<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
[X] Annual report pursuant to section 13 or 15(d) of the Securities
Exchange Act of 1934 for the fiscal year ended May 28, 1994 or
[ ] Transition report pursuant to section 13 or 15(d) of the Securities
Exchange Act of 1934 for the transition period from to
______ ______
Commission file number 1-4837
TEKTRONIX, INC.
(Exact name of Registrant as specified in its charter)
Oregon 93-0343990
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
26600 S.W. Parkway Avenue
Wilsonville, Oregon 97070
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (503) 627-7111
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange on
Title of each class which registered
___________________ ________________________
Common Shares, New York Stock Exchange
without par value Pacific Stock Exchange
Series A No Par Preferred New York Stock Exchange
Shares Purchase Rights Pacific Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the Registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter
period that the Registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days.
Yes X . No .
__________ ___________
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein, and will
not be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III of
this Form 10-K or any amendment to this Form 10-K. [ ]
The aggregate market value of the voting stock held by non-
affiliates of the Registrant was approximately $900,107,115 at August 1,
1994.
At August 1, 1994 there were 30,103,851 Common Shares of the
Registrant outstanding.
DOCUMENTS INCORPORATED BY REFERENCE
___________________________________
Document Part of 10-K into which incorporated
________ ____________________________________
Registrant's Proxy Statement Part III
dated August 3, 1994
1994 Annual Report to Shareholders Parts I, II and IV
<PAGE>
PART I
Item 1. Business.
Tektronix is an Oregon corporation organized in 1946. Its principal
executive offices are located at 26600 S.W. Parkway Avenue, Wilsonville,
Oregon 97070, approximately 18 miles south of Portland. Its telephone number
is (503) 627-7111. References herein to "Tektronix" or the "Company" are to
Tektronix, Inc. and its wholly-owned subsidiaries unless the context indicates
otherwise.
Tektronix' products cover a wide range of electronic equipment. The
Company's products may be grouped into four classes of similar products as
follows: (i) measurement business products, (ii) color printing and imaging
products, (iii) video systems products, and (iv) network displays products.
Measurement business products include digital and analog oscilloscopes,
general purpose test instruments, television waveform monitors, vectorscopes,
signal generators, automated test equipment, logic analyzers, card-modular
test instruments, spectrum analyzers, cable testers, optical fiber testers,
cameras, probes and related products. Color printing and imaging products
include color printers and related products and supplies. Video systems
products include studio production equipment, signal processing and
distribution equipment, transmission systems and related products. Network
displays products include graphics terminals and related products.
Products
________
The table below sets forth the contribution to total net sales of
the Company's product groupings for the last three fiscal years (in thousands
of dollars).
<TABLE>
<CAPTION>
Measurement Color Printing
Business and Imaging Video Systems Network Displays Other
Products Products Products Products Products <F1>
_______________ _________________ _____________ ________________ _______________
Amount Percent Amount Percent Amount Percent Amount Percent Amount Percent
______ _______ ______ _______ ______ _______ ______ _______ ______ _______
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1992 $761,642 58.7% $197,079 15.2% $151,534 11.7% $90,386 7.0% $96,602 7.5%
1993 $704,396 54.1% $248,413 19.1% $162,938 12.5% $87,928 6.7% $98,703 7.6%
1994 $664,048 50.4% $313,502 23.8% $152,441 11.5% $89,378 6.8% $98,635 7.5%
____________
<FN>
<F1>(1) The Other product grouping includes the historic net sales to third
parties by the non-strategic components and other business operations
that the Company divested in 1994 and early 1995 or intends to divest in
the near future. During 1994, the Company sold its integrated circuits
operation to Maxim Integrated Products, Inc. and transferred its
hybrid circuits operation to a joint venture with Maxim, and in early
1995 completed the sale of approximately 65% of the stock of its
printed circuit board operation in the initial public offering of
Merix Corporation.
</TABLE>
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Measurement Business Products
_____________________________
Because of their wide range of capabilities, measurement business
products are used in a variety of applications, including research, design,
testing, installation, manufacturing and service in the computer, military,
commercial aerospace, telecommunications, television, process control and
automotive industries.
Tektronix pioneered the development of high precision oscilloscopes
over 45 years ago, and the oscilloscope is the Company's primary measurement
product. Oscilloscopes are used by engineers and technicians when an
electrical signal needs to be viewed, measured, tested or calibrated.
Oscilloscopes are used extensively in the computer, communications, aerospace
and other industries for design, manufacturing and maintenance. In addition
to electrical signals, oscilloscopes can be adapted to measure mechanical
motion (vibration), sound, light, heat, pressure, strain and velocity.
Oscilloscopes produce graphic representations of electrical signals
on a cathode ray tube or other display device. Normally, the display shows
the signal as a graph of its amplitude over a certain period of time, which
may range from minutes to less than a billionth of a second. Oscilloscopes
provide a convenient way to visually monitor and interpret analog electrical
fluctuations, mechanical motion and sound.
The development of the microprocessor and associated growth in
microprocessor-based devices stimulated both the existing analog markets and
new digital markets. In addition, the microprocessor made possible
significant improvements in oscilloscope design and performance. Most of the
oscilloscopes and other measurement products manufactured by Tektronix feature
digital storage and conversion functions, programmable operations, the ability
to work in conjunction with personal computers and workstations and
combinations of these capabilities. In addition, trends toward smaller
microelectronic devices have opened new segments for specialized measurement
equipment probes and other related equipment, such as connectors, adapters and
cards, and cameras and plotters to record displayed waveforms.
Recently, Tektronix redesigned a substantial portion of its
oscilloscope product line to provide a consistent "architecture" across
products and to enhance ease of use. Because the Company manufactures
oscilloscopes in a wide range of configurations, bandwidths and other
performance characteristics and in sizes ranging from hand-held to large
laboratory units, this redesign provides customers with reduced learning time
and higher productivity. The redesign also reduces the time required by the
Company to develop new products because many essential
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user interface aspects have been standardized. Some elements of this redesign
also have been patented and provide the Company with certain competitive
advantages.
The Company also offers modular instruments delivered on printed
circuit cards that can be mixed and matched by customers and plugged directly
into the backplane of industry-standard VXI-based card cages. These are
controlled by personal computers or workstations to form complete instrument
systems tailored to customers' particular requirements. A number of
measurement products are now available in the VXI standard, which products are
used primarily in manufacturing applications. Tektronix has been instrumental
in the development of VXI-based hardware and software industry standards.
Measurement business products also include television test products,
formerly reported as Television Systems products. Television test products
include vectorscopes, waveform monitors, signal generators, automated test
equipment, demodulators, aural modulation monitors and synchronizers which are
used primarily by the television industry to test and display the quality of
video and audio signals. The resolution of images and the fidelity of sounds,
as well as the stability of the signals that carry them, are essential to
program quality. Tektronix' television test products excel at the many forms
of test and measurement vital to creating and maintaining signals of the
highest quality.
Market changes are driving the development of new categories of
products from Tektronix. The proliferation of electronic technology is
requiring technicians and craftspeople to use smart electronic tools for
electronic problem detection in areas such as automotive and electrical
equipment repair and maintenance. TekTools(tm), Tektronix' new line of
handheld, smart and rugged products, are designed specifically for these
markets. Under the TekTools brand are a number of products such as a family
of Digital Multimeters and a new line of products, the TekMeter(tm) family,
that combine the functionality of a multimeter and oscilloscope into one
product, and a number of accessories. An automotive version of the TekMeter
has been developed for automotive electronic troubleshooting and repair and
is being distributed to automotive service centers through third party
distributors that specialize in distribution to the automotive market.
Currently, the TekTools product family includes products priced from below
$100 up to about $2,000.
While TekTools are battery powered portable products, the Company
also markets a line of lower priced benchtop basic instruments such as
frequency counters, multimeters, power supplies and oscilloscopes.
Applications include education, light manufacturing, electronic trouble
shooting and basic electronic design.
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Other measurement business products include logic analyzers,
spectrum analyzers and cable and fiber optic testers.
Logic analyzers are a principal tool for electronic designers,
engineers and technicians in testing and trouble-shooting computers, computer
peripheral devices and digital electronic systems and instruments. Logic
analyzers capture, display and examine streams of data coded as binary digits
(bits), which are transmitted simultaneously over many channels. The
Company's Digital Analysis System (DAS), a broad application logic analyzer,
combines logic analysis and pattern generation by using card modular plug-in
units to permit a range of performance in one system. The DAS is also used by
software engineers in the development and optimization of microprocessor based
designs.
Spectum analyzers are used in communications and other industries to
display and measure signal amplitude versus frequency rather than amplitude
versus time (the latter being what an oscilloscope displays). It is an
essential tool used to design, check and adjust communications transmitting
and receiving equipment.
Products designed for the telecommunications industry play an
increasingly important role in the Company's measurement business portfolio.
Tektronix is a leading supplier of a broad range of test solutions for
emerging networks, designed for ensuring integrity and optimizing performance
of networks, and verifying design and assuring quality of communications
equipment. Cable testers and fiber optic testers use time-domain-
reflectometry techniques to locate faults in metallic and fiber optic cables.
Essentially, these instruments send signals from one end of a cable and then
measure the reflection time of the signals to determine the location of the
fault. Cable testers and fiber optic testers are widely used in the
telecommunication and cable television industries. The Company also has
developed a series of products for SDH or SONET transmission testing in the
telecommunications industry.
Other measurement business products include digitizers, signal
sources, curve tracers and modular lines of general purpose test instruments.
Color Printing and Imaging Products
___________________________________
Tektronix' color printing and imaging products include color
printers and related products and supplies.
Color printers produce full color hard copies of images produced by
personal computers, workstations and terminals. Most of the Company's
printers are compatible with the Postscript industry standard page description
language, which specifies how an image is transferred to hard copy. By
adopting the Postscript
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standard, color printers can be used in conjunction with a wide range of
third-party graphics software. Tektronix produces color printers using
thermal wax, phase change ink jet and dye sublimation color transfer
technologies. The printers are controlled by software designed and
implemented by the Company. Tektronix has developed proprietary technology
that uses solid sticks of ink, of the Company's own formulation, that are
melted and then jetted onto the paper. This technology produces vivid and
stable images, allows printing on plain rather than coated paper and can be
applied to a wide range of sizes and gauges of paper.
The use of color in computing and printing has been stimulated by
enhancements in the underlying microprocessor technology of personal computers
and workstations, by increasingly larger system and peripheral storage
capabilities, and by enhancements in computer display capability. As personal
computers increasingly become capable of displaying images (instead of just
characters), there has been an accompanying growth in demand for printers that
can print such images in color. This demand has been especially strong in
certain scientific and engineering segments and in the graphic arts segment,
where color has typically been a strong element of the way information is
conveyed. The Company's printers are used in a number of environments,
including office, graphic arts and engineering applications.
The purchase of a printer has typically been the second largest
dollar expense of a personal computer user, second only to the basic computer
system. While a substantial majority of the spending on printers has been
directed to black and white (monochrome) printers, color printers have been a
rapidly growing segment of the total printer market. As color printer
technology advances and as prices for color printers approach the costs of
higher performance monochrome printers, the market for color printers can be
expected to show continued growth. In the past, there have been two
significant areas of application for color printers. The first type of
application is characterized by high quality output and higher prices, and
color printers in this application are used to produce very high quality
images that approach the quality of four-color offset printing. The second
type of application is characterized by color text and images approaching the
resolution of monochrome ink jet and laser printers and lower user costs.
Tektronix participates primarily in the second application area, with products
that range in price from approximately $3,000 (suggested list price) up to
approximately $15,000. Products in the first application area typically sell
for three to ten times more than the prices of the products in the second
application area.
While the market for color printers is currently growing rapidly, it
is still much smaller than the market for
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monochrome printers. Moreover, it is characterized by intense and increasing
competition, resulting in a competitive pricing environment. Because the
market for color hard copy is still small compared to the market for
monochrome printers, distribution of products from manufacturer to end user
is less efficient. The Company expects distribution channels to expand as
color hard copy becomes a more prominent feature in computer applications.
Also included in color printing and imaging products are supplies
for use with the Company's color printers, including inks, ribbons and paper.
These supplies are a very significant source of ongoing color printing and
imaging revenue.
Video Systems Products
______________________
The increasing use of television to communicate a broad array of
information and entertainment has created markets for a number of products
that support the development of "content" for distribution by television
signals. As television distribution systems become more powerful, there is
greater potential for increased usage via integration of computer applications
with television. Those trends, coupled with the increasing use of cable and
satellite to distribute content, are expanding the market for Tektronix' video
systems products. These trends may result in increased demand for lower cost
production products based on industry standard platforms and for systems that
support the development and distribution of new forms of content, such as
multimedia products.
Most video systems products are from The Grass Valley Group, Inc.
("Grass Valley"), a wholly-owned subsidiary of the Company based in California
that manufactures products used by the television industry for program
production and distribution. Grass Valley products include studio production
equipment, signal processing and distribution equipment and transmission
systems. Studio production equipment is used in the creative process of
television program production and assembly. Production equipment products
include production switchers, special effects devices and editing controllers.
Production switchers allow an operator to select signals from various sources,
such as cameras, video tape recorders and network or remote transmissions, and
to combine these signals into the continuous program seen by the viewing
audience. Grass Valley also manufactures electronic graphics systems which
are used to create video titles and graphics for use in television program
production. Signal processing and distribution equipment is used in the
process of moving signals within a television production facility or between
facilities. Such equipment includes routing switchers, amplifiers, timing
systems and signal conversion devices. Transmission systems are used in the
process of transporting
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signals between facilities. Transmission system products include fiber optic
video transmitter/receiver systems, digital video coders/decoders,
cross-connect switches and interactive conferencing systems including distance
learning systems. Grass Valley's customers include the television networks,
local television stations, post-production houses (which assemble commercials
and television programs from recorded footage), telephone and cable companies
and corporate and educational users.
Other video systems products include the Company's new Profile (tm)
product which is a disk-based, multi-channel video storage and playback system
for use by television broadcasters in video library systems.
Network Displays Products
_________________________
The Company's major network displays product line is its X
terminals, which are standards-based graphics terminals that also provide
multiple windowing and networking capability. The Company's X terminals
connect users with a host computer and other devices, such as a printer, that
make up a computing system. Many X terminal applications involve a central
"server" (containing applications and data) connected to multiple terminals,
thereby allowing a number of users to access those applications and data. The
Company no longer manufactures its older line of proprietary graphics
terminals, but it still has a service business for its installed base for such
products. This service business has continually declined as the installed
base of these proprietary graphics terminals declines.
X terminal products are based on standard architecture originally
developed by the Massachusetts Institute of Technology. As a result, it is
difficult for any manufacturer to develop a proprietary advantage in either
the underlying hardware or in elements of the operating system. As a result,
competition in the X terminals market is intense. The Company's graphics
terminals have historically been used in technical applications such as
mechanical engineering design, drafting and mapping. As a result, the Company
has enjoyed a strong position in the technical and scientific segments of the
market. Recently, the market has expanded and shifted to commercial
applications from scientific and engineering applications. In accordance with
this trend, recent additions to the Company's X terminal product line focus on
new commercial and business applications, as well as engineering applications.
Commercial customers now account for a major portion of the Company's X
terminal revenues.
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Manufacturing
_____________
During 1994, the Company sold its integrated circuits operation to
Maxim Integrated Products, Inc. and transferred its hybrid circuits operation
to a joint venture with Maxim, and in early 1995 completed the sale of
approximately 65% of the stock of its printed circuit board operation in the
initial public offering of Merix Corporation. As a result of these activities
and other recent component operation divestitures, the Company's manufacturing
operations are no longer highly integrated. The Company has entered into
supply agreements with each of the companies now operating the respective
component operations and, as a result, believes that the Company will be able
to acquire the required components as needed. Other companies also
manufacture special components for Tektronix.
Tektronix also purchases raw materials, components, data processing
equipment and computer peripheral devices for use in its products and systems.
Such purchased materials and components are generally available to Tektronix
as needed. Although shortages of such items have been experienced from time
to time, Tektronix believes that such shortages will not have a material
adverse effect on the Company.
Tektronix owns substantially all of its manufacturing facilities.
Its primary manufacturing facilities are located in or near the Portland,
Oregon metropolitan area. Some of Tektronix' products, components and
accessories are manufactured in Heerenveen, The Netherlands and in Hong Kong.
Tektronix recently announced that it plans to transform its Heerenveen plant
from a manufacturing operation to a logistics center. Grass Valley's products
are manufactured near Grass Valley, California. See Item 2, "Properties" for
a more detailed description of the Company's manufacturing facilities.
Certain Tektronix products are assembled for the Japanese market at
plants in Tokyo and Gotemba, Japan by Sony/Tektronix Corporation, a Japanese
corporation equally owned by Tektronix and Sony Corporation. Sony/Tektronix
also designs and manufactures small, lightweight portable oscilloscopes,
benchtop semiconductor testers and digitizers in Japan for sale worldwide.
Sales and Distribution
______________________
Tektronix maintains its own worldwide sales engineering and field
maintenance organization, staffed with technically trained personnel. Sales
in the United States, Canada, Brazil, the United Kingdom, Germany, France,
Italy, Spain, The Netherlands, Belgium, Sweden, Denmark, Norway, Finland,
Switzerland, The Republic of Ireland, Australia, Austria, Hong Kong, Taiwan
and Mexico are made primarily through field offices
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of the Company and its subsidiaries located in principal market areas. Sales
in the Peoples Republic of China are made through liaison offices of a Hong
Kong subsidiary of the Company. Except for Grass Valley products, sales in
Japan are made by Sony/Tektronix Corporation. Sales in India are made by
Hinditron Tektronix Instruments, Ltd., an Indian company which is 40% owned
by Tektronix. Many of the Company's products are sold in whole or in part
through independent distributors throughout the United States and in some
other countries. Certain of the Company's independent distributors also sell
products manufactured by the Company's competitors. In some countries, all
sales are made either directly by Tektronix or by independent representatives
to whom Tektronix provides direct technical and administrative assistance. A
number of the Tektronix field offices also perform major maintenance and
reconditioning operations.
Tektronix' principal customers are electronic and computer equipment
manufacturers, private industrial concerns engaged in commercial or
governmental projects, military and nonmilitary agencies of the United States
and of foreign countries, public utilities, educational institutions, radio
and television stations and networks, graphics arts companies and users of
sophisticated office products. Certain products are sold both to equipment
users and to original equipment manufacturers.
During the last fiscal year, United States Government agencies
accounted directly for approximately three percent of Tektronix' consolidated
sales as compared with approximately four percent for the prior year. During
the last five years, direct sales to United States Government agencies ranged
from three to six percent. The balance of sales during each year was
distributed among several thousand other customers, with no other single
customer accounting for as much as three percent. The Company believes that
sales directly related to United States Government expenditures (excluding
sales to the United States Government) were approximately four percent of
Tektronix' consolidated sales for the last fiscal year. Contracts involving
the United States Government are subject, as is customary, to termination by
the Government at its convenience.
Most Tektronix product sales are sold as standard catalog items.
Tektronix attempts to fill its orders as promptly as possible. At May 28,
1994, Tektronix' unfilled product orders amounted to approximately $108
million, as compared to approximately $107 million at May 29, 1993. Tektronix
expects that substantially all unfilled product orders at May 28, 1994 will be
filled during its current fiscal year. Orders received by the Company are
subject to cancellation by the customer.
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International Sales
___________________
The following table sets forth the breakdown between U.S. and
international sales, based upon purchaser location, for each of the last three
fiscal years (in thousands of dollars):
<TABLE>
<CAPTION>
U.S. Sales International Sales
__________________ ___________________
Amount Percent Amount Percent
______ _______ ______ _______
<S> <C> <C> <C> <C>
1992 $670,291 51.7% $626,952 48.3%
1993 $713,734 54.8% $588,644 45.2%
1994 $737,451 56.0% $580,553 44.0%
</TABLE>
See "Business Segments" in the Notes to Consolidated Financial Statements at
page 20 of the Company's 1994 Annual Report to Shareholders, containing
information on sales, operating income and assets by geographic area based
upon the location of the seller, which is hereby incorporated by reference.
Tektronix products are sold worldwide. European sales are made
principally in Germany, France, the United Kingdom, Switzerland, Italy, Spain,
Sweden, The Netherlands and Austria. Other international sales are
principally in Japan, Canada and Australia. International sales include both
export sales from the United States and sales by foreign subsidiaries.
Fluctuating exchange rates and other factors beyond the control of Tektronix,
such as the stability of international monetary conditions, tariff and trade
policies and domestic and foreign tax and economic policies, affect the level
and profitability of international sales. The Company is unable to predict
the effect of these factors on its business. The Company hedges against
certain currency exposures in order to minimize their impact.
Research and Development
________________________
Tektronix operates in an industry characterized by rapid
technological change and research and development are important elements in
its business. Expenditures during fiscal years ended May 30, 1992, May 29,
1993 and May 28, 1994 for research and development amounted to approximately
$169,183,000, $157,068,000 and $153,148,000, respectively. Almost all of
these funds were Company-generated.
Research and development activities are conducted by central
research and design groups and specialized product development groups. These
activities include: (i) research on basic devices and techniques (ii) the
design and development of products and components and specialized equipment
and (iii) the development of processes needed for production. Most of
Tektronix' research and development is devoted to enhancing and developing its
own products.
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Patents
_______
It is Tektronix' policy to seek patents in the United States and
appropriate foreign countries for its significant patentable developments.
However, electronic equipment as complex as most Tektronix products is
generally not patentable in its entirety. The Company believes that its
business is not dependent to any material extent upon any particular patent or
group of patents or upon any licensing arrangement.
Competition
___________
The electronics industry continues to become more competitive, both
in the United States and abroad. Primary competitive factors are product
performance, technology, customer service, product availability and price.
Tektronix believes that its reputation in the marketplace is also a
significant positive competitive factor. With respect to many of its
products, the Company competes with companies that have substantially larger
resources.
Tektronix is the world's largest manufacturer of oscilloscopes and
no single competitor offers as complete a line. Tektronix is the leading
manufacturer of test and measurement equipment for the television industry.
Tektronix has competed for a number of years in the market for logic
analyzers with several companies. While a competitor has a larger market
share in logic analyzers, Tektronix is the only other significant manufacturer
in this relatively small segment of the instrumentation market.
Tektronix competes with a number of companies in specialized areas
of other test and measurement products, and it competes with one large company
that sells a broad line of test and measurement products.
A large number of manufacturers, including computer manufacturers,
compete with Tektronix in the markets for color printers and X terminals.
Tektronix is a leader in the market for workgroup color printers and the
leader in dye sublimation, Phase-change and thermal wax color printers.
Tektronix is the fastest growing major supplier of X terminals and it now
ranks third in unit sales.
Tektronix competes with a number of electronics firms that
manufacture specialized equipment for the television industry, both with
respect to its television test and measurement products and the products of
Grass Valley. Grass Valley is the leading manufacturer of high-performance
production switchers, a leading manufacturer of high-performance
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distribution/processing equipment and a significant factor in its other
markets.
Employees
_________
At May 28, 1994, Tektronix had 8,468 employees, of whom 1,390 were
located in foreign countries. Tektronix' employees in the United States and
most foreign countries are not covered by collective bargaining agreements.
The Company believes that relations with its employees are good.
Environment
___________
The Company's facilities are subject to numerous laws and
regulations concerning the discharge of materials into the environment, or
otherwise relating to protection of the environment. Compliance with these
laws has not had and is not expected to have a material effect upon the
capital expenditures, earnings or competitive position of the Company.
Executive Officers of the Company
_________________________________
The following are the executive officers of the Company:
<TABLE>
<CAPTION>
Has Served As
An Officer of
Name Position Age Tektronix Since
____ ________ ___ _______________
<S> <C> <C> <C>
Jerome J. Meyer Chairman, Chief 56 1990
Executive Officer
and Director
William D. Walker Vice Chairman of 63 1992 (also
the Board, Director served in
1990 and
from 1969
to 1984)
Delbert W. Yocam President and Chief 50 1992
Operating Officer,
Director
Roy D. Barker Vice President, 53 1993
Color Printing and
Imaging Division
Daniel W. Castles Vice President and 38 1993
President, The Grass
Valley Group, Inc.
John P. Karalis Vice President, 56 1992
Corporate Development
and Secretary
</TABLE>
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<TABLE>
<CAPTION>
Has Served as
An Officer of
Name Position Age Tektronix Since
____ ________ ___ _______________
<S> <C> <C> <C>
Richard I. Knight Vice President, 47 1988
Technology
Carl W. Neun Vice President and 50 1993
Chief Financial
Officer
Daniel Terpack Vice President, 53 1993
Measurement Business
Division
Timothy E. Vice President, Total 41 1991
Thorsteinson Quality and Human
Resources
John W. Vold Vice President and 64 1991
President, Asian
Operations
Jack Raiton Controller 50 1986
</TABLE>
The executive officers are elected by the board of directors of the
Company at its annual meeting. Executive officers hold their positions until
the next annual meeting or until their successors are elected, or until such
tenure is terminated by death, resignation or removal in the manner provided
in the bylaws. There are no arrangements or understandings between executive
officers or any other person pursuant to which the executive officers were
elected and none of the executive officers are related.
All of the executive officers named have been employed by Tektronix
in management positions for the last five years except: Mr. Jerome J. Meyer
who joined Tektronix in 1990 and prior to that time served as President of the
industrial business of Honeywell, Inc. ("Honeywell") (from 1988 to 1990),
President and Chief Executive Officer of Honeywell Bull, Inc., now known as
Bull HN Information Systems, Inc. (from 1987 to 1988) and a Vice President of
Honeywell (from 1986 to 1987); Mr. John W. Vold who joined Tektronix in 1991
and from 1987 to 1991 was Executive Vice President of Bull HN Information
Systems, Inc., and prior to that time was Vice President of the Airborne
Products Division of Unisys Corporation; Mr. Timothy E. Thorsteinson who
joined Tektronix in 1991 and from 1990 to 1991 was Director of Quality
Performance of National Semiconductor Corporation ("National Semiconductor")
and prior to that time held a number of management positions in human
resources management at National
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Semiconductor; Mr. John P. Karalis who joined Tektronix in 1992 and prior to
that time was with the law firm of Brown and Bain (from 1989 to 1992) and Vice
President and General Counsel of Apple Computer, Inc. (from 1987 to 1989);
Mr. Carl W. Neun who joined Tektronix in 1993 and prior to that time served as
Senior Vice President of Administration and Chief Financial Officer of Conner
Peripherals, Inc., (from 1987 to 1993); Mr. Delbert W. Yocam who joined
Tektronix in 1992 and prior to that was an independent consultant (from 1990
to 1992) and was President of Apple Pacific (from 1988 to 1989) and Executive
Vice President and Chief Operating Officer of Apple Computer, Inc. (from 1986
to 1988); Mr. Daniel Terpack who joined Tektronix in 1992 and prior to that
was General Manager of Hewlett-Packard Company's Corvallis, Oregon Division,
responsible for portable computation products; and Mr. William D. Walker, who
is not an employee of the Company and has been a director of the Company since
1980.
Item 2. Properties.
A brief description of the location and general characteristics of
the significant properties occupied by Tektronix in August of 1994 is set
forth below. Tektronix believes that its operations are in compliance in all
material respects with requirements relating to environmental quality and
energy conservation.
Tektronix owns a 265-acre industrial park (the "Howard Vollum Park")
near Beaverton, Oregon. The Howard Vollum Park includes 23 buildings arranged
in a campus-like setting and containing an aggregate of approximately 2.6
million gross square feet of enclosed floorspace. Most of the Company's
central research and development and a substantial portion of its product
manufacturing and administrative activities are located at Howard Vollum Park.
The Company's measurement business products and television test equipment
products are manufactured primarily at Howard Vollum Park. The Company leases
certain excess space at the Howard Vollum Park to other corporations.
Measurement business operations are also conducted at three
buildings, containing approximately 414,000 square feet, at the Company's
48-acre site near Aloha, Oregon, approximately five miles west of Howard
Vollum Park. The Company intends to consolidate these operations with
operations at Howard Vollum Park and the property is currently offered for
sale as surplus.
The Company's Color Printing and Imaging Division, Network Displays
Division and corporate headquarters occupy three buildings containing
approximately 592,000 square feet on a 167-acre tract owned by the Company in
Wilsonville, Oregon, approximately 16 miles south of Howard Vollum Park. An
additional 192,000 square foot building on the Company's Wilsonville property
is leased to another corporation.
14
<PAGE>
All of the buildings described above were constructed after 1957 and
are maintained in good condition. Warehouses, production facilities and other
critical operations are protected by fire sprinkler installations. Most
manufacturing, office and engineering areas are air-conditioned. The Company
believes that its facilities described above are adequate for their intended
uses. Capacity utilization within the Company varies between product area
but, in general, the Company has the capacity to increase production
substantially without adding significant plant capacity.
Tektronix owns a 240-acre site six miles east of Vancouver,
Washington (Vancouver is across the Columbia River from Portland, Oregon.).
The Company has leased the 488,000-square foot manufacturing facility that is
situated on the site to another corporation. The property is surplus and the
Company is attempting to sell it.
Tektronix owns 61 acres within an industrial park in Redmond,
Oregon, about 150 miles east of Portland; 136 acres in Fairview, Oregon, about
15 miles east of Portland; and 75 acres adjacent to and west of Howard Vollum
Park. At the present time, the Company is attempting to sell these parcels of
undeveloped land.
Grass Valley's operating facilities are primarily housed in ten
buildings containing a total of approximately 190,000 square feet of
floorspace on a 320-acre site owned by Grass Valley near Grass Valley,
California, and three buildings containing a total of approximately 149,000
square feet on Grass Valley's 116-acre tract of land in the neighboring town
of Nevada City.
A 109,000-square-foot plant owned by Tektronix is located on 23
acres of land in Heerenveen, The Netherlands.
Tektronix also owns a seven-acre site in Hoddesdon, England, with
manufacturing buildings containing about 47,000 square feet which is leased to
another corporation. Tektronix is attempting to sell this facility.
Domestic field offices in Santa Clara and Irvine, California;
Chicago, Illinois; and Philadelphia, Pennsylvania are owned by Tektronix.
Together they comprise approximately 214,000 square feet. All other Tektronix
U.S. field offices, aggregating approximately 190,000 square feet, are leased.
Field offices near Cologne (101,000 square feet), London (83,000
square feet), and Sydney, Australia (23,000 square feet) are located in
buildings owned by the Company. Field offices in other foreign countries
occupy leased premises.
15
<PAGE>
Item 3. Legal Proceedings.
Mr. Jerome J. Lemelson has advised the Company that he believes
Tektronix is infringing certain of his patents which allegedly cover such
equipment or processes as bar code systems, machine vision, beam processing
and IC manufacturing techniques. Mr. Lemelson's claims of infringement are
primarily based on general allegations that all manufacturers, including
Tektronix, which operate in certain industries must by the nature of their
activities be infringing Mr. Lemelson's patents. Tektronix has had ongoing
communications with Mr. Lemelson's representatives in an effort to obtain more
specific information regarding the activities Mr. Lemelson believes are
infringing. The Company is still investigating Mr. Lemelson's claims to
determine if they may relate to any of the Company's equipment, products or
processes. The Company believes that ultimate resolution of these claims will
not have a material adverse effect on its financial position or results of
operation.
There are no other material pending legal proceedings.
Item 4. Submission of Matters to a Vote of Security Holders.
No matter was submitted to a vote of security holders during the
fourth quarter of the fiscal year covered by this report.
PART II
Item 5. Market for the Registrant's Common Equity and Related Stockholder
Matters.
The information required by this item is included on page 26 of the
Company's 1994 Annual Report to Shareholders and is incorporated herein by
reference.
Item 6. Selected Financial Data.
The information required by this item is included on page 27 of the
Company's 1994 Annual Report to Shareholders and is incorporated herein by
reference.
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
The information required by this item is included on pages 10
through 13 of the Company's 1994 Annual Report to Shareholders and is
incorporated herein by reference.
Item 8. Financial Statements and Supplementary Data.
The information required by this item is included on pages 14
through 26 of the Company's 1994 Annual Report to Shareholders and is
incorporated herein by reference.
