356
Property, plant and equipment 26,215 24,869
Goodwill 9,293 10,180
Other assets, principally intangibles 4,832 5,754
$ 127,267 $ 141,159
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt $ 371 $ 23,263
Accounts payable and accrued expenses 37,540 36,504
Deferred income 8,236 6,947
Total current liabilities 46,147 66,714
Long-term debt, less current portion 47,192 45,757
Other non-current liabilities 5,845 4,113
Total liabilities 99,184 116,584
Stockholders' equity:
Common stock, $0.01 par value; 15,000,000 106 106
shares authorized, 10,638,299 and 10,621,699
shares issued
Additional paid-in capital 25,760 25,744
Retained earnings 4,351 1,781
Foreign currency translation adjustment (1,435) (1,957)
Pension liability adjustment (699) (1,099)
Total stockholders' equity 28,083 24,575
$ 127,267 $ 141,159
</TABLE>
GENICOM Corporation and Subsidiaries
Management's Discussion and Analysis of Results of Operations and
Financial Condition
(Unaudited)
Liquidity and Capital Resources
The Company's working capital increased from $33.6 million in 1993
to $40.8 million in 1994, an increase of $7.1 million or 21.2%.
The Company's current ratio was 1.9 to 1 at the end of fiscal year
1994 compared to 1.5 to 1 at the end of fiscal year 1993. These
favorable trends are primarily attributable to the decrease in debt
classified as current under the senior credit facility, partially
offset by the decrease in the Company's inventory. Cash and cash
equivalents decreased $1.1 million since January 2, 1994.
Net cash generated by operations during 1994 totaled $28.6 million.
The major sources of cash are profitable operations, inventory
management programs, lower spending for restructuring programs and
favorable payment terms associated with the Company's growing ESS
business.
[A graphic image near the above paragraph has been omitted from
this electronic filing. This bar chart image displayed inventories
(in millions) for the following years: 1992 - $56, 1993 - $54 and
1994 - $43]
Due to the needs of its growing ESS business, the Company has
increased the cash used in investing activities to acquire the
necessary field support spares and equipment. The Company used
cash flow to reduce borrowings under its senior credit facility and
to purchase $9.2 million of its Notes in the open market at
favorable terms, thus realizing a gain of $1.0 million. The
Company does not have any material commitments of funds for capital
expenditures other than to support the current level of operations,
except for the acquisitions discussed below (See "Other Matters").
The Company intends to fund the purchase price of such acquisitions
through its cash flows from operations, credit facilities and the
potential issuance of common stock.
In the first quarter of 1994, the Company retired $9.0 million
principal amount of its previously purchased Notes in fulfillment
of its annual sinking fund requirement. As of January 1, 1995, the
Company had $12.4 million of the Notes in treasury, $9.0 million of
which will be used to satisfy the 1995 sinking fund requirement and
$3.4 million which will be applied to the $9.0 million needed for
the 1996 sinking fund requirement. In addition to the above
mentioned sinking fund requirements, on February 15, 1997, $31.0
million of the Notes will mature. While the Company expects that
it will be able to satisfy the balance of the 1996 sinking fund and
the 1997 maturity, there is no assurance that the Company will have
the resources available to do so.
[A graphic image near the above paragraph has been omitted from
this electronic filing. This bar chart image displayed debt
obligations (in millions) for the following years: 1992 - $69,
1993 - $69 and 1994 - $48.]
As of January 1, 1995, the Company had $10.9 million outstanding
and $13.4 million available for borrowing under its senior credit
facility. On June 9, 1994, the Company and its senior creditor
amended the Company's senior credit facility by extending its term
to fiscal 1997, changing the rate of interest to prime plus 3.0%
and providing for early termination of the credit facility by the
Company under certain circumstances.
Other Matters
On February 16, 1995, the Company completed its acquisition of
substantially all of Printer Systems Corporation's ("PSC")
outstanding common and preferred shares for consideration
aggregating to potentially $4.8 million. PSC had fiscal year 1994
revenues approximating $10.0 million. The acquisition of PSC
will expand the Company's Laser Printing Solutions and
Enterprising Service Solutions businesses.
On March 1, 1995, the Company completed its acquisition of
substantially all of the assets and liabilities of Harris Adacom
Network Services, Inc. ("HANS"), including its Canadian subsidiary,
Harris Adacom Inc., for cash and notes totaling $7.3 million. In
1994, revenues from the acquired operations totaled $36.1 million.
The acquisition of HANS will significantly expand the Company's
Enterprising Service Solutions business and will provide an entry
into the systems integration business and the new markets of
network diagnostic and monitoring services.
On November 17, 1994, the Company announced that it was in
negotiations with an undisclosed third party to acquire their
desktop printer business with revenue under $100 million. The
proposed acquisition is subject to negotiation of definitive
agreements by the various parties, government and shareholder
approvals, and other customary and appropriate steps. At this time
there is no assurance that any agreement will be reached.
Management believes that a material decline in sales volume or the
Company's inability to effectively execute their integration
programs for the newly acquired strategic businesses could have a
material adverse impact on the financial condition, results of
operations, or liquidity of the Company.
As described in further detail in the Company's 1994 Annual Report,
Notes to Consolidated Financial Statements, the Company is required
to adopt SFAS No. 107 "Disclosures about Fair Value of Financial
Instruments", SFAS No. 114 "Accounting by Creditors for Impairment
of a Loan", SFAS No. 118 "Amendment to Accounting for Certain
Investments in Debt and Equity Securities", and SFAS No. 119
"Disclosure about Derivative Financial Instruments and Fair Value
of Financial Instruments" during fiscal year 1995. Management
believes such standards will not have a material adverse impact
on the financial condition, results of operations, or liquidity of
the Company.