16
<PAGE>
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure.
None.
PART III
Item 10. Directors and Executive Officers of the Registrant.
The information required by this item regarding Directors is
included under "Board of Directors" and "Election of Directors" on pages 3 to
7 of the Company's Proxy Statement dated August 3, 1994.
The information required by this item regarding officers is
contained under "Executive Officers of the Company" in Item 1 of Part I
hereof.
The information required by Item 405 of Regulation S-K is included
under "Compliance with Section 16(a) of the Exchange Act" on page 26 of the
Company's Proxy Statement dated August 3, 1994.
Item 11. Executive Compensation.
The information required by this item is included under "Directors'
Compensation" and "Executive Compensation" on pages 7 to 13 of the Company's
Proxy Statement dated August 3, 1994.
Item 12. Security Ownership of Certain Beneficial Owners and Management.
The information required by this item is included under "Ownership
of Shares" and "Election of Directors" on page 2 and 4 to 7 of the Company's
Proxy Statement dated August 3, 1994.
Item 13. Certain Relationships and Related Transactions.
None
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K.
(a) (1) Financial Statements.
____________________
The following documents are included in the Company's 1994
Annual Report to Shareholders at the pages indicated and are incorporated
herein by reference:
17
<PAGE>
<TABLE>
<CAPTION>
Page in 1994 Annual
Report to Shareholders
______________________
<S> <C>
Independent Auditors' Report 14
Consolidated Statements of Operations 15
Consolidated Balance Sheets 16
Consolidated Statements of Cash Flows 17
Consolidated Statements of Shareholders' 18
Equity
Notes to Consolidated Financial Statements 19 to 26
</TABLE>
(2) Financial Statement Schedules.
_____________________________
The following schedules and independent auditors' consent and
report are filed herewith:
Schedule II -- Amounts Receivable from Related Parties
Schedule V -- Property, Plant and Equipment
Schedule VI -- Accumulated Depreciation and Amortization of
Property, Plant and Equipment
Schedule IX -- Short-Term Borrowings
Schedule X -- Supplementary Income Statement Information
Independent Auditors' Consent and Report on Schedules
All other schedules are omitted as the required information is
inapplicable or is presented in the financial statements or related
notes thereto.
Separate financial statements for the registrant have been omitted
because the registrant is primarily an operating company and the
subsidiaries included in the consolidated financial statements are
substantially totally held. All subsidiaries of the registrant are
included in the consolidated financial statements. Summarized
financial information for 50 percent or less owned persons in which
the registrant has an interest is included in the Notes to
Consolidated Financial Statements appearing in the Company's Annual
Report to Shareholders.
(3) Exhibits:
(3)(i) Restated Articles of Incorporation, as
amended. Incorporated by reference to
Exhibit (3) of Form 10-Q dated September
28, 1990, SEC File No. 1-4837.
(ii) Bylaws, as amended.
(4)(i) Indenture dated as of November 16, 1987, as
amended by First Supplemental Indenture
dated as of July 13, 1993, covering the
registrant's 7-1/2% notes due August 1,
2003. Indenture incorporated by reference
18
<PAGE>
to Exhibit 4(i) of Form 10-K dated August
22, 1990, SEC File No. 1-4837.
(ii) Pursuant to Item 601(b)(4)(iii) of
Regulation S-K, the registrant agrees to
furnish to the Commission upon request
copies of agreements relating to other
indebtedness.
(10)(i) Restated Operating Performance Incentive
Plan, as amended. Incorporated by
reference to Exhibit (10)(i) of Form 10-Q
dated April 15, 1988, SEC File No. 1-4837.
(ii) 1982 Stock Option Plan, as amended.
Incorporated by reference to Exhibit
10(iii) of Form 10-K dated August 22, 1989,
SEC File No. 1-4837.
(iii) Stock Incentive Plan, as amended.
Incorporated by reference to Exhibit 10(ii)
of Form 10-Q dated April 9, 1993, SEC File
No. 1-4837.
(iv) Restated Annual Performance Improvement
Plan. Incorporated by reference to Exhibit
10(i) of Form 10-Q dated April 9, 1993, SEC
File No. 1-4837.
(v) Restated Deferred Compensation Plan.
Incorporated by reference to Exhibit 10(i)
of Form 10-Q dated December 20, 1984, SEC
File No. 1-4837.
(vi) Retirement Equalization Plan, as amended.
Incorporated by reference to Exhibit
10(vii) of Form 10-K dated August 18, 1993,
SEC File No. 1-4837.
(vii) Severance Agreement entered into between
the Company and its named officers.
Incorporated by reference to Exhibit
10(viii)of Form 10-K dated August 18, 1993,
SEC File No. 1-4837.
(viii) Indemnity Agreement entered into between
the Company and its named officers and
directors. Incorporated by reference to
Exhibit 10(ix) of Form 10-K dated August
18, 1993, SEC File No. 1-4837.
(ix) Executive Severance Agreement.
(x) Retention Incentive Agreement.
19
<PAGE>
(xi) Executive Compensation and Benefits
Agreement dated as of October 24, 1990.
Incorporated by reference to Exhibit
(10)(ii) of Form 10-Q dated December 21,
1990, SEC File No. 1-4837.
(xii) Executive Compensation and Benefits
Agreement dated as of October 1, 1992.
Incorporated by reference to Exhibit
(10)(iii) of Form 10-Q dated January 8,
1993, SEC File No. 1-4837.
(xiii) Employment Letter Agreement dated September
1, 1992.
(xiv) Executive Compensation and Benefits
Agreement dated as of March 29, 1993.
(xv) Rights Agreement dated as of August 16,
1990. Incorporated by reference to Exhibit
1 of Form 8-K dated August 27, 1990, SEC
File No. 1-4837.
(xvi) Non-Employee Directors' Deferred
Compensation Plan.
(13) Portions of the 1994 Annual Report to
Shareholders that are incorporated herein
by reference.
(21) Subsidiaries of the registrant.
(24) Powers of Attorney.
(b) No reports on Form 8-K have been filed during the last quarter of
the period covered by this Report.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused this Report
to be signed on its behalf by the undersigned, thereunto duly authorized.
TEKTRONIX, INC.
By /s/ Carl W. Neun
_______________________________
Carl W. Neun
Vice President and
Chief Financial Officer
Dated: August 11, 1994
20
<PAGE>
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Capacity Date
_________ ________ ____
<S> <C> <C>
JEROME J. MEYER * Chairman and Chief August 11, 1994
Jerome J. Meyer Executive Officer,
Director
CARL W. NEUN Vice President and August 11, 1994
Carl W. Neun Chief Financial Officer,
Principal Financial and
Accounting Officer
PAUL E. BRAGDON * Director August 11, 1994
Paul E. Bragdon
PAUL C. ELY * Director August 11, 1994
Paul C. Ely
A.M. GLEASON * Director August 11, 1994
A. M. Gleason
WAYLAND R. HICKS * Director August 11, 1994
Wayland R. Hicks
KEITH R. MCKENON * Director August 11, 1994
Keith R. McKennon
ANDREW V. SMITH * Director August 11, 1994
Andrew V. Smith
</TABLE>
21
<PAGE>
<TABLE>
<CAPTION>
Signature Capacity Date
_________ ________ ____
<S> <C> <C>
RICHARD W. SONNENFELDT * Director August 11, 1994
Richard W. Sonnenfeldt
JEAN VOLLUM * Director August 11, 1994
Jean Vollum
WILLIAM D. WALKER * Director August 11, 1994
William D. Walker
DELBERT W. YOCAM * Director August 11, 1994
Delbert W. Yocam
*By JOHN P. KARALIS August 11, 1994
John P. Karalis
as attorney-in-fact
</TABLE>
22
<PAGE>
INDEPENDENT AUDITORS' CONSENT AND REPORT ON SCHEDULES
We consent to the incorporation by reference in Registration
Statements No. 33-33496 and 33-30648 of Tektronix, Inc. on Form S-8
and Registration Statements No. 33-18658 and 33-59648 of Tektronix,
Inc. on Form S-3 of our reports dated June 23, 1994 (which expresses
an unqualified opinion and includes an explanatory paragraph relating
to a change in method of accounting for other postretirement benefits
and income taxes in the year ended May 29, 1993), incorporated by
reference in this Annual Report on Form 10-K of Tektronix, Inc. for
the year ended May 28, 1994.
Our audits of the financial statements referred to in our
aforementioned report also included the financial statement schedules
of Tektronix, Inc. listed in Item 14. These financial statement
schedules are the responsibility of the Company's management. Our
responsibility is to express an opinion based on our audits. In our
opinion, such financial statement schedules, when considered in
relation to the basic consolidated financial statements taken as a
whole, present fairly in all material respects the information set
forth therein.
DELOITTE & TOUCHE
Portland, Oregon
June 23, 1994
<PAGE>
SCHEDULE II
<TABLE>
TEKTRONIX, INC. AND SUBSIDIARIES
AMOUNTS RECEIVABLE FROM RELATED PARTIES
<CAPTION>
Balance at
Beginning Amounts Balances at End of Year
of Year Additions Collected Current Long-Term
___________ _________ _________ _______ _________
<S> <C> <C> <C> <C> <C>
Year ended
May 28, 1994: $0 $0 $0 $0 $0
Year ended
May 29, 1993:
E Machines $111,070 $167,972 $ 279,042 $0 $0
Year ended
May 30, 1992:
E Machines $363,941 $756,151 $1,009,022 $111,070 $0
</TABLE>
The balance at the beginning of 1992 included two promissory notes guaranteed
by Stephen H. Vollum. The notes were paid in full in the fiscal year ended
May 30, 1992.
<PAGE>
SCHEDULE V
<TABLE>
TEKTRONIX, INC. AND SUBSIDIARIES
PROPERTY, PLANT AND EQUIPMENT
(in thousands)
<CAPTION>
Balance at <F1> Balance
Beginning Additions Other at End
of Year at Cost Retirements Changes of Year
___________ _________ ___________ _______ _______
<S> <C> <C> <C> <C> <C>
Year ended
May 28, 1994:
Land $ 13,127 $99 ($993) ($495) $ 11,738
Buildings and
leasehold
improvements 241,412 10,596 (40,616) (14,318) 197,074
Machinery and
equipment 538,635 59,575 (153,220) (93) 444,897
________ _______ __________ _________ ________
Total $793,174 $70,270 ($194,829) ($14,906) $653,709
________ _______ __________ _________ ________
Year ended
May 29, 1993:
Land $ 14,605 $495 ($1,668) ($305) $ 13,127
Buildings and
leasehold
improvements 247,055 8,635 (8,810) (5,468) 241,412
Machinery and
equipment 576,107 48,641 (51,984) (34,129) 538,635
________ _______ _________ _________ ________
Total $837,767 $57,771 ($62,462) ($39,902) $793,174
________ _______ _________ _________ ________
Year ended
May 30, 1992:
Land $ 15,939 $36 ($1,717) $347 $ 14,605
Buildings and
leasehold
improvements 251,930 3,466 (9,881) 1,540 247,055
Machinery and
equipment 615,771 62,005 (81,724) (19,945) 576,107
________ _______ _________ _________ ________
Total $883,640 $65,507 ($93,322) ($18,058) $837,767
________ _______ _________ _________ ________
<FN>
<F1>(A) Includes currency translation and other adjustments. In 1994, includes
reclassification of $9,982 of Buildings to Property held for sale and, in
1993, includes restructuring writedowns of $30,200.
</TABLE>
<PAGE>
SCHEDULE VI
<TABLE>
TEKTRONIX, INC. AND SUBSIDIARIES
ACCUMULATED DEPRECIATION AND AMORTIZATION OF
PROPERTY, PLANT AND EQUIPMENT
(in thousands)
<CAPTION>
Balance at Additions <F1> Balance
Beginning Charged to Other at End
of Year Expense Retirements Changes of Year
__________ __________ ___________ _______ _______
<S> <C> <C> <C> <C> <C>
Year ended
May 28, 1994:
Buildings and
leasehold
improvements $113,437 $ 8,537 ($19,948) ($1,930) $100,096
Machinery and
equipment 443,903 46,381 (155,803) (4,190) 330,291
________ _______ __________ ________ ________
Total $557,340 $54,918 ($175,751) ($6,120) $430,387
________ _______ __________ ________ ________
Year ended
May 29, 1993:
Buildings and
leasehold
improvements $112,716 $ 8,673 ($4,465) ($3,487) $113,437
Machinery and
equipment 439,497 54,400 (46,889) (3,105) 443,903
________ _______ _________ ________ ________
Total $552,213 $63,073 ($51,354) ($6,592) $557,340
________ _______ _________ ________ ________
Year ended
May 30, 1992:
Buildings and
leasehold
improvements $111,070 $ 8,629 ($6,910) ($73) $112,716
Machinery and
equipment 469,102 56,999 (74,215) (12,389) 439,497
________ _______ _________ _________ ________
Total $580,172 $65,628 ($81,125) ($12,462) $552,213
________ _______ _________ _________ ________
<FN>
<F1> (A) Includes currency translation and other adjustments.
</TABLE>
<PAGE>
SCHEDULE IX
<TABLE>
TEKTRONIX, INC. AND SUBSIDIARIES
SHORT-TERM BORROWINGS
(in thousands)
<CAPTION>
End of Year During the Year
______________________ ________________________________
Average Average
Interest Maximum Average Interest
Balance Rate Outstanding Outstanding Rate
____________________________________________________________________________
<S> <C> <C> <C> <C> <C>
May 28, 1994:
Notes payable
to banks $15,963 5.5% $90,579 $36,479 5.0%
____________________________________________________________________________
May 29, 1993:
Notes payable
to banks $61,566 4.8% $80,200 $71,089 4.8%
____________________________________________________________________________
May 30, 1992:
Notes payable
to banks $49,990 6.4% $79,989 $58,591 6.3%
____________________________________________________________________________
</TABLE>
The average borrowings were determined based on the amounts outstanding at
each accounting period-end. Average interest rates were computed using
interest rates and amounts outstanding at accounting period-ends.
<PAGE>
SCHEDULE X
<TABLE>
TEKTRONIX, INC. AND SUBSIDIARIES
SUPPLEMENTARY INCOME STATEMENT INFORMATION
(in thousands)
<CAPTION>
Year Ended Year Ended Year Ended
May 28, 1994 May 29, 1993 May 30, 1992
____________ ____________ ____________
<S> <C> <C> <C>
Advertising expense $48,742 $38,864 $37,068
Maintenance and repairs
expense $28,531 $40,003 $47,637
Taxes, other than payroll
and income taxes $ 7,765 $ 9,141 $ 9,941
</TABLE>
<PAGE>
EXHIBIT LIST
(3)(i) Restated Articles of Incorporation, as
amended. Incorporated by reference to
Exhibit (3) of Form 10-Q dated September
28, 1990, SEC File No. 1-4837.
(ii) Bylaws, as amended.
(4)(i) Indenture dated as of November 16, 1987, as
amended by First Supplemental Indenture
dated as of July 13, 1993, covering the
registrant's 7-1/2% notes due August 1,
2003. Indenture incorporated by reference
to Exhibit 4(i) of Form 10-K dated August
22, 1990, SEC File No. 1-4837.
(ii) Pursuant to Item 601(b)(4)(iii) of
Regulation S-K, the registrant agrees to
furnish to the Commission upon request
copies of agreements relating to other
indebtedness.
(10)(i) Restated Operating Performance Incentive
Plan, as amended. Incorporated by
reference to Exhibit (10)(i) of Form 10-Q
dated April 15, 1988, SEC File No. 1-4837.
(ii) 1982 Stock Option Plan, as amended.
Incorporated by reference to Exhibit
10(iii) of Form 10-K dated August 22, 1989,
SEC File No. 1-4837.
(iii) Stock Incentive Plan, as amended.
Incorporated by reference to Exhibit 10(ii)
of Form 10-Q dated April 9, 1993, SEC File
No. 1-4837.
(iv) Restated Annual Performance Improvement
Plan. Incorporated by reference to Exhibit
10(i) of Form 10-Q dated April 9, 1993, SEC
File No. 1-4837.
(v) Restated Deferred Compensation Plan.
Incorporated by reference to Exhibit 10(i)
of Form 10-Q dated December 20, 1984, SEC
File No. 1-4837.
(vi) Retirement Equalization Plan, as amended.
Incorporated by reference to Exhibit
10(vii) of Form 10-K dated August 18, 1993,
SEC File No. 1-4837.
<PAGE>
(vii) Severance Agreement entered into between
the Company and its named officers.
Incorporated by reference to Exhibit
10(viii)of Form 10-K dated August 18, 1993,
SEC File No. 1-4837.
(viii) Indemnity Agreement entered into between
the Company and its named officers and
directors. Incorporated by reference to
Exhibit 10(ix) of Form 10-K dated August
18, 1993, SEC File No. 1-4837.
(ix) Executive Severance Agreement.
(x) Retention Incentive Agreement.
(xi) Executive Compensation and Benefits
Agreement dated as of October 24, 1990.
Incorporated by reference to Exhibit
(10)(ii) of Form 10-Q dated December 21,
1990, SEC File No. 1-4837.
(xii) Executive Compensation and Benefits
Agreement dated as of October 1, 1992.
Incorporated by reference to Exhibit
(10)(iii) of Form 10-Q dated January 8,
1993, SEC File No. 1-4837.
(xiii) Employment Letter Agreement dated September
1, 1992.
(xiv) Executive Compensation and Benefits
Agreement dated as of March 29, 1993.
(xv) Rights Agreement dated as of August 16,
1990. Incorporated by reference to Exhibit
1 of Form 8-K dated August 27, 1990, SEC
File No. 1-4837.
(xvi) Non-Employee Directors' Deferred
Compensation Plan.
(13) Portions of the 1994 Annual Report to
Shareholders that are incorporated herein
by reference.
(21) Subsidiaries of the registrant.
(24) Powers of Attorney.
<PAGE> EXHIBIT 3(ii)
As Amended through June 23, 1994
BYLAWS
OF
TEKTRONIX, INC.
ARTICLE I
SHAREHOLDERS
Section 1. Annual Meeting. The annual meeting of
shareholders shall be held on the fourth Thursday of September each
year, at such time as the board of directors shall designate, for the
purpose of electing directors and for the transaction of such other
business as may properly come before the meeting. If the day fixed for
the annual meeting shall be a legal holiday in the State of Oregon, the
meeting shall be held on the next succeeding Thursday. If the election
of directors shall not be held on the day designated for any annual
meeting, the board of directors shall cause the election to be held at a
special meeting of the shareholders as soon thereafter as conveniently
may be.
Section 2. Special Meetings. Special meetings of the
shareholders may be called by the Chairman of the Board or by the board
of directors, and shall be called by the Chairman of the Board at the
request of the holders of not less than one tenth of all the outstanding
shares of the corporation entitled to vote at the meeting.
Section 3. Place of Meetings. The place of each annual
meeting and any special meeting of the shareholders shall be determined
by the board of directors.
Section 4. Notice of Meeting. Written or printed notice
stating the date, time and place of the shareholders meeting and, in the
case of a special meeting or a meeting for which special notice is
required by law, the purposes for which the meeting is called, shall be
delivered by the corporation to each shareholder entitled to vote at the
meeting and, if required by law, to any other shareholders entitled to
receive notice, not earlier than sixty days nor less than thirty days
before the meeting date. If mailed, the notice shall be deemed
delivered when it is mailed to the shareholder with postage prepaid at
the shareholder's address shown in the corporation's record of
shareholders.
Section 5. Closing of Transfer Records or Fixing of Record
Date. The board of directors may fix a future date as the record date
to determine the shareholders entitled to notice of a shareholders
meeting, demand a special meeting, vote, take any other action or
receive payment of any share or cash dividend or other
1
<PAGE>
distribution. This date shall not be earlier than seventy days or, in the
case of a meeting, later than thirty-five days before the meeting or action
requiring a determination of shareholders. The record date for any
meeting, vote or other action of the shareholders shall be the same for
all voting groups. If not otherwise fixed by the board of directors,
the record date to determine shareholders entitled to notice of and to
vote at an annual or special shareholders meeting is the close of
business on the day before the notice is first mailed or delivered to
shareholders. If not otherwise fixed by the board of directors, the
record date to determine shareholders entitled to receive payment of any
share or cash dividend or other distribution is the close of business on
the day the board of directors authorizes the share or cash dividend or
other distribution.
Section 6. Voting Lists. After a record date for a meeting
is fixed, the corporation shall prepare an alphabetical list of all
shareholders entitled to notice of the shareholders meeting. The list
shall be arranged by voting group and, within each voting group, by
class or series of shares, and it shall show the address of and number
of shares held by each shareholder. The shareholders list shall be
available for inspection by any shareholder, upon proper demand as may
be required by law, beginning two business days after notice of the
meeting is given and continuing through the meeting, at the
corporation's principal office or at a place identified in the meeting
notice in the city where the meeting will be held. The corporation
shall make the shareholders list available at the meeting, and any
shareholder or the shareholder's agent or attorney shall be entitled to
inspect the list at any time during the meeting or any adjournment.
Refusal or failure to prepare or make available the shareholders list
does not affect the validity of action taken at the meeting.
Section 7. Quorum; Adjournment.
(a) Shares entitled to vote as a separate voting group may
take action on a matter at a meeting only if a quorum of those shares
exists with respect to that matter. A majority of the votes entitled to
be cast on the matter by the voting group constitutes a quorum of that
voting group for action on that matter.
(b) A majority of votes represented at the meeting, although
less than a quorum, may adjourn the meeting from time to time to a
different time and place without further notice to any shareholder of
any adjournment. At an adjourned meeting at which a quorum is present,
any business may be transacted that might have been transacted at the
meeting originally held.
(c) Once a share is represented for any purpose at a meeting,
it shall be present for quorum purposes for the remainder of the meeting
and for any adjournment of that meeting unless a new record date is or
must be set for the adjourned meeting. A new record date must be set if
the meeting is adjourned to a date more than 120 days after the date
fixed for the original meeting.
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Section 8. Voting. If a quorum exists, action on a matter,
other than the election of directors, by a voting group is approved if
the votes cast within the voting group favoring the action exceed the
votes cast opposing the action, unless a greater number of affirmative
votes is required by law or the Restated Articles of Incorporation.
Unless otherwise provided in the Restated Articles of Incorporation,
directors are elected by a plurality of the votes cast by the shares
entitled to vote in the election at a meeting at which a quorum is
present.
Section 9. Proxies. At all meetings of shareholders, a
shareholder may vote by proxy executed in writing by the shareholder or
by his duly authorized attorney in fact. Such proxy shall be filed with
the secretary of the corporation before or at the time of the meeting.
No proxy shall be valid after eleven months from the date of its
execution, unless otherwise provided in the proxy.
Section 10. Voting of Shares by Certain Holders.
(a) Shares standing in the name of another corporation may be
voted by such officer, agent or proxy as the bylaws of such corporation
may prescribe, or, in the absence of such provision, as the board of
directors of such other corporation may determine.
(b) Shares held by an administrator, executor, guardian or
conservator may be voted by him, either in person or by proxy, without a
transfer of such shares into his name. Shares standing in the name of a
trustee may be voted by him, either in person or by proxy, but no
trustee shall be entitled to vote shares held by him without a transfer
of such shares into his name.
(c) Shares standing in the name of a receiver may be voted by
such receiver, and shares held by or under the control of a receiver may
be voted by such receiver without the transfer thereof into his name if
authority so to do be contained in an appropriate order of the court by
which such receiver was appointed.
(d) A shareholder whose shares are pledged shall be entitled
to vote such shares until the shares have been transferred into the name
of the pledgee, and thereafter the pledgee shall be entitled to vote the
shares so transferred.
(e) Neither treasury shares nor shares held by the
corporation in a fiduciary capacity, nor shares held by another
corporation if a majority of the shares entitled to vote for the
election of directors of such other corporation is held by the
corporation, shall be voted at any meeting or counted in determining the
total number of outstanding shares at any given time.
Section 11. Proper Business for Shareholders' Meeting. To be
properly brought before the meeting, business must be either (a)
specified in the notice of meeting (or any supplement thereto) given by
or at the direction of the board of directors, (b) otherwise properly
brought before a meeting by or at the direction of the board of
directors, or (c) otherwise properly brought before the meeting by a
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shareholder. In addition to any other applicable requirements, for
business to be properly brought before an annual meeting by a
shareholder, the shareholder must have given timely notice thereof in
writing to the Secretary of the corporation. To be timely, a
shareholder's notice must be delivered to or mailed and received at the
principal executive office of the corporation not less than 50 days nor
more than 75 days prior to the meeting; provided, however, that in the
event that less than 65 days' notice or prior public disclosure of the
date of the meeting is given or made to shareholders, notice by the
shareholder to be timely must be so received not later than the close of
business on the 10th day following the day on which such notice of the
date of the annual meeting was mailed or such public disclosure was
made, whichever first occurs. A shareholder's notice to the Secretary
shall set forth (a) one or more matters appropriate for shareholder
action that the shareholder proposes to bring before the meeting, (b) a
brief description of the matters desired to be brought before the
meeting and the reasons for conducting such business at the meeting, (c)
the name and record address of the shareholder, (d) the class and number
of shares of the corporation that the shareholder owns or is entitled to
vote and (e) any material interest of the shareholder in such matters.
Notwithstanding anything in these bylaws to the contrary, no business
shall be conducted at the annual meeting except in accordance with the
procedure set forth in this Section 11; provided, however, that nothing
in this Section 11 shall be deemed to preclude discussion by any
shareholder of any business properly brought before the annual meeting.
The Chairman of the Board shall, if the facts warrant, determine and
declare to the meeting that the business was not properly brought before
the meeting in accordance with the provisions of this Section 11, and if
the Chairman of the Board should so determine, shall so declare to the
meeting any such business not properly brought before the meeting shall
not be transacted.
Section 12. Shareholder Nomination of Directors. Not less
than 50 days nor more than 75 days prior to the date of any annual
meeting of shareholders, any shareholder who intends to make a
nomination at the annual meeting shall deliver a notice to the Secretary
of the corporation setting forth (a) as to each nominee whom the
shareholder proposes to nominate for election or reelection as a
director, (i) the name, age, business address and residence address of
the nominee, (ii) the principal occupation or employment of the nominee,
(iii) the class and number of shares of capital stock of the corporation
that are beneficially owned by the nominee and (iv) any other
information concerning the nominee that would be required, under the
rules of the Securities and Exchange Commission, in a proxy statement
soliciting proxies for the election of such nominee; and (b) as to the
shareholder giving the notice, (i) the name and record address of the
shareholder and (ii) the class and number of shares of capital stock of
the corporation that are beneficially owned by the shareholder;
provided, however, that in the event that less than 65 days' notice or
prior public disclosure of the date of the annual meeting is given or
made to shareholders, notice by the shareholder to be timely must be so
delivered not later than the close of business on the 10th day following
the day on which such notice of the date of the meeting was mailed or
such public disclosure was made, whichever first occurs. Such notice
shall include a signed consent to serve as a director of the
corporation, if elected, of each such nominee. The corporation may
require any
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proposed nominee to furnish such other information as may reasonably be
required by the corporation to determine the eligibility of such proposed
nominee to serve as a director of the corporation.
Section 13. Shareholder Nomination of Directors - Special
Meetings. Any shareholder who intends to make a nomination at any
special meeting of shareholders held for the purpose of electing
directors shall deliver a timely notice to the Secretary of the
corporation setting forth (a) as to each nominee whom the shareholder
proposes to nominate for election or reelection as a director, (i) the
name, age, business address and residence address of the nominee, (ii)
the principal occupation or employment of the nominee, (iii) the class
and number of shares of capital stock of the corporation that are
beneficially owned by the nominee and (iv) any other information
concerning the nominee that would be required, under the rules of the
Securities and Exchange Commission, in a proxy statement soliciting
proxies for the election of such nominee; and (b) as to the shareholder
giving the notice, (i) the name and record address of the shareholder
and (ii) the class and number of shares of capital stock of the
corporation that are beneficially owned by the shareholder. To be
timely for these purposes, such notice must be given (a) if given by the
shareholder (or any of the shareholders) who or that made a demand for a
meeting pursuant to which such meeting is to be held, concurrently with
the delivery of such demand, and (b) otherwise, not later than the close
of business on the 10th day following the day on which the notice of the
special meeting was mailed. Such notice shall include a signed consent
to serve as a director of the corporation, if elected, of each such
nominee. The corporation may require any proposed nominee to furnish
such other information as may reasonably be required by the corporation
to determine the eligibility of such proposed nominee to serve as a
director of the corporation.
ARTICLE II
BOARD OF DIRECTORS
Section 1. General Powers. The business and affairs of the
corporation shall be managed by its board of directors.
Section 2. Number, Tenure and Qualifications. The directors
of the corporation shall be divided into three classes of directors
designated Class I, Class II and Class III. Until immediately prior to
the 1994 annual meeting of shareholders, the number of directors of the
corporation shall be eleven, consisting of three Class I directors, four
Class II directors and four Class III directors. Effective immediately
prior to the 1994 annual meeting of shareholders, the number of
directors of the corporation shall be ten, consisting of three Class I
directors, three Class II directors and four Class III directors. At
the 1986 annual meeting of shareholders, Class I directors were elected
to a term of office expiring at the 1987 annual meeting of shareholders,
Class II directors were elected to a term of office expiring at the 1988
annual meeting of shareholders, and Class III directors were elected to
a term of
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office expiring at the 1989 annual meeting of shareholders, and in each
case until their successors are elected and qualified. At each annual
meeting of shareholders following such initial classification and election,
directors elected to succeed those directors whose terms expire shall be
elected to serve three-year terms and until their successors are elected and
qualified, so that the term of one class of directors will expire each year.
When the number of directors is changed by amendment of this Section 2, any
newly created directorships, or any decrease in directorships, shall be so
apportioned among the classes so as to make all classes as nearly equal as
possible, provided that no decrease in the number of directors constituting
the Board of Directors shall shorten the term of any incumbent director.
Directors need not be residents of the State of Oregon or shareholders of
the corporation.
Section 3. Annual and Regular Meetings. The annual meeting
of the board of directors may be held before or after the annual meeting
of shareholders, on the day and at the time and place designated by the
Chairman of the Board. The board of directors may provide by resolution,
the time and place, either within or without the State of Oregon, for
the holding of regular meetings without notice other than such
resolution.
Section 4. Special Meetings. Special meetings of the board
of directors may be called by or at the request of the Chairman of the
Board or any two directors. The person or persons authorized to call
special meetings of the board of directors may fix any place, either
within or without the State of Oregon, as the place for holding any
special meeting of the board of directors called by them.
Section 5. Notice. Notice of the date, time and place of any
special meeting of the board of directors shall be given at least three
days prior to the meeting by notice communicated in person, by
telephone, telegraph, teletype, other form of wire or wireless
communication, mail or private carrier. If written, notice shall be
effective at the earliest of (a) when received, (b) five days after its
deposit in the United States mail, as evidenced by the postmark, if
mailed postpaid and correctly addressed, or (c) on the date shown on the
return receipt, if sent by registered or certified mail, return receipt
requested and the receipt is signed by or on behalf of the addressee.
Notice by all other means shall be deemed effective when received by or
on behalf of the director. Notice of any regular or special meeting
need not describe the purposes of the meeting unless required by law or
the Restated Articles of Incorporation.
Section 6. Quorum. A majority of the number of directors
fixed by Section 2 of this Article II shall constitute a quorum for the
transaction of business at any meeting of the board of directors, but if
less than such majority is present at a meeting, a majority of the
directors present may adjourn the meeting from time to time without
further notice.
Section 7. Manner of Acting. The act of the majority of the
directors present at a meeting at which a quorum is present shall be the
act of the board of directors, unless a greater number is required by
law or these bylaws.
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Section 8. Vacancies. Any vacancy on the board of directors,
including a vacancy resulting from an increase in the number of
directors, may be filled by the shareholders, the board of directors,
the remaining directors if less than a quorum (by the vote of a majority
thereof) or by a sole remaining director. Any vacancy not filled by the
directors shall be filled by election at an annual meeting or at a
special meeting of shareholders called for that purpose. A vacancy that
will occur at a specified later date, by reason of a resignation or
otherwise, may be filled before the vacancy occurs, but the new director
may not take office until the vacancy occurs.
Section 9. Compensation. By resolution of the board of
directors, the directors may be paid their expenses, if any, of
attendance at each meeting of the board of directors, and may be paid a
fixed sum for attendance at each meeting of the board of directors or a
stated salary as director. No such payment shall preclude any director
from serving the corporation in any other capacity and receiving
compensation therefor.
Section 10. Presumption of Assent. A director of the
corporation who is present at a meeting of the board of directors at
which action on any corporate matter is taken shall be presumed to have
assented to the action taken unless his dissent shall be entered in the
minutes of the meeting or unless he shall file his written dissent to
such action with the person acting as the secretary of the meeting
before the adjournment thereof or shall forward such dissent by
registered mail to the secretary of the corporation immediately after
the adjournment of the meeting. Such right to dissent shall not
apply to a director who voted in favor of such action. It shall be the
duty of the person acting as secretary of the meeting to record in the
minutes any negative votes, abstentions or dissents if requested to do
so by the director so voting, abstaining or dissenting.
Section 11. Informal Action by Directors. Any action
required to be taken at a meeting of directors, or any action which may
be taken at a meeting of directors, may be taken without a meeting
if a consent in writing setting forth the action so taken shall be
signed by all the directors entitled to vote with respect to the subject
matter thereof. Such consent shall have the same effect as a unanimous
vote of the directors.
Section 12. Removal. The shareholders may remove one or more
directors with or without cause at a meeting called expressly for that
purpose, unless the Restated Articles of Incorporation provide for
removal for cause only.
Section 13. Transactions with Directors. Any contract or
other transaction between the corporation and one or more of its
directors, or between the corporation and another party in which one or
more of its directors are interested shall be valid notwithstanding the
presence or participation of such director or directors in a meeting of
the board of directors which acts upon or in reference to such contract
or transaction, if the fact of such interest shall be disclosed or known
to the board of directors and it shall authorize and approve such
contract or transaction by a vote of a majority of the directors
present. Such interested director
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or directors may be counted in determining whether a quorum is present at
any such meeting, but shall not be counted in calculating the majority
necessary to carry such vote. This section shall not invalidate any
contract or other transaction which would otherwise be valid under
applicable law.
Section 14. Meeting by Telephone Conference Call. A meeting
of the board of directors may be held by means of conference telephone
or similar communications equipment through which all persons
participating in the meeting can hear each other. Participation in a
meeting pursuant to this section shall constitute presence in person at
the meeting. Notice (including waiver of notice) and quorum
requirements as specified in Sections 5 and 6 of this Article shall
apply to meetings pursuant to this section. A record shall be kept of
the action taken for insertion into the minute book.
ARTICLE III
COMMITTEES
Section 1. Designation. The board of directors, by
resolution adopted by a majority of the number of directors fixed by
Section 2 of Article II of these bylaws, may designate from among its
members an executive committee and one or more other committees. The
designation of a committee, and the delegation of authority to it, shall
not operate to relieve the board of directors, or any member thereof, of
any responsibility imposed upon it or him by law. No member of any
committee shall continue to be a member thereof after he ceases to be a
director of the corporation. The board of directors shall have the
power at any time, by resolution adopted by a majority of the number of
directors fixed by Section 2 of Article II of these bylaws, to increase
or decrease the number of members of any committee, to fill vacancies
thereon, to change any member thereof, and to change the functions or
terminate the existence thereof.
Section 2. Powers. During the interval between meetings of
the board of directors, and subject to such limitations as may be
imposed by resolution of the board of directors, the executive committee
shall have and may exercise all the authority of the board of directors
in the management of the corporation. Any other committee shall have
such authority of the board of directors as the board shall delegate by
resolution adopted by a majority of the number of directors fixed by
Section 2 of Article II of these bylaws. Notwithstanding the foregoing,
neither the executive committee nor any other committee shall have the
authority of the board of directors in reference to amending the
articles of incorporation; adopting a plan of merger or consolidation;
recommending to the shareholders the sale, lease, exchange, mortgage,
pledge or other disposition of all or substantially all the property and
assets of the corporation otherwise than in the usual and regular course
of its business; recommending to the shareholders a voluntary
dissolution of the corporation or revocation thereof; or amending the
bylaws of the corporation. Reports on actions
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taken by a committee shall be submitted to the next succeeding meeting
of the board of directors.
Section 3. Procedure; Meetings; Quorum. Each committee shall
appoint a chairman from among its members and a secretary who may, but
need not, be a member of the committee or of the board of directors.
The chairman shall preside at all committee meetings and the secretary
shall keep a record of its proceedings. Regular meetings of a
committee, of which no notice shall be necessary, shall be held on such
days and at such places as shall be fixed by resolution adopted by a
majority of the committee. Special meetings of a committee shall be
called at the request of any member of the committee, and shall be held
upon notice by letter or telegram mailed or delivered for transmission
not later than during the second day preceding the day of the meeting,
or by word of mouth or telephone received not later than the day
immediately preceding the day of the meeting. Any notice required by
this section may be waived in writing signed by the member or members
entitled to the notice, whether before, or after the meeting time stated
therein. Attendance of any member of a committee at a special meeting
shall constitute a waiver of notice of such meeting. A majority of the
committee, from time to time, shall be necessary to constitute a quorum
for the transaction of business, and the act of a majority of the
members present at a meeting at which a quorum is present shall be the
act of the committee. The board of directors may vote to the members of
any committee a reasonable fee as compensation for attendance at
meetings of such committee.
Section 4. Meeting by Telephone Conference Call. A meeting
of a committee may be held by means of conference telephone or similar
telephone communications equipment through which all persons
participating in the meeting can hear each other. Participation in the
meeting pursuant to this section shall constitute presence in person at
the meeting. Notice (including waiver of notice) and quorum
requirements as specified in Section 3 of this Article shall apply to
meetings pursuant to this section. A record shall be kept of action
taken for insertion into the minute book.
Section 5. Informal Action by Committee. Any action which
may be taken at a meeting of a committee may be taken without a meeting
if a consent in writing setting forth the actions so taken shall be
signed by all members of the committee entitled to vote with respect to
the subject matter thereof. The action shall be effective on the date
when the last signature is placed on the consent or at such earlier time
as is set forth therein. The consent shall have the same effect as a
unanimous vote of the committee.
ARTICLE IV
OFFICERS
Section 1. Number. The officers of the corporation shall be
a Chairman of the Board of Directors (the "Chairman of the Board"); a
President; a Secretary; and
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such other officers and assistant officers as may be elected or appointed
from time to time by the board of directors. The officers of the corporation
shall have such powers and duties as may be prescribed by the board of
directors. Any two or more offices may be held by the same person.
Section 2. Election and Term of Office. The officers of the
corporation shall be elected annually by the board of directors at the
first meeting of the board of directors held after the annual meeting of
the shareholders. If the election of officers shall not be held at the
meeting, it shall be held as soon thereafter as is convenient. Each
officer shall hold office until a successor shall have been duly elected
and shall have qualified or until the officer's death, resignation or
removal in the manner hereinafter provided.
Section 3. Removal. Any officer or agent elected or
appointed by the board of directors may be removed by the board of
directors at any time with or without cause. Election or appointment
of an officer or agent shall not of itself create contract rights.
Section 4. Vacancies. A vacancy in any office because of
death, resignation, removal, disqualification or otherwise, may be
filled by the board of directors for the unexpired portion of the term.
Section 5. Chairman of the Board. The Chairman of the Board
of Directors shall be the chief executive officer of the corporation
and, subject to the control of the board of directors, shall in general
supervise and control all of the business and affairs of the
corporation. The Chairman of the Board may execute in behalf of the
corporation all contracts, agreements, stock certificates and other
instruments. The Chairman of the Board shall from time to time report
to the board of directors all matters within the Chairman's knowledge
affecting the corporation which should be brought to the attention of
the board. The Chairman of the Board shall vote all shares of stock in
other corporations owned by the corporation, and shall be empowered to
execute proxies, waivers of notice, consents and other instruments in
the name of the corporation with respect to such stock. He shall
preside at all meetings of the board of directors and shareholders. The
Chairman of the Board shall perform such other duties as may be
prescribed from time to time by the board of directors.
Section 6. President. The President shall be the chief
operating officer of the corporation and shall supervise the operations
of the corporation, subject to the direction of the board of directors
and the Chairman of the Board. The President shall perform such other
duties as may be prescribed from time to time by the board of directors
or the Chairman of the Board.
Section 7. Secretary. The Secretary shall keep the minutes
of all meetings of the directors and shareholders, and shall have
custody of the minute books and other records pertaining to the
corporate business. The Secretary shall countersign all stock
certificates and other instruments requiring the seal of the
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corporation and shall perform such other duties as may be prescribed from
time to time by the board of directors.
Section 8. Salaries. The salaries of the officers shall be
fixed from time to time by the board of directors and no officer shall
be prevented from receiving such salary because the officer is also a
director of the corporation.
ARTICLE IV-A
NON-CORPORATE OFFICERS
A. The Chairman of the Board of the corporation shall have the
power, in the exercise of his or her discretion, to appoint persons to
hold positions and titles such as vice president, treasurer, assistant
vice president, assistant secretary, president of a division, or similar
titles as the business of the corporation may require, subject to such
limits in appointment power as the board of directors may determine.
Each such appointee shall have such title, shall serve in such capacity,
and shall have such authority and perform such duties as the Chairman of
the Board of the corporation shall determine; provided that no such
appointee shall have executive powers, be in charge of a principal
business unit, division or function or perform similar policy making
functions. The board of directors shall be advised of any such
appointment at a meeting of the board of directors, and the appointment
shall be noted in the minutes of the meeting. The minutes shall state
that such persons are non-corporate officers appointed pursuant to this
Article IV-A of these bylaws.
B. Any such appointee, absent specific election by the board of
directors as an elected corporate officer (i) shall not be considered an
officer elected by the board of directors pursuant to Article IV of
these bylaws, (ii) shall not be considered an 'officer' of the
corporation for the purposes of Rule 3b-2 promulgated under the
Securities Exchange Act of 1934, as amended, and the rules and
regulations promulgated thereunder (collectively, the "Act"), or an
'executive officer' of the corporation for the purposes of Rule 3b-7
promulgated under the Act, and similarly shall not be considered an
'officer' of the corporation for the purposes of Section 16 of the Act,
or an 'executive officer' of the corporation for the purposes of Section
14 of the Act, and (iii) shall be empowered to represent himself or
herself to third parties as an appointed vice president, etc., only, and
shall be empowered to execute documents, bind the corporation, or
otherwise act on behalf of the corporation only as authorized by the
Chairman of the Board or the President of the corporation or by
resolution of the board of directors. An elected corporate officer of
the corporation may also be appointed to a position pursuant to this
Article IV-A.
C. A person appointed to a position pursuant to this Article IV-A
may be removed at any time by the Chairman of the Board or by the board
of directors of the corporation.
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ARTICLE V
INDEMNITY OF DIRECTORS AND OFFICERS
A. The corporation shall indemnify to the fullest extent then
permitted by law any person who is made, or threatened to be made, a
party to any threatened, pending or completed action, suit or
proceeding, whether civil, criminal, administrative, investigative or
otherwise (including an action, suit or proceeding by or in the right of
the corporation) by reason of the fact that the person is or was a
director or officer of the corporation or is or was serving at the
request of the corporation as a director or officer of another
corporation, partnership, joint venture, trust or other enterprise
against all expenses (including attorneys' fees), judgments, amounts
paid in settlement and fines actually and reasonably incurred in
connection therewith.
B. Expenses incurred in connection with an action, suit or
proceeding may be paid or reimbursed by the corporation in advance of
the final disposition of such action, suit or proceeding upon receipt of
an undertaking by or on behalf of the director or officer to repay such
amounts if it shall ultimately be determined that such person is not
entitled to be indemnified by the corporation.
C. The indemnification provided hereby shall not be deemed
exclusive of any other rights to which those indemnified may be entitled
under the Restated Articles of Incorporation, any statute, agreement, or
vote of shareholders or directors or otherwise, both as to action in any
official capacity and as to action in another capacity while holding an
office, and shall continue as to a person who has ceased to be a
director or officer and shall inure to the benefit of the heirs,
executors and administrators of such person.
D. The corporation shall have power to purchase and maintain
insurance on behalf of any person who is or was a director, officer,
employee or agent of the corporation, or fiduciary with respect to any
employee benefit plans of the corporation or is or was serving at the
request of the corporation as a director, officer, employee or agent, or
as a fiduciary of an employee benefit plan, of another corporation,
partnership, joint venture, trust or other enterprise against any
liability asserted against and incurred by the person in any such
capacity, or arising out of the person's status as such, whether or not
the corporation would have the power to indemnify the person against
such liability under the provisions of the Restated Articles of
Incorporation or the Oregon Business Corporation Act.
E. Any person other than a director or officer who is or was an
employee or agent of the corporation, or fiduciary within the meaning of
the Employee Retirement Income Security Act of 1974 with respect to any
employee benefit plans of the corporation, or is or was serving at the
request of the corporation as an employee or agent of another
corporation, partnership, joint venture, trust or other enterprise may
be indemnified to such extent as the board of directors in its
discretion at any time or from time to time may authorize.
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ARTICLE VI
CONTRACTS, LOANS, CHECKS AND DEPOSITS
Section 1. Contracts. The board of directors may authorize
any officer or officers, agent or agents, to enter into any contract or
execute and deliver any instrument in the name of and on behalf of the
corporation, and such authority may be general or confined to specific
instances.
Section 2. Loans. No loans shall be contracted on behalf of
the corporation and no evidence of indebtedness shall be issued in its
name unless authorized by a resolution of the board of directors. Such
authority may be general or confined to specific instances.
Section 3. Checks, Draft, etc. All checks, drafts or other
orders for the payment of money, notes or other evidences of
indebtedness issued in the name of the corporation, shall be signed by
such officer or officers, agent or agents of the corporation and in such
manner as shall from time to time be determined by or pursuant to
resolution of the board of directors.
Section 4. Deposits. All funds of the corporation not
otherwise employed shall be deposited from time to time to the credit of
the corporation in such banks, trust companies or other depositories as
the board of directors may select.
ARTICLE VII
CERTIFICATES FOR SHARES AND THEIR TRANSFER
Section 1. Certificates for Shares. Certificates
representing shares of the corporation shall be in such form as shall be
determined by the board of directors. Such certificates shall be signed
by the Chairman of the Board or a Vice President and by the Secretary or
an Assistant Secretary and may be sealed with the seal of the
corporation or a facsimile thereof. All certificates for shares shall
be consecutively numbered or otherwise identified. The name and address
of the person to whom the shares represented thereby are issued, with
the number of shares and date of issue, shall be entered on the share
transfer records of the corporation. All certificates surrendered to
the corporation for transfer shall be cancelled and no new certificate
shall be issued until the former certificate for a like number of shares
shall have been surrendered and cancelled, except that in case of a
lost, destroyed or mutilated certificate a new one may be issued
therefore upon such terms and indemnity to the corporation as the board
of directors may prescribe.
Section 2. Transfer of Shares. Transfer of shares of the
corporation shall be made only on the share transfer records of the
corporation by the holder of record thereof or by his legal
representative, who shall furnish proper evidence of authority
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to transfer, or by his attorney thereunto authorized by power of attorney
duly executed and filed with the secretary of the corporation. The person
in whose name shares stand on the books of the corporation shall be deemed
by the corporation to be the owner thereof for all purposes.
Section 3. Transfer Agent and Registrar. The board of
directors may from time to time appoint one or more transfer agents and
one or more registrars for the shares of the corporation, with such
powers and duties as the board of directors shall determine by
resolution. The signatures of the president or vice president and the
secretary or assistant secretary upon a certificate may be facsimiles if
the certificate is countersigned by a transfer agent or registered by a
registrar other than the corporation itself or an employee of the
corporation.
Section 4. Officer Ceasing to Act. In case any officer who
has signed or whose facsimile signature has been placed upon a stock
certificate shall have ceased to be such officer before such certificate
is issued, it may be issued by the corporation with the same effect as
if he were such officer at the date of its issuance.
Section 5. Fractional Shares. The corporation shall not
issue certificates for fractional shares.
ARTICLE VIII
FISCAL YEAR
The fiscal year of the corporation shall end on the last
Saturday in May of each year.
ARTICLE IX
DIVIDENDS
The board of directors may from time to time declare, and the
corporation may pay, dividends on its outstanding shares in the manner
and upon the terms and conditions provided by law.
ARTICLE X
SEAL
The seal of the corporation shall be in the form of a circle
containing therein "TEKTRONIX, INC. CORPORATE SEAL OREGON."
14
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ARTICLE XI
AMENDMENTS
These bylaws may be altered, amended or repealed and new
bylaws may be adopted by the board of directors at any regular or
special meeting.
I HEREBY CERTIFY that the foregoing are the bylaws of
TEKTRONIX, INC. adopted at a meeting of the board of directors of the
company held on September 9, 1963, and as amended with regard to Article
IV at a meeting of the board of directors of the company held on
December 22, 1966, and as amended with regard to Article IV at a meeting
of the board of directors of the company held on January 30, 1969, and
as amended with regard to Article II at a meeting of the board of
directors of the company held on July 17, 1969, and as amended with
regard to Article IV at a meeting of the board of directors of the
company held on September 24, 1970, and as amended with regard to
Article IV at a meeting of the board of directors of the company held on
September 30, 1971, and as amended with regard to Article V at a meeting
of the board of directors of the company held on September 27, 1973, and
as amended with regard to Article IV at a meeting of the board of
directors of the company held on September 26, 1974, and as amended with
regard to Article I at a meeting of the board of directors of the
company held on April 28, 1977, and as amended with regard to Article I
at a meeting of the board of directors of the company held on May 20,
1977, and as amended with regard to Article IV at a meeting of the board
of directors of the company held on January 18, 1979, and as amended
with regard to Article II at a meeting of the board of directors of the
company held on February 28, 1980, and as amended with regard to Article
II at a meeting of the board of directors of the company held on May 22,
1980, and as amended with regard to Articles I, II and III at a meeting
of the board of directors of the company held on June 25, 1980, and as
amended with regard to Article II at a meeting of the board of directors
of the company held on September 9, 1980, with the amendment to be
effective September 27, 1980, and as amended with regard to Article I at
a meeting of the board of directors of the company held on July 23,
1981, and approved by the shareholders at a meeting held on September
26, 1981, and as amended with regard to Article VI at a meeting of the
board of directors of the company held on May 3, 1983, and as amended
with regard to Article II at a meeting of the board of directors of the
company held on June 30, 1983, and as amended with regard to Articles
III and IV at a meeting of the board of directors of the company held on
March 1, 1984, and as amended with regard to Article I at a meeting of
the board of directors of the company held on December 6, 1984, and as
amended with regard to Article II at a meeting of the board of directors
of the company held on August 13, 1985, and as amended with regard to
Article II at a meeting of the board of directors of the company held on
October 24, 1985, and as amended with regard to Article II at a meeting
of the board of directors of the company held on July 17, 1986, and as
amended with regard to Article V at a meeting of the board of directors
of the company held on September 27, 1986, and as amended with regard to
Article II at a meeting of the board of directors of the company held on
June 23, 1988, and as amended with regard to Article II at a meeting of
the board of directors of the
15
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company held on July 21, 1988, and as amended with regard to Article II
at a meeting of the board of directors of the company held on July 20, 1989,
and as amended with regard to Articles I, II and IV at a meeting of the
board of directors of the company held on November 29, 1989, and as amended
with regard to Articles II and IV at a meeting of the board of directors of
the company held on April 25, 1990, and as amended with regard to Article I
at a meeting of the board of directors of the company held on June 20, 1990,
and as amended with regard to Article II at a meeting of the board of
directors of the company held on July 19, 1990, and as amended with
regard to Articles II and IV at a meeting of the board of directors of
the company held on October 24, 1990, and as amended with regard to
Article II at a meeting of the board of directors of the company held on
March 20, 1991, and as amended with regard to Article I at a meeting of
the board of directors of the company held on July 17, 1991, and as
amended with regard to Articles I, II, IV, and VII at a meeting of the
board of directors of the company held on September 26, 1991, and as
amended with regard to Article II at a meeting of the board of directors
of the company held on January 29, 1992, and as amended with regard to
Article II by action of the board of directors of the company without a
meeting, effective July 10, 1992, and as amended with regard to Article
IV at a meeting of the board of directors of the company held on
September 23, 1992, and as amended with regard to Article II by action
of the board of directors of the company without a meeting, effective
September 24, 1992, and as amended with regard to Article I at a meeting
of the board of directors of the company held on October 18, 1992, and
as amended with regard to Article II at a meeting of the board of
directors of the company held on December 2, 1992, and as amended with
regard to Article IV-A at a meeting of the board of directors of the
company held on March 31, 1993, and as amended with regard to Articles I
and II at a meeting of the board of directors of the company held on
June 23, 1994.
/s/ John P. Karalis
___________________________
Secretary
16
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EXHIBIT 10(ix)
LIST OF DIRECTORS AND NAMED EXECUTIVE OFFICERS
WITH WHOM TEKTRONIX HAS EXECUTIVE SEVERENCE
AGREEMENTS IN SUBSTANTIALLY THE FORM ATTACHED
DIRECTORS
Delbert W. Yocam
NAMED EXECUTIVE OFFICERS
John P. Karalis
Carl W. Neun
John W. Vold
<PAGE>
EXHIBIT-10(ix)
EXECUTIVE SEVERANCE AGREEMENT
September 22, 1993
[NAME]
[ADDRESS] EXECUTIVE
TEKTRONIX, INC.,
an Oregon corporation
P.O. Box 1000
Wilsonville, Oregon TEKTRONIX
Tektronix considers the establishment and maintenance of a sound and vital
management to be essential to protecting and enhancing the best interests
of Tektronix and its shareholders. In order to induce Executive to remain
employed by Tektronix in the face of uncertainties about the long-term
strategies of Tektronix and their potential impact on the scope and nature
of Executive's position with Tektronix, this Agreement, which has been
approved by the Organization and Compensation Committee of the Board of
Directors of Tektronix, sets forth the severance benefits that Tektronix
will provide to Executive in the event Executive's employment by Tektronix
is terminated under the circumstances described in this Agreement.
1. EMPLOYMENT RELATIONSHIP. Executive is currently employed by Tektronix
as [TITLE]. Executive and Tektronix acknowledge that either party may
terminate this employment relationship at any time and for any reason,
subject to the obligation of Tektronix to provide the benefits
specified in this Agreement in accordance with the terms hereof.
2. RELEASE OF CLAIMS. In consideration for the severance benefits
outlined in this Agreement, Executive agrees to execute a Release of
Claims in the form attached as Exhibit A ("Release of Claims").
Executive promises to execute and deliver the Release of Claims to
Tektronix within the later of forty-five (45) days from the date
Executive receives the Release of Claims or on the last day of
Executive's active employment.
3. COMPENSATION UPON TERMINATION. In the event that Executive's
employment is terminated at any time by Tektronix other than for Cause
(as defined in Section 6.1 of this Agreement), death, or Disability
(as defined in Section 6.2 of this Agreement), subject to Executive's
execution of a Release of Claims, Executive shall be entitled to the
following benefits:
1
<PAGE>
3.1 As severance pay and in lieu of any further pay for periods
subsequent to the date of termination, Tektronix shall pay
Executive, in a single payment within the later of forty-five
(45) days after termination of employment or eight days after
execution of the Release of Claims, an amount in cash equal to
Executive's annual base pay at the rate in effect immediately
prior to the date of termination, or, if greater, an amount in
cash equal to Executive's average annual base pay for the three
years ending with Executive's last pay change preceding
termination.
3.2 Executive is entitled to extend coverage under any group health
plan in which Executive and Executive's dependents are enrolled
at the time of termination of employment under the COBRA
continuation laws for the 18-month statutory period, or so long
as Executive remains eligible under COBRA.
Tektronix will pay Executive a lump sum payment in an amount
equivalent to the reasonably estimated cost Executive may incur
to extend for a period of eighteen (18) months under the COBRA
continuation laws Executive's group health and dental plan
coverage in effect at the time of termination. Executive may
use this payment, as well as any payment made under 3.1, for
such COBRA continuation coverage or for any other purpose.
3.3 Except as provided in Section 5.2, Executive shall be entitled
to a portion of the benefits under any incentive plans in effect
at the time of termination (including the Results Sharing Plan
and the Annual Performance Improvement Plan), prorated for the
portion of the plan year during which Executive was a
participant. For purposes of this Agreement, Executive's
participation in the Annual Performance Improvement Plan will be
considered to have ended on Executive's last day of active
employment. Prorated awards shall not be due and payable by
Tektronix to Executive until the date that all awards are paid
after the close of the incentive period. Unless the applicable
plan provides for a greater payment for a participant whose
employment terminates prior to the end of an incentive period
(in which case the applicable plan payment shall be made), the
proration shall be calculated pursuant to this Section 3.3. The
payment, if any, that would have been made under Executive's
award had Executive been made a participant for the full
incentive period shall be calculated at the end of the incentive
period. Such amount shall be divided by the total number of
days in the incentive period and the result multiplied by the
actual number of days Executive participated in the plan.
2
<PAGE>
3.4 Tektronix will pay up to $12,500 to a third party outplacement
firm selected by Executive to provide career counseling
assistance to Executive for a period of one (1) year following
Executive's termination date.
3.5 Tektronix will permit Executive to continue to participate in
its Executive Financial Counseling Program through the remainder
of the term of Executive's current participation (which shall in
no case be longer than one (1) year after the effective date of
Executive's termination).
4. SUBSEQUENT EMPLOYMENT. The amount of any payment provided for in this
Agreement shall not be reduced, offset or subject to recovery by
Tektronix by reason of any compensation earned by Executive as the
result of employment by another employer after termination.
5. OTHER AGREEMENTS.
5.1 In the event that severance benefits are payable to Executive
under any other agreement with Tektronix in effect at the time
of termination (including but not limited to any change of
control, "golden parachute" or employment agreement, but
excluding for this purpose any stock option agreement or stock
bonus agreement or stock appreciation right agreement that may
provide for accelerated vesting or related benefits upon the
occurrence of a change in control), the benefits provided in
this Agreement shall not be payable to Executive. Executive
may, however, elect to receive all of the benefits provided for
in this Agreement in lieu of all of the benefits provided in all
such other agreements. Any such election shall be made with
respect to the agreements as a whole, and Executive cannot
select some benefits from one agreement and other benefits from
this Agreement.
5.2 The vesting or accrual of stock options, restricted stock, stock
bonuses, or any other stock awards shall not continue following
termination. Any agreements between Executive and Tektronix
that relate to stock awards (including but not limited to stock
options, long term incentive program, stock bonuses and
restricted stock) shall be governed by such agreements and shall
not be affected by this Agreement.
6. DEFINITIONS.
6.1 CAUSE. Termination by Tektronix of Executive's employment for
"Cause" shall mean termination upon (a) the willful and
continued failure by Executive to perform substantially
Executive's reasonably assigned duties with Tektronix (other
than any such failure resulting from Executive's incapacity due
to physical or mental illness) after a demand for
3
<PAGE>
substantial performance is delivered to Executive by the Chairman
of the Board of Directors or the President of Tektronix which
specifically identifies the manner in which such executive
believes that Executive has not substantially performed
Executive's duties, or (b) the willful engaging by Executive in
illegal conduct which is materially and demonstrably injurious
to Tektronix. For purposes of this Section 6.1, no act, or
failure to act, on Executive's part shall be considered
"willful" unless done, or omitted to be done, by Executive in
knowing bad faith and without reasonable belief that Executive's
action or omission was in, or not opposed to, the best interests
of Tektronix. Any act, or failure to act, based upon authority
given pursuant to a resolution duly adopted by the Board of
Directors or based upon the advice of counsel for Tektronix
shall be conclusively presumed to be done, or omitted to be
done, by Executive in good faith and in the best interests of
Tektronix.
6.2 DISABILITY. Termination by Tektronix of Executive's employment
based on "Disability" shall mean termination because of
Executive's absence from Executive's duties with Tektronix on a
full-time basis for one hundred eighty (180) consecutive days as
a result of Executive's incapacity due to physical or mental
illness, unless within thirty (30) days after notice of
termination by Tektronix following such absence Executive shall
have returned to the full-time performance of Executive's
duties.
7. SUCCESSORS; BINDING AGREEMENT.
7.1 This Agreement shall be binding on and inure to the benefit of
Tektronix and its successors and assigns.
7.2 This Agreement shall inure to the benefit of and be enforceable
by Executive and Executive's legal representatives, executors,
administrators and heirs.
8. RESIGNATION OF CORPORATE OFFICES. Executive will resign Executive's
office, if any, as a director, officer or trustee of Tektronix, its
subsidiaries or affiliates, effective as of the date of termination
of employment. Executive agrees to provide Tektronix such written
resignation(s) upon request.
9. GOVERNING LAW, ARBITRATION. This Agreement shall be construed in
accordance with and governed by the laws of the State of Oregon. Any
dispute or controversy arising under or in connection with this
Agreement or the breach thereof, shall be settled exclusively by
arbitration in Portland, Oregon in accordance with the Commercial
Arbitration Rules of the American Arbitration
4
<PAGE>
Association, and judgment upon the award rendered by the Arbitrator
may be entered in any Court having jurisdiction thereof.
10. FEES AND EXPENSES. In the event that Executive initiates arbitration
under the circumstances described in this Agreement to obtain or
enforce any right or benefit provided by this Agreement and the
arbitrator determines that Executive is the prevailing party,
Executive shall be permitted to recover Executive's reasonable
attorneys' fees and costs incurred in connection with such proceeding.
In the event that the arbitrator determines that Tektronix is the
prevailing party, each party shall bear its own attorneys' fees and
costs incurred in connection with such proceeding.
11. AMENDMENT. No provision of this Agreement may be modified unless such
modification is agreed to in a writing signed by Executive and
Tektronix.
TEKTRONIX, INC.
_______________________________
NAME
By: ______________________________
Title: __________________________
5
<PAGE>
Exhibit A
RELEASE OF CLAIMS
This Release of Claims (the "Release") is made and executed by_____________
__________________ in connection with the termination of my employment with
Tektronix, Inc. ("Tektronix") and in consideration of my receiving valuable
severance pay and benefits as provided for in the Executive Severance
Agreement ("Agreement"). These benefits are substantial consideration to
which I am not otherwise entitled.
On behalf of myself and my spouse, heirs, administrators and assigns, I
hereby release Tektronix, its parent and related corporations, affiliates,
or joint venturers and all officers, directors, employees, agents, and
insurers of the aforementioned (collectively the "Company") from any and
all liability, damages or causes of action, whether known or unknown
relating to my employment with the Company or the termination of that
employment, including but not limited to any claims for additional
compensation in any form, or damages. This specifically includes, but is
not limited to, all claims for relief or remedy under any state or federal
laws, including but not limited to Title VII of the Civil Rights Act of
1964, the Post-Civil War Civil Rights Acts (42 USC Sections 1981-1988), the
Civil Rights Act of 1991, the Equal Pay Act, the Age Discrimination in
Employment Act of 1967, the Americans with Disabilities Act, the Older Workers
Benefit Protection Act, the Worker Adjustment and Retraining Notification Act,
the Rehabilitation Act of 1973, the Vietnam Era Veterans' Readjustment
Assistance Act, the Fair Labor Standards Act, Executive Order 11246, all
as amended, and the civil rights, employment and labor laws of the state
of any state or the United States.
This Release shall not affect any rights which I may have under any medical
insurance, disability, workers' compensation, unemployment compensation or
retirement plans maintained by the Company.
I acknowledge that I have been given at least 45 days to consider whether
to execute this Release of Claims and accept benefits under the Program;
that I have been advised of my right to consult with an attorney or
financial advisor of my choice and at my own expense; that the Agreement
gives me severance pay and benefits which the Company would otherwise have
no obligation to give me; and that I voluntarily enter into the Release of
Claims.