<TABLE>
CONSOLIDATED STATEMENTS OF CASH FLOWS
<CAPTION>
Year ended, January 1, January 2, January 3,
(In thousands) 1995 1994 1993
<S> <C> <C> <C>
Cash flows from operating activities:
Net income (loss) $ 2,570 $ (3,229) $ 1,597
Adjustments to reconcile net income (loss) to
cash provided by operating activities:
Depreciation 9,374 6,703 6,380
Amortization 3,149 2,400 2,100
Effect of gain on early extinguishment of
notes (1,009)
Effect of investment gain (901) (1,741)
Extraordinary gain (1,414)
Effect of restructuring accrual 0 (3,380) (3,767)
Effect of environmental recovery from G.E. 0 (862)
Changes in assets and liabilities:
Accounts receivable 1,031 2,099 (5,892)
Inventories 10,882 1,710 (9,401)
Accounts payable and accrued expenses 2,521 1,733 8,503
Other 938 (190) 3,748
Net cash provided by operating activities 28,555 5,243 1,854
Cash flows from investing activities:
Additions to property, plant and equipment (11,067) (5,724) (5,241)
Proceeds from sale of investment 3,436
Other investing activities (581) (1,456) (2,124)
Net cash used in investing activities (8,212) (7,180) (7,365)
Cash flows from financing activities:
Borrowings from long-term debt 21,537 26,818 30,534
Payments on long-term debt (33,985) (26,697) (21,218)
Purchases of senior subordinated notes (8,123) (2,565)
Net cash (used in) provided by financing activities (20,571) 121 6,751
Effect of exchange rate changes on cash and cash (896) 612 811
equivalents
Net (decrease) increase in cash and cash (1,124) (1,204) 2,051
equivalents
Cash and cash equivalents at beginning of year 1,797 3,001 950
Cash and cash equivalents at end of year $ 673 $ 1,797 $ 3,001
Supplemental data:
Cash paid (received) during the year for:
Income taxes $ 28 $ (501) $ (1,181)
Interest 7,491 7,953 7,758
</TABLE>
<TABLE>
GENICOM CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF
CHANGES IN STOCKHOLDERS' EQUITY
For the years ended January 1, 1995,
January 2, 1994 and January 3, 1993
(In thousands)
<CAPTION>
Foreign
Common Stock Additional Currency Pension
---------------- Paid-in Retained Translation Liability
Shares Amount Capital Earnings Adjustment Adjustment
<S> <C> <C> <C> <C> <C> <C>
Balance as of December 29, 10,605 $ 106 $ 25,730 $ 3,413 $ (631) $ (814)
1991
Exercise of stock options
Net income 1,597
Cumulative translation (1,164)
adjustment
Pension liability adjustment 287
Balance as of January 3, 1993 10,605 106 25,730 5,010 (1,795) (527)
Exercise of stock options 17 14
Net loss (3,229)
Cumulative translation (162)
adjustment
Pension liability adjustment (572)
Balance as of January 2, 1994 10,622 106 25,744 1,781 (1,957) (1,099)
Exercise of stock options 16 16
Net income 2,570
Cumulative translation 522
adjustment
Pension liability adjustment 400
Balance as of January 1, 1995 10,638 $ 106 $ 25,760 $ 4,351 $ (1,435) $ (699)
</TABLE>
GENICOM Corporation and Subsidiaries
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation
The consolidated financial statements include the accounts of
GENICOM Corporation (the "Company") and its wholly-owned
subsidiaries. All significant intercompany accounts and
transactions have been eliminated. Certain reclassifications
have been made to the 1993 and 1992 financial statements in order
to conform to the 1994 presentation.
Fiscal Year
The Company's fiscal year ends on the Sunday nearest December 31.
Accordingly, the Company is reporting for the 52-week periods
ended January 1, 1995 and January 2, 1994, and the 53-week period
ended January 3, 1993.
Cash and Cash Equivalents
The Company considers all highly liquid investments with a
maturity of three months or less at the time of purchase to be
cash equivalents.
Inventories
Inventories are stated at the lower of cost, determined on the
first-in first-out method, or market.
Property, Plant and Equipment
Property, plant and equipment is stated at cost. Depreciation is
calculated using the straight-line method for financial reporting
purposes based on estimated lives at acquisition date (generally
10 to 25 years for buildings and 18 months to 10 years for
machinery and equipment) and accelerated methods for income tax
purposes.
Significant improvements and the cost of tooling are capitalized,
while repairs and maintenance costs are charged to operations.
Goodwill and Intangibles
Goodwill includes the excess of acquisition costs over the fair
market value of net assets of acquired businesses and is being
amortized on a straight-line basis over 5 to 20 years. The
Company assesses at each balance sheet date whether there has
been a permanent impairment in the value of goodwill. This is
accomplished by determining whether projected undiscounted future
cash flows from operations exceed the net book value of goodwill
as of such balance sheet date. Other intangible assets,
including patents, copyrights, trademarks, licenses and
organization and financing costs, are amortized on a straight-
line basis over periods ranging from 3 to 15 years. The
aggregate amount of accumulated amortization for goodwill and
intangibles was $12.9 million and $10.7 million at January 1,
1995 and January 2, 1994, respectively.
Research and Development Costs and Capitalized Software
Costs incurred in basic research and development are expensed as
incurred. Certain costs relating to software and product
development are capitalized and amortized over the estimated
economic life of the product.
The Company capitalized software costs of $0.6 million and $1.5
million in 1994 and 1993, respectively. The related amortization
expenses were $1.0 million and $0.4 million in 1994 and 1993,
respectively. As of January 1, 1995 and January 2, 1994,
capitalized software, net of amortization, was $1.5 million and
$1.9 million, respectively.
Income Taxes
The Company accounts for income taxes under the liability method
in accordance with SFAS No. 109 "Accounting for Income Taxes".
Certain expenses are recognized in different periods for
financial reporting and Federal income tax purposes. Research and
development credits are recognized as a reduction of income tax
expense in the year they are recognized for Federal tax purposes.
The Company does not provide deferred taxes on the undistributed
earnings of its foreign subsidiaries as such earnings are
intended to be permanently reinvested in those operations.
Foreign Operations
The consolidated balance sheets include foreign assets and
liabilities of $55.5 million and $14.7 million as of January 1,
1995, respectively, and $54.8 million and $15.3 million as of
January 2, 1994, respectively. The net effects of foreign
currency transactions reflected in income were immaterial in
fiscal years 1994, 1993 and 1992.
Assets and liabilities of most of the Company's foreign
operations are translated into U.S. dollars using exchange rates
in effect at the balance sheet date and results of operations
items are translated using the average exchange rates prevailing
throughout the period. The resulting translation adjustments are
recorded as a separate component of stockholders' equity. The
Company's Mexican subsidiary remeasures its financial statements
in U.S. dollars, as this is the currency of the primary economic
environment in which the entity operates. Prior to 1993, the
Mexican subsidiary was considered to operate in a highly
inflationary economy. Accordingly, its translation adjustments,
which are not material, are included in results of operations.
Off-Balance Sheet Risk and Concentrations of Credit Risk
The Company periodically hedges against foreign currency
fluctuations through the use of forward exchange contracts.