I understand that the Release of Claims is to be signed within 45 days from
the date I received it or on my last day of employment, whichever is later,
and that I may revoke the Release of Claims, provided I do so in writing
within seven (7) days of signing the Release. I understand and agree that
the Company will have no obligation to pay me any benefits under the
Agreement until the expiration of the revocation
6
<PAGE>
period, provided I have not revoked the Release of Claims. I understand that
if I revoke the Release of Claims my termination will nonetheless remain in
full force and effect and I will not be entitled to any benefits under the
Agreement.
I acknowledge that I have had time to consider the alternatives and
consequences of my election to receive benefits under the Agreement and of
signing the Release; that I am aware of my right to consult an attorney or
financial advisor at my own expense; and that, in consideration for
executing this Release and my election to receive benefits under the
Agreement, I have received additional benefits and compensation of value
to which I would not otherwise be entitled.
I HAVE READ THE FOREGOING RELEASE. I UNDERSTAND THE EFFECT OF THIS RELEASE
AND I VOLUNTARILY ENTER INTO IT AT THIS TIME.
Every provision of this Release is intended to be severable. In the event
any term or provision contained in this Release is determined to be
illegal, invalid or unenforceable, such illegality, invalidity or
unenforceability shall not affect the other terms and provisions of this
Release which shall continue in full force and effect.
Dated: __________________, 1993
____________________________
Employee Name
____________________________
Employee Signature
7
<PAGE>
EXHIBIT-10(ix)
EXECUTIVE SEVERANCE AGREEMENT
October 23, 1992
Mr. Jerome J. Meyer
24790 S.W. Big Fir Road
West Linn, OR 97068 EXECUTIVE
TEKTRONIX, INC.,
an Oregon corporation
P.O. Box 1000
Wilsonville, Oregon TEKTRONIX
Tektronix considers the establishment and maintenance of a sound and
vital management to be essential to protecting and enhancing the best
interests of Tektronix and its shareholders. In order to induce
Executive to remain employed by Tektronix in the face of uncertainties
about the long-term strategies of Tektronix and their potential impact
on the scope and nature of Executive's position with Tektronix, this
Agreement, which has been approved by the Organization and Compensation
Committee of the Board of Directors of Tektronix, sets forth the
severance benefits that Tektronix will provide to Executive in the
event Executive's employment by Tektronix is terminated under the
circumstances described in this Agreement.
1. EMPLOYMENT RELATIONSHIP. Executive is currently employed by
Tektronix as Chairman and Chief Executive Officer. Executive and
Tektronix acknowledge that either party may terminate this
employment relationship at any time and for any reason, subject to
the obligation of Tektronix to provide the benefits specified in
this Agreement in accordance with the terms hereof.
2. COMPENSATION UPON TERMINATION. In the event that Executive's
employment by Tektronix as its Chairman and Chief Executive Officer
is terminated at any time by Tektronix other than for Cause (as
defined in Section 5.1 of this Agreement), death, Disability (as
defined in Section 5.2 of this Agreement) or Retirement (as defined
in Section 5.3 of this Agreement), Executive shall be entitled to
the following benefits:
2.1 As severance pay and in lieu of any further salary for periods
subsequent to the date of termination, Tektronix shall pay
Executive, in a single payment within thirty days after
termination, an amount in cash equal to two times Executive's
annual base salary at the rate in effect immediately prior to
the date of termination, or, if greater, an amount in cash
equal to two times Executive's average annual base salary for
the three years ending with Executive's last salary change
preceding termination.
1
<PAGE>
2.2 Executive is entitled to extend coverage under any group
health plan in which he and his dependents are enrolled at the
time of termination of employment under the COBRA continuation
laws for the 18-month statutory period, or so long as he
remains eligible under COBRA. The COBRA continuation period
shall begin on the day that coverage under Tektronix' group
health plans normally ends due to termination of employment.
Tektronix agrees to cover Executive's COBRA continuation
payments until the earlier of the termination of his COBRA
continuation rights as the result of coverage under the group
health plan of a new employer or one year after the date of
termination of employment, provided that Executive continues
to pay an amount equal to Executive's regular contribution, if
any, for group health benefits.
2.3 Executive shall be entitled to a portion of the benefits under
any incentive plans in effect at the time of termination
(including the Results Sharing Plan and the Annual Performance
Improvement Plan), prorated for the portion of the plan year
during which Executive was a participant. Unless the
applicable plan provides for a greater payment for a
participant whose employment terminates prior to the end of an
incentive period (in which case the applicable plan payment
shall be made), the proration shall be calculated pursuant to
this Section 2.3. The payment, if any, that would have been
made under Executive's award had Executive been made a
participant for the full incentive period shall be calculated
at the end of the incentive period. Such amount shall be
divided by the total number of days in the incentive period
and the result multiplied by the actual number of days
Executive participated in the plan. Prorated awards shall not
be due and payable by Tektronix to Executive until the date
that all awards are paid after the close of the incentive
period.
2.4 Tektronix shall reimburse Executive up to $12,500 for
outplacement services provided to Executive by a third-party
outplacement firm selected by Executive that are incurred by
Executive within 12 months following Executive's termination.
3. SUBSEQUENT EMPLOYMENT. Except as provided in Section 2.2 of this
Agreement, the amount of any payment provided for in this Agreement
shall not be reduced, offset or subject to recovery by Tektronix by
reason of any compensation earned by Executive as the result of
employment by another employer after termination.
2
<PAGE>
4. OTHER AGREEMENTS.
4.1 In the event that severance benefits are payable to Executive
under any other agreement with Tektronix in effect at the time
of termination (including any change of control, "golden
parachute" or employment agreement, but excluding any stock
option agreement or stock bonus agreement or stock
appreciation right agreement that may provide for accelerated
vesting or related benefits upon termination or upon the
occurrence of a change in control), the benefits provided in
this Agreement shall not be payable to Executive. Executive
may, however, elect to receive all of the benefits provided
for in this Agreement in lieu of all of the benefits provided
in all such other agreements. Any such election shall be made
with respect to the agreements as a whole, and Executive
cannot select some benefits from one agreement and other
benefits from this Agreement. No such election shall,
however, operate to deprive Executive of the benefit of any
term or provision relating to acceleration or lapse of
forfeiture restrictions in any stock option or stock bonus
agreement between Tektronix and Executive, even if such term
or provision is referred to or required by an employment or
compensation agreement or other agreement of the kind covered
by the first sentence of this section.
4.2 The vesting or accrual of stock options, restricted stock or
any other stock awards shall not continue following
termination except as may be expressly provided by their
terms. Any agreements between Executive and Tektronix that
relate to stock awards (including but not limited to stock
options, stock bonuses and restricted stock, and the
provisions of any employment agreement or compensation
agreement relating to special acceleration of options or lapse
of forfeiture restrictions on bonus shares) shall remain in
effect, and the treatment of such stock awards shall be
governed by such agreements.
5. DEFINITIONS.
5.1 CAUSE. Termination by Tektronix of Executive's employment for
"Cause" shall mean termination upon (a) the willful and
continued failure by Executive to perform substantially
Executive's reasonably assigned duties with Tektronix (other
than any such failure resulting from Executive's incapacity
due to physical or mental illness) after a demand for
substantial performance is delivered to Executive by the
Chairman of the Organization and Compensation Committee of the
Board of Directors of Tektronix which specifically identifies
the manner in which such executive believes that Executive has
not substantially performed Executive's duties, or (b) the
willful engaging by Executive in illegal
3
<PAGE>
conduct which is materially and demonstrably injurious to
Tektronix. For purposes of this Section 5.1, no act, or
failure to act, on Executive's part shall be considered
"willful" unless done, or omitted to be done, by Executive in
knowing bad faith and without reasonable belief that
Executive's action or omission was in, or not opposed to, the
best interests of Tektronix. Any act, or failure to act,
based upon authority given pursuant to a resolution duly
adopted by the Board of Directors or based upon the advice of
counsel for Tektronix shall be conclusively presumed to be
done, or omitted to be done, by Executive in good faith and in
the best interests of Tektronix.
5.2 DISABILITY. Termination by Tektronix of Executive's
employment based on "Disability" shall mean termination
because of Executive's absence from Executive's duties with
Tektronix on a full-time basis for one hundred eighty (180)
consecutive days as a result of Executive's incapacity due to
physical or mental illness, unless within thirty (30) days
after termination following such absence Executive shall have
returned to the full-time performance of Executive's duties.
5.3 RETIREMENT. Termination by Executive or by Tektronix of
Executive's employment based on "Retirement" shall mean
termination on Executive's normal retirement date as set forth
in the Tektronix Pension Plan (or any successor or substitute
plan of Tektronix).
6. SUCCESSORS; BINDING AGREEMENT.
6.1 This Agreement shall be binding on and inure to the benefit of
Tektronix and its successors and assigns.
6.2 This Agreement shall inure to the benefit of and be
enforceable by Executive and Executive's legal
representatives, executors, administrators and heirs.
7. FEES AND EXPENSES. Tektronix shall pay all legal fees and related
expenses incurred by Executive as a result of Executive's seeking
to obtain or enforce any right or benefit provided by this
Agreement.
4
<PAGE>
8. AMENDMENT. No provision of this Agreement may be modified unless
such modification is agreed to in a writing signed by Executive and
Tektronix.
9. GOVERNING LAW. This Agreement shall be construed in accordance
with and governed by the laws of the State of Oregon.
TEKTRONIX, INC.
/s/ J.J. Meyer
-------------------
JEROME J. MEYER
/s/ A.V. Smith
By: -----------------
Title: ----------------
5
<PAGE>
EXHIBIT 10(x)
LIST OF NAMED EXECUTIVE OFFICERS WITH WHOM
TEKTRONIX HAS A BASIC FORM OF RETENTION INCENTIVE
AGREEMENT IN SUBSTANTIALLY THE FORM ATTACHED
NAMED EXECUTIVE OFFICERS
Carl W. Neun
John P. Karalis
<PAGE>
EXHIBIT 10(x)
RETENTION INCENTIVE AGREEMENT
This Retention Incentive Agreement (the "Agreement") is effective March
16, 1994 between Tektronix, Inc., an Oregon corporation ("Tektronix")
and [Name] ("Executive").
For good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, Tektronix and Executive agree as
follows:
1. Executive is awarded the performance-based restricted stock grant
for the number of shares and on the terms and conditions set forth on
Exhibit A ("Restricted Stock Grant").
2. In the event that Executive's employment with Tektronix is
terminated by Tektronix without Cause (as defined in Section 6.1 of
Executive's Executive Severance Agreement dated September 22, 1993 (the
"Executive Severance Agreement")) at any time prior to February 2,
1996:
(A) notwithstanding anything to the contrary in any restricted or
bonus stock grants (including the Restricted Stock Grant, but
excluding any performance share awards under the Tektronix Long-
Term Incentive Compensation Program ("LTIP Awards")) or in any
stock option agreements held by Executive on the date of
termination: (i) all restricted or bonus stock grants other than
LTIP Awards and all stock options held by Executive on the date of
termination shall fully vest on the date of termination (whether
or not vesting was conditioned on the passage of time or the
achievement of performance objectives), and (ii) Executive shall
have a period equal to the longer of: (a) two (2) years from the
date of termination and (b) the period provided in his grants, to
exercise any stock options held by Executive on the date of
termination; provided that the period permitted for exercise shall
in no event extend beyond the expiration of the related option as
originally granted, and
(B) notwithstanding any length of service requirements in any
LTIP Awards, all LTIP Awards shall continue in force after
Executive's termination and Executive shall be entitled to
benefits under the LTIP Awards in accordance with the actual
achievement of the performance objectives as set out in the LTIP
Awards, which benefits shall be calculated in the manner and
payable at the times specified in the LTIP Awards.
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(C) any severance payment which may be due as a result of the
termination under section 3.1 of Executive's Executive Severance
Agreement, is increased from one (1) to two (2) times Executive's
annual base salary in effect immediately prior to the date of
termination.
All other terms and conditions of the restricted or bonus stock grants,
stock option agreements, the LTIP Awards and the Executive Severance
Agreement shall continue to apply.
Executive acknowledges and agrees that the purpose of this Agreement is to
provide both for retention of the Executive and to provide flexibility in
Tektronix' use of Executive's services. Consequently, Executive agrees
that for purposes of this Agreement (including the Restricted Stock Grant),
Executive's employment with Tektronix shall not be deemed terminated if
Executive is assigned additional or different titles and/or tasks and
responsibilities from those currently held or assigned, provided that
any changes: (i) leave Executive with management responsibility,
consistent with Executive's areas of professional expertise, for a
significant functional activity and/or a significant business unit or
subsidiary, and (ii) do not require Executive to relocate from the
greater Portland, Oregon area. In the event Tektronix terminates
Executive's employment because of (a) the death of Executive, or (b)
physical disability preventing the Executive from performing regular
duties, such termination shall be deemed a termination by Tektronix
without Cause for purposes of this Agreement.
3. For Tektronix' fiscal years 1994 and 1995, Executive's award
targets under the Tektronix Annual Performance Improvement Plan
("APIP") shall be based on achievement of a specific set of objectives
as set by the Chairman of the Board and Chief Executive Officer of
Tektronix ("Chairman and CEO") and approved by the Company's Organization
and Compensation Committee (the "OCC"). The objectives may include
corporate or operating unit performance measures, achievement of the
restructuring of Tektronix (including the types of activities set out in
the Restricted Stock Grant) or other targets or tasks as set by the
Chairman and CEO and approved by the OCC, in their sole discretion.
The objectives for the current fiscal year (1994) shall be set as soon as
reasonably possible, shall replace the current award objectives entirely
and shall apply to the entire year. The objectives for fiscal year 1995
shall be set at the regular time for setting APIP award objectives.
Executive's participation in APIP shall otherwise continue to be governed
by the terms of the APIP plan as in effect from time to time.
4. Except as expressly stated in this Agreement, nothing in this
Agreement is intended to affect Executive's right to participate in the
compensation plans or programs of Tektronix to the extent they may
apply pursuant to their terms and conditions as in effect from time to
time. By way of example, if changes are made to the Tektronix Long
Term Incentive Compensation Program ("LTIP") to modify or
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eliminate performance targets (such as Average Return on Equity), Executive's
participation in the plan shall also be adjusted to reflect any such
changes applicable to Executive.
5. In consideration of the benefits outlined in this Agreement,
Executive agrees to execute and deliver a Release of Claims, in the
form attached as Exhibit A to Executive's Executive Severance Agreement
on the date of termination of employment with Tektronix. Execution and
delivery of the Release of Claims is a condition precedent to Tektronix'
obligations under this Agreement.
6. This Agreement is not a contract of employment. Except as
expressly stated in this Agreement, nothing in this Agreement grants,
modifies or eliminates any rights of Executive or Tektronix pursuant to
any other agreements between them. Except as expressly stated in this
Agreement, there is no change in the relationship between Tektronix and
Executive, with all arrangements continuing to be governed by the terms
and conditions in effect on the date of this Agreement, including those
of any written employment agreement (or absent such an agreement, to
continue on an "at will" basis) and of any applicable plan, including
the APIP and LTIP plans, as may be in effect from time to time.
7. This Agreement contains the entire agreement between the parties
concerning the subject matter of this Agreement and supersedes any
other discussions, agreements, representations or warranties of any
kind.
8. This Agreement shall be construed in accordance with and governed
by the laws of Oregon. Any dispute or controversy arising under or in
connection with this Agreement or the breach thereof, shall be settled
exclusively by arbitration in Portland, Oregon in accordance with the
Commercial Arbitration Rules of the American Arbitration Association or
such comparable rules as may be agreed upon by the parties. Any
judgment upon the award rendered by the arbitrator may be entered in
any court having jurisdiction thereof.
9. Any modification of this Agreement shall be effective only if in
writing and signed by each party or its duly authorized representative.
If for any reason any provision of this Agreement shall be held
invalid in whole or in part, such invalidity shall not affect the
remainder of this Agreement.
TEKTRONIX, INC. EXECUTIVE
By: _________________________ ________________________
Chairman, (Name)
Organization and Compensation
Committee
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EXHIBIT 10(x)
RETENTION INCENTIVE AGREEMENT
This Retention Incentive Agreement (the "Agreement") is effective March
16, 1994 between Tektronix, Inc., an Oregon corporation ("Tektronix")
and Jerome J. Meyer ("Executive").
For good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, Tektronix and Executive agree as follows:
1. Executive is awarded the performance-based restricted stock grant
for the number of shares and on the terms and conditions set forth on
Exhibit A ("Restricted Stock Grant").
2. In the event that Executive's employment with Tektronix is
terminated by Tektronix without Cause (as defined in Section 5.1 of
Executive's Executive Severance Agreement dated October 23, 1992 (the
"Executive Severance Agreement")) at any time prior to February 2,
1996:
(A) notwithstanding anything to the contrary in any restricted or
bonus stock grants (including the Restricted Stock Grant, but
excluding any performance share awards under the Tektronix Long-
Term Incentive Compensation Program ("LTIP Awards")) or in any
stock option agreements held by Executive on the date of
termination: (i) all restricted or bonus stock grants other than
LTIP Awards and all stock options held by Executive on the date of
termination shall fully vest on the date of termination (whether or
not vesting was conditioned on the passage of time or the
achievement of performance objectives), and (ii) Executive shall
have a period equal to the longer of: (a) two (2) years from the
date of termination and (b) the period provided in his grants, to
exercise any stock options held by Executive on the date of
termination; provided that the period permitted for exercise shall
in no event extend beyond the expiration of the related option as
originally granted, and
(B) notwithstanding any length of service requirements in any LTIP
Awards, all LTIP Awards shall continue in force after Executive's
termination and Executive shall be entitled to benefits under the
LTIP Awards in accordance with the actual achievement of the
performance objectives as set out in the LTIP Awards, which
benefits shall be calculated in the manner and payable at the times
specified in the LTIP Awards.
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All other terms and conditions of the restricted or bonus stock grants,
stock option agreements, the LTIP Awards and the Executive Severance
Agreement shall continue to apply.
In the event Tektronix terminates Executive's employment because of (a)
the death of Executive, or (b) physical disability preventing the
Executive from performing regular duties, such termination shall be
deemed a termination by Tektronix without Cause for purposes of this
Agreement.
3. For Tektronix' fiscal years 1994 and 1995, Executive's award targets
under the Tektronix Annual Performance Improvement Plan ("APIP") shall
be based on achievement of a specific set of objectives as set by the
Company's Organization and Compensation Committee (the "OCC"). The
objectives may include corporate or operating unit performance measures,
achievement of the restructuring of Tektronix (including the types of
activities set out in the Restricted Stock Grant) or other targets or
tasks as set by the OCC, in their sole discretion. The objectives for
the current fiscal year (1994) shall be set as soon as reasonably
possible, shall replace the current award objectives entirely and shall
apply to the entire year. The objectives for fiscal year 1995 shall be
set at the regular time for setting APIP award objectives.
Executive's participation in APIP shall otherwise continue to be
governed by the terms of the APIP plan as in effect from time to time.
4. Except as expressly stated in this Agreement, nothing in this
Agreement is intended to affect Executive's right to participate in the
compensation plans or programs of Tektronix to the extent they may apply
pursuant to their terms and conditions as in effect from time to time.
By way of example, if changes are made to the Tektronix Long Term
Incentive Compensation Program ("LTIP") to modify or eliminate
performance targets (such as Average Return on Equity), Executive's
participation in the plan shall also be adjusted to reflect any such
changes applicable to Executive.
5. In consideration of the benefits outlined in this Agreement,
Executive agrees to execute and deliver a Release of Claims, in the form
attached as Exhibit B to this Agreement, on the date of termination of
employment with Tektronix. Execution and delivery of the Release of
Claims is a condition precedent to Tektronix' obligations under this
Agreement.
6. This Agreement is not a contract of employment. Except as
expressly stated in this Agreement, nothing in this Agreement grants,
modifies or eliminates any rights of Executive or Tektronix pursuant to
any other agreements between them. Except as expressly stated in this
Agreement, there is no change in the relationship between Tektronix and
Executive, with all arrangements continuing to be governed by the terms
and conditions in effect on the date of this Agreement, including those
of any written employment agreement (or absent such an agreement, to
continue on
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an "at will" basis) and of any applicable plan, including
the APIP and LTIP plans, as may be in effect from time to time.
7. This Agreement contains the entire agreement between the parties
concerning the subject matter of this Agreement and supersedes any other
discussions, agreements, representations or warranties of any kind.
8. This Agreement shall be construed in accordance with and governed by
the laws of Oregon. Any dispute or controversy arising under or in
connection with this Agreement or the breach thereof, shall be settled
exclusively by arbitration in Portland, Oregon in accordance with the
Commercial Arbitration Rules of the American Arbitration Association or
such comparable rules as may be agreed upon by the parties. Any
judgment upon the award rendered by the arbitrator may be entered in any
court having jurisdiction thereof.
9. Any modification of this Agreement shall be effective only if in
writing and signed by each party or its duly authorized representative.
If for any reason any provision of this Agreement shall be held invalid
in whole or in part, such invalidity shall not affect the remainder of
this Agreement.
TEKTRONIX, INC. EXECUTIVE
By: /s/ A.V. SMITH /s/ J.J. MEYER
Chairman, Jerome J. Meyer
Organization and Compensation
Committee
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EXHIBIT 10(xiii)
September 1, 1992
John Karalis
7878-66 East Gainey Ranch Road
Scottsdale, AZ 85258
Dear John:
On behalf of Tektronix, Inc. I am pleased to confirm our
offer of employment in the position of Vice President,
Corporate Development. In this position you will report to
Jerome J. Meyer. The title of Vice President is conferred
by the Board of Directors and is subject to Board approval.
Following is a summary of the benefits and terms relating to
this offer:
1. COMPENSATION AND BENEFITS
Your compensation will consist of a base salary, payable
biweekly, at the annual rate of $175,000. You will also
participate in the Tektronix Results Sharing program
which provides employees with a cash payout when
specific financial targets are achieved. In addition,
you will receive a comprehensive benefits package that
includes group insurance, a company 401(k) plan,
flexible time off, and tuition reimbursement. You will
receive more information about the Tektronix benefits
program in your new employee orientation.
In this position, you will be a participant in the
Tektronix Annual Performance Improvement Plan (APIP).
The APIP plan provides cash payment opportunities
contingent on attainment of established performance
targets. The targeted amount for the 1993 fiscal year
will be 30% of your base pay, payable after the plan
year closes. Your APIP participation for the 1993
fiscal year will be prorated, commencing on the date you
begin employment at Tektronix. This amount will be
payable, on the normal plan schedule, unless you
voluntarily terminate your employment or are terminated
by Tektronix for cause at any time prior to the date
payment is made following the close of the 1993 fiscal
year or July 31, whichever is earlier. In subsequent
years, incentive compensation will be earned and paid in
accordance with applicable incentive compensation plans.
2. STOCK BONUS AWARD
Pursuant to the Tektronix Stock Incentive Plan, you will
receive a stock bonus award of 10,000 shares of
Tektronix common stock. The award will become effective
on the date you begin employment at Tektronix. One half
of the shares will vest at the end of the first and
second years of your employment with Tektronix. This
award will be subject to certain restrictions stated in
the plan and outlined in a
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separate Stock Bonus
Agreement to be prepared following Board approval. In
general, the unvested bonus shares will be subject to
forfeiture to Tektronix if your employment terminates
for any reason during a forfeiture period of two years
following the date of the award. The plan contains
special provisions for non-forfeiture in the event of
death or disability. The plan also provides that
dividends (plus interest) will be accumulated for your
account subject to the same possibility of forfeiture,
but you will have voting rights on the stock during the
forfeiture period. A copy of the prospectus for the
plan is enclosed for your information.
3. ADDITIONAL BENEFITS
Tektronix will also provide you the following additional
benefits:
Housing Allowance. Tektronix will pay you a
housing allowance of $1,250 per month.
Commuting Expenses. Tektronix will reimburse
you for reasonable (business class) airfare
expenses for up to 4 trips per month between
Portland and your residence in Phoenix.
These benefits will be provided to you for a period of
24 months or as long as you maintain your principal
residence outside the Portland area, whichever is the
lesser. You should be advised that these benefits may
be subject to applicable state or federal tax
withholding and may consist of taxable income.
4. ELIGIBILITY FOR SEVERANCE PAY
As we have discussed, Tektronix is an "at-will"
employer. Basically, this means that your position is
not intended to be for any fixed term and either you or
the company can terminate it at any time and for any
reason. However, if your employment is terminated by
Tektronix other than for cause at any time during the
first year after your employment begins, you will
receive as severance pay an amount equal to one year of
your then-current base pay. If your employment is
terminated by Tektronix other than for cause at any time
during the second year, you will receive as severance
pay the amount you would have earned during the
remainder of the second year had your employment not
been terminated.
For purposes of this letter, cause for termination would
generally be defined as limited to any willful and
continuous failure to perform your reasonably assigned
duties (as determined by the CEO), the commission by you
of felonious acts or any act of fraud or dishonesty, or
the commission of any act of willful misconduct that, in
the judgment of the CEO, materially and adversely
affects the financial condition of Tektronix.
As you know, your election as a Vice President of Tektronix,
the stock bonus award, APIP participation and severance pay
all require the approval of the Tektronix Board of Directors
or its Organization and Compensation
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Committee. If the terms of this offer are acceptable to you,
I will recommend formal action and approval by the Board or the
Committee at the next regular meeting.
This offer is intended to supersede the existing consulting
relationship between you and Tektronix.
John, we have enclosed the following forms which will need
to be signed upon your acceptance of this position:
. EMPLOYMENT ELIGIBILITY VERIFICATION FORM (Form I-9)
We are required by the Immigration Reform and Control
Act of 1986 to have this form completed and on file for
all Tektronix employees. Please bring the appropriate
documents mentioned in the Form I-9 with you on your
first day of employment.
. TEKTRONIX EMPLOYMENT AGREEMENT
This document refers to the nondisclosure of company
confidential information and ownership of inventions.
Tektronix requires that all employees sign this
document.
Should you have questions concerning any part of this offer
letter, please call me at 503/685-4020. To confirm your
acceptance of this offer, please sign the original of this
letter where indicated and return it along with the signed
copy of the Employment Agreement. We look forward to
hearing from you by September 8, 1992 regarding your
decision.
Congratulations and we look forward to welcoming you to Tektronix!
Sincerely,
/s/ T. Thorsteinson
Timothy E. Thorsteinson
Vice President
Quality/Human Resources
enclosures: Employment Agreement
Form I-9
Prospectus
I accept Tektronix's offer of employment under the terms
outlined in this letter. (See addendum attached.)
/s/ John Karalis 9/1/92
________________________ _______________________
John Karalis Date
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ADDENDUM TO THE JOHN P. KARALIS SEPTEMBER 1, 1992 OFFER LETTER.
1. Employment will be deemed to commence September 1, 1992.
2. During the first 24 months of his employment, Mr. Karalis is
entitled to 35 days off in addition to regular company holidays.
Business air travel of over 2 hours shall be first class.
3. Mr. Karalis' base salary will be reviewed at the close of the
1993 fiscal year and again at the close of the 1994 fiscal year.
4. Mr. Karalis shall receive a guaranteed APIP award, or other cash
equivalent, of 30% of his base salary, prorated from September 1,
1992, for the 1993 fiscal year.
5. Mr. Karalis' stock bonus award will be reviewed at the close of
the 1993 fiscal year and again at the close of the 1994 fiscal
year.
6. The housing allowance of $1,250.00 per month shall apply during
the first 24 months of employment if Mr. Karalis purchases a
residence in the Portland area while also maintaining a residence
in the Phoenix area. In addition, Tektronix shall reimburse Mr.
Karalis reasonable and actual customary closing costs in a
Portland area residence purchase and real estate commission and
reasonable and actual customary closing costs in selling such a
residence upon termination of his employment at Tektronix.
7. During that period of the first 24 months of employment during
which Mr. Karalis elects to rent housing in the Portland area
while maintaining a residence in the Phoenix area, Tektronix shall
pay him a housing allowance equal to the apartment rental,
furniture package and house-keeping and utilities charges not to
exceed those set forth in the attached Oswego Pointe quotation.
Tektronix may, at its option, pay these charges directly to the
lessor and/or furniture rental provider.
8. Tektronix shall reimburse Mr. Karalis for purchase and
installation of a fax machine at his Phoenix area residence for
business use and, if feasible at reasonable cost, installation of
Tektronix electronic mail upon Mr. Karalis' computer at his
Phoenix area home.
9. The air fare expenses referred to in item 3 of the offer letter
may be incurred by either Mr. Karalis, his wife, his son or his
daughter. (Mr. Karalis' "principal residence" shall be deemed to
be in Phoenix for so long as he maintains a residence there.)
10. If Tektronix' health insurance does not provide dependent coverage
for Mr. Karalis' son, Tektronix shall reimburse Mr. Karalis the
additional premium required to purchase commensurate coverage.
11. Mr. Karalis shall receive the following severance pay if he is
terminated by Tektronix other than for cause during the first 24
months of his employment. An immediate lump sum cash payment
equal to the sum of:
a. An amount equal to his base salary at the date of termination
for the entire period remaining of the first 24 months of his
employment.
b. If the APIP award for the 1993 fiscal year has not been paid
as referred to in item 4 of this addendum, then an amount equal
to the guaranteed APIP award referred to in item 4. Any amount
to be paid under this item with respect to an unpaid award for
the 1994 fiscal year shall be at the discretion of Jerome Meyer.
c. The issue of compensation for any unvested portion of the
10,000 share stock bonus award as of the date of termination
remains open
<PAGE> pending review of this general topic by the Board of
Directors.
In addition, Tektronix shall reimburse Mr. Karalis the lease
termination costs for a rented Portland residence or the item 6 selling
costs for a purchased residence, whichever the case may actually be.
12. Any failure by Tektronix to provide the compensation benefits,
stock bonus award and other consideration set forth in the offer
letter; any change in Mr. Karalis' reporting relationship to Mr.
Meyer as chief executive officer; change in title; material change
in responsibilities; change in location of office from the corporate
executive suite in Wilsonville, Oregon; material change in perquisites;
or other material change in his employment relationship; may be deemed
by Mr. Karalis, at his option, to be a constructive termination by
Tektronix other than for cause.
13. Any inconsistency between this addendum and the typed text of the
offer letter shall be controlled by this addendum. References to the
offer letter include this addendum.
14. Any dispute arising out of this agreement or the employment
relationship to which it refers shall be resolved by arbitration
under the rules of the American Arbitration Assocation in San Francisco,
California.
Any arbitral award may be enforced in any court of competent
jurisdiction.
<PAGE>
EXHIBIT 10(xiv)
EXECUTIVE COMPENSATION AND BENEFITS AGREEMENT
Carl W. Neun
3530 Lakeview
Lake Oswego, OR 97034 Executive
Tektronix, Inc.,
an Oregon corporation
P.O. Box 1000
Wilsonville, OR 97075 Tektronix
1. EMPLOYMENT.
By letter dated February 16, 1993 from Tim Thorsteinson, Vice
President, Total Quality/Human Resources,("Offer Letter") Tektronix
offered and Executive accepted employment with Tektronix on a full-time
basis as Vice President and Chief Financial Officer of Tektronix. The
Offer Letter, at page 4, provided that Tektronix would give Executive a
written three-year contract covering compensation and benefits.
WHEREFORE, Tektronix hereby offers and Executive hereby accepts this
Executive Compensation and Benefits Agreement.
2. EFFECTIVE DATE.
Executive's employment hereunder commenced on March 29, 1993
(the "Effective Date") and shall continue under this Agreement until the
third anniversary of the Effective Date, unless terminated earlier as
hereinafter provided.
3. POSITION; DUTIES.
3.1 Effective March 31, 1993, the Board of Directors of
Tektronix elected Executive Chief Financial Officer and a Vice President
of Tektronix, subject to Executive's acceptance of this Agreement and to
the customary restrictions relating to the election, tenure, removal and
replacement of corporate officers.
3.2 Executive will, during the term of this Agreement,
faithfully and diligently perform all such acts and duties, and furnish
such services, as the Chairman and Chief Executive Officer or his
designee shall reasonably direct. Executive will devote such time,
energy, and skill to the business of Tektronix as shall reasonably be
required for the performance of his duties.
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4. SALARY AND BONUS.
4.1 On the Effective Date, Tektronix made a one-time cash
payment to Executive of $125,000, less applicable withholding taxes, as
a hire-on bonus.
4.2 Tektronix will pay Executive base pay at an annual rate
of $350,000 for the 1993 and 1994 fiscal years (respectively "FY300" and
"FY94"), provided that Tektronix, in its sole discretion, may increase
Executive's base pay for any portion of FY94. Thereafter, Executive's
base pay shall be at an annual rate set, from time to time, by
Tektronix.
4.3 Tektronix will pay Executive Results Share pay in
accordance with Tektronix' Results Sharing Plan.
4.4 Executive will be a participant in Tektronix' Annual
Performance Improvement Plan ("APIP") beginning with FY300. Executive
acknowledges that he has received his APIP payment for FY300.
Executive's APIP participation for FY94 and subsequent fiscal years
shall be in accordance with the terms of the applicable APIP plan(s) and
the applicable performance targets established thereunder; provided
that, for the twelve (12) month period beginning March 29, 1993 and
ending March 28, 1994, it is expected that achievement of performance
targets for the periods of Executive's FY300 and FY94 APIP participation
apportioned to the 12-months ("combined partial APIP periods") will
produce total incentive compensation for the combined partial APIP
periods of at least 40 percent of base pay earned during the combined
partial APIP periods. If the total amount payable to Executive for the
combined partial APIP periods is less than 40 percent of base pay,
Tektronix shall pay Executive a one-time lump sum payment equal to the
difference between the amounts actually paid under the plan(s) for the
combined partial APIP periods and 40 percent of base pay earned during
the combined partial APIP periods (the "Guarantee Payment").
Notwithstanding the foregoing, if Executive voluntarily terminates
employment or is terminated for cause prior to the earlier of July 31,
1993 or the date payment is issued under the FY300 APIP plan,
Executive's participation in APIP will terminate and all rights to the
award or guaranteed minimum payment attributable to such plan year (or
any portion thereof) or subsequent years will cease. If Executive
voluntarily terminates, or is terminated by Tektronix without Cause (as
defined in Section 6.1 of Executive's Executive Severance Agreement),
after March 28, 1994 but before payment is due under the FY94 APIP plan,
Executive will remain entitled to payment of any Guarantee Payment,
which will be payable at the time payments are made pursuant to the FY94
APIP plan.
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4.5 Base pay shall be payable bi-weekly in arrears; results
share and APIP payments (including any Guarantee Payment) shall be made
at the times provided in the respective plans. Base pay, results share,
APIP and any other cash payments shall be subject to applicable
withholdings.
5. STOCK OPTION GRANT.
Executive has received a grant of non-statutory stock options
to purchase 150,000 shares of Tektronix common stock under the Tektronix
Stock Incentive Plan ("Stock Incentive Plan"), at an option price per
share equal to the fair market value of the common shares on the
effective date of the grant. The option grant was effective as of the
Effective Date and will otherwise be subject to the terms of the Stock
Incentive Plan and of a Stock Option Agreement in the form attached
hereto as Exhibit A.
6. STOCK BONUS GRANT.
Executive has received, effective on the Effective Date, a
stock bonus award of 20,000 Tektronix common shares under the Stock
Incentive Plan, and otherwise in accordance with, and subject to, the
terms of the Stock Incentive Plan and the form of Stock Bonus Agreement,
as amended, attached to this Agreement as Exhibit B. The bonus shares
shall be forfeited to the Company according to the schedule in the Stock
Bonus Agreement, as amended, and possibility of forfeiture shall lapse
as specified in the Stock Bonus Agreement, as amended.
7. LONG-TERM INCENTIVE COMPENSATION PROGRAM.
Executive has received, effective on the Effective Date, as
part of Tektronix' Long-Term Incentive Compensation Program, stock
options to purchase 35,000 Tektronix common shares under the Stock
Incentive Plan, and otherwise in accordance with, and subject to, the
terms of the Stock Incentive Plan and a Stock Option Agreement in the
form attached to this Agreement as Exhibit C.
Executive also has received, effective on the Effective Date,
as part of Tektronix' Long-Term Incentive Compensation Program, a stock
bonus award of 11,000 Tektronix common shares under the Stock Incentive
Plan, and otherwise in accordance with, and subject to, the terms of the
Stock Incentive Plan and the form of Performance Shares Agreement
attached to this Agreement as Exhibit D.
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8. BENEFITS.
Executive's accrual rate for Flexible Time Off (FTO) shall
begin at 8.3 hours per pay period. Executive shall also be entitled to
such additional benefits and perquisites as Tektronix provides its
officers generally.
9. CHANGE IN CONTROL.
Executive and Tektronix have executed a Change in Control
Severance Agreement in the form attached hereto as Exhibit E.
10. EXECUTIVE SEVERANCE AGREEMENT.
Executive and Tektronix have executed an Executive Severance
Agreement in the form attached hereto as Exhibit F.
11. SUPPLEMENTAL EXECUTIVE RETIREMENT AGREEMENT.
In addition to those retirement benefits generally available
to Tektronix employees, Executive shall be entitled to a supplemental
retirement benefit on the terms set forth on Exhibit G attached hereto.
12. EMPLOYMENT AND CONFIDENTIAL INFORMATION.
Executive and Tektronix has executed a Tektronix Employment
Agreement covering inventions and confidential information in the form
attached hereto as Exhibit H.
13. TERMINATION AND SEVERANCE.
13.1 Either party may terminate the employment relationship
and this Agreement at any time and for any reason.
13.2 If Executive's employment is terminated by Tektronix
other than for cause (as defined in the Executive Severance Agreement)
or Change in Control (as defined in the Change in Control Severance
Agreement) between March 29, 1993 and March 28, 1996, Executive may
elect to receive as severance benefits either:
(a) severance benefits payable to Executive under Executive's
Executive Severance Agreement, subject to the terms and conditions set
forth in that Agreement; or
(b) the base pay that would have been paid to Executive during the
remainder of the term of this Agreement calculated at Executive's rate
of base pay immediately prior to the date of termination.
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Notwithstanding the foregoing, if Executive elects severance benefits
under subparagraph 13.2(b), Executive's entitlement to stock grants or
options pursuant to paragraphs 5-7 of this Agreement shall be as stated
in the Stock Incentive Plan and Exhibits A-D to this Agreement.
13.3 If Executive's employment is terminated as a result of
a Change in Control (as defined in the Change in Control Severance
Agreement), Executive will receive only those severance benefits payable
under Executive's Change in Control Severance Agreement and shall not be
eligible for additional compensation or severance benefits under this
Agreement. Notwithstanding the foregoing, Executive's entitlement to
stock grants or options pursuant to paragraphs 5-7 of this Agreement
shall be as stated in the Stock Incentive Plan and Exhibits A-D to this
Agreement.
13.4 If Executive's employment is terminated by Tektronix
for cause (as defined in the Executive Severance Agreement) or if
Executive terminates his employment for any reason, he shall be entitled
to compensation and benefits under this Agreement only to the extent
actually earned or vested (as recorded in Tektronix' records) as of the
date of termination and shall not be entitled to any severance benefits
under this Agreement.
14. GENERAL PROVISIONS.
14.1 The failure of either party to this Agreement to insist
upon the performance of any of the terms and conditions hereof, or the
waiver of any breach of any of the terms and conditions hereof, shall
not be construed as thereafter waiving any such terms and conditions,
but the same shall continue and remain in full force and effect as if no
such waiver or forbearance had occurred.
14.2 Any modification of this Agreement shall be effective
only if in writing and signed by each party or its duly authorized
representative.
14.3 If for any reason any provision of this Agreement shall
be held invalid in whole or in part, such invalidity shall not affect
the remainder of this Agreement.
14.4 This Agreement shall be construed in accordance with
and governed by the laws of the State of Oregon. Any dispute or
controversy arising under or in connection with this Agreement or the
breach thereof, shall be settled exclusively by arbitration in Portland,
Oregon in accordance with the Commercial Arbitration Rules of the
American Arbitration Association or such comparable rules as may be
agreed upon by
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the parties, and judgment upon the award rendered by the
Arbitrator may be entered in any court having jurisdiction thereof.
14.5 This Agreement may be executed in two counterparts by
the parties hereto, whereupon it will become their binding agreement.
14.6 The following documents are included as part of this
Agreement:
Exhibit A - Stock Option Agreement
Exhibit B - Stock Bonus Agreement
Exhibit C - Stock Option Agreement
Exhibit D - Performance Shares Agreement
Exhibit E - Change in Control Severance Agreement
Exhibit F - Executive Severance Agreement
Exhibit G - Tektronix Employment Agreement
Exhibit H - Schedule
14.7 This document, including the Exhibits listed in Section
14.6 above, supersedes and replaces the Offer Letter and contains the
entire agreement between the parties with respect to any subjects
addressed in both documents. In the event of conflict or discrepancy
between the terms and conditions described in the Offer Letter and the
terms and conditions stated herein, the provision(s) of this Agreement
shall control.
14.8 This Agreement is subject to, and conditioned upon,
ratification of its terms by the Organization and Compensation Committee
of the Board of Directors of Tektronix.
TEKTRONIX, INC.
By /s/ J.J. Meyer /s/ Carl W. Neun
Jerome J. Meyer Carl W. Neun
Chief Executive Officer
3-16-94 3/16/94
------------- --------------
Date Signed Date Signed
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Ratified by
ORGANIZATION AND COMPENSATION
COMMITTEE
By: /s/ A.V. SMITH
Name: A.V. Smith
Title: Chm. Comp. Committee
3/16/94
- - ---------------
Date Signed
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EXHIBIT E to EXHIBIT 10(xiv)
September 10, 1993
Mr. Carl W. Neun
3530 Lakeview Blvd
Lake Oswego, OR 97035
Dear Mr. Neun:
Tektronix, Inc., an Oregon corporation (the "Company"), considers
the establishment and maintenance of a sound and vital management to be
essential to protecting and enhancing the best interests of the Company and
its shareholders. In this connection, the Company recognizes that, as is
the case with many publicly held corporations, the possibility of a change
in control may exist and that such possibility, and the uncertainty and
questions which it may raise among management, may result in the departure
or distraction of management personnel to the detriment of the Company and
its shareholders. Accordingly, the Board of Directors of the Company (the
"Board") has determined that appropriate steps should be taken to reinforce
and encourage the continued attention and dedication of members of the
Company's management to their assigned duties without distraction in
circumstances arising from the possibility of a change in control of the
Company.
In order to induce you to accept employment with the Company and
to remain in the employ of the Company, this letter agreement, which has
been approved by the Board, sets forth the severance benefits which the
Company agrees will be provided to you in the event your employment with
the Company is terminated subsequent to a "change in control" of the
Company under the circumstances described below.
1. Agreement to Provide Services; Right to Terminate.
(i) Except as otherwise provided in paragraph (ii) below, the
Company or you may terminate your employment at any time, subject to the
Company's providing the benefits hereinafter specified in accordance with
the terms hereof.
(ii) In the event of a tender offer or exchange offer by a Person
(as hereinafter defined) for more than 25 percent of the combined voting
power of the Company's outstanding securities ordinarily having the right
to vote at elections of directors ("Voting Securities"), including shares
of Common Stock of the Company
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(the "Company Shares"), you agree that you
will not leave the employ of the Company (other than as a result of
Disability or upon Retirement, as such terms are hereinafter defined) and
will render the services contemplated in the recitals to this Agreement
until such tender offer or exchange offer has been abandoned or terminated
or a change in control of the Company, as defined in Section 3 hereof, has
occurred. For purposes of this Agreement, the term "Person" shall mean and
include any individual, corporation, partnership, group, association or
other "person," as such term is used in Section 14(d) of the Securities
Exchange Act of 1934 (the "Exchange Act"), other than the Company or any
employee benefit plan(s) sponsored by the Company.
2. Term of Agreement. This Agreement shall commence on the date
hereof and shall continue in effect until December 31, 1993; provided,
however, that commencing on January 1, 1994 and each January 1 thereafter,
the term of this Agreement shall automatically be extended for one
additional year unless at least 90 days prior to such January 1 date, the
Company or you shall have given notice that this Agreement shall not be
extended; and provided, further, that this Agreement shall continue in
effect for a period of twenty-four (24) months beyond the term provided
herein if a change in control of the Company, as defined in Section 3
hereof, shall have occurred during such term. Notwithstanding anything in
this Section 2 to the contrary, this Agreement shall terminate if you or
the Company terminate your employment prior to a change in control of the
Company as defined in Section 3 hereof. In addition, the Company may
terminate this Agreement during your employment if, prior to a change in
control of the Company as defined in Section 3 hereof, you cease to hold
your current position with the Company, except by reason of a promotion.
3. Change in Control. For purposes of this Agreement, a "change in
control" of the Company shall mean a change in control of a nature that
would be required to be reported in response to Item 1(a) of the Current
Report on Form 8-K, as in effect on the date hereof, pursuant to Section 13
or 15(d) of the Exchange Act; provided that, without limitation, such a
change in control shall be deemed to have occurred at such time as (a) any
Person is or becomes the "beneficial owner" (as defined in Rule 13d-3 under
the Exchange Act), directly or indirectly, of 25 percent or more of the
combined voting power of the Company's Voting Securities or (b) individuals
who constitute the Board on the date hereof (the "Incumbent Board") cease
for any reason to constitute at least a majority thereof, provided that any
person becoming a director subsequent to the date hereof whose election,
or nomination for election by the Company's shareholders, was approved by
a vote of at least a majority of the directors comprising the Incumbent
Board (either by a specific vote or by approval of the proxy statement of
the Company in which such person is named as a nominee for director,
without objection to such nomination) shall be, for purposes of this clause
(b), considered as though such person were a member of the Incumbent Board.
Notwithstanding anything in the foregoing to the
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contrary, no change in control shall be deemed to have occurred
for purposes of this Agreement by virtue of any transaction
which results in you, or a group of Persons which includes
you, acquiring, directly or indirectly, 25 percent or more of the
combined voting power of the Company's Voting Securities.
4. Termination Following Change in Control. If any of the events
described in Section 3 hereof constituting a change in control of the
Company shall have occurred, you shall be entitled to the benefits provided
in paragraph (iii) of Section 5 hereof upon the termination of your
employment within twenty-four (24) months after such event, unless such
termination is (a) because of your death or Retirement, (b) by the Company
for Cause or Disability or (c) by you other than for Good Reason (as all
such capitalized terms are hereinafter defined).
(i) Disability. Termination by the Company of your employment
based on "Disability" shall mean termination because of your absence from
your duties with the Company on a full-time basis for one hundred eighty
(180) consecutive days as a result of your incapacity due to physical or
mental illness, unless within thirty (30) days after Notice of Termination
(as hereinafter defined) is given to you following such absence you shall
have returned to the full-time performance of your duties.
(ii) Retirement. Termination by you or by the Company of your
employment based on "Retirement" shall mean termination on your normal
retirement date as set forth in the Company's Pension Plan (or any
successor or substitute plan or plans of the Company put into effect prior
to a change in control).
(iii) Cause. Termination by the Company of your employment
for "Cause" shall mean termination upon (a) the willful and continued
failure by you to perform substantially your reasonably assigned duties
with the Company consistent with those duties assigned to you prior to the
change in control (other than any such failure resulting from your
incapacity due to physical or mental illness) after a demand for
substantial performance is delivered to you by the Chairman of the Board
or President of the Company which specifically identifies the manner in
which such executive believes that you have not substantially performed
your duties, or (b) the willful engaging by you in illegal conduct which
is materially and demonstrably injurious to the Company. For purposes of
this paragraph (iii), no act, or failure to act, on your part shall be
considered "willful" unless done, or omitted to be done, by you in knowing
bad faith and without reasonable belief that your action or omission was
in, or not opposed to, the best interests of the Company. Any act, or
failure to act, based upon authority given pursuant to a resolution duly
adopted by the Board or based upon the advice of counsel for the Company
shall be conclusively presumed to be done, or omitted to be done, by you
in good faith and in the best interests of the corporation.
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Notwithstanding the foregoing, you shall not be deemed to have been
terminated for Cause unless and until there shall have been delivered to
you a copy of a resolution duly adopted by the affirmative vote of not less
than three-quarters of the entire membership of the Board at a meeting of
the Board called and held for the purpose (after reasonable notice to you
and an opportunity for you, together with your counsel, to be heard before
the Board), finding that in the good faith opinion of the Board you were
guilty of the conduct set forth above in (a) or (b) of this paragraph (iii)
and specifying the particulars thereof in detail.
(iv) Good Reason. Termination by you of your employment for
"Good Reason" shall mean termination based on:
(A) a change in your status, title, position(s) or
responsibilities as an officer of the Company which, in your
reasonable judgment, does not represent a promotion from your
status, title, position(s) and responsibilities as in effect
immediately prior to the change in control, or the assignment to
you of any duties or responsibilities which, in your reasonable
judgment, are inconsistent with such status, title or
position(s), or any removal of you from or any failure to
reappoint or reelect you to such position(s), except in
connection with the termination of your employment for Cause,
Disability or Retirement or as a result of your death or by you
other than for Good Reason;
(B) a reduction by the Company in your base salary as
in effect immediately prior to the change in control;
(C) the failure by the Company to continue in effect
any Plan (as hereinafter defined) in which you are participating
at the time of the change in control of the Company (or Plans
providing you with at least substantially similar benefits) other
than as a result of the normal expiration of any such Plan in
accordance with its terms as in effect at the time of the change
in control, or the taking of any action, or the failure to act,
by the Company which would adversely affect your continued
participation in any of such Plans on at least as favorable a
basis to you as is the case on the date of the change in control
or which would materially reduce your benefits in the future
under any of such Plans or deprive you of any material benefit
enjoyed by you at the time of the change in control;
(D) the failure by the Company to provide and credit
you with the number of paid vacation days to which you are then
entitled in accordance with the Company's normal vacation policy
as in effect immediately prior to the change in control;
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(E) the Company's requiring you to be based anywhere
other than where your office is located immediately prior to the
change in control except for required travel on the Company's
business to an extent substantially consistent with the business
travel obligations which you undertook on behalf of the Company
prior to the change in control;
(F) the failure by the Company to obtain from any
Successor (as hereinafter defined) the assent to this Agreement
contemplated by Section 6 hereof; or
(G) any purported termination by the Company of your
employment which is not effected pursuant to a Notice of
Termination satisfying the requirements of paragraph (v) below
(and, if applicable, paragraph (iii) above); and for purposes of
this Agreement, no such purported termination shall be effective.
For purposes of this Agreement, "Plan" shall mean any compensation plan
such as an incentive, stock option or restricted stock plan or any employee
benefit plan such as a thrift, pension, profit sharing, medical,
disability, accident, life insurance plan or a relocation plan or policy
or any other plan, program or policy of the Company intended to benefit
employees.
(v) Notice of Termination. Any purported termination by the
Company or by you following a change in control shall be communicated by
written Notice of Termination to the other party hereto. For purposes of
this Agreement, a "Notice of Termination" shall mean a notice which shall
indicate the specific termination provision in this Agreement relied upon
and shall set forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of your employment under the
provision so indicated.
(vi) Date of Termination. "Date of Termination" following a
change in control shall mean (a) if your employment is to be terminated for
Disability, thirty (30) days after Notice of Termination is given (provided
that you shall not have returned to the performance of your duties on a
full-time basis during such thirty (30) day period), (b) if your employment
is to be terminated by the Company for Cause, the date on which a Notice
of Termination is given, and (c) if your employment is to be terminated by
you or by the Company for any other reason, the date specified in the
Notice of Termination, which shall be a date no earlier than ninety (90)
days after the date on which a Notice of Termination is given, unless an
earlier date has been agreed to by the party receiving the Notice of
Termination either in advance of, or after, receiving such Notice of Ter-
mination. Notwithstanding anything in the foregoing to the contrary, if
the party receiving the Notice of Termination has not previously agreed to
the termination, then within
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<PAGE>
thirty (30) days after any Notice of Termination is given,
the party receiving such Notice of Termination may notify
the other party that a dispute exists concerning the termination,
in which event the Date of Termination shall be the date set either by
mutual written agreement of the parties or by the arbitrators in a
proceeding as provided in Section 13 hereof.
5. Compensation Upon Termination or During Disability.
(i) During any period following a change in control that you
fail to perform your duties as a result of incapacity due to physical or
mental illness, you shall continue to receive your full base salary at the
rate then in effect and any benefits or awards under any Plans shall
continue to accrue during such period, to the extent not inconsistent with
such Plans, until your employment is terminated pursuant to and in accord-
ance with paragraphs 4(i) and 4(vi) hereof. Thereafter, your benefits
shall be determined in accordance with the Plans then in effect.
(ii) If your employment shall be terminated for Cause following
a change in control of the Company, the Company shall pay you your full
base salary through the Date of Termination at the rate in effect just
prior to the time a Notice of Termination is given plus any benefits or
awards (including both the cash and stock components) which pursuant to the
terms of any Plans have been earned or become payable, but which have not
yet been paid to you. Thereupon the Company shall have no further
obligations to you under this Agreement.
(iii) If, within twenty-four (24) months after a change in
control of the Company shall have occurred, as defined in Section 3 above,
your employment by the Company shall be terminated (a) by the Company other
than for Cause, Disability or Retirement or (b) by you for Good Reason
based on an event occurring concurrent with or subsequent to a change of
control, then, by no later than the fifth day following the Date of
Termination (except as otherwise provided), you shall be entitled, without
regard to any contrary provisions of any Plan, to a severance benefit (the
"Severance Benefit") consisting of the Specified Benefits (as defined below
in this Section 5(iii)) unless you would receive a greater after-tax
benefit from the Capped Benefit (as defined in the next sentence), in which
case the Severance Benefit shall be the Capped Benefit. The Capped Benefit
is the Specified Benefits, reduced by the amount necessary to prevent any
portion of the Specified Benefits from being "parachute payments" as
defined in section 280G(b)(2) of the Internal Revenue Code of 1986, as
amended ("IRC"), or any successor provision. For purposes of determining
whether you would receive a greater after-tax benefit from the Capped
Benefit than from the Specified Benefits, there shall be taken into account
all payments and benefits you will receive upon a change in control of the
Company, including accelerated vesting of options, stock bonuses and other
awards under the Company's stock option and stock incentive plans
(collectively, excluding the Severance Benefit, the "Change of Control
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Payments"). To determine whether your after-tax benefit from the Capped
Benefit would be greater than your after-tax benefit from the Specified
Benefits, there shall be subtracted from the sum of the before-tax
Severance Benefit and the Change of Control Payments (including the
monetary value of any non-cash benefits) any excise tax that would be
imposed under IRC Section 4999 and all federal, state and local taxes required
to be paid by you in respect of the receipt of such payments, assuming that
such payments would be taxed at the highest marginal rate applicable to
individuals in the year in which the Severance Benefit is to be paid or
such lower rate as you advise the Company in writing is applicable to you.
The Specified Benefits are as follows:
(A) the Company shall pay your full base salary through the Date
of Termination at the rate in effect just prior to the time a Notice
of Termination is given plus any benefits or awards (including both
cash and stock components) which pursuant to the terms of any Plans
have been earned or become payable, but which have not yet been paid
to you (including amounts which previously had been deferred at your
request);
(B) as severance pay and in lieu of any further salary for
periods subsequent to the Date of Termination, the Company shall pay
to you in a single payment an amount in cash equal to three times your
annual base salary at the rate in effect just prior to the time a
Notice of Termination is given;
(C) the Company shall maintain in full force and effect, for the
continued benefit of you and your dependents for a period terminating
on the earliest of (a) two years after the Date of Termination or
(b) the commencement date of equivalent benefits from a new employer
all life, accidental death, medical and dental insurance plans or
programs in which you were entitled to participate immediately prior
to the Date of Termination, provided that your continued participation
is possible under the general terms and provisions of such Plans and
you continue to pay an amount equal to your regular contribution for
such participation, if any. If, at the end of two years after the
Termination Date you have not previously received or are not then
receiving equivalent benefits from a new employer, the Company shall
arrange, at its sole cost and expense, to enable you to convert you
and your dependents' coverage under such Plans to individual policies
or programs upon the same terms as employees of the Company may apply
for such conversions. In the event that your participation in any
such Plan is barred, the Company, at its sole cost and expense, shall
arrange to have issued for the benefit of you and your dependents
individual policies of insurance providing benefits substantially
similar (on an after-tax basis) to those which you otherwise would
have been entitled to receive under such Plans pursuant to this
paragraph (C) or, if such insurance is not avail-
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able at a reasonable cost to the Company, the Company shall
otherwise provide you and your dependents equivalent
benefits (on an after-tax basis). You shall not be required
to pay any premiums or other charges in an amount greater
than that which you would have paid in order to participate in such
Plans.
(D) the Company shall pay you for any vacation time earned but
not taken at the Date of Termination, at an hourly rate equal to your
annual base salary as in effect immediately prior to the time a Notice
of Termination is given divided by 2080;
(E) you shall be entitled to purchase from the Company at the
Company's cost less accumulated depreciation any Company-owned
automobile which had been designated for your use prior to the time a
Notice of Termination is given;
(F) the Company shall reimburse you for costs you incur at any
time during the first twelve (12) months following the Date of
Termination in a single move anywhere in the continental United
States; moving to include packing, shipping, insurance (valuation not
to exceed $150,000) and temporary storage (not to exceed six months)
for up to 20,000 pounds of household goods;
(G) the Company shall purchase your residence (which shall mean
a dwelling owned by you in which you resided at the time a Notice of
Termination is given) or shall assist you in the sale of your
residence as follows:
(i) The Company will purchase your residence
subject to the terms hereof. Within ninety (90) days
following the Date of Termination you may request
determination of a purchase price of your residence by
written notice to the Company. You and the Company
shall each select a qualified and recognized appraiser
with appropriate professional designation within ten
(10) days of receipt of the notice by the Company. If
the higher of the two appraisals rendered by the
designated appraisers does not exceed 105 percent of
the lower of the two appraisals, the purchase price of
the residence shall equal the average of the two
appraisals. If the higher appraisal exceeds 105
percent of the lower appraisal, a third appraiser shall
be selected jointly by you and the Company, and the
purchase price of the residence shall equal the average
of the two closest
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appraisals. The Company shall give you written notice
of the purchase price upon its determination,
and shall immediately purchase your residence
at the determined purchase price if you
submit a written request for purchase to the Company
within the sixty (60) day period following the date of
receipt of notice of the purchase price. If you do not
submit a written request for purchase within the 60-day
period, the Company's obligation to purchase your
residence will expire.
(ii) Upon receiving notice of the purchase price
determined under (i) above, you may attempt to sell
your residence yourself.
(iii) If you sell your residence to the
Company or sell it yourself within the 60-day period
following the date on which notice is received, the
Company will reimburse you for costs you incurred
incident to the sale, including: reimbursement of
actual brokerage fees up to a maximum of seven percent
of the selling price; mortgage prepayment penalty fees,
if any; state and county transfer taxes normally paid
by the seller; owners' title insurance charges normally
paid by the seller; and revenue stamp and appraisal
fees, if any. Evidence of these expenses must be
submitted to the Company for approval and supported by
copies of all closing papers. The income tax
consequences of such reimbursements will be your
responsibility. The Company shall have no obligation
to reimburse you for costs incident to sale of your
residence if you have entered into an exclusive listing
commitment with respect to sale of the residence and
the commitment extends beyond the 60-day period
following the date you receive notice of the purchase
price unless approval of the Company for such longer
commitment period has been obtained.
(iv) If you decide to rent or lease your residence
the Company shall not be obligated to purchase it nor
to reimburse you for costs incident to any subsequent
sale.
(iv) Except as specifically provided above, the amount of any
payment provided for in this Section 5 shall not reduced, offset or subject
to recovery by the Company by reason of any compensation earned by you as
the result of employment by another employer after the Date of Termination,
or
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otherwise. Your entitlements under subparagraph (5)(iii) are in
addition to, and not in lieu of, any rights, benefits or entitlements you
may have under the terms or provisions of any Plan.
6. Successors; Binding Agreement.
(i) Upon your written request, the Company will seek to have any
Successor (as hereinafter defined), by agreement in form and substance
satisfactory to you, assent to the fulfillment by the Company of its
obligations under this Agreement. Failure of the Company to obtain such
assent prior to or at the time a Person becomes a Successor shall
constitute Good Reason for termination by you of your employment and, if
a change in control of the Company has occurred, shall entitle you immedi-
ately to the benefits provided in paragraph (iii) of Section 5 hereof upon
delivery by you of a Notice of Termination which the Company, by executing
this Agreement, hereby assents to. For purposes of this Agreement,
"Successor" shall mean any Person that succeeds to, or has the practical
ability to control (either immediately or with the passage of time), the
Company's business directly, by merger or consolidation, or indirectly, by
purchase of the Company's Voting Securities or otherwise.
(ii) This Agreement shall inure to the benefit of and be
enforceable by your personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees.
If you should die while any amount would still be payable to you hereunder
if you had continued to live, all such amounts, unless otherwise provided
herein, shall be paid in accordance with the terms of this Agreement to
your devisee, legatee or other designee or, if there be no such designee,
to your estate.
7. Employee's Commitment. You agree that subsequent to your period
of employment with the Company, you will not at any time communicate or
disclose to any unauthorized person, without the written consent of the
Company, any proprietary processes of the Company or any subsidiary or
other confidential information concerning their business, affairs,
products, suppliers or customers which, if disclosed, would have a material
adverse effect upon the business or operations of the Company and its
subsidiaries, taken as a whole; it being understood, however, that the
obligations of this Section 7 shall not apply to the extent that the
aforesaid matters (a) are disclosed in circumstances where you are legally
required to do so or (b) become generally known to and available for use
by the public otherwise than by your wrongful act or omission.
8. Fees and Expenses. The Company shall pay all legal fees and
related expenses incurred by you as a result of (i) your termination
following a change in control of the Company (including all such fees and
expenses, if any, incurred in
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contesting or disputing any such termination) or (ii) your
seeking to obtain or enforce any right or benefit provided by
this Agreement.
9. Survival. The respective obligations of, and benefits afforded
to, the Company and you as provided in Sections 5, 6(ii), 7, 8 and 13 of
this Agreement shall survive termination of this Agreement.
10. Notice. For the purposes of this Agreement, notices and all
other communications provided for in the Agreement shall be in writing and
shall be deemed to have been duly given when delivered or mailed by United
States registered mail, return receipt requested, postage prepaid and
addressed, in the case of the Company, to the address set forth on the
first page of this Agreement or, in the case of the undersigned employee,
to the address set forth below his signature, provided that all notices to
the Company shall be directed to the attention of the Chairman of the Board
or President of the Company, with a copy to the Secretary of the Company,
or to such other address as either party may have furnished to the other
in writing in accordance herewith, except that notice of change of address
shall be effective only upon receipt.
11. Miscellaneous. No provision of this Agreement may be modified,
waived or discharged unless such modification, waiver or discharge is
agreed to in a writing signed by you and the Chairman of the Board or
President of the Company. No waiver by either party hereto at any time of
any breach by the other party hereto of, or of compliance with, any
condition or provision of this Agreement to be performed by such other
party shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time. No agreements
or representations, oral or otherwise, express or implied, with respect to
the subject matter hereof have been made by either party which are not
expressly set forth in this Agreement. The validity, interpretation,
construction and performance of this Agreement shall be governed by the
laws of the State of Oregon.
12. Validity. The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement, which shall remain in full force and effect.
13. Arbitration. Any dispute or controversy arising under or in
connection with this Agreement shall be settled exclusively by arbitration
in Portland, Oregon by three arbitrators in accordance with the rules of
the American Arbitration Association then in effect. Judgment may be
entered on the arbitrators' award in any court having jurisdiction;
provided, however, that you shall be entitled to seek specific performance
of your right to be paid until the Date of Termination during the pendency
of any dispute or controversy arising under or
11
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in connection with this Agreement. The Company shall bear all costs
and expenses arising in connection with any arbitration proceeding
pursuant to this Section 13.