Gains and losses on contracts to hedge foreign currency
commitments are deferred and accounted for as part of the
commitment transaction except for losses expected to be incurred
in future periods which are recorded when identified.
The forward exchange contracts which the Company uses as hedges
are subject to off-balance sheet market risk. The Company
believes that its risk due to non-performance by the other
parties to these contracts is remote. The Company had $0.6
million and $4.3 million of forward exchange contracts
outstanding as of January 1, 1995 and January 2, 1994,
respectively.
Financial instruments that potentially subject the Company to
concentration of credit risk consist primarily of receivables.
The Company extends credit to various customers that are
primarily in the computer and computer peripherals industries.
These specific industries may be similarly affected by economic
factors, however, the Company performs ongoing credit evaluations
of its customers and establishes an allowance for doubtful
accounts for specific customers that it determines to have
significant credit risk. Generally, the Company does not require
collateral from its customers and has, historically, not
experienced significant credit related losses.
Revenue Recognition and Warranty Costs
Revenues from the sales of products, which include printers and
relays, are recorded when products are shipped to customers.
Revenues from services, which include service and rentals, are
recognized monthly as earned. Advance billings for customer
maintenance contracts are deferred and amortized over the
contract life on a straight-line basis. Estimated warranty costs
for equipment sales are provided for in the year of sale.
Net Income (Loss) Per Share
Net income (loss) per common share and common share equivalent is
computed by dividing net income (loss) by the weighted average
number of common shares and dilutive common share equivalents
outstanding during each year. Common share equivalents include
the weighted average number of shares issuable upon the assumed
exercise of outstanding stock options, assuming the applicable
proceeds from such exercise are used to acquire treasury shares.
Recent Accounting Pronouncements
The Financial Accounting Standards Board issued SFAS No. 107
"Disclosures about Fair Value of Financial Instruments", SFAS No.
114 "Accounting by Creditors for Impairment of a Loan", SFAS No.
118 "Accounting by Creditors for Impairment of a Loan - Income
Recognition and Disclosure - Amendment of SFAS No. 114" and SFAS
No. 119 "Disclosure about Derivative Financial Instruments and
Fair Value of Financial Instruments". Management believes such
standards will not have a material adverse impact on the
financial condition, results of operations or liquidity
of the Company.
Note 2: SUPPLEMENTAL BALANCE SHEET INFORMATION
Inventories consist of:
<TABLE>
<CAPTION>
Jan. 1, Jan. 2,
(in thousands) 1995 1994
<S> <C> <C>
Raw materials $ 14,354 $ 13,768
Work in process 6,639 8,524
Finished goods 22,375 31,539
$ 43,368 $ 53,831
</TABLE>
Property, plant and equipment consists of:
<TABLE>
<CAPTION>
Jan. 1, Jan. 2,
(in thousands) 1995 1994
<S> <C> <C>
Land $ 714 $ 713
Buildings 10,406 10,361
Machinery and equipment 77,274 76,954
Construction in progress 361 305
88,755 88,333
Less: accumulated depreciation 62,540 63,464
$ 26,215 $ 24,869
</TABLE>
Accounts payable and accrued expenses consist of:
<TABLE>
<CAPTION>
Jan. 1, Jan. 2,
(in thousands) 1995 1994
<S> <C> <C>
Trade accounts payable $ 18,918 $ 19,554
Accrued liabilities:
Accrued compensation and benefits 8,900 9,045
Interest 1,883 2,383
Other 7,839 5,522
$ 37,540 $ 36,504
</TABLE>
Note 3: DEBT OBLIGATIONS
Long-term debt consists of:
<TABLE>
<CAPTION>
Jan. 1, Jan. 2,
(in thousands) 1995 1994
<S> <C> <C>
Revolving credit notes and term loans $ 10,897 $ 22,511
Senior subordinated notes 36,532 45,627
Other subordinated notes 134 882
47,563 69,020
Less: current portion 371 23,263
$ 47,192 $ 45,757
</TABLE>
The Company has an agreement (the "Loan Agreement") with a
lender to provide credit facilities to a maximum borrowing
of $35.0 million. The Loan Agreement was amended on June 9,
1994, to extend its term to December 30, 1996. The Company
has pledged as collateral generally all assets of the
Company. The Loan Agreement provides for financing based on
formulas applied to certain adjusted asset balances, such
balances being determined at lender's sole discretion, an
annual fee of 4.0% of the amount by which average daily
borrowings are below $10.0 million, and interest at a posted
prime rate plus 3.0% (11.5% as of January 1, 1995). Prior
to June 9, 1994 the interest rate was the posted prime rate
plus 2.25% (8.25% as of January 2, 1994). Also, the Loan
Agreement has provisions for automatic renewal for
successive one (1) year terms should certain notice
provisions not be exercised by either party. Moreover, upon
the termination of the Loan Agreement by either the lender,
pursuant to an event of default, or the Company, a
termination fee is payable by the Company.
The Company classified the loan as current on the January 2,
1994 balance sheet, since the Loan Agreement was due to
expire on September 23, 1994.
The Company maintains a term loan agreement (the "Term
Loan") with the same lender which amortizes monthly and
bears the same interest rate. The Term Loan matures on the
earlier of the maturity date of the Loan Agreement or
September 1, 1997.
The Company's international subsidiaries maintain various
credit facilities for their local operations. Borrowings
under such credit facilities bear interest at prevailing or
negotiated rates.
The Company issued senior subordinated notes (the "Notes")
on February 13, 1987, with an aggregate principal amount of
$76.0 million. The Notes, which bear interest at 12.5%
payable semiannually, are redeemable at the option of the
Company, in whole or in part, at any time on or after
February 15, 1992. Sinking fund payments to retire $9.0
million annually began in 1992, with the Notes maturing on
February 15, 1997. The Notes are subordinated to all senior
indebtedness.
In 1994 and 1992, the Company used cash flow from operations
and borrowings under the Loan Agreement to purchase $9.2
million and $4.0 million, respectively, principal amount of
its Notes prior to their scheduled maturity. Such purchases
were at market prices below face value and, as a result, the
Company recognized gains of $0.7 million and $1.3 million,
net of income taxes and the write-off of related unamortized
discount and debt issuance costs. Notes purchased by the
Company have been applied to the Notes' sinking fund
requirements and $12.4 million of the Notes remain in
treasury. This amount will be applied toward the Notes'
sinking fund requirements for 1995 and a portion of the 1996
requirement.