14. Related Agreements. To the extent that any provision of any
other agreement between the Company or any of its subsidiaries and you
shall limit, qualify or be inconsistent with any provision of this
Agreement, then for purposes of this Agreement, while the same shall remain
in force, the provision of this Agreement shall control and such provision
of such other agreement shall be deemed to have been superseded, and to be
of no force or effect, as if such other agreement had been formally amended
to the extent necessary to accomplish such purpose.
15. Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original, but all of
which together will constitute one and the same instrument.
If this letter correctly sets forth our agreement on the subject
matter hereof, kindly sign and return to the Company the enclosed copy of
this letter which will then constitute our agreement on this subject.
Agreed to this 10th day Sincerely,
of September, 1993 Tektronix, Inc.
/s/ Carl W. Neun By: /s/ J.J. Meyer
- - -------------------- -------------------------
Carl W. Neun Jerome J. Meyer
Chairman and Chief Executive Officer
12
<PAGE>
EXHIBIT F TO EXHIBIT-10(xiv)
EXECUTIVE SEVERANCE AGREEMENT
September 22, 1993
Carl W. Neun
350 Lakeview Boulevard
Lake Oswego, OR 97034 EXECUTIVE
TEKTRONIX, INC.,
an Oregon corporation
P.O. Box 1000
Wilsonville, Oregon TEKTRONIX
Tektronix considers the establishment and maintenance of a sound and vital
management to be essential to protecting and enhancing the best interests of
Tektronix and its shareholders. In order to induce Executive to remain
employed by Tektronix in the face of uncertainties about the long-term
strategies of Tektronix and their potential impact on the scope and nature of
Executive's position with Tektronix, this Agreement, which has been approved
by the Organization and Compensation Committee of the Board of Directors of
Tektronix, sets forth the severance benefits that Tektronix will provide to
Executive in the event Executive's employment by Tektronix is terminated under
the circumstances described in this Agreement.
1. EMPLOYMENT RELATIONSHIP. Executive is currently employed by Tektronix as
Vice President and Chief Financial Officer. Executive and Tektronix
acknowledge that either party may terminate this employment relationship
at any time and for any reason, subject to the obligation of Tektronix to
provide the benefits specified in this Agreement in accordance with the
terms hereof.
2. RELEASE OF CLAIMS. In consideration for the severance benefits outlined
in this Agreement, Executive agrees to execute a Release of Claims in the
form attached as Exhibit A ("Release of Claims"). Executive promises to
execute and deliver the Release of Claims to Tektronix within the later of
forty-five (45) days from the date Executive receives the Release of
Claims or on the last day of Executive's active employment.
3. COMPENSATION UPON TERMINATION. In the event that Executive's employment
is terminated at any time by Tektronix other than for Cause (as defined in
Section 6.1 of this Agreement), death, or Disability (as defined in
Section 6.2 of this Agreement), subject to Executive's execution of a
Release of Claims, Executive shall be entitled to the following benefits:
1
<PAGE>
3.1 As severance pay and in lieu of any further pay for periods
subsequent to the date of termination, Tektronix shall pay
Executive, in a single payment within the later of forty-five (45)
days after termination of employment or eight days after execution
of the Release of Claims, an amount in cash equal to Executive's
annual base pay at the rate in effect immediately prior to the date
of termination, or, if greater, an amount in cash equal to
Executive's average annual base pay for the three years ending with
Executive's last pay change preceding termination.
3.2 Executive is entitled to extend coverage under any group health plan
in which Executive and Executive's dependents are enrolled at the
time of termination of employment under the COBRA continuation laws
for the 18-month statutory period, or so long as Executive remains
eligible under COBRA.
Tektronix will pay Executive a lump sum payment in an amount
equivalent to the reasonably estimated cost Executive may incur to
extend for a period of eighteen (18) months under the COBRA
continuation laws Executive's group health and dental plan coverage
in effect at the time of termination. Executive may use this
payment, as well as any payment made under 3.1, for such COBRA
continuation coverage or for any other purpose.
3.3 Except as provided in Section 5.2, Executive shall be entitled to a
portion of the benefits under any incentive plans in effect at the
time of termination (including the Results Sharing Plan and the
Annual Performance Improvement Plan), prorated for the portion of
the plan year during which Executive was a participant. For purposes
of this Agreement, Executive's participation in the Annual
Performance Improvement Plan will be considered to have ended on
Executive's last day of active employment. Prorated awards shall
not be due and payable by Tektronix to Executive until the date that
all awards are paid after the close of the incentive period. Unless
the applicable plan provides for a greater payment for a participant
whose employment terminates prior to the end of an incentive period
(in which case the applicable plan payment shall be made), the
proration shall be calculated pursuant to this Section 3.3. The
payment, if any, that would have been made under Executive's award
had Executive been made a participant for the full incentive period
shall be calculated at the end of the incentive period. Such amount
shall be divided by the total number of days in the incentive period
and the result multiplied by the actual number of days Executive
participated in the plan.
2
<PAGE>
3.4 Tektronix will pay up to $12,500 to a third party outplacement firm
selected by Executive to provide career counseling assistance to
Executive for a period of one (1) year following Executive's
termination date.
3.5 Tektronix will permit Executive to continue to participate in its
Executive Financial Counseling Program through the remainder of the
term of Executive's current participation (which shall in no case be
longer than one (1) year after the effective date of Executive's
termination).
4. SUBSEQUENT EMPLOYMENT. The amount of any payment provided for in this
Agreement shall not be reduced, offset or subject to recovery by Tektronix
by reason of any compensation earned by Executive as the result of
employment by another employer after termination.
5. OTHER AGREEMENTS.
5.1 In the event that severance benefits are payable to Executive under
any other agreement with Tektronix in effect at the time of
termination (including but not limited to any change of control,
"golden parachute" or employment agreement, but excluding for this
purpose any stock option agreement or stock bonus agreement or stock
appreciation right agreement that may provide for accelerated vesting
or related benefits upon the occurrence of a change in control), the
benefits provided in this Agreement shall not be payable to
Executive. Executive may, however, elect to receive all of the
benefits provided for in this Agreement in lieu of all of the
benefits provided in all such other agreements. Any such election
shall be made with respect to the agreements as a whole, and
Executive cannot select some benefits from one agreement and other
benefits from this Agreement.
5.2 The vesting or accrual of stock options, restricted stock, stock
bonuses, or any other stock awards shall not continue following
termination. Any agreements between Executive and Tektronix that
relate to stock awards (including but not limited to stock options,
long term incentive program, stock bonuses and restricted stock)
shall be governed by such agreements and shall not be affected by
this Agreement.
6. DEFINITIONS.
6.1 CAUSE. Termination by Tektronix of Executive's employment for "
Cause" shall mean termination upon (a) the willful and continued
failure by Executive to perform substantially Executive's reasonably
assigned duties with Tektronix (other than any such failure resulting
from Executive's incapacity due to physical or mental illness) after
a demand for
3
<PAGE>
substantial performance is delivered to Executive by the Chairman of
the Board of Directors or the President of Tektronix which
specifically identifies the manner in which such executive believes
that Executive has not substantially performed Executive's duties,
or (b) the willful engaging by Executive in illegal conduct which is
materially and demonstrably injurious to Tektronix. For purposes of
this Section 6.1, no act, or failure to act, on Executive's part
shall be considered "willful" unless done, or omitted to be done, by
Executive in knowing bad faith and without reasonable belief that
Executive's action or omission was in, or not opposed to, the best
interests of Tektronix. Any act, or failure to act, based upon
authority given pursuant to a resolution duly adopted by the Board of
Directors or based upon the advice of counsel for Tektronix shall be
conclusively presumed to be done, or omitted to be done, by Executive
in good faith and in the best interests of Tektronix.
6.2 DISABILITY. Termination by Tektronix of Executive's employment based
on "Disability" shall mean termination because of Executive's absence
from Executive's duties with Tektronix on a full-time basis for one
hundred eighty (180) consecutive days as a result of Executive's
incapacity due to physical or mental illness, unless within thirty
(30) days after notice of termination by Tektronix following such
absence Executive shall have returned to the full-time performance of
Executive's duties.
7. SUCCESSORS; BINDING AGREEMENT.
7.1 This Agreement shall be binding on and inure to the benefit of
Tektronix and its successors and assigns.
7.2 This Agreement shall inure to the benefit of and be enforceable by
Executive and Executive's legal representatives, executors,
administrators and heirs.
8. RESIGNATION OF CORPORATE OFFICES. Executive will resign Executive's
office, if any, as a director, officer or trustee of Tektronix, its
subsidiaries or affiliates, effective as of the date of termination of
employment. Executive agrees to provide Tektronix such written
resignation(s) upon request.
9. GOVERNING LAW, ARBITRATION. This Agreement shall be construed in
accordance with and governed by the laws of the State of Oregon. Any
dispute or controversy arising under or in connection with this Agreement
or the breach thereof, shall be settled exclusively by arbitration in
Portland, Oregon in accordance with the Commercial Arbitration Rules of
the American Arbitration
4
<PAGE>
Association, and judgment upon the award rendered by the Arbitrator may be
entered in any Court having jurisdiction thereof.
10. FEES AND EXPENSES. In the event that Executive initiates arbitration
under the circumstances described in this Agreement to obtain or enforce
any right or benefit provided by this Agreement and the arbitrator
determines that Executive is the prevailing party, Executive shall be
permitted to recover Executive's reasonable attorneys' fees and costs
incurred in connection with such proceeding. In the event that the
arbitrator determines that Tektronix is the prevailing party, each party
shall bear its own attorneys' fees and costs incurred in connection with
such proceeding.
11. AMENDMENT. No provision of this Agreement may be modified unless such
modification is agreed to in a writing signed by Executive and Tektronix.
TEKTRONIX, INC.
By: /s/ J. J. Meyer /s/ Carl W. Neun
______________________ _________________
Carl W. Neun
Title: Chairman & CEO
5
<PAGE>
Exhibit A
RELEASE OF CLAIMS
This Release of Claims (the "Release") is made and executed by _______________-
________________ in connection with the termination of my employment with
Tektronix, Inc. ("Tektronix") and in consideration of my receiving valuable
severance pay and benefits as provided for in the Executive Severance Agreement
("Agreement"). These benefits are substantial consideration to which I am not
otherwise entitled.
On behalf of myself and my spouse, heirs, administrators and assigns, I hereby
release Tektronix, its parent and related corporations, affiliates, or joint
venturers and all officers, directors, employees, agents, and insurers of the
aforementioned (collectively the "Company") from any and all liability, damages
or causes of action, whether known or unknown relating to my employment with
the Company or the termination of that employment, including but not limited to
any claims for additional compensation in any form, or damages. This
specifically includes, but is not limited to, all claims for relief or remedy
under any state or federal laws, including but not limited to Title VII of the
Civil Rights Act of 1964, the Post-Civil War Civil Rights Acts (42 USC Sections
1981-1988), the Civil Rights Act of 1991, the Equal Pay Act, the Age
Discrimination in Employment Act of 1967, the Americans with Disabilities Act,
the Older Workers Benefit Protection Act, the Worker Adjustment and Retraining
Notification Act, the Rehabilitation Act of 1973, the Vietnam Era Veterans'
Readjustment Assistance Act, the Fair Labor Standards Act, Executive Order
11246, all as amended, and the civil rights, employment and labor laws of the
state of any state or the United States.
This Release shall not affect any rights which I may have under any medical
insurance, disability, workers' compensation, unemployment compensation or
retirement plans maintained by the Company.
I acknowledge that I have been given at least 45 days to consider whether to
execute this Release of Claims and accept benefits under the Program; that I
have been advised of my right to consult with an attorney or financial advisor
of my choice and at my own expense; that the Agreement gives me severance pay
and benefits which the Company would otherwise have no obligation to give me;
and that I voluntarily enter into the Release of Claims.
I understand that the Release of Claims is to be signed within 45 days from the
date I received it or on my last day of employment, whichever is later, and
that I may revoke the Release of Claims, provided I do so in writing within
seven (7) days of signing the Release. I understand and agree that the Company
will have no obligation to pay me any benefits under the Agreement until the
expiration of the revocation
6
<PAGE>
period, provided I have not revoked the Release of Claims. I understand that
if I revoke the Release of Claims my termination will nonetheless remain in
full force and effect and I will not be entitled to any benefits under the
Agreement.
I acknowledge that I have had time to consider the alternatives and
consequences of my election to receive benefits under the Agreement and of
signing the Release; that I am aware of my right to consult an attorney or
financial advisor at my own expense; and that, in consideration for executing
this Release and my election to receive benefits under the Agreement, I have
received additional benefits and compensation of value to which I would not
otherwise be entitled.
I HAVE READ THE FOREGOING RELEASE. I UNDERSTAND THE EFFECT OF THIS RELEASE AND
I VOLUNTARILY ENTER INTO IT AT THIS TIME.
Every provision of this Release is intended to be severable. In the event any
term or provision contained in this Release is determined to be illegal,
invalid or unenforceable, such illegality, invalidity or unenforceability shall
not affect the other terms and provisions of this Release which shall continue
in full force and effect.
Dated: __________________, 1993
____________________________
Employee Name
____________________________
Employee Signature
7
<PAGE>
EXHIBIT G TO EXHIBIT 10(xiv)
SERP Agreement for Mr. Neun
Mr. Neun's employment offer letter provides him with a Supplemental Executive
Retirement Plan (SERP) that when combined with his benefits from the Tektronix
Pension Plan provides retirement income equal to 55% of Final Average Pay at
age 62. The SERP defines Final Average Pay (FAP) as the annual average of the
five consecutive years preceding retirement or termination. Annual
compensation is defined as Base Pay, Results Sharing and Annual Incentive
Compensation (to include any amounts deferred). The following table
represents the percentage of the SERP plus Pension Plan benefit:
SERP Plus Pension
Age Years of Service Plan Percent
___ ________________ ___________________
50 1 Unvested
51 2 Unvested
52 3 Unvested
53 4 Unvested
54 5 Unvested
55 6 35.00%
56 7 37.86%
57 8 40.71%
58 9 43.57%
59 10 46.43%
60 11 49.29%
61 12 52.14%
62 and after 13 55.00%
The SERP Percent is the combined SERP and Pension Plan benefit that Mr. Neun
will have vested at the beginning of the Service Year.
In the event that Mr. Neun is vested and retires or terminates from Tektronix,
including at any time prior to age 62, he may begin receiving at any time,
upon reasonable notice to Tektronix, the retirement benefits from the SERP and
the Tektronix Pension Plan in the aggregate benefit amount shown above as
vested on the effective date of his retirement or termination from Tektronix.
<PAGE>
EXHIBIT H TO EXHIBIT 10(xiv)
______________________________
TEKTRONIX EMPLOYMENT AGREEMENT
______________________________
I understand and agree to the following during my employment with Tektronix,
Inc. (together with its subsidiaries referred to herein as "Tektronix") and
after its termination:
(1) I will not make any unauthorized use or disclosure of any
confidential information about Tektronix, its products, customers or
suppliers.
(2) I will promptly disclose to Tektronix any inventions, software or
mask works which I, whether by myself or with others, may develop
during my employment and for six months after termination from
Tektronix that relate to Tektronix activities or that result from
work performed for Tektronix or from the use of Tektronix equipment,
supplies, facilities or confidential information.
(3) I agree to assign, and hereby do assign, to Tektronix any inventions,
software or mask works covered by paragraph 2 above, and I will give
all assistance requested by Tektronix at any time to obtain or
protect its interests in patents, software, mask works or inventions
upon which I have worked in connection with my employment.
(4) I will not directly or indirectly ship, transmit, or release in any
manner outside the United States or to a non-U.S. national at any
time during or after my employment by Tektronix any confidential
information, including technical data acquired or developed during my
employment or the direct product of such technical data without both
the prior authorization of Tektronix and any required U.S. government
license, authorization or approval.
(5) I understand that my employment is for an indefinite period of time
and may be terminated at any time and for any reason (with or without
cause) by either me or Tektronix.
This agreement replaces any prior "Employment Agreement" I have signed with
Tektronix. It is to be interpreted in accordance with any limitations on
assignment of inventions by applicable laws in the states in which it is to be
enforced. This agreement may not otherwise be modified except by written
agreement signed by an officer of Tektronix, Inc.
___________________________________
Signed: /s/ Carl W. Neun
Print or Type Name: Carl W. Neun
Social Security Number: ###-##-####
Date: 3/30/93
___________________________________
000-9208-00 Revised 1/15/91
<PAGE>
EXHIBIT 10(xvi)
TEKTRONIX
NON-EMPLOYEE DIRECTORS' DEFERRED COMPENSATION PLAN
March 17, 1994
TEKTRONIX, INC.
AN OREGON CORPORATION
PO BOX 1000
WILSONVILLE, OREGON 97070 TEKTRONIX
<PAGE>
TABLE OF CONTENTS
PAGE
1. Plan Administration 1
2. Deferral Election 1
3. Deferred Compensation Account 2
4. Time and Manner of Payment 3
5. Death 4
6. Termination; Amendment 4
7. Claims Procedure 5
8. General Provisions 5
9. Effective Date 6
i
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TEKTRONIX
NON-EMPLOYEE DIRECTORS' DEFERRED COMPENSATION PLAN
March 17, 1994
Tektronix, Inc.
an Oregon corporation
PO Box 1000
Wilsonville, Oregon 97070 Tektronix
Members of the Tektronix Board of Directors who are not employees
of Tektronix or an affiliate (Non-Employee Directors) are paid annual
retainers and meeting fees, in cash, for service as directors of the
company (Directors' Fees).
In order to provide greater incentives for qualified persons to
serve as Non-Employee Directors, Tektronix adopts this plan to allow the
Non-Employee Director to elect from time to time to defer receipt of
Directors' Fees.
1. PLAN ADMINISTRATION
The Chief Executive Officer of Tektronix or delegate shall
appoint one or more employees of Tektronix as Administrator of the plan.
The Administrator shall interpret and administer the plan and for that
purpose may make, amend or revoke rules and regulations at any time.
2. DEFERRAL ELECTION
2.1 A Non-Employee Director may elect as provided below to
defer all or a specified part of the Directors' Fees payable to the
Director. An election shall be in writing on a form provided by the
Administrator and shall specify the time and manner of payment of the
deferred amounts in accordance with other provisions of this plan.
2.2 An election under 2.1 shall be effective as follows:
(a) Except as provided in (b) and 2.3, an election
received by the Administrator on or before December 20 of any year shall
be effective for fees payable for succeeding calendar years.
<PAGE>
(b) An initial election shall be effective for all fees
payable after it is received if that occurs within 30 days after notice
to a Director of whichever of the following is applicable:
(1) Adoption of this plan.
(2) Commencement of the Director's eligibility to
participate in this plan.
2.3 An election shall continue in effect through the year in
which the Director terminates it in writing or changes the amount
deferred by submitting a new election. Such a notice or new election
received on or before December 20 of any year shall be effective for
succeeding calendar years and shall not affect fees deferred under the
prior election.
2.4 Tektronix may withhold from any deferral or from
nondeferred fees payable at the same time any amounts required by
applicable law and regulations.
3. DEFERRED COMPENSATION ACCOUNT
3.1 Tektronix shall credit to a Director's deferred
compensation account (the Account) each amount deferred by the Director
under this plan. The Account shall be credited as of the day a deferred
fee would otherwise have been paid to the Director.
3.2 Until full payment of a Director's Account has been made
to the Director or beneficiaries under this plan, Tektronix shall credit
interest to the Account as follows:
(a) The interest rate for each calendar quarter shall
be the yield to maturity of the most recent 10 year U.S. Treasury Notes
as of the close of the quarter.
(b) Interest on undistributed balances shall accrue
from the date deferrals are credited under 3.1 until the last
installment is paid.
(c) Interest shall be added to principal during the
deferral period as of the last day of each calendar quarter. Installment
payments shall be calculated by dividing the adjusted principal by the
number of installments to be paid.
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Interest during the payment period shall be added to the second and
subsequent installments of principal.
3.3 Each Director's account shall be maintained on the books
of Tektronix until full payment has been made to the Director or
beneficiaries under this plan. No funds shall be set aside or earmarked
for the Account, which shall be purely a bookkeeping device.
4. TIME AND MANNER OF PAYMENT
4.1 Subject to 4.5 and 5.1 the Account shall be paid or
payment commenced in the next January after one of the following Payment
Dates as selected under 4.3:
(a) The date the Director's service on the Tektronix
Board ends.
(b) The date the Director reaches age 65 or a later age
specified by the Director in the selection under 4.3.
(c) The date that the criteria in both (a) and (b) have
been met.
4.2 Subject to 4.5 and 5.1 the Account shall be paid in one of
the following ways as selected under 4.3:
(a) In a single lump sum.
(b) In not more than five substantially equal annual
installments of principal plus interest.
4.3 The time and manner of payment under 4.1 and 4.2 shall be
selected by the Director as follows:
(a) The selection shall be made in the deferral
election.
(b) The selection shall be irrevocable for the portion
of the Account attributable to amounts deferred under the election in
which the selection is made.
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(c) If the time or method of payment is different under
different elections, the Account shall be appropriately divided for
distribution.
4.4 Tektronix may withhold from any payments any income tax
or other amounts as required by law.
4.5 If a Director has elected to defer payment of an amount,
the Administrator may in its discretion make or commence payments
earlier than the deferred date if, on application by the Director, the
Administrator finds that financial hardship exists because of illness,
accident, disability or other unexpected event creating a financial
need.
5. DEATH
5.1 A Director's account shall be payable under 5.2 on the
Director's death regardless of the provisions of 4 above.
5.2 On death of a Director the Account shall be paid in a
single lump sum within 30 days after death in the following order of
priority:
(a) To the surviving beneficiaries designated by the
Director in writing to the Administrator.
(b) To the Director's surviving spouse.
(c) To the Director's estate.
6. TERMINATION; AMENDMENT
6.1 Tektronix may terminate this plan effective the first day
of any year after notice to the Non-Employee Directors. On termination,
amounts in an Account shall remain to the credit of the Account, shall
continue to be credited with interest and shall be paid out in
accordance with 3 and 4 above.
6.2 Tektronix may amend this plan effective the first day of
any calendar year after notice to the Non-Employee Directors.
6.3 If the Internal Revenue Service rules that any amounts
deferred under this plan will be subject to current income tax, all
amounts to which the ruling is applicable shall be paid within 30 days
to the Directors with Accounts.
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7. CLAIMS PROCEDURE
7.1 Any person claiming a benefit, requesting an
interpretation or ruling under the plan, or requesting information under
the plan shall present the request in writing to the Administrator, who
shall respond in writing as soon as practicable.
7.2 If the claim or request is denied, the written notice of
denial shall state the following:
(a) The reasons for denial, with specific reference to
the plan provisions on which the denial is based.
(b) A description of any additional material or
information required and an explanation of why it is necessary.
(c) An explanation of the plan's review procedure.
7.3 The initial notice of denial shall normally be given
within 90 days after receipt of the claim. If special circumstances
require an extension of time, the claimant shall be so notified and the
time limited shall be 180 days.
7.4 Any person whose claim or request is denied or who has
not received a response within 30 days may request review by notice in
writing to the Administrator. The original decision shall be reviewed by
the Administrator which may, but shall not be required to, grant the
claimant a hearing. On review, whether or not there is a hearing, the
claimant may have representation, examine pertinent documents and submit
issues and comments in writing.
7.5 The decision on review shall ordinarily be made within 60
days. If an extension of time is required for a hearing or other special
circumstances, the claimant shall be so notified and the time limit
shall be 120 days. The decision shall be in writing and shall state the
reasons and the relevant plan provisions. All decisions on review shall
be final and bind all parties concerned.
8. GENERAL PROVISIONS
8.1 All amounts of deferred compensation under this plan
shall remain at all times the unrestricted assets of Tektronix and the
promise to pay the deferred amounts shall at all times remain unfunded
as to the Directors. The rights of Directors and beneficiaries under the
plan shall only be as general creditors of Tektronix.
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8.2 Any notice under this plan shall be in writing or by
electronic means and shall be received when actually delivered or, if
mailed, when deposited postpaid as first class mail. Mail should be
directed to Tektronix at the address stated in this plan, to a Director
at the address stated in the Director's election or to such other
address as either party may specify by notice to the other party.
8.3 The interests of a Director or beneficiary under this
plan are personal and no such interest may be assigned, seized by legal
process or in any way subjected to the claims of any creditor.
9. EFFECTIVE DATE
This plan shall be effective March 17, 1994.
Adopted March 17, 1994
TEKTRONIX, INC.
By /S/ JEROME J. MEYER
Jerome J. Meyer,
Chairman of the Board
6
<PAGE>
EXHIBIT-13
MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATION
OVERVIEW
Tektronix recorded net earnings of $60.7 million, or $2.00 per share,
in its fiscal year ended May 28, 1994, a per share increase of 53.8% over
fiscal 1993 earnings of $39.0 million, or $1.30 per share, before
restructuring charges.
[Bar chart depicting net earnings (adjusted)]
NET EARNINGS (adjusted)
in $millions
1992 30.2
1993 35.7
1994 49.0
The Company incurred pre-tax restructuring charges of $150.0
million in 1993 that resulted in a net loss of $55.1 million, or
$1.83 per share. Operating income for 1994 was $86.7 million, a 21.4%
increase over 1993 results before the restructuring charges. The improvement
[Bar chart depicting net earnings (reported)]
NET EARNINGS (reported)
in $millions
1992 21.0
1993 (55.1)
1994 60.7
in operating income was due primarily to reduced administrative costs and
higher sales, which were partially offset by lower gross margins. The
improved net earnings in 1994 were also due to after tax non-operating gains
of $9.1 million, or $0.30 per share, from sales of stock held by Tektronix
in certain companies. Net earnings, before restructuring charges, for the
fiscal year ended May 30, 1992 were $30.2 million, or $1.03 per share.
NET SALES AND PRODUCT ORDERS
Net sales in 1994 were $1.318 billion, up 1.2% from $1.302 billion in
1993. Sales to customers in the United States of $737.4 million were 3.3%
above the level for the prior year, and represented 55.9% of total sales.
The improved domestic sales level reflected the impact of new products and
modest improvement in the U.S. economic environment. International sales
were down 1.4% to $580.6 million, reflecting weakness in certain economies
in Europe and Asia, particularly in the first half of the year.
Net sales in 1993 were up slightly from 1992's level. U.S. sales of
$713.7 million in 1993 were 6.5% above the level of the prior year.
International sales declined by 6.1% in 1993 due to the weaknesses in Europe
and Japan.
The Company's net sales have been divided into three product classes:
Test and Measurement, Computer Graphics, and Television Systems. Net sales by
product class for the last three years were:
<TABLE>
<CAPTION>
NET SALES (in thousands) 1994 1993 1992
- - ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Test and Measurement $ 644,625 $ 679,254 $ 724,802
Computer Graphics 410,580 352,094 301,506
Television Systems 262,799 271,030 270,935
</TABLE>
Test and Measurement sales in 1994 accounted for 48.9% of total sales.
Sales were 5.1% below the prior year, reflecting the impacts of the lack of
growth in certain segments of the test and measurement market, recessionary
economies in Europe and Japan, and weakness in some major industrial
markets. Orders and sales were stronger toward the end of the year, with
both showing modest growth in the fourth quarter due to a strong
performance in telecommunications. Sales declined 6.3% in 1993 compared
with 1992 for the same reasons.
Computer Graphics sales increased 16.6% to $410.6 million in 1994 and
made up 31.2% of total sales. Strong sales growth in color printers and
X terminals was partially offset by declines in older graphic terminals sales
and in the terminals service business. Sales in 1993 increased 16.8% from
1992 levels for the same reasons.
Television Systems, which includes television test equipment and
television production equipment, had sales of $262.8 million in 1994 and
accounted for 19.9% of total sales, declining 3.0% from the prior year.
Sales of television test equipment improved slightly, reflecting strong new
prod-
[Pie chart depicting 1994 sales by product class]
1994 SALES by product class
in %
T & M 48.9%
Computer Graphics 31.2%
TV Systems 19.9%
-----
100.0%
uct introductions in the last half of the year, but were offset by
declining sales of television production equipment. Television Systems sales
in 1993 were at the same level as 1992.
Product orders for 1994 were $1.090 billion, or
10
<PAGE>
5.8% above the level of prior year. The growth in orders was strongest
in the second half of the year. Growth in demand for color printers,
X terminals, cable and transmission test products and electronic tools
was partially offset by weaknesses in general purpose test and
measurement instruments and television production equipment, and the
decline of proprietary terminals. The product order backlog at the
end of 1994 was at the same level as the prior year. Because of the
low product order backlog level, the Company's future quarterly
results are dependent on new orders that can be shipped in the
same quarter. Product orders increased 2.3% from 1992 to 1993.
In fiscal 1995, the Company intends to change the product classes for
which it reports net sales. The Company believes the change more accurately
reflects its current operating management and product alignment and will
provide improved clarity regarding the Company's performance in the markets
it serves. The new product classes and the net sales for the last three
years are:
<TABLE>
<CAPTION>
NET SALES (in thousands) 1994 1993 1992
- - ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Measurement Business $ 664,048 $ 704,396 $ 761,642
Color Printing and Imaging 313,502 248,413 197,079
Video Systems 152,441 162,938 151,534
Network Displays 89,378 87,928 90,386
Other 98,635 98,703 96,602
</TABLE>
Measurement Business, the Company's original and historically largest
division, includes oscilloscopes, logic analyzers, card modular
instruments, intelligent hand-held tools, spectrum analyzers,
telecommunications test instruments, and video and audio test products.
Color Printing and Imaging, the Company's fastest growing division,
produces the Phaser family of color printers and supplies that utilize
thermal wax transfer, phase change and dye sublimation technologies.
Video Systems provides the television and video industries with products
covering a range of applications from production and storage to
systemization and transmission. Video Systems includes the operations of
the Company's Grass Valley subsidiary.
[Pie chart depicting 1994 sales by product class]
1994 NET SALES by product class
in %
Measurement Business 50.3%
Color Printing 23.8%
Video Systems 11.6%
Network Displays 6.8%
Other 7.5%
------
100.0%
Network Displays includes a rapidly growing X terminals business offering
a broad line of both software and hardware products that supports the X
windows environment in networked systems.
The Other product class relates to the non-strategic components operations
which the Company divested in 1994 and early 1995 or intends to divest in
the near future. The majority of this product class was previously
reported in Test and Measurement.
OPERATING COST AND EXPENSES
Manufacturing cost of sales increased as a percentage of net sales to 54.0%
in 1994 from 51.9% in 1993. The increase in cost of sales as a percentage of
net sales was caused by a reduction in the historically higher margin on
international sales, a continuing shift in the mix of sales toward products
with lower margins due to the use of alternative distribution channels, and
by the impact of a stronger Japanese Yen on certain component costs. These
factors (with the possible exception of the Yen exchange rate) are expected
to modestly affect cost of sales in 1995. Cost of sales as a percentage of
net sales increased to 51.9% in 1993 from 50.3% in 1992. The increase
reflected competitive price and discounting pressures, a continuing shift
in the mix of sales toward products with lower margins, and increased sales
through alternative distribution channels.
Research and development (R&D) expenses were $153.1 million in 1994, down
2.5% from the prior year as the Company continued to focus its resources on
its core businesses. R&D expenses represented 11.6% of sales in 1994
compared with 12.1% in 1993 and 13.0% in 1992. The Company expects to spend
essentially the same amount on R&D in 1995 as it did in 1994.
Selling, general and administrative (SG&A) expenses were $364.5 million,
or 7.9% below the level of a year ago. Infrastructure reductions, ongoing
process improvement and increasing use of alternative distribution channels
reduced SG&A expenses for the year. SG&A expenses in 1993, including
accruals for severance pay of $7.5 million,
11
<PAGE>
were 3.0% below 1992's levels. The Company does not expect to show
significant reductions in SG&A expenses in 1995.
There was an equity loss in joint ventures of $1.6 million compared with
a loss of $1.9 million in the prior year. The losses relate primarily to the
Company's joint venture, Sony/Tektronix Corporation, and are due to reduced
capital spending by Japanese customers and a generally weak economic
environment in Japan. The Company recorded earnings from joint ventures of
$2.4 million in 1992.
Non-operating income was $9.2 million in 1994 compared with non-operating
expenses of $10.1 million and $10.9 million in 1993 and 1992, respectively.
Non-operating income in 1994 includes gains of $13.3 million from the sale
of stock held by Tektronix in TriQuint Semiconductor, Inc., Planar Systems,
Inc. and Credence Systems Corporation. The Company continues to hold
investments in these companies that it intends to liquidate over time.
The Company recorded taxes on 1994 results at an annual effective rate of
32%, compared with 34% in the prior year. The Company recognized a benefit of
$2.3 million on the recalculation of deferred tax benefits in the first quarter
because of the enactment of tax legislation increasing the federal corporate
income tax rate. The current year provision was primarily for U.S. taxes, while
the prior years' provisions were primarily for foreign taxes, reflecting
the shift in net earnings from foreign to U.S. sources in the three years
presented. During the first quarter of 1995, the Company received approval
from the Internal Revenue Service to capitalize the costs of a major
research and development project. The Company expects the capitalization of
these costs for tax purposes to reduce its deferred tax asset valuation
allowances and thus reduce the effective rate at which taxes will be
provided in 1995.
Net earnings of $60.7 million in 1994 compares with a net loss in 1993 of
$55.1 million, after restructuring charges and accounting changes.
Excluding the restructuring charges and accounting changes, 1993 earnings
would have been $35.6 million. The improved earnings were due primarily to
lower administrative costs, the gains on sales of investments described
above and higher sales, partially offset by lower gross margins.
RESTRUCTURING CHARGES
During the fourth quarter of 1993, the Company incurred pre-tax
restructuring charges of $150.0 million, or $3.13 per share after taxes,
for the purpose of exiting non-strategic components operations to further
reduce the Company's vertical integration, consolidating facilities,
refocusing on core business products, discontinuing certain older products
and other steps to improve operating efficiency.
The Company substantially completed the reduction of vertical integration
with the sale of the Integrated Circuits Operation and the formation of a
joint venture for the Hybrid Circuits Operation in 1994, and the initial
public offering for Merix Corporation, formerly the Circuit Board Division,
completed in the first quarter of 1995. The Company retains a 35% ownership
in Merix after the offering. A few smaller components operations remain to
be divested, which the Company believes will be substantially completed in
1995. The primary benefits of these actions are the avoidance of future
investments to maintain technological competitiveness and the ability to be
more responsive to changing market conditions. The short-term savings in
labor and depreciation costs are expected to be offset by lost revenue from
component sales to third parties.
The Company also continues its consolidation of facilities and relocation
of employees and equipment in a way that will enhance efficiency and
productivity. The refocusing on core business products involves the
discontinuation of older, low-volume products, which is expected to reduce
overhead and inventory carrying costs without significantly impacting revenue.
Approximately half of the product inventory reserved for phase out was
disposed of in 1994 and it is expected that most of the balance will be
disposed of in 1995.
Significant reserves were provided for workforce reduction. While most of
the planned workforce reduction has been accomplished, there are still
several areas where restructuring will result in severance costs and this
is reflected in the remaining reserves. The Company will benefit from
reduced payroll costs in 1995 and future years, but it is expected that,
over time, the benefit will be reduced by normal wage inflation.
During 1995 the remaining restructuring activities include the divestiture
of the smaller remaining components operations, continued consolidation of
facilities, discontinuation of older products and the remaining workforce
reductions. At May 28, 1994, inventories and facilities subject to
restructuring activities have been reduced by $22.3 million and liabilities
for severance, facilities consolidations and other restructuring costs
12
<PAGE>
were $51.5 million. The Company believes it has adequately provided for all
remaining restructuring activities.
ACCOUNTING CHANGES
In the first quarter of 1993, Tektronix adopted Statements of Financial
Accounting Standards No. 106 (Postretirement Benefits) and No. 109 (Income
Taxes). The combined result of adopting these pronouncements was a one-time
net increase in earnings of $3.3 million or $0.11 per share.
FINANCIAL CONDITION
The Company's financial condition is strong. Cash flows from operating
activities and borrowing capacity from existing lines of credit are
expected to be sufficient to meet current and anticipated future needs. At
May 28, 1994, the Company maintained bank credit facilities totaling $285.9
million, of which $269.9 million was unused. The unused facilities include
$119.9 million in lines of credit and $150.0 million under revolving credit
agreements from U.S. and foreign banks. Additional details, including
maturity dates of agreements and certain financial covenants, are included
under `Short-term and Long-term Debt' in the NOTES TO CONSOLIDATED FINANCIAL
STATEMENTS.
Cash flows from operations, from the sales of stock in certain companies
and from the sale of certain component business assets enabled the Company
to pay down short-term debt, fund restructuring activities, and increase
cash balances. Current assets increased by $24.9 million due primarily to
higher cash and accounts receivable. Cash and cash equivalents increased
from the end of 1993 to the end of 1994 by $12.9 million. Accounts
receivable were up $18.9 million
[Bar chart depicting market capitalization]
MARKET CAPITALIZATION
in $millions
1992 566.3
1993 674.4
1994 870.3
because of higher sales in the fourth quarter of 1994 compared with the same
quarter of 1993.
Net property, plant and equipment declined by $12.5 million as depreciation
and disposals exceeded capital expenditures. Deferred tax assets decreased
$9.1 million to $79.6 million due to the reclassification of $11.4 million
to current, less the $2.3 million addition arising from the increase in the
federal tax rate. In order for the Company to realize all deferred tax
assets recognized, future taxable income must be at least comparable to
recent amounts.
Current liabilities decreased by $57.7 million or 17.3% primarily because
of repayment of short-term debt of $52.4 million. Accounts payable were
higher by $22.5 million. The increase was due to liabilities, including the
reclassification of amounts from long-term to current, related to
restructuring activities and to the timing of certain payments. Accrued
compensation decreased $27.6 million because of reductions in severance and
payroll accruals related to restructuring.
Long-term debt increased by $34.1 million as the Company issued new debt in
the form of $100.0 million 7.5% notes due August, 2003, and retired the
outstanding $70.0 million bridge loan. Other long-term liabilities
decreased by $4.3 million primarily
[bar chart depicting total debt]
TOTAL DEBT
in $millions
1992 140.0
1993 139.6
1994 121.2
because of the reclassification of restructuring liabilities from long-term
current liabilities.
Shareholders' equity increased by $34.5 million or 7.9%. Common stock
declined $10.1 million as the Company repurchased shares for $33.8 million
and issued shares under employee incentive plans for $23.7 million.
Retained earnings increased $42.6 million due to earnings of $60.7 million
less dividend payments of $18.1 million.
13
<PAGE>
MANAGEMENT'S LETTER
The consolidated financial statements of Tektronix, Inc. and subsidiaries
have been prepared by management and have been audited by Tektronix'
independent auditors, Deloitte & Touche. Management is responsible for the
consolidated financial statements, which have been prepared in conformity
with generally accepted accounting principles and include amounts based on
management's judgments.
Management is also responsible for maintaining internal control, including
systems designed to provide reasonable assurance that assets are
safeguarded and that transactions are executed and recorded in accordance
with established policies and procedures.
Tektronix' controls and systems were developed by Tektronix management and
have the full support and endorsement of the Board of Directors. Compliance
is mandatory.
The Board of Directors is responsible for the Company's financial and
accounting policies, practices and reports. Its Audit Committee, composed
entirely of outside directors, meets regularly with the independent
auditors, representatives of management, and the internal auditors to
review accounting, reporting, auditing and internal control matters. Both
the independent auditors and the internal auditors have free access to the
Audit Committee, with and without management representatives in attendance.
PAUL E. BRAGDON
Chairman of Tektronix Audit Committee
CARL W. NEUN
Vice President and Chief Financial Officer
INDEPENDENT AUDITORS' REPORT
To the Directors and Shareholders of Tektronix, Inc.:
We have audited the accompanying consolidated balance sheets of Tektronix,
Inc. and subsidiaries as of May 28, 1994 and May 29, 1993, and the related
consolidated statements of operations, shareholders' equity, and cash flows
for the years ended May 28, 1994, May 29, 1993, and May 30, 1992. These
financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements
based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, such consolidated financial statements present fairly, in
all material respects, the consolidated financial position of Tektronix,
Inc. and subsidiaries at May 28, 1994 and May 29, 1993, and the results of
their operations and their cash flows for the years ended May 28, 1994, May
29, 1993, and May 30, 1992, in conformity with generally accepted
accounting principles.
As discussed in the notes to the consolidated financial statements, the
Company adopted, in the year ended May 29, 1993, Statement of Financial
Accounting Standards No. 106, "Employers' Accounting for Postretirement
Benefits Other Than Pensions," and Statement of Financial Accounting
Standards No. 109, "Accounting for Income Taxes."
DELOITTE & TOUCHE
Portland, Oregon
June 23, 1994
14
<PAGE>
<TABLE>
CONSOLIDATED STATEMENTS OF OPERATIONS
<CAPTION>
F O R T H E Y E A R E N D E D
(In thousands, except per share amounts) May 28, 1994 May 29, 1993 May 30, 1992
- - ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net sales $ 1,318,004 $ 1,302,378 $ 1,297,243
Operating costs and expenses:
Cost of sales 712,052 676,310 652,087
Research and development expenses 153,148 157,068 169,183
Selling, general and administrative expenses 364,508 395,698 407,961
Restructuring charges -- 150,000 17,298
--------- --------- ---------
Total operating costs and expenses 1,229,708 1,379,076 1,246,529
Equity in joint venture earnings (losses) (1,601) (1,932) 2,414
--------- --------- ---------
Operating income (loss) 86,695 (78,630) 53,128
Interest expense 10,019 10,311 11,291
Non-operating expenses (income) (9,210) 10,118 10,938
--------- --------- ---------
Earnings (loss) before taxes 85,886 (99,059) 30,899
Income taxes 25,208 (40,649) 9,948
--------- --------- ---------
Earnings (loss) before cumulative effects
of accounting changes 60,678 (58,410) 20,951
Cumulative effects of accounting changes:
Income taxes -- 38,100 --
Postretirement benefits, net of tax -- (34,775) --
--------- --------- ---------
Net earnings (loss) $ 60,678 $ (55,085) $ 20,951
========= ========= =========
Earnings (loss) per share before cumulative
effects of accounting changes $ 2.00 $ (1.94) $ 0.71
Earnings (loss) per share $ 2.00 $ (1.83) $ 0.71
Dividends per share $ 0.60 $ 0.60 $ 0.60
Average shares outstanding 30,406 30,021 29,488
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
15
<PAGE>
<TABLE>
<CAPTION>
CONSOLIDATED BALANCE SHEETS
(Dollars in thousands) May 28, 1994 May 29, 1993
- - -----------------------------------------------------------------------------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 42,919 $ 30,004
Accounts receivable - net 267,405 248,514
Inventories 171,267 171,416
Other current assets 59,054 65,778
------- -------
Total current assets 540,645 515,712
Property, plant and equipment:
Land 11,738 13,127
Buildings and leasehold improvements 197,074 241,412
Machinery and equipment 444,897 538,635
------- -------
653,709 793,174
Accumulated depreciation and amortization (430,387) (557,340)
------- -------
Property, plant and equipment - net 223,322 235,834
Property held for sale 39,776 38,489
Deferred tax assets 79,552 88,629
Other long-term assets 107,854 105,841
------- -------
Total assets $ 991,149 $ 984,505
======= =======
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term debt $ 17,084 $ 69,481
Accounts payable 161,757 139,222
Accrued compensation 78,877 106,464
Deferred revenue 18,124 18,333
------- -------
Total current liabilities 275,842 333,500
Long-term debt 104,146 70,073
Other long-term liabilities 141,672 145,988
Commitments and contingencies -- --
Shareholders' equity:
Preferred stock, no par value (authorized
1,000,000 shares; none issued) -- --
Common stock, no par value (authorized
80,000,000 shares; issued and outstanding
30,270,000 in 1994, and 30,483,000 in 1993) 180,883 190,984
Retained earnings 235,795 193,221
Currency adjustment 52,811 50,739
------- -------
Total shareholders' equity 469,489 434,944
------- -------
Total liabilities and shareholders' equity $ 991,149 $ 984,505
======= =======
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
16
<PAGE>
<TABLE>
CONSOLIDATED STATEMENTS OF CASH FLOWS
<CAPTION>
F O R T H E Y E A R E N D E D
(In thousands) May 28, 1994 May 29, 1993 May 30, 1992
- - ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Earnings (loss) $ 60,678 $ (55,085) $ 20,951
Adjustments to reconcile earnings (loss) to cash
from operating activities:
Depreciation expense 54,918 63,073 65,628
Restructuring charges -- 150,000 17,298
Deferred taxes 9,905 (60,938) (26,153)
Accounting change for income taxes -- (38,100) --
Accounting change for postretirement benefits -- 34,775 --
Equity losses, net of dividends received 1,601 34,546 2,498
(Gains) losses on sale of assets (14,402) 1,354 (1,711)
Accounts receivable (23,728) (26,918) 24,687
Inventories (777) 11,667 (17,507)
Accounts payable 11,764 (234) (22,151)
Accrued compensation (27,065) (10,787) (21,912)
Income taxes payable -- (24,548) 9,650
Other liabilities 17,636 4,618 8,279
Other assets (11,968) (15,325) 1,720
Other - net 5,942 (511) (2,231)
------ ------ ------
Net cash provided by operating activities 49,232 67,587 59,046
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property, plant and equipment (70,270) (57,771) (65,507)
Proceeds from sale of assets 51,786 9,579 12,873
Proceeds from sale of investments 26,285 -- --
------ ------ ------
Net cash provided (used) by investing 7,801 (48,192) (52,634)
activities
CASH FLOWS FROM FINANCING ACTIVITIES:
Net change in short-term debt (44,963) 13,207 7,480
Issuance of long-term debt 105,173 70,000 36
Repayment of long-term debt (77,894) (82,974) (16,059)
Issuance of common stock 23,730 12,566 5,999
Repurchase of common stock (33,831) -- --
Dividends (18,104) (17,970) (17,682)
------ ------ ------
Net cash used by financing activities (45,889) (5,171) (20,226)
Effect of exchange rate changes 1,771 (2,622) (594)
------ ------ ------
Increase (decrease) in cash and cash equivalents 12,915 11,602 (14,408)
Cash and cash equivalents at beginning of year 30,004 18,402 32,810
------ ------ ------
Cash and cash equivalents at end of year $ 42,919 $ 30,004 $ 18,402
====== ====== ======
Supplemental disclosures of cash flows:
Income taxes paid $ 6,379 $ 33,380 $ 19,266
Interest paid 10,673 12,923 12,317
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
17
<PAGE>
<TABLE>
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
<CAPTION>
Common Stock Retained Currency
(In thousands) Shares Amount Earnings Adjustment Total
- - ---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
BALANCE MAY 25, 1991 29,247 $ 168,084 $ 263,007 $ 45,501 $ 476,592
Shares issued to employees 363 7,842 7,842
Net earnings 20,951 20,951
Dividends - $0.60 per share (17,682) (17,682)
Currency adjustment 2,086 2,086
------ ------- ------- ------ -------
BALANCE MAY 30, 1992 29,610 175,926 266,276 47,587 489,789
Shares issued to employees 873 15,058 15,058
Net loss (55,085) (55,085)
Dividends - $0.60 per share (17,970) (17,970)
Currency adjustment 3,152 3,152
------ ------- ------- ------- -------
BALANCE MAY 29, 1993 30,483 190,984 193,221 50,739 434,944
Shares issued to employees 1,125 23,730 23,730
Shares repurchased (1,338) (33,831) (33,831)
Net earnings 60,678 60,678
Dividends - $0.60 per share (18,104) (18,104)
Currency adjustment 2,072 2,072
------ ------- ------- ------- -------
BALANCE MAY 28, 1994 30,270 $ 180,883 $ 235,795 $ 52,811 $ 469,489
====== ======= ======= ======= =======
</TABLE>
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS.
18
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
ACCOUNTING POLICIES
PRINCIPLES OF CONSOLIDATION The consolidated financial statements include
the accounts of Tektronix, Inc. and its wholly owned subsidiaries (the
Company). All material intercompany transactions and balances have been
eliminated.
CASH AND CASH EQUIVALENTS Cash and cash equivalents include cash deposits in
banks and investments with a maturity of three months or less at the time
of purchase.
INVESTMENTS Investments in joint venture and other companies are accounted
for on the cost or equity basis depending on the Company's share in their
common stock. Investments are included in other long-term assets and are
stated at the lower of cost or net realizable value. All material
intercompany income has been eliminated. Intangible assets are amortized
over a minimal time frame, generally five years, to reflect the general
nature of the technology business.
FOREIGN CURRENCIES Earnings on non-U.S. affiliates are translated into
U.S. dollars at average rates of exchange. Most non-U.S. sales operations'
assets and liabilities are translated into dollars at current rates of
exchange with changes in exchange rates reflected in the currency
adjustment to shareholders' equity. Non-U.S. manufacturing operations and
sales operations in highly inflationary economies translate monetary assets
and liabilities into dollars at current rates of exchange and include the
gains and losses in non-operating income, while other assets and
liabilities are carried at their historic values. Transaction gains and
losses, other than certain hedging transactions, are included in earnings.
INVENTORIES Inventories are stated at the lower of cost or market. Cost
is determined on the first-in, first-out (FIFO) basis.
PROPERTY AND DEPRECIATION Land, buildings and equipment are carried at cost
less accumulated depreciation. Depreciation is based on the estimated
useful lives of depreciable assets, ranging from 10 to 48 years for
buildings and 3 to 7 years for equipment, and is generally provided using
the straight-line method. Leasehold improvements are amortized on a
straight-line basis over the estimated useful life or the lease term,
whichever is less.
Property held for sale is stated at the lower of cost or estimated net
realizable value and includes certain facilities and land no longer used in
the Company's operations.
REVENUE RECOGNITION Revenue from product and component sales is recognized
at the time of shipment. Service revenue is recognized over the contractual
period or as services are provided.
RESEARCH AND DEVELOPMENT EXPENSES Expenditures for research, development
and engineering of products and manufacturing processes are expensed as
incurred.
INCOME TAXES In 1993, the Company adopted Statement of Financial Accounting
Standards (SFAS) No. 109, "Accounting for Income Taxes." Accordingly,
deferred income taxes reflect the impact of temporary differences between
the assets and liabilities recognized for financial reporting purposes and
amounts recognized for tax purposes in 1994 and 1993. Deferred taxes are
based on tax laws as currently enacted. Prior to 1993, net deferred tax
assets were not recognized until realized.
Tektronix, Inc. and its U.S. subsidiaries file a consolidated federal
income tax return. Each U.S. subsidiary records its own tax provision and
makes payment to the parent company for taxes due or receives payment for
tax benefits utilized.
RECLASSIFICATI0N Certain items have been reclassified to conform with the
current year's presentation with no effect on previously reported earnings.
PER SHARE AMOUNTS The per share amounts are based on the weighted average
number of shares outstanding during the year.
FISCAL YEAR The Company's fiscal year is the 52 or 53 weeks ending the last
Saturday in May. 1994 and 1993 were 52-week fiscal years; 1992 was a 53-
week fiscal year.
RESTRUCTURING CHARGES
In the fourth quarter of 1993, the Company provided for pre-tax
restructuring charges of $150.0 million for the purpose of exiting non-
strategic components operations to further reduce the Company's vertical
integration, consolidating facilities, refocusing on core business
products, discontinuing certain older products and other steps to improve
operating efficiency.
In 1992, the Company provided for restructuring charges of $17.3 million
for reductions in operations, including severance costs and the write-off
of certain assets.
19
<PAGE>
BUSINESS SEGMENTS
The Company and its affiliates operate predominately in a single industry
segment: the design, manufacture, sale and service of electronic
measurement, design and display instruments and systems used in science,
industry and education. Geographically, the Company operates primarily in
the industrialized world. Net sales, earnings (loss) before taxes and total
assets in the United States, Europe and other geographical areas were:
<TABLE>
<CAPTION>
(In thousands) 1994 1993 1992
- - ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Net sales:
United States
sales to customers $ 737,451 $ 713,734 $ 670,291
United States export
sales to customers 187,149 196,921 221,892
United States transfers
to affiliates 313,004 290,432 245,259
--------- --------- ---------
United States sales 1,237,604 1,201,087 1,137,442
European sales
to customers 305,563 320,542 347,686
European transfers
to affiliates 4,031 9,282 13,617
--------- --------- ---------
European sales 309,594 329,824 361,303
Other area sales
to customers 87,841 71,181 57,374
Other area transfers
to affiliates 9,427 10,754 10,498
--------- --------- ---------
Other area sales 97,268 81,935 67,872
Eliminations (326,462) (310,468) (269,374)
--------- --------- ---------
Net sales $ 1,318,004 $ 1,302,378 $ 1,297,243
========= ========= =========
Earnings (loss) before taxes:
United States $ 97,369 $ (98,366) $ 40,161
Europe 3,698 317 15,980
Other areas 1,992 1,767 2,322
Corporate and eliminations (17,173) (2,777) (27,564)
--------- --------- ---------
Earnings (loss) before taxes $ 85,886 $ (99,059) $ 30,899
========= ========= =========
Total assets:
United States $ 699,568 $ 707,511 $ 620,038
Europe 175,532 172,217 186,115
Other areas 34,170 28,016 24,325
Corporate and eliminations 81,879 76,761 96,272
--------- --------- ---------
Total assets $ 991,149 $ 984,505 $ 926,750
========= ========= =========
</TABLE>
Transfers of products and services are made at arms-length prices between
geographic areas. The profit on transfers between geographic areas is not
recognized until sales are made to unaffiliated customers. Area earnings
(loss) before taxes includes all directly incurred and allocable costs,
except identified corporate expenses. Assets are those that are specifically
associated with the operations of each geographic area.
Net sales to the United States government were not more than 6% of
consolidated net sales in any of the past three years, and no other
customer accounted for more than 2% of sales.
NON-US AFFILIATES
The Company has operating subsidiaries located in Australia, Austria,
Belgium, Brazil, Canada, Denmark, Finland, France, Germany, Hong Kong (with
a branch in China), Italy, Korea, Mexico, The Netherlands, Norway,
Singapore, Spain, Sweden, Switzerland, Taiwan, and the United Kingdom (with
a branch in Ireland). The assets, liabilities, net sales and earnings of
non-U.S. subsidiaries are included in the consolidated financial statements
in these amounts:
<TABLE>
<CAPTION>
(In thousands) 1994 1993 1992
- - ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Current assets $ 147,090 $ 128,015 $ 132,236
Property, plant and
equipment - net 42,976 50,924 54,494
Other long-term assets 2,339 2,888 2,567
Current liabilities 65,086 71,350 72,996
Other liabilities 14,456 14,628 23,828
Net sales $ 393,404 $ 391,723 $ 405,326
Gross profit 112,574 127,384 132,847
Operating income 3,184 2,217 21,059
Earnings before taxes 5,690 2,084 18,302
Net earnings 9,314 1,375 10,820
</TABLE>
The Company has foreign investments in joint venture companies in Japan and
India. The Company's share of the assets, liabilities, net sales and
earnings of these unconsolidated affiliates, as well as the Company's arms-
length sales to, purchases from, and accounts receivable consisted of:
<TABLE>
<CAPTION>
(In thousands) 1994 1993 1992
- - ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Current assets $ 67,147 $ 94,050 $ 80,848
Property, plant and
equipment - net 24,640 22,022 20,279
Other long-term assets 10,269 8,219 7,826
Current liabilities 20,537 49,055 16,680
Other liabilities 7,549 6,285 4,835
Net sales $ 94,246 $ 82,682 $ 98,219
Gross profit 33,808 27,605 32,872
Operating income (loss) (4,080) (6,306) 1,374
Earnings (loss) before taxes (2,971) (4,521) 5,256
Net earnings (loss) (1,601) (1,932) 2,373
Sales to $ 67,535 $ 63,958 $ 79,500
Purchases from 5,585 5,990 4,114
Accounts receivable 11,117 11,663 6,176
</TABLE>
There are no significant restrictions which prevent dividends to the parent
company from non-U.S. affiliates. The Company received dividends from joint
venture companies of $33.2 million in
20
<PAGE>
1993, and $1.6 million in 1992. There were no dividends received in 1994.
ACCOUNTS RECEIVABLE
Accounts receivable have been reduced by an allowance for doubtful
accounts, which was $3.8 million in 1994 and $3.3 million in 1993. The net
charges to this reserve for uncollected credit sales have not been
material.
INVENTORIES
Inventories consisted of:
<TABLE>
<CAPTION>
(In thousands) 1994 1993
- - -----------------------------------------------------------------------------
<S> <C> <C>
Materials and work in process $ 89,341 $ 87,867
Finished goods 81,926 83,549
------- -------
Inventories $ 171,267 $ 171,416
======= =======
</TABLE>
OTHER LONG-TERM ASSETS
Other long-term assets consisted of:
<TABLE>
<CAPTION>
(In thousands) 1994 1993
- - -----------------------------------------------------------------------------
<S> <C> <C>
Investment in joint venture affiliates $ 74,703 $ 69,728
Licensing agreements
and other intangibles, net 17,649 12,923
Other 15,502 23,190
------- -------
Other long-term assets $ 107,854 $ 105,841
======= =======
</TABLE>
The Company's portion of undistributed earnings in equity investees in
1994 and 1993 was $13.8 million and $13.9 million, respectively.
Licensing agreements and other intangibles have been reduced by
accumulated amortization of $15.3 million in 1994 and $15.5 million in 1993.
SHORT-TERM AND LONG-TERM DEBT
The Company's short-term debt consisted of:
<TABLE>
<CAPTION>
(In thousands) 1994 1993
- - -----------------------------------------------------------------------------
<S> <C> <C>
Line of credit borrowings $ 15,963 $ 26,566
Revolving credit borrowings -- 35,000
------- -------
Short-term borrowings 15,963 61,566
Current maturities of long-term borrowings 1,121 7,915
------- -------
Short-term debt $ 17,084 $ 69,481
======= =======
</TABLE>
The Company has a $150.0 million revolving credit agreement with Morgan
Guaranty Trust Company of New York as agent that matures on March 10, 1996.
At May 28, 1994, the Company maintained unused bank credit facilities of
$269.9 million including $119.9 million in lines of credit and $150.0
million in the revolving credit agreement. At May 28, 1994, the interest
rate on the utilized U.S. line of credit was 4.7%. Interest rates on the
utilized non-U.S. lines of credit averaged 6.5% .
The Company's long-term debt consisted of:
<TABLE>
<CAPTION>
(In thousands) 1994 1993
- - -----------------------------------------------------------------------------
<S> <C> <C>
7.5% Notes due August 1, 2003 $ 100,000 $ --
Bridge loan credit agreement -- 70,000
Non-U.S. currency borrowings -- 7,805
Other borrowings 5,267 183
------- -------
Long-term borrowings 105,267 77,988
Current maturities (1,121) (7,915)
------- -------
Long-term debt $ 104,146 $ 70,073
======= =======
</TABLE>
Certain of the Company's debt agreements require the maintenance of
specified interest rate coverage ratios and a minimum consolidated tangible
net worth. At May 28, 1994, the Company had unrestricted retained earnings
of $41.3 million after meeting those requirements.
Aggregate long-term debt payments will be $1.1 million in 1995, $1.1
million in 1996, $1.2 million in 1997, $1.2 million in 1998, and $0.7
million in 1999.
OTHER LONG-TERM LIABILITIES
Other long-term liabilities consisted of:
<TABLE>
<CAPTION>
(In thousands) 1994 1993
- - -----------------------------------------------------------------------------
<S> <C> <C>
Accrued postretirement benefits $ 54,480 $ 53,630
Accrued pension 43,881 38,869
Restructuring 13,502 35,800
Other 29,809 17,689
------- -------
Other long-term liabilities $ 141,672 $ 145,988
======= =======
</TABLE>
NON-OPERATING EXPENSES (INCOME)
Non-operating expenses (income) consisted of:
<TABLE>
<CAPTION>
(In thousands) 1994 1993 1992
- - ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
(Earnings) loss in equity investees $ (903) $ (612) $ 3,512
Gain on sale of investments (13,309) -- --
Charitable contributions 2,824 3,148 2,943
Currency losses 1,980 2,825 1,383
Other 198 4,757 3,100
------- ------- -------
Non-operating expenses (income) $ (9,210) $ 10,118 $ 10,938
======= ======= =======
</TABLE>
COMMITMENTS AND CONTINGENCIES
Rental expense was $20.7 million in 1994, $19.9 million in 1993, and $20.2
million in 1992. The future minimum obligations under operating leases and
other commitments having an initial or remaining noncancelable term in
excess of one year as of May 28, 1994, are:
21
<PAGE>
<TABLE>
<CAPTION>
Future
(In thousands) 1995 1996 1997 1998 1999 Years Total
- - ---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Operating leases $13,271 $8,623 $5,243 $1,764 $1,120 $6,115 $36,136
Commitments 16,312 10,350 10,350 350 350 -- 37,712
</TABLE>
Commitments relate primarily to a supply agreement that was signed
pursuant to the 1994 sale of the Company's Integrated Circuits Operation to
Maxim Integrated Products, Inc. Under the agreement, the Company has minimum
purchase requirements through 1997. The Company also has long-term or
minimum purchase agreements with various other suppliers.
In the normal course of business, the Company and its subsidiaries are
parties to various legal claims, actions and complaints, including matters
involving patent infringement and other intellectual property claims.
Included among the intellectual property matters are claims by Jerome J.
Lemelson that certain of the Company's manufacturing equipment and
processes infringe certain of his patents. Although it is impossible to
predict with certainty whether or not the Company and its subsidiaries will
ultimately be successful in any of these legal matters or, if not, what the
impact might be, the Company believes that disposition of these matters will
not have a material adverse effect on the Company's financial position and
results of operations.
SHAREHOLDERS' EQUITY
EMPLOYEE SHARE PURCHASE PLAN Most employees were eligible to participate in
an Employee Share Purchase Plan, which terminates on June 30, 1994. During
1994, 13,000 shares were issued for $0.4 million; 23,000 shares were issued
for $0.5 million in 1993.
STOCK OPTION AND INCENTIVE COMPENSATION PLANS The Company has stock option
plans for selected employees. There were 3,890,000 shares reserved for
issuance under these plans at May 28, 1994. Under the terms of the plans,
incentive stock options are granted at an option price not less than the
market value at the date of grant. Nonqualified stock options may not be
granted at less than 50% of the market value at the date of grant. The
exercise period for the options is not to exceed 10 years.
The stock option plans allow stock appreciation rights (SARS) to be
granted to employees. Employees may surrender all or part of their SARS for
shares or payment in an amount equal to the excess of market price over
option price at the date of exercise.
Activity under the option plans was:
<TABLE>
<CAPTION>
(Shares in thousands) 1994 1993 1992
- - ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Outstanding at beginning of year 3,324 3,085 2,914
Granted 758 1,066 770
Exercised (925) (451) (281)
Canceled (291) (376) (318)
------ ------ ------
Outstanding at end of year 2,866 3,324 3,085
====== ====== ======
Options exercisable at end of year 1,312 1,348 1,166
Option prices per share:
Granted $22-28 $18-27 $17-31
Exercised 13-28 13-25 13-28
Canceled 13-42 13-38 13-39
Exercisable at end of year 13-33 13-42 13-42
</TABLE>
There were 1,218 employees holding options at May 28, 1994. The
Company also has cash and stock incentive compensation plans for certain
executives. The plans provide for compensation based on financial
performance over one- and three-year periods.
SHAREHOLDER RIGHTS AGREEMENT In August 1990, the Company's Board of
Directors approved a shareholder rights agreement and declared a dividend
of one right for each outstanding common share. Each right entitles the
holder to purchase one one-thousandth of a share of Series A No Par
Preferred Shares at an exercise price of $60, subject to adjustment.