The Loan Agreement and the Notes contain certain restrictive
covenants which include, among other things, required
minimum net worth of $22.8 million, restrictions on
additional borrowing and the sale or disposition of certain
assets and limitations on the payment of dividends. Under
the most restrictive covenants, retained earnings are not
available for payment of dividends in 1995.
Aggregate maturities and sinking fund requirements for long-
term debt at January 1, 1995, after giving consideration to
the Notes held in treasury, mature as follows: $0.4 million
in 1995, $16.1 million in 1996 and $31.2 million in 1997.
Note 4: EMPLOYEE BENEFIT PLANS
The Company provides postretirement medical and life
insurance benefits to hourly and salaried employees hired
before March 22, 1993, who retire after attaining age 60
with at least 5 years of service. Under certain conditions,
benefits may be extended to the retirees' spouse and
dependents. Salaried employees hired after March 22, 1993,
are eligible for postretirement medical and life insurance
benefits only upon attainment of Social Security retirement
age and completion of 10 years of service and no spouse or
dependent coverage is provided.
The postretirement medical coverage is contributory, while
the life insurance coverage is noncontributory.
On January 4, 1993, the Company adopted the provisions of
SFAS No. 106 "Employers' Accounting for Postretirement
Benefits Other Than Pensions", which requires the accrual of
the cost of providing postretirement benefits during an
employee's active service.
The components of net periodic postretirement benefit costs
were:
<TABLE>
<CAPTION>
Jan. 1, Jan. 2,
(in thousands) 1995 1994
<S> <C> <C>
Service cost - benefits attributed to $ 396 $ 493
service during the period
Interest cost on accumulated 1,334 1,291
postretirement benefit obligation
Amortization of unrecognized transition 878 878
obligation over 20 years
Net periodic postretirement benefit cost $ 2,608 $ 2,662
</TABLE>
The following table sets forth the combined funded status
for the Company's postretirement benefit obligation as of
the indicated actuarial valuation dates:
<TABLE>
<CAPTION>
Jan. 1, Jan. 2,
(in thousands) 1995 1994
<S> <C> <C>
Accumulated postretirement
benefit obligation:
Retirees $ 9,296 $ 10,515
Active plan participants 8,045 9,128
17,341 19,643
Unrecognized transition 15,805 16,683
obligation
Unrecognized net (gain) loss (2,309) 1,130
Accrued postretirement benefit cost $ 3,845 $ 1,830
</TABLE>
The Company funds postretirement benefit costs as incurred.
For measurement purposes, 11.0% and 12.0% annual rates of
increase in the per capita cost of covered health care
benefits were assumed for 1995 and 1994, respectively; both
rates were assumed to decrease gradually to 6.0% for 2001
and remain at that level thereafter. If the he,alth care
cost trend rate were to increase 1.0%, the accumulated
postretirement benefit obligation as of January 1, 1995 and
January 2, 1994, would have increased by 7.0% and 5.0%,
respectively. The effect of this change on the aggregate
service and interest costs for 1994 and 1993 would be
increases of 7.1% and 4.7%, respectively. The weighted-
average discount rates used in determining the accumulated
postretirement benefit obligation were 8.0% and 7.0% in 1994
and 1993, respectively.
Substantially all domestic non-collective bargaining
employees are eligible to participate in the Company's
retirement savings plan (the "Savings Plan"), which
qualifies under section 401(k) of the Internal Revenue Code.
The Company makes certain matching contributions which are
allocated to the participants and vest based on the
employee's years of service. The Company's expense under
the Savings Plan was $0.5 million, $1.2 million and $1.1
million in fiscal years 1994, 1993 and 1992, respectively.
The Company's domestic collective bargaining employees are
covered by a contributory defined benefit pension plan (the
"Pension Plan"). The Pension Plan benefits are based on
years of credited service and the participant's
compensation. Eligible employees must elect to participate
and contribute 3.0% of compensation between $12,000 and
$25,650 per calendar year. The Company makes contributions
to the Pension Plan sufficient to meet federal funding
requirements.
Components of periodic pension costs were:
<TABLE>
<CAPTION>
Jan. 1, Jan. 2, Jan. 3,
(in thousands) 1995 1994 1993
<S> <C> <C> <C>
Service cost $ 445 $ 442 $ 426
Interest cost on projected 731 660 608
benefit obligation
Actual return on plan assets 131 (753) (528)
Net amortization and deferral (673) 243 92
Net periodic pension expense $ 634 $ 592 $ 598
</TABLE>
The following table sets forth the Pension Plan's funded
status as of the indicated actuarial valuation dates:
<TABLE>
<CAPTION>
Jan. 1, Jan. 2,
(in thousands) 1995 1994
<S> <C> <C>
Actuarial present value of benefit
obligations:
Vested benefits $ 8,621 $ 8,550
Non-vested benefits 555 672
Total accumulated benefit obligations 9,176 9,222
Effect of projected future compensation 734 936
levels
Projected benefit obligation 9,910 10,158
Fair value of plan assets 8,097 7,603
Fair value of plan assets less than (1,813) (2,555)
projected benefit obligations
Unrecognized net liability existing at 318 363
January 1, 1987
Unrecognized net loss from actuarial 1,753 2,116
experience
Adjustment to recognize minimum liability (1,337) (1,544)
Accrued pension cost $ (1,079) $ (1,620)
</TABLE>
The Company's assumptions used in determining the pension
cost and pension liability shown above were as follows:
<TABLE>
<CAPTION>
Jan. 1, Jan. 2, Jan. 3,
1995 1994 1993
<S> <C> <C> <C>
Discount rate 8.00 7.25 7.75
Rate of compensation 5.00 5.00 5.00
progression
Rate of return on plan assets 9.00 9.00 9.00
</TABLE>
Pension Plan assets consist primarily of treasury notes,
government and corporate bonds, corporate equities and cash
equivalent funds.
The Company makes contributions to various employee benefit
plans for certain of its foreign subsidiaries and the
expense for these plans was not material in 1994, 1993 and
1992.
On January 3, 1994, the Company adopted the provisions of
SFAS No. 112 "Employers' Accounting for Postemployment
Benefits" which requires employers to accrue costs of
providing postemployment benefits other than pensions. The
implementation of SFAS No. 112 did not have a material
effect on the Company's financial condition, results of
operations or liquidity.
Note 5: STOCK OPTIONS
Under the Company's stock option plan, 1,913,368 shares of
unissued common stock are reserved for issuance pursuant to
options outstanding and to be granted. Stock option activity
for the respective fiscal periods is as follows:
<TABLE>
<CAPTION>
Number of Option Amount
Shares Per Share Total
<S> <C> <C> <C>
Outstanding,
December 29, 1991 917,567 $ 0.15-7.50 $ 1,252,577
Granted 270,000 1.00-1.44 332,188
Exercised
Cancelled (52,500) 1.00-1.63 (55,625)
Outstanding,
January 3, 1993 1,135,067 0.15-7.50 1,529,140
Granted 406,500 1.00-1.50 412,500
Exercised (17,000) 0.15-1.75 (17,975)
Cancelled (42,000) 0.15-1.50 (51,500)
Outstanding,
January 2, 1994 1,482,567 1.00-7.50 1,872,165
Granted 460,000 1.00-2.38 471,688
Exercised (16,600) 1.00 (16,600)
Cancelled (166,833) 1.00-7.50 (196,823)
Outstanding,
January 1, 1995 1,759,134 $ 1.00-7.50 $ 2,130,430
Options exercisable,
January 1, 1995 819,934 $ 1.00-7.50 $ 1,090,330
Options available
for future grants 154,234
</TABLE>
Options granted under the stock option plan are granted at
prices not less than 85.0% of the fair market value of the
common stock and become exercisable in installments at dates
ranging from one to ten years from the date of grant, as
determined by the Board of Directors or the Compensation
Committee thereof.
In 1992 and 1993, the stockholders approved nonstatutory
stock option grants of 100,000 and 10,000 shares of common
stock, respectively, to certain members of the Company's
Board of Directors. The stock options become exercisable at
a rate of 33.3% per year beginning one year from grant date.
However, the stock options become fully exercisable upon the
merger of the Company into another entity or the acquisition
of the Company by another entity or the sale or transfer of
substantially all assets of the Company to another entity.
As of January 1, 1995, none of these stock options had been
exercised.
Note 6: Income Taxes
On January 4, 1993, the Company adopted SFAS No. 109. The
Company previously accounted for income taxes under the liability
method in accordance with Statement of Financial Accounting
Standards No. 96 "Accounting for Income Taxes". The adoption of
SFAS No. 109 did not have a material effect on the Company's
financial condition or results of operations.
The components of income (loss) before income taxes were as
follows:
(in thousands) Jan. 1, Jan. 2, Jan. 3,
1995 1994 1993
Domestic $ 4,524 $ 1,767 $ 4,943
Foreign (906) (4,940) (4,169)
$ 3,618 $ (3,173) $ 774
Income tax expense (benefit) consists of the following:
<TABLE>
<CAPTION>
(in thousands) Jan. 1, Jan. 2, Jan. 3,
1995 1994 1993
<S> <C> <C> <C>
Current:
Federal $ 164 $ (27)
State 568 23 $ 70
Foreign 148 60 283
880 56 353
Deferred:
Federal 168 82
Foreign 15
168 97
$ 1,048 $ 56 $ 450
A reconciliation of the U.S. statutory Federal tax rate of 34.0%
to the Company's effective tax rate is as follows:
</TABLE>
<TABLE>
<CAPTION>
(in thousands) Jan. 1, Jan. 2, Jan. 3,
1995 1994 1993
<S> <C> <C> <C>
Tax expense (benefit)
at statutory rate $ 1,230 $ (1,079) $ 263
Increase (decrease)
related to:
State income taxes,
net of Federal tax
benefit 568 23 70
Foreign income tax 148 60 298
Foreign operating
losses generating no
current tax benefit 279 1,642 1,462
Domestic operating
profit not taxed
due to carryfoward
losses (1,331) (563) (1,725)
Other, net 154 (27) 82
$ 1,048 $ 56 $ 450
29.0% (1.8)% 58.1%
</TABLE>
Deferred tax assets and liabilities are recorded based on
temporary differences between earnings as reported in the
financial statements and earnings for income tax purposes. The
major components of the Company's deferred tax assets and
liabilities are as follows:
<TABLE>
<CAPTION>
(in thousands) Jan. 1, Jan. 2,
1995 1994
<S> <C> <C>
Deferred tax assets:
Net operating loss carryforwards $ 12,838 $ 10,958
Inventory valuation 3,475 3,439
Retiree medical and life 1,580 732
Vacation accrual 1,049 1,146
Bad debt reserve 554 603
Gain on tax/book differential 93 6,528
Valuation allowance (16,747) (19,943)
Total deferred tax asset $ 2,842 $ 3,463
Deferred tax liabilities:
Depreciation 1,481 1,896
Foreign currency translation gain 456 456
Other 905 1,111
Total deferred tax liability $ 2,842 $ 3,463
</TABLE>
At January 1, 1995, the Company had U.S. Federal net operating
loss carryforwards of $11.8 million, of which $11.3 million
expires in 2005 and $0.5 million expires in 2008. The Company
also had available research and development tax credit
carryforwards in the amount of $0.5 million which expire during
the years of 2003 to 2008.
The cumulative amount of undistributed earnings of foreign
subsidiaries which the Company intends to permanently invest and
upon which no deferred U.S. income taxes have been provided is
$2.5 million. The Company cannot practically determine the amount
of deferred income tax liability that would result had such
earnings actually been remitted. The amount of foreign
withholding taxes, at current rates, that would have been due on
the earnings had they actually been remitted was $0.1 million.
Note 7: OTHER INCOME AND RESTRUCTURING COSTS
During fiscal 1994, the Company reported gains of $1.0
million from the early extinguishment of $9.2 million of its
Notes.
During fiscal 1994 and 1993, the Company sold 35.0% and
65.0%, respectively, of its investment in Xeikon N.V., a
Belgian printer development and manufacturing company.
These transactions added approximately $0.9 million and $1.7
million of pre-tax income to fiscal 1994 and 1993,
respectively.
During fiscal 1993, the Company incurred costs totaling $1.0
million associated with the reorganization and restructuring
of the Company's sales and marketing, development and
administrative operations including the formation of an
application solutions function. Such costs are reflected in
the Company's operating expenses.
Note 8: COMMITMENTS AND CONTINGENT LIABILITIES
Leasing arrangements:
As lessee:
The Company leases certain manufacturing and warehousing
properties. Rent expense amounted to $6.7 million, $6.3
million, and $6.8 million in 1994, 1993 and 1992,
respectively.