Generally, the rights become exercisable 10 days after a person or group
acquires or commences a tender offer that would result in beneficial
ownership of 20% or more of the common shares. In addition, the rights
become exercisable if any party becomes the beneficial owner of 10% or more
of the outstanding common shares and is determined by the Board of
Directors to be an adverse party. Upon the occurrence of certain additional
events specified in the shareholder rights agreement, each right would
entitle its holder to purchase common shares of the Company (or, in some
cases, a potential acquiring company) or other property having a value of
twice the right's exercise price. The rights, which are not currently
exercisable, expire in September, 2000, but may be redeemed by action of
the Board prior to that time, under certain circumstances, for $0.01 per
right.
BENEFIT PLANS
PENSION PLANS The Company has defined benefit retirement plans covering most
employees. Benefits upon retirement or termination are based on length of
service and final average compensation at retirement.
The Company's funding policy is to con-
22
<PAGE>
tribute amounts determined annually on an actuarial basis that provide
for current and future benefits in accordance with funding requirements
of applicable laws and regulations of the countries in which the plans are
located. Assets of funded benefit plans are held primarily in trust accounts.
The significant majority of the assets are invested in common stocks, bonds,
and real estate, with the balance primarily in cash and short-term investments.
The following tables set forth the funded status and the amounts
recognized in the financial statements for the Company's defined benefit
retirement plans:
<TABLE>
<CAPTION>
(In thousands) 1994 1993
- - ---------------------------------------------------------------------------------------------
Assets exceed Accumulated Assets exceed Accumulated
accumulated benefits accumulated benefits
benefits exceed assets benefits exceed assets
- - ---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Actuarial present value of
benefit obligations:
Vested benefit obligation $ 22,333 $ 300,841 $ 296,241 $ 9,849
- - ---------------------------------------------------------------------------------------------
Accumulated benefit obligation $ 26,498 $ 318,650 $ 320,915 $ 10,416
- - ---------------------------------------------------------------------------------------------
Projected benefit obligation $ 39,601 $ 359,050 $ 374,144 $ 12,585
Plan assets at fair value 35,384 304,510 333,650 --
------- ------- ------- -------
Projected benefit obligation in
excess of plan assets (4,217) (54,540) (40,494) (12,585)
Unrecognized initial net asset 806 (7,415) (10,858) 2,762
Unrecognized prior service cost 116 11,466 14,429 109
Unrecognized net (gain) loss 3,139 7,129 9,861 (3,177)
------- ------- ------- -------
Net pension liability $ (156) $ (43,360) $ (27,062) $ (12,891)
======= ======= ======= =======
</TABLE>
Assumptions used in the accounting for the defined benefit plans were:
<TABLE>
<CAPTION>
1994 1993 1992
- - ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Overall weighted-average
discount rates 8.2% 8.0% 9.0%
Overall rates of increase
in compensation levels 4.8% 4.7% 6.0%
Expected long-term rate
of return on plan assets 9.4% 9.4% 9.4%
</TABLE>
Net periodic pension expense includes the following components:
<TABLE>
<CAPTION>
(In thousands) 1994 1993 1992
- - ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Service cost $ 9,346 $ 8,844 $ 9,276
Interest cost 30,458 29,801 28,663
Actual return on plan assets (22,721) (25,108) (29,376)
Net amortization
and deferral (9,072) (5,681) 221
- - ---------------------------------------------------------------------------------------------
Net periodic
pension expense 8,011 7,856 8,784
Other benefit plans 1,114 1,261 1,484
------ ------ ------
Pension expense $ 9,125 $ 9,117 $ 10,268
====== ====== ======
</TABLE>
A credit of $4.4 million arising from employee reductions and the related
impact on pension expense recognized in prior years, was recognized during
1993. As a result, pension expense was reduced by $1.0 million in 1993.
POSTRETIREMENT BENEFITS The Company sponsors unfunded plans to provide
health care and life insurance benefits for certain retired employees. The
postretirement health care plan is contributory, with retiree contributions
adjusted annually; the postretirement life insurance plan is
noncontributory. The majority of the Company's domestic employees may
become eligible for these benefits if they retire while working for the
Company. However, benefits and eligibility rules may be modified from time
to time. There are no significant postretirement health care benefit plans
outside of the United States.
The Company adopted SFAS No. 106, "Accounting for Postretirement Benefits
Other than Pensions," in the first quarter of 1993. Under SFAS No. 106, the
Company recognizes the cost of postretirement benefits over the active
service period of its employees. Prior to 1993, the cost of these benefits
was charged to operating expenses as claims and premiums were paid. The
Company elected to recognize the transition obligation of $57.1 million,
which represents the previously unrecognized prior service cost,
immediately upon implementation. This resulted in a one-time, non-cash
charge of $34.8 million, net of applicable income taxes. In addition, the
Company also recognized a curtailment gain of $2.9 million in 1993 arising
from employee reductions that resulted in a decrease in the accumulated
postretirement benefit obligation.
The following tables set forth the plans' combined status and the amounts
recognized in the financial statements:
23
<PAGE>
<TABLE>
<CAPTION>
(In thousands) 1994 1993
- - -----------------------------------------------------------------------------
<S> <C> <C>
Accumulated postretirement benefit obligation:
Current retirees $ 32,209 $ 32,465
Active employees eligible to retire 9,620 11,303
Other active employees 11,475 13,368
------- -------
Accumulated obligation 53,304 57,136
Unrecognized net gain 4,687 5
------- -------
Accrued liability recognized
in balance sheet $ 57,991 $ 57,141
======= =======
Net periodic postretirement benefit expense:
Service cost $ 1,008 $ 1,038
Interest cost 4,405 5,018
------- -------
Net postretirement benefit expense $ 5,413 $ 6,056
======= =======
</TABLE>
The cost of postretirement benefits reported for 1992 was $3.0 million
on a pay-as-you-go-basis.
The assumed discount rate used in determining the accumulated
postretirement benefit obligation (APBO) as of May 28, 1994 was 8.2% and
8.0% at the end of 1993; the rate of salary increase used was 4.8% and
4.5%, respectively. The health care cost trend rate used in measuring the
APBO at year end was 12.3% for 1994 and 13.5% for 1993. This rate is
assumed to decrease gradually until it reaches 5.8% in the year 2004 and
remain level thereafter. The health care cost trend rate assumption has a
significant effect on the amounts reported. Increasing the health care cost
trend rate by one percentage point each year would increase the accumulated
postretirement benefit obligation as of May 28, 1994, by $2.3 million and
the aggregate of the service and interest cost components of net periodic
postretirement benefit cost for 1994 by $0.3 million.
POSTEMPLOYMENT BENEFITS The Company also provides postemployment benefits
other than retirement benefits to certain employees. Such benefits, which
include severance, disability and medical costs, have been historically
accrued. Therefore, there is no material impact from the adoption of SFAS
No. 112, "Employers' Accounting for Postemployment Benefits."
EMPLOYEE SAVINGS PLANS The Company has two employee savings plans that
qualify as deferred salary arrangements under Section 401(k) of the
Internal Revenue Code. Participating U.S. employees may defer up to 15% of
their pre-tax earnings subject to certain regulatory limitations. Employee
contributions are invested, at the employees' direction, among a variety of
investment alternatives. Depending on the plan, the Company currently
matches 3% of an employee's contribution either in cash or Company stock.
In addition, beginning in 1993, the Company also makes a contribution to
the 401(k) plan for certain employees equal to 2% of an employee's annual
pay, even if the employee does not currently contribute to the plan. The
latter contribution is made regardless of the Company's performance and is
invested entirely in Company stock. Total cost for these plans was $12.7
million in 1994, $13.1 million in 1993 and $4.8 million in 1992.
FINANCIAL INSTRUMENTS
OFF-BALANCE SHEET FINANCIAL INSTRUMENTS: RISK AND FAIR VALUES The
Company uses various off-balance sheet instruments to reduce its exposure
to financial market risk caused by currency and interest rate fluctuations.
At May 28, 1994, market risk was not expected to have a material adverse
effect on the consolidated position of the Company.
At the end of 1994 and 1993, the Company had forward foreign exchange
contracts outstanding of $20.6 million and $53.0 million, respectively.
These contracts have maturities that generally do not exceed one year and
require the Company to exchange foreign currencies for U.S. dollars at
maturity. The fair value of these foreign exchange contracts is the amount
the Company would receive or pay to terminate the contracts. This amount is
calculated using quoted market rates. The fair market value of these
contracts was estimated to be a net receivable of $0.3 million at the end
of 1994 and a net payable of $3.0 million at the end of 1993.
In 1992, the Company entered into an interest rate swap agreement, having
a notional principal amount of $75.0 million, that matures in 1995. Under
this agreement, the Company makes fixed-rate payments and receives floating-
rate payments in return. The fair value of this interest rate swap is the
amount the Company would receive or pay to terminate the swap agreement.
This amount is calculated using information provided by outside quotation
services, taking into account current interest rates and the
creditworthiness of the swap counterparty. At the end of 1994 and 1993, the
fair value was estimated to be a net payable of $3.6 million and $1.4
million, respectively.
In the event that a counterparty fails to meet the terms of a foreign
exchange contract or the interest rate swap agreement, the Company's
exposure is limited to the currency rate or interest rate differential. The
Company has executed these contracts with many creditworthy financial
institutions and considers the risk of nonperformance to be remote.
24
<PAGE>
BALANCE SHEET FINANCIAL INSTRUMENTS: FAIR VALUES The carrying amount
reported in the consolidated balance sheets for cash and cash equivalents,
accounts receivable, accounts payable and short-term debt approximates fair
value because of the immediate or short-term maturity of these financial
instruments.
The fair values of fixed-rate receivables and long-term debt are estimated
by discounting future cash flows using current discount rates that reflect
the risks associated with similar types of instruments. At May 28, 1994,
the estimated fair values of the Company's notes receivable approximated
the carrying value. The carrying amount reported for long-term debt at the
end of 1994 also approximated fair value. The carrying amount reported for
long-term debt at the end of 1993 approximated fair value because the
underlying instrument was a variable-rate note that repriced frequently.
At year-end 1994 and 1993, the carrying value of the Company's minority
equity investments accounted for on the cost basis was $5.1 million and
$9.9 million, respectively. It was not practicable to estimate the fair
value of the securities held at the end of 1993 because the investments
were in non-traded companies. In 1994, the companies represented by such
investments successfully completed initial public offerings and, as a
result, their fair values can be estimated based on quoted market prices.
At May 28, 1994, the estimated fair value of these equity investments was
approximately $26.6 million.
Beginning in 1995, the Company will account and report for such investments
in accordance with the requirements of SFAS No. 115, "Accounting for Certain
Investments in Debt and Equity Securities." Under SFAS No. 115, these
investments would have been classified as available-for-sale securities and
reported at fair value in the consolidated balance sheet, with the net
unrealized gains of $21.5 million reported as a separate component of
shareholders' equity.
CONCENTRATION OF CREDIT RISK Financial instruments that potentially subject
the Company to concentrations of credit risk consist principally of trade
accounts receivable. The risk is limited due to the large number of
entities comprising the Company's customer base and their dispersion across
many different industries and geographies. At May 28, 1994, the Company had
no significant concentrations of credit risk.
INCOME TAXES
The Company adopted SFAS No. 109 in the first quarter of 1993. The adoption
of this standard changed the Company's method of accounting for income
taxes from the deferred method to the liability method. During the first
quarter of 1994, the Revenue Reconciliation Act of 1993 was enacted,
increasing the maximum federal rate tax for corporations to 35% from 34%
and the Company recorded additional tax benefits to reflect the rate
increase. The effect was to increase earnings by $2.3 million.
The components of earnings (loss) before taxes are contained in the
Business Segments footnote. The provision for income taxes consisted of:
<TABLE>
<CAPTION>
(In thousands) 1994 1993 1992
- - ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Current:
Federal $ 9,081 $ 11,996 $ 601
State 2,900 716 1,150
Non-U.S. 3,938 12,140 8,365
------- ------- -------
15,919 24,852 10,116
Deferred:
Federal 15,167 (49,969) --
State 1,684 (8,569) --
Non-U.S. (7,562) (6,963) (168)
------- ------- -------
9,289 (65,501) (168)
------- ------- -------
Total provision $ 25,208 $ (40,649) $ 9,948
======= ======= =======
</TABLE>
The provisions differ from the amounts that would result by applying the
U.S. statutory rate to earnings (loss) before taxes. A reconciliation of the
difference is:
<TABLE>
<CAPTION>
(In thousands) 1994 1993 1992
- - ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Income taxes based
on U.S. statutory rate $ 30,060 $ (33,680) $ 10,506
State income taxes,
net of U.S. tax 2,980 (5,183) 759
Foreign taxes on
non-U.S. source income (4,370) 5,678 1,391
Foreign sales corporation (3,926) (328) --
Prior year foreign tax credits 6,422 -- (5,670)
Expenses not recognized -- -- 1,984
Provision for audit adjustments 3,060 (7,793) (1,250)
Capital gains adjustments
from sale of investments (2,678) -- --
Other U.S. adjustments 1,917 657 2,228
Change in beginning of year
valuation allowance (5,981) -- --
Benefit of tax rate change (2,276) -- --
------- ------- -------
Income taxes $ 25,208 $ (40,649) $ 9,948
======= ======= =======
</TABLE>
Net deferred tax assets and liabilities are included in the following
consolidated balance sheet accounts:
<TABLE>
<CAPTION>
(In thousands) 1994 1993
- - -----------------------------------------------------------------------------
<S> <C> <C>
Other current assets $ 41,031 $ 40,810
Deferred tax assets 79,552 88,629
Other long-term assets -- 1,051
------- -------
Net deferred tax assets $ 120,583 $ 130,490
======= =======
</TABLE>
25
<PAGE>
The temporary differences and carryforwards that give rise to deferred
tax assets and liabilities were as follows:
<TABLE>
<CAPTION>
(In thousands) 1994 1993
- - -----------------------------------------------------------------------------
<S> <C> <C>
Deferred tax assets:
Reserves and other liabilities $ 39,396 $ 38,819
AMT and foreign tax
credit carryforwards 36,886 47,697
Restructuring costs and
separation programs 31,551 57,232
Accrued postretirement benefits 23,196 22,326
Accrued pension obligation 14,059 11,627
Net operating losses of
non-U.S. affiliates 8,388 2,926
Accumulated depreciation 1,196 --
------- -------
Gross deferred tax assets 154,672 180,627
Less valuation allowance (19,297) (25,278)
------- -------
Deferred tax assets 135,375 155,349
Deferred tax liabilities:
Unamortized LIFO reserve (14,792) (18,750)
Accumulated depreciation -- (6,109)
------- -------
Deferred tax liabilities (14,792) (24,859)
------- -------
Net deferred tax assets $ 120,583 $ 130,490
======= =======
</TABLE>
SFAS No. 109 requires that a valuation allowance be recorded when it is
more likely than not that some portion of the deferred tax assets will not
be realized. The Company previously established a valuation allowance for
its deferred tax assets which include temporary differences, tax credit
carryforwards and certain net operating losses of non-U.S. affiliates.
During 1994, the valuation allowance was reduced by $6.0 million. The
reduction resulted primarily from the utilization of foreign tax credit
carryforwards and the utilization of net operating losses of non-U.S.
affiliates.
There are $22.0 million of unused foreign tax credits which, if not used,
will expire between 1995 and 1998. There are $14.9 million of alternative
minimum tax (AMT) credits that can be carried forward indefinitely.
QUARTERLY FINANCIAL DATA (unaudited)
In the opinion of management, this unaudited quarterly financial summary
includes all adjustments necessary to present fairly the results for the
periods represented (in thousands, except per share amounts):
<TABLE>
<CAPTION>
Aug. 28, Nov. 27, Feb. 26, May 28,
13 weeks to 1993 1993 1994 1994
- - ---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net sales $ 290,070 $ 317,165 $ 332,825 $ 377,944
Gross profit 135,869 145,214 151,903 172,966
Operating income 14,688 19,107 22,795 30,105
Earnings before taxes 11,295 17,357 23,452 33,782
Net earnings (loss) 9,731 11,455 15,479 24,013
Earnings per share $ 0.32 $ 0.37 $ 0.51 $ 0.80
Dividends per share 0.15 0.15 0.15 0.15
Common stock prices:
High $ 27.50 $ 25.50 $ 28.25 $ 33.38
Low 22.13 21.38 21.38 26.00
</TABLE>
<TABLE>
<CAPTION>
Aug. 29, Nov. 28, Feb. 27, May 29,
13 weeks to 1992 1992 1993 1993
- - ---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net sales $ 304,624 $ 333,485 $ 311,233 $ 353,036
Gross profit 144,506 163,840 151,162 166,560
Operating income (loss) 13,315 19,128 17,608 (128,681)
Earnings (loss) before taxes 9,329 12,777 13,840 (135,005)
Net earnings (loss) 9,482 8,433 9,134 (82,134)
Earnings (loss) per share $ 0.32 $ 0.28 $ 0.30 $ (2.73)
Dividends per share 0.15 0.15 0.15 0.15
Common stock prices:
High $ 20.38 $ 22.50 $ 25.25 $ 27.88
16.88 19.38 17.63 22.13
</TABLE>
Operating income and net earnings in the fourth quarter of 1993 reflect
the impact of pre-tax restructuring charges of $150.0 million. These charges
are discussed in the Management Review and Notes to Consolidated Financial
Statements.
The Company's common stock is traded on the New York and Pacific Stock
Exchanges. There were 4,625 shareholders of record at June 23, 1994. The
above quoted market prices are the composite prices reported by THE WALL
STREET JOURNAL rounded to full cents per share.
Dividends are paid at the discretion of the Board of Directors dependent
upon their judgment of the Company's future earnings, expenditures and
financial condition.
26
<PAGE>
<TABLE>
CONSOLIDATED FINANCIAL PERFORMANCE
<CAPTION>
UNAUDITED 1994 1993 1992 1991 1990
- - ---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Net sales $ 1,318.0 $ 1,302.4 $ 1,297.2 $ 1,330.9 $ 1,408.3
Gross margin 46.0% 48.1% 49.7% 49.2% 48.4%
Research and development expenses 11.6% 12.1% 13.0% 12.9% 13.8%
Selling, general,
and administrative expenses 27.7% 30.4% 31.4% 30.7% 31.9%
Operating margin 6.6% -6.0% 4.1% 6.2% -2.6%
Pretax margin 6.5% -7.6% 2.4% 4.7% -4.6%
Earnings margin 4.6% -4.2% 1.6% 2.4% -6.2%
Net earnings (loss) $ 60.7 $ (55.1) $ 21.0 $ 32.3 $ (87.5)
Earnings (loss) per share 2.00 (1.83) 0.71 1.11 (3.02)
Dividends per share 0.60 0.60 0.60 0.60 0.60
Cumulative effects on earnings
of accounting changes -- $ 3.3 -- -- --
Total assets $ 991.1 $ 984.5 $ 926.8 $ 947.8 $ 1,037.6
Long-term debt 104.1 70.1 84.3 89.1 175.1
Total debt 121.2 139.6 140.0 146.3 260.7
Shareholders' equity 469.5 434.9 489.8 476.6 448.9
Return on equity 13.4% -11.9% 4.3% 7.0% -17.4%
Shares outstanding 30.3 30.5 29.6 29.2 29.1
Book value per share $ 15.51 $ 14.27 $ 16.54 $ 16.30 $ 15.45
Closing share price 28.75 22.13 19.13 23.25 14.38
Facilities expenditures $ 70.3 $ 57.8 $ 65.5 $ 67.9 $ 97.1
Depreciation expense 54.9 63.1 65.6 74.6 73.1
Square feet in use 5.0 5.6 6.1 6.4 7.4
Employees 8,468 9,840 11,334 11,947 13,941
Net sales/employee (in thousands) $ 155.6 $ 132.4 $ 114.5 $ 111.4 $ 101.0
</TABLE>
AMOUNTS ARE IN MILLIONS, EXCEPT PER SHARE AND EMPLOYEES.
RETURNS ARE BASED ON AVERAGE ASSETS.
27
<PAGE>
EXHIBIT 21
Exhibit 21
Subsidiaries of Tektronix, Inc.
Percentage of Voting
Name of Subsidiary and Securities Owned by
Jurisdiction in Which Organized Immediate Parent
_______________________________ ________________
Tektronix Ges.m.b.H. (Austria) 100%
Tektronix GmbH (Germany) 100
Tektronix Canada Inc. (Canada) 100
Tektronix Australia Pty. Limited (Australia) 100
Grass Valley Group Pty. Limited (Australia) 100
Tektronix (France) 100
Tektronix N.V. (Belgium) 100
Tektronix, S.A. de C.V. (Mexico) 100
Tektronix A/S (Denmark) 100
Tektronix S.p.A. (Italy) 100
Tektronix Norge A/S (Norway) 100
Tektronix AB (Sweden) 100
Tektronix Oy (Finland) 100
Tektronix Industria e Comercio Ltda. (Brazil) 100
Tektronix Europe B.V. (The Netherlands) 100
The Grass Valley Group, Inc. (California) 100
GVG International, Ltd. (California) 100
GVG Japan, Ltd. (Japan) 100
Grass Valley International, Inc. (Guam) 100
Tektronix International A.G. (Switzerland) 100
Tektronix Holland N.V. 100
(The Netherlands)
<PAGE>
Page 2. Exhibit 21
Tektronix U.K. Limited 100
(England)
GVG Limited (United Kingdom) 100
Bouwerij Heerenveen N.V. 100
(The Netherlands)
Tektronix Espanola, S.A. (Spain) 100
Tektronix Development Company (Oregon) 100
Tektronix Foreign Sales Corporation (Guam) 100
Tektronix China, Limited (Hong Kong) 100
Tektronix Hong Kong Limited (Hong Kong) 100
Tektronix International, Inc. (Oregon) 100
Yangzhong Tektronix Electronic Instrument Co., Ltd. 70
(China)
Shanghai Tektronix Electronic Instrument Co., Ltd. 65
(China)
Chongqing Tektronix Electronic Instrument Co., Ltd. 60
(China)
Tektronix Taiwan, Ltd. (Taiwan) 100
Tektronix Properties, Inc. (Oregon) 100
Tektronix Federal Systems, Inc. (Oregon) 100
Tektronix Asia, Ltd. (Oregon) 100
CAChe Scientific, Inc. (Oregon) 70
Tektronix Singapore Pte Ltd (Singapore) 100
Tektronix Sales and Marketing Company (Oregon) 100
Tektronix Korea, Ltd. (Korea) 100
<PAGE> EXHIBIT 24
POWER OF ATTORNEY
The undersigned constitutes and appoints JEROME J. MEYER, CARL W.
NEUN and JOHN P. KARALIS and each of them, as the undersigned's
true and lawful attorneys and agents, with full power of
substitution and resubstitution for the undersigned and in the
undersigned's name, place and stead, in any and all capacities, to
sign the Tektronix, Inc. Annual Report on Form 10-K for the year
ended May 28, 1994 and any and all amendments thereto, and to file
the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission,
granting unto said attorneys and agents, and each of them, full
power and authority to do any and all acts and things necessary or
advisable to be done, as fully and to all intents and purposes as
the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys and agents or either of them, or
their or his substitute or substitutes, may lawfully do or cause to
be done by virtue hereof.
Dated: July 26, 1994
/s/ Paul E. Bragdon
___________________________________
Paul E. Bragdon
<PAGE>
POWER OF ATTORNEY
The undersigned constitutes and appoints JEROME J. MEYER, CARL W.
NEUN and JOHN P. KARALIS and each of them, as the undersigned's
true and lawful attorneys and agents, with full power of
substitution and resubstitution for the undersigned and in the
undersigned's name, place and stead, in any and all capacities, to
sign the Tektronix, Inc. Annual Report on Form 10-K for the year
ended May 28, 1994 and any and all amendments thereto, and to file
the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission,
granting unto said attorneys and agents, and each of them, full
power and authority to do any and all acts and things necessary or
advisable to be done, as fully and to all intents and purposes as
the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys and agents or either of them, or
their or his substitute or substitutes, may lawfully do or cause to
be done by virtue hereof.
Dated: July 28, 1994
/s/ Paul C. Ely, Jr.
__________________________________
Paul C. Ely, Jr.
<PAGE>
POWER OF ATTORNEY
The undersigned constitutes and appoints JEROME J. MEYER, CARL W.
NEUN and JOHN P. KARALIS and each of them, as the undersigned's
true and lawful attorneys and agents, with full power of
substitution and resubstitution for the undersigned and in the
undersigned's name, place and stead, in any and all capacities, to
sign the Tektronix, Inc. Annual Report on Form 10-K for the year
ended May 28, 1994 and any and all amendments thereto, and to file
the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission,
granting unto said attorneys and agents, and each of them, full
power and authority to do any and all acts and things necessary or
advisable to be done, as fully and to all intents and purposes as
the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys and agents or either of them, or
their or his substitute or substitutes, may lawfully do or cause to
be done by virtue hereof.
Dated: July 28, 1994
/s/ A. M. Gleason
__________________________________
A. M. Gleason
<PAGE>
POWER OF ATTORNEY
The undersigned constitutes and appoints JEROME J. MEYER, CARL W.
NEUN and JOHN P. KARALIS and each of them, as the undersigned's
true and lawful attorneys and agents, with full power of
substitution and resubstitution for the undersigned and in the
undersigned's name, place and stead, in any and all capacities, to
sign the Tektronix, Inc. Annual Report on Form 10-K for the year
ended May 28, 1994 and any and all amendments thereto, and to file
the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission,
granting unto said attorneys and agents, and each of them, full
power and authority to do any and all acts and things necessary or
advisable to be done, as fully and to all intents and purposes as
the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys and agents or either of them, or
their or his substitute or substitutes, may lawfully do or cause to
be done by virtue hereof.
Dated: July 28, 1994
/s/ Wayland R. Hicks
__________________________________
Wayland R. Hicks
<PAGE>
POWER OF ATTORNEY
The undersigned constitutes and appoints JEROME J. MEYER, CARL W.
NEUN and JOHN P. KARALIS and each of them, as the undersigned's
true and lawful attorneys and agents, with full power of
substitution and resubstitution for the undersigned and in the
undersigned's name, place and stead, in any and all capacities, to
sign the Tektronix, Inc. Annual Report on Form 10-K for the year
ended May 28, 1994 and any and all amendments thereto, and to file
the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission,
granting unto said attorneys and agents, and each of them, full
power and authority to do any and all acts and things necessary or
advisable to be done, as fully and to all intents and purposes as
the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys and agents or either of them, or
their or his substitute or substitutes, may lawfully do or cause to
be done by virtue hereof.
Dated: July 26, 1994
/s/ Jerome J. Meyer
___________________________________
Jerome J. Meyer
<PAGE>
POWER OF ATTORNEY
The undersigned constitutes and appoints JEROME J. MEYER, CARL W.
NEUN and JOHN P. KARALIS and each of them, as the undersigned's
true and lawful attorneys and agents, with full power of
substitution and resubstitution for the undersigned and in the
undersigned's name, place and stead, in any and all capacities, to
sign the Tektronix, Inc. Annual Report on Form 10-K for the year
ended May 28, 1994 and any and all amendments thereto, and to file
the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission,
granting unto said attorneys and agents, and each of them, full
power and authority to do any and all acts and things necessary or
advisable to be done, as fully and to all intents and purposes as
the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys and agents or either of them, or
their or his substitute or substitutes, may lawfully do or cause to
be done by virtue hereof.
Dated: July 26, 1994
/s/ Keith R. McKennon
_____________________________________
Keith R. McKennon
<PAGE>
POWER OF ATTORNEY
The undersigned constitutes and appoints JEROME J. MEYER, CARL W.
NEUN and JOHN P. KARALIS and each of them, as the undersigned's
true and lawful attorneys and agents, with full power of
substitution and resubstitution for the undersigned and in the
undersigned's name, place and stead, in any and all capacities, to
sign the Tektronix, Inc. Annual Report on Form 10-K for the year
ended May 28, 1994 and any and all amendments thereto, and to file
the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission,
granting unto said attorneys and agents, and each of them, full
power and authority to do any and all acts and things necessary or
advisable to be done, as fully and to all intents and purposes as
the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys and agents or either of them, or
their or his substitute or substitutes, may lawfully do or cause to
be done by virtue hereof.
Dated: July 28, 1994
/s/ Andrew V. Smith
____________________________________
Andrew V. Smith
<PAGE>
POWER OF ATTORNEY
The undersigned constitutes and appoints JEROME J. MEYER, CARL W.
NEUN and JOHN P. KARALIS and each of them, as the undersigned's
true and lawful attorneys and agents, with full power of
substitution and resubstitution for the undersigned and in the
undersigned's name, place and stead, in any and all capacities, to
sign the Tektronix, Inc. Annual Report on Form 10-K for the year
ended May 28, 1994 and any and all amendments thereto, and to file
the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission,
granting unto said attorneys and agents, and each of them, full
power and authority to do any and all acts and things necessary or
advisable to be done, as fully and to all intents and purposes as
the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys and agents or either of them, or
their or his substitute or substitutes, may lawfully do or cause to
be done by virtue hereof.
Dated: August 11, 1994
/s/ Richard W. Sonnenfeldt
---------------------------------
Richard W. Sonnenfeldt
<PAGE>
POWER OF ATTORNEY
The undersigned constitutes and appoints JEROME J. MEYER, CARL W.
NEUN and JOHN P. KARALIS and each of them, as the undersigned's
true and lawful attorneys and agents, with full power of
substitution and resubstitution for the undersigned and in the
undersigned's name, place and stead, in any and all capacities, to
sign the Tektronix, Inc. Annual Report on Form 10-K for the year
ended May 28, 1994 and any and all amendments thereto, and to file
the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission,
granting unto said attorneys and agents, and each of them, full
power and authority to do any and all acts and things necessary or
advisable to be done, as fully and to all intents and purposes as
the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys and agents or either of them, or
their or his substitute or substitutes, may lawfully do or cause to
be done by virtue hereof.
Dated: July 27, 1994
/s/ William D. Walker
__________________________________
William D. Walker
<PAGE>
POWER OF ATTORNEY
The undersigned constitutes and appoints JEROME J. MEYER, CARL W.
NEUN and JOHN P. KARALIS and each of them, as the undersigned's
true and lawful attorneys and agents, with full power of
substitution and resubstitution for the undersigned and in the
undersigned's name, place and stead, in any and all capacities, to
sign the Tektronix, Inc. Annual Report on Form 10-K for the year
ended May 28, 1994 and any and all amendments thereto, and to file
the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission,
granting unto said attorneys and agents, and each of them, full
power and authority to do any and all acts and things necessary or
advisable to be done, as fully and to all intents and purposes as
the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys and agents or either of them, or
their or his substitute or substitutes, may lawfully do or cause to
be done by virtue hereof.
Dated: July 26, 1994
/s/ Jean Vollum
_________________________________
Jean Vollum
<PAGE>
POWER OF ATTORNEY
The undersigned constitutes and appoints JEROME J. MEYER, CARL W.
NEUN and JOHN P. KARALIS and each of them, as the undersigned's
true and lawful attorneys and agents, with full power of
substitution and resubstitution for the undersigned and in the
undersigned's name, place and stead, in any and all capacities, to
sign the Tektronix, Inc. Annual Report on Form 10-K for the year
ended May 28, 1994 and any and all amendments thereto, and to file
the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission,
granting unto said attorneys and agents, and each of them, full
power and authority to do any and all acts and things necessary or
advisable to be done, as fully and to all intents and purposes as
the undersigned might or could do in person, hereby ratifying and
confirming all that said attorneys and agents or either of them, or
their or his substitute or substitutes, may lawfully do or cause to
be done by virtue hereof.
Dated: July 28, 1994
/s/ Delbert W. Yocam
_________________________________
Delbert W. Yocam
<PAGE>
APPENDIX - EXHIBIT 13
APPENDIX
GRAPHIC AND IMAGE INFORMATION
IN EXHIBIT 13
(See text for tabular version of information.)
Page in
Annual Report and
Exhibit 13 Description of Graphics
----------------- ------------------------------------
10 Bar chart depicting net earnings
(adjusted).
10 Bar chart depicting net earnings
(reported).
10 Pie chart depicting 1994 sales by
product class.
11 Pie chart depicting 1994 sales by
product class.
13 Pie chart depicting market
capitalization.
13 Bar chart depicting total debt.