Minimum future lease commitments for operating leases as of
January 1, 1995, are as follows: 1995 - $4.4 million, 1996
- - $2.5 million, 1997 - $1.5 million, 1998 - $0.9 million,
1999 - $0.3 million and $1.8 million thereafter.
As lessor:
The Company has rental plans for the leasing of printers.
Operating lease terms vary, generally from one to sixty
months. Rental revenue was $0.7 million, $1.1 million, and
$1.4 million for 1994, 1993 and 1992, respectively.
On January 1, 1995 and January 2, 1994, the cost of
equipment leased was $1.1 million and $1.0 million,
respectively, which is included in property, plant and
equipment, net of accumulated depreciation of $0.9 million
and $0.9 million, respectively.
Environmental matters:
The Company and the former owner of its Waynesboro, Virginia
facility, General Electric Company ("G.E."), have generated
and managed hazardous wastes at the facility for many years
as a result of their use of certain materials in
manufacturing processes. The Company and the United States
Environmental Protection Agency ("EPA") have agreed to a
corrective action consent order ( the "Order"), which became
effective on September 14, 1990. The Order requires the
Company to undertake an investigation of solid waste
management units at its Waynesboro, Virginia facility and to
conduct a study of any necessary corrective measures that
may be required. Although the Order is currently being
implemented, it is not possible for the Company to reliably
estimate the total cost of the investigation and the study
required by the Order. If, as a result of the investigation
and study, corrective measures are required, the Company
expects that it will then enter into discussions with the
EPA concerning a further order for that purpose.
On December 9, 1993, the Company entered into a Cooperation
Agreement ("Agreement") with G.E. covering certain
environmental matters at the Company's Waynesboro, Virginia
site. One of the matters covered is the cost of responding
to the Order. The Agreement provides that G.E. will bear
70.0% of the allocable costs relating to the Order. In
1993, the Company recorded a $1.2 million recovery from G.E.
of previously incurred allocable costs relating to the
Order. A dispute has arisen between the Company and G.E.
concerning the Agreement. Management believes that the
dispute will not have a material effect upon the financial
condition, results of operations or liquidity of the
Company.
As a result of the continuing financial obligation which
G.E. has with respect to releases at the facility and the
protracted nature of the investigation, the Company believes
that the costs of the investigation and study and any
corrective action that may be required are not likely to
have a material effect upon the financial condition, results
of operations or liquidity of the Company.
The Company has been notified by the EPA that it is one of
700 potentially responsible parties under the Comprehensive
Environmental Response, Compensation and Liability Act of
1980, for necessary corrective action at a hazardous waste
disposal site in Greer, South Carolina. In prior years, the
Company arranged for the transportation of wastes to the
site for treatment or disposal. Based on information
currently available, the Company believes its share of the
costs of the investigation and any necessary corrective
action is not likely to have a material effect upon the
financial condition, results of operations or liquidity of
the Company.
Other matters:
In the ordinary course of business, the Company is party to
various environmental, administrative and legal proceedings.
In the opinion of management, the Company's liability, if
any, in all pending litigation or other legal proceedings,
other than those discussed above, will not have a material
effect on its financial condition, results of operations or
liquidity of the Company.
Note 9: RELATED PARTY TRANSACTIONS
G.E. is one of the principal stockholders of the Company.
Sales by the Company to G.E. and its affiliates amounted to
$4.6 million, $4.6 million and $6.5 million in 1994, 1993
and 1992, respectively. Amounts receivable from G.E. were
$1.8 million and $1.7 million as of January 1, 1995 and
January 2, 1994, respectively.
Decision Data Holdings, Ltd., ("Decision Data"), one of the
Company's customers, is a related party due to common
ownership. Sales to Decision Data were $1.2 million, $1.8
million and $12.8 million in 1994, 1993 and 1992,
respectively. Amounts receivable from Decision Data were
$0.4 million and $0.2 million as of January 1, 1995 and
January 2, 1994, respectively.
Note 10: CERTAIN GEOGRAPHIC DATA AND SEGMENT INFORMATION
The Company operates in one reportable business segment, the
computer peripheral sales and services business. Printer
products and services are delivered internationally through
a network of subsidiaries located in Canada, Western Europe
and the Pacific Rim. In addition, the Company has a
manufacturing facility in Mexico which is operated as a
maquiladora company.
Transfers (sales) between geographic areas are accounted for
at prices approximating market. Information regarding the
Company's operations in the Pacific Rim, which are not
material, has been combined with its European operations.
Additionally, information regarding the Company's Mexican
subsidiary has been combined with its U.S. operations
because of the vertical integration and its close proximity
to the United States.
Financial information by geographic area:
<TABLE>
(in thousands)
<CAPTION>
United States
Fiscal Year 1994 and Canada Europe Eliminations Consolidated
<S> <C> <C> <C> <C>
Sales to unaffiliated $ 174,455 $ 59,342 $ 233,797
customers
Transfers between
geographic areas 41,821 $ (41,821)
Total sales $ 216,276 $ 59,342 $ (41,821) $ 233,797
Operating income (loss) $ 9,262 $ (94) $ 9,168
Identifiable assets $ 97,517 $ 29,750 $ 127,267
</TABLE>
<TABLE>
<CAPTION>
United States
Fiscal Year 1993 and Canada Europe Eliminations Consolidated
<S> <C> <C> <C> <C>
Sales to unaffiliated $ 159,504 $ 62,361 $ 221,865
customers
Transfers between
geographic areas 43,519 $ (43,519)
Total sales $ 203,023 $ 62,361 $ (43,519) $ 221,865
Operating income (loss) $ 6,134 $ (3,489) $ 2,645
Identifiable assets $ 104,461 $ 36,698 $ 141,159
</TABLE>
<TABLE>
<CAPTION>
United States
Fiscal Year 1992 and Canada Europe Eliminations Consolidated
<S> <C> <C> <C> <C>
Sales to unaffiliated $ 158,646 $ 64,046 $ 222,692
customers
Transfers between
geographic areas 41,756 $ (41,756)
Total sales $ 200,402 $ 64,046 $ (41,756) $ 222,692
Operating income (loss) $ 11,552 $ (3,036) $ 8,516
Identifiable assets $ 110,554 $ 36,252 $ 146,806
</TABLE>
Total sales to customers outside the United States amounted
to $72.3 million, $73.5 million and $77.0 million for 1994,
1993 and 1992, respectively; these amounts include export
sales from the United States of $1.5 million, $1.5 million
and $3.0 million in 1994, 1993 and 1992, respectively.
Note 11: SUMMARIZED QUARTERLY FINANCIAL DATA (UNAUDITED)
<TABLE>
(in thousands, except per share data)
<CAPTION>
Quarter
1994 First Second Third Fourth
<S> <C> <C> <C> <C>
Revenues $ 55,336 $ 59,325 $ 57,350 $ 61,786
Operating income 1,322 3,196 2,408 2,242
Net income 94 1,502 486 488
Earnings per share:
Primary 0.01 0.13 0.04 0.04
Fully diluted 0.01 0.13 0.04 0.04
</TABLE>
<TABLE>
<CAPTION>
Quarter
1993 First Second Third Fourth
<S> <C> <C> <C> <C>
Revenues $ 56,677 $ 55,043 $ 53,973 $ 56,172
Operating income
(loss) 1,569 2,191 451 (1,566)
Net income (loss) 83 39 (1,669) (1,682)
Earnings (loss) per
share:
Primary 0.01 0.00 (0.16) (0.16)
Fully diluted 0.01 0.00 (0.16) (0.16)
</TABLE>
Note 12: SUBSEQUENT EVENT - BUSINESS ACQUISITIONS
Printer Systems Corporation
- ---------------------------
On February 16, 1995, the Company acquired Printer Systems
Corporation ("PSC"), a privately held company whose primary
business is the design, manufacture, distribution and support of
printer products for commercial customers. PSC, which is
headquartered in Gaithersburg, Maryland had 1994 revenues of
$10.0 million. Pursuant to the purchase agreement, the Company
acquired substantially all of PSC's outstanding common and
preferred shares for consideration aggregating to potentially
$4.8 million. Of the consideration $0.8 million was payable at
closing and $1.2 million is payable over the three years
subsequent to closing. Payment of the remaining balance of up to
$2.8 million in consideration is contingent upon attainment of
performance objectives during the three years subsequent to
closing. The purchase price will be funded from the Company's
cash flows from operations and credit facilities and the
acquisition will be accounted for as a purchase.
Harris Adacom Network Services, Inc.
- ------------------------------------
On March 1, 1995, the Company acquired substantially all of the
assets and certain liabilities of Harris Adacom Network Services,
Inc. ("HANS"), including all of the stock of its Canadian
subsidiary, Harris Adacom Inc. for cash and notes totaling $7.3
million. The assets acquired relate to HANS's service depot
facility, field service operations, systems integration business,
and network diagnostic and monitoring operations. The purchase
price will be funded from the Company's cash flows from
operations and credit facilities and the acquisition will be
accounted for as a purchase. In 1994, revenues from the acquired
operations totaled $36.1 million.
Board of Directors:
Don E. Ackerman
Chairman of the Board
President
Chandelle Ventures, Inc.
Bruce K. Anderson
General Partner
Welsh, Carson, Anderson & Stowe
Edward E. Lucente
Marketing Consultant
Paul T. Winn
President and Chief Executive Officer
GENICOM Corporation
Executive Officers:
B. Garrett Buttner
Vice President and General Manager
Supplies and Service Marketing & Sales
Lee P. Chu
Senior Vice President
Integrated Network Services Business
James C. Gale
Senior Vice President Finance and
Chief Financial Officer
Arthur D. Gallo
Vice President and General Manager
Page Printer Business
James A. Jones
Vice President, Corporate Controller
and Treasurer
C. Bruce Meyer
Vice President Human Resources and
Corporate Communications
Michael J. Shelor
ESSD Vice President and General Manager
Service Logistics & Operations
Raymond D. Stapleton
Senior Vice President
International Service Market Development
Paul T. Winn
President and Chief Executive Officer
Corporate Directory
Operations Management:
Donald J. Einecker
Vice President and General Manager
Datacom de Mexico, S.A. de C.V.
Michel Fargier
Acting General Manager
GENICOM S.A., France
Stuart Fathers
General Manager
GENICOM Pty. Ltd., Australia
C. Edward Feaster
Assistant General Manager
International Operations
Klaus Fuchs
General Manager
GENICOM GmbH, Germany
Russell M. Gerhard
Vice President Engineering
Bruce Glashan
President
Harris Adacom Inc.
Tony Hammell
General Manager
GENICOM Limited, United Kingdom
Dennis M. Harbin
General Manager
Relay Products Division
Steve Mosek
General Manager
GENICOM Canada, Inc.
Harold I. McIlroy
Vice President Quality and
Customer Satisfaction
Richard B. Songer
ESSD Vice President and General Manager
Field Service
Remigio Uttini
General Manager
GENICOM SpA, Italy
Company Facilities:
Headquarters:
GENICOM Corporation
14800 Conference Center Drive
Suite 400, Westfields
Chantilly, Virginia, USA 22021-3806
Telephone: (703) 802-9200
Service and Manufacturing Operations:
GENICOM Corporation
One Genicom Drive
Waynesboro, Virginia, USA 22980-1999
Telephone: (703) 949-1000
Enterprising Service Solutions Corporation
2 Crosby Drive
Bedford, Massachusetts, USA 01730
Telephone: (617) 275-2777
Harris Adacom Network Services
1100 Venture Court
Carrollton, Texas, USA 75006-5412
Telephone: (214) 386-2000
Datacom de Mexico, S.A. de C.V.
Carretera a Matamoros con Brecha E-99
Apartado Postal 775
Parque Industrial Reynosa
Reynosa, Tamaulipas, Mexico 88780
Telephone: (210) 682-9211 - U.S. Number
(89) 227035 - Mexican Number
Research and Development Operations:
Printer Systems Corporation
207 Perry Parkway
Gaithersburg, Maryland, USA 20877
Telephone: (301) 258-5060
International Sales and Service Operations:
GENICOM Pty. Ltd.
175 Gibbes Street, Unit 12
Chatswood, N.S.W. 2067
Australia
Telephone: 61-2-417-6411
GENICOM Canada, Inc.
5170-A Timberlea Boulevard
Mississauga, Ontario
Canada L4W 2S5
Telephone: (905) 625-0770
GENICOM S.A.
17 Rue Ampere
91300 Massy
France
Telephone: 33-1-69-308484
GENICOM GmbH
Oberliederbacher Weg 42
65843 Sulzbach/Ts.
Germany
Telephone: 49-6196-70320
GENICOM SpA
Via Achille Grandi 12
20093 Cologno Monzese
Milan, Italy
Telephone: 39-2-27304510
GENICOM Limited
Unit B13 Armstrong Mall
Southwood, Farnborough,
Hampshire, GU14 ONR
United Kingdom
Telephone: 44-1252-522500
Harris Adacom Inc.
100 Commerce Valley Drive E
Toronto, Canada L3T 7R1
Telephone: (905) 882-2500
Independent Accountants:
Coopers & Lybrand L.L.P.
1800 M Street, N.W.
Washington, D.C. 20036
Registrar & Transfer Agent:
First Union National Bank of North Carolina
Shareholder Services Group
Two First Union Center
Charlotte, North Carolina 28288-1154
Legal Counsel:
McGuire Woods Battle & Boothe L.L.P.
One James Center
901 East Cary Street
Richmond, Virginia 23219-4030
Stock Trading:
GENICOM's common stock is traded in the over-the-counter market
and quoted on The Nasdaq Stock Market (Symbol: GECM). As of
February 3, 1995, there were approximately 557 shareholders of
record. The following table sets forth, for the periods
indicated, the high and low closing prices per share of GENICOM
common stock as reported by Nasdaq:
<TABLE>
<CAPTION>
1994 1993
------------- ---------------
High Low High Low
------ ------ ----- ------
<S> <C> <C> <C> <C>
First Quarter $1 5/8 $1 1/16 $ 2 $ 1 1/8
Second Quarter 2 3/8 1 3 1/2 1 5/8
Third Quarter 3 1/4 1 3/4 3 1/2 1 1/2
Fourth Quarter 2 7/8 1 7/8 1 5/8 1 3/16
</TABLE>
SEC Form 10-K:
If you would like a copy of our Annual Report on SEC Form 10-K
for the fiscal year ended January 1, 1995, you may obtain it
without charge. Direct your request to GENICOM Corporation,
Investor Relations Department, 14800 Conference Center Drive,
Suite 400, Westfields, Chantilly, Virginia, USA 22021-3806 or
call the GENICOM Corporation Investor Relations Department at
(703) 802-9200.
Corporate and Investor Information:
Please direct inquiries to GENICOM Corporation, Investor
Relations Department, 14800 Conference Center Drive, Suite 400,
Westfields, Chantilly, Virginia, USA 22021-3806 or call the
GENICOM Corporation Investor Relations Department at (703) 802-
9200.
Annual Stockholders' Meeting:
The Annual Stockholders' Meeting of GENICOM Corporation will be
held on Thursday, April 27, 1995, at the Company's Headquarters,
14800 Conference Center Drive, Suite 400, Westfields, Chantilly,
Virginia, USA 22021-3806. A Form of Proxy and Proxy Statement is
being mailed to stockholders of record with this report.
Equal Employment Opportunity Policy:
GENICOM Corporation is an equal opportunity employer. It is the
policy of the Company to recruit, hire and promote without regard
to race, color, religion, sex, age, national origin or disability
status as a disabled veteran or veteran of the Vietnam Era.
Environmental Policy:
GENICOM has a long-standing commitment to high standards of
employee health and safety and environmental protection. It is
the policy of GENICOM to manage its plants and activities so that
employees' health and safety on the job are protected from
unreasonable risks, so that employee expectations concerning the
work environment are met, and so that the environment is properly
protected from adverse effects of facility operation or from use
of the Company's products and services. The Company is committed
to offering products and using processes that will help solve
environmental problems.
Exhibit 22
SUBSIDIARIES OF REGISTRANT
Jurisdiction
Subsidiary of Incorporation
- ------------------------ ---------------
GENICOM International Holdings Delaware
Corporation
GENICOM International Sales Corporation Delaware
Enterprising Service Solutions Delaware
Corporation
Delmarva Technologies Corporation Delaware
Rastek Corporation Delaware
Rastek Japan Ltd. Japan
GENICOM Relay Products Corporation Delaware
Printer Systems Corporation Virginia
Printer Connection, Inc. Virginia
Printer Systems International, Inc. Virginia
Harris Adacom Inc. Canada
GENICOM Canada, Inc. Canada
GENICOM Foreign Sales Corporation U.S. Virgin
Islands
GENICOM Euro Holdings B.V. The Netherlands
Datacom de Mexico, S.A. de C.V. Mexico
GENICOM International Limited England
GENICOM (No. 1) Limited England
GENICOM Ltd. England
GENICOM S.A.R.L. France
GENICOM S.A. France
GENICOM GmbH Germany
GENICOM S.p.A. Italy
GENICOM (Australia) PTY LTD. Australia
GENICOM Pty Limited Australia
E - 36
Exhibit 24
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration
statement of GENICOM Corporation and Subsidiaries on Form S-8
(FILE Nos. 33-49472 and 33-53843) of our report dated
January 31, 1995, except Note 12, for which the date
is March 1, 1995, on our audits of the consolidated financial
statements and financial statement schedules of GENICOM
Corporation and Subsidiaries as of January 1, 1995 and
January 2, 1994 and for the three fiscal years in the
period ended January 1, 1995, which report is included
on page F-2 in this Annual Report on Form 10-K.
Coopers & Lybrand L.L.P.
- ------------------------
Coopers & Lybrand L.L.P.
Washington, D.C.
March 31, 1995
E - 37
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10-K FOR
THE YEAR ENDED JANUARY 1, 1995 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> JAN-01-1995
<PERIOD-START> JAN-02-1994
<PERIOD-END> JAN-01-1995
<CASH> 673
<SECURITIES> 0
<RECEIVABLES> 37,846
<ALLOWANCES> (1,479)
<INVENTORY> 43,368
<CURRENT-ASSETS> 86,927
<PP&E> 88,755
<DEPRECIATION> (62,540)
<TOTAL-ASSETS> 127,267
<CURRENT-LIABILITIES> 46,147
<BONDS> 47,192
<COMMON> 106
0
0
<OTHER-SE> 27,977
<TOTAL-LIABILITY-AND-EQUITY> 127,267
<SALES> 166,518
<TOTAL-REVENUES> 233,797
<CGS> 120,455
<TOTAL-COSTS> 173,894
<OTHER-EXPENSES> 50,735
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 7,458
<INCOME-PRETAX> 3,618
<INCOME-TAX> 1,048
<INCOME-CONTINUING> 2,570
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,570
<EPS-PRIMARY> 0.23
<EPS-DILUTED> 0.23
</TABLE>
