-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, JtmkYe0Z6PVkI0OgAj48m1WVSsVJ1o1To2m9KQY3HbAdbV3gmkxyMRHeJzK4RO2u fKoq0hHjJiAHbAqx1OK7Qw== 0000317771-98-000059.txt : 19981113 0000317771-98-000059.hdr.sgml : 19981113 ACCESSION NUMBER: 0000317771-98-000059 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19981002 FILED AS OF DATE: 19981112 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TELLABS INC CENTRAL INDEX KEY: 0000317771 STANDARD INDUSTRIAL CLASSIFICATION: TELEPHONE & TELEGRAPH APPARATUS [3661] IRS NUMBER: 363831568 STATE OF INCORPORATION: DE FISCAL YEAR END: 1227 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 000-09692 FILM NUMBER: 98745435 BUSINESS ADDRESS: STREET 1: 4951 INDIANA AVE CITY: LISLE STATE: IL ZIP: 60532 BUSINESS PHONE: 6303788800 MAIL ADDRESS: STREET 1: 4951 INDIANA AVE CITY: LISLE STATE: IL ZIP: 60532 10-Q 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10Q [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended October 2, 1998 [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 0-9692 ---------- TELLABS, INC. --------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 36-3831568 ------------------------- ---------------------- (State of Incorporation) (I.R.S. Employer Identification No.) 4951 Indiana Avenue, Lisle, Illinois 60532 ------------------------------------ ------------ (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code (630) 378-8800 ------------------ Securities registered pursuant to Section 12(b) of the Act: Title of each class Name of each exchange on which registered None N/A ------------------------- --------- Securities registered pursuant to Section 12 (g) of the Act: Common shares, with $ .01 par value --------------------------------- (Title of Class) Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES [X] NO[ ] On October 2, 1998, 194,252,929 common shares of Tellabs, Inc. were outstanding. -1- TELLABS, INC. INDEX Page PART I. FINANCIAL INFORMATION Item 1. Financial Statements: Condensed Consolidated Comparative Balance Sheets 3 Condensed Consolidated Comparative Statements of Earnings 4 Condensed Consolidated Comparative Statements of Cash Flow 5 Notes to Condensed Consolidated Comparative Financial Statements 7 Item 2. Management's Discussion and Analysis 9 PART II. OTHER INFORMATION Item 5. Other Information 13 Item 6. Exhibits and Reports on Form 8-K 13 SIGNATURE 14 -2- TELLABS, INC. CONDENSED CONSOLIDATED COMPARATIVE BALANCE SHEETS (Unaudited) Oct. 2, Jan. 2, 1998 1998 Assets ----------- ----------- Current assets (In thousands) Cash and cash equivalents $233,455 $109,048 Investments in marketable securities 376,350 377,986 Accounts receivable, less allowance 322,303 284,084 Inventories Raw materials 51,579 28,335 Work in process 26,221 15,664 Finished goods 61,893 45,615 ----------- ----------- 139,693 89,614 Other current assets 9,126 2,202 ----------- ----------- Total Current Assets 1,080,927 862,934 Property, plant, and equipment 401,406 338,296 Less accumulated depreciation 154,157 128,967 ----------- ----------- 247,249 209,329 Goodwill, net 53,423 61,453 Intangibles and other assets, net 59,904 49,663 ----------- ----------- $1,441,503 $1,183,379 =========== =========== Liabilities Current Liabilities Accounts payable $59,472 $50,422 Accrued liabilities 71,751 115,917 Income taxes 47,038 59,481 ----------- ----------- Total Current Liabilities 178,261 225,820 Long-term debt 2,850 2,850 Other long-term liabilities 17,724 14,870 Deferred income taxes 9,139 6,730 Stockholders' Equity Preferred stock: authorized 5,000,000 shares of $.01 par value; no shares issued and outstanding - - Common stock: 500,000,000 shares of $.01 par value; 194,252,929 and 181,626,660 shares issued and outstanding 1,943 1,816 Additional paid-in capital 182,079 130,378 Cumulative foreign currency translation adjustment (8,781) (27,901) Unrealized net holding gains on available-for-sale securities 10,743 95,990 Retained earnings 1,047,545 732,826 ----------- ----------- Total Stockholders' Equity 1,233,529 933,109 ----------- ----------- $1,441,503 $1,183,379 =========== =========== The accompanying notes are an integral part of these statements. -3- TELLABS, INC. CONDENSED CONSOLIDATED COMPARATIVE STATEMENTS OF EARNINGS (Unaudited) Three Months Ended Nine Months Ended Oct. 2, Sept. 26, Oct. 2, Sept. 26, 1998 1997 1998 1997 --------- --------- ----------- ----------- (In thousands, except per-share data) Net sales $423,548 $309,408 $1,138,769 $849,232 Cost of sales 146,240 115,829 405,344 322,694 --------- --------- ----------- ----------- Gross Profit 277,308 193,579 733,425 526,538 Marketing, general and administrative expense 83,759 58,734 225,778 160,158 Research and development expense 52,221 40,039 143,446 110,807 Asset impairment - - 24,793 - Merger costs 12,991 - 12,991 - Goodwill amortization 1,334 1,493 4,184 4,516 --------- --------- ----------- ----------- Total Operating Expense 150,305 100,266 411,192 275,481 Operating Profit 127,003 93,313 322,233 251,057 Interest income 6,948 3,031 15,697 8,446 Interest expense (79) (14) (240) (312) Other (expense) income, net (3,853) 1,104 69,790 22,862 --------- --------- ----------- ----------- Earnings before income taxes 130,019 97,434 407,480 282,053 Income taxes 42,256 33,127 132,431 95,898 --------- --------- ----------- ----------- Net Earnings $87,763 $64,307 $275,049 $186,155 ========= ========= =========== =========== Earnings per share - Basic $0.46 $0.35 $1.49 $1.03 ========= ========= =========== =========== - Diluted $0.45 $0.34 $1.45 $1.00 ========= ========= =========== =========== Average number of shares of common stock outstanding - Basic 190,396 181,274 184,886 180,716 - Diluted 195,128 186,576 189,852 186,114 The accompanying notes are an integral part of these statements. -4- TELLABS, INC. CONDENSED CONSOLIDATED COMPARATIVE STATEMENTS OF CASH FLOW (Unaudited) For The Nine Months Ended Oct. 2, Sept. 26, 1998 1997 --------- --------- (In thousands) Cash Flows from Operating Activities: Net earnings $275,049 $186,155 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation and amortization 38,916 32,224 Provision for doubtful receivables 6,382 2,419 Deferred income taxes 3,876 (3,844) Gain on the sale of investments (74,152) (21,015) Asset impairment charge 24,793 - Merger costs 12,991 - Net changes in assets and liabilities, net of effects from acquisitions: Accounts receivable (30,601) (45,704) Inventories (42,752) (9,128) Other current assets 2,092 446 Long-term assets (31,405) (17,444) Accounts payable 6,742 4,093 Accrued liabilities (2,106) (7,061) Income taxes (14,301) 19,572 Long-term liabilities 2,751 3,062 ----------- ----------- Net Cash Provided by Operating Activities 178,275 143,775 Cash Flows from Investing Activities: Acquisition of property, plant and equipment, net (56,186) (65,262) Payments for purchases of marketable securities (380,952) (191,237) Proceeds from sales of marketable securities 329,376 133,406 Payments for acquisitions, net of cash acquired - (7,821) Cash acquired in merger, net of merger costs 12,728 - ----------- ----------- Net Cash Used in Investing Activities (95,034) (130,914) Cash Flows from Financing Activities: Common stock sold through stock-option plans * 37,530 30,928 ----------- ----------- Net Cash Provided by Financing Activities 37,530 30,928 Effect of exchange rate changes on cash 3,636 (6,382) ----------- ----------- Net increase in cash and cash equivalents 124,407 37,407 Beginning of period cash and cash equivalents 109,048 90,446 ----------- ----------- End of period cash and cash equivalents $233,455 $127,853 =========== =========== -5- TELLABS, INC. CONDENSED CONSOLIDATED COMPARATIVE STATEMENTS OF CASH FLOW (continued) (Unaudited - In thousands) For The Nine Months Ended Oct. 2, Sept. 26, 1998 1997 --------- --------- Supplemental Disclosures: Interest paid $181 $236 Income taxes paid $113,686 $57,089 Supplemental Schedule of Non-Cash Investing and Financing Activities: During 1997, in acquiring all of the outstanding shares of Trelcom Oy and certain wavelength-division multiplexing and optical networking technology and related assets from IBM, Tellabs, Inc. ("the Company") paid direct costs totaling $8,434,000. In conjunction with the acquisitions, the purchase prices are currently allocated as follows: (In thousands) --------- Fair value of assets acquired $1,777 Cost in excess of fair value 8,098 Liabilities assumed (1,441) --------- Cash paid for acquisitions $8,434 ========= * "Common stock sold through stock option plans" contains non-cash deferred tax benefits of $25,366,000 and $20,962,000 during the first nine months of 1998 and 1997, respectively. The accompanying notes are an integral part of these statements. -6- TELLABS, INC. NOTES TO CONDENSED CONSOLIDATED COMPARATIVE FINANCIAL STATEMENTS 1. Financial Information: The unaudited financial information reflects all adjustments (consisting only of normal recurring accruals) which are, in the opinion of management, necessary for a fair presentation of the statements contained herein. Certain reclassifications have been made in the 1997 financial statements to conform to the 1998 presentation. In accordance with Statement of Financial Accounting Standards No. 130, "Reporting Comprehensive Income", total comprehensive income for the three months ended October 2, 1998, and September 26, 1997, was $92,963,000 and $83,243,000, respectively. Total comprehensive income for the nine months ended October 2, 1998, and September 26, 1997, was $208,922,000 and $255,430,000, respectively. 2. Basis of Presentation: These financial statements are presented in accordance with the requirements of Form 10-Q and consequently may not include all disclosures normally required by generally accepted accounting principles or those normally reflected in the Company's Annual Report on Form 10-K. Accordingly, the financial statements and notes herein should be read in conjunction with the financial statements and related notes in the Company's Form 10-K for the year ended January 2, 1998. During the third quarter of 1998, the Company completed its merger with Coherent Communications Systems Corporation ("Coherent"). This transaction will be accounted for as an immaterial pooling of interests. Therefore, the Company will not restate any prior quarterly or annual financial results to reflect this transaction. -7- TELLABS, INC. NOTES TO CONDENSED CONSOLIDATED COMPARATIVE FINANCIAL STATEMENTS (continued) 3. Earnings Per Share Reconciliation The following table sets forth the computation of basic and diluted earnings per share: (In thousands, except per-share data) Three Months Ended Nine Months Ended 10/02/98 09/26/97 10/02/98 09/26/97 Numerator: -------- -------- -------- -------- Net Income $87,763 $64,307 $275,049 $186,155 Denominator: Denominator for basic earnings per share - weighted-average shares 190,396 181,274 184,886 180,716 Effect of Dilutive Securities: employee stock options and awards 4,732 5,302 4,966 5,398 ------ ------ ------ ------ Denominator for diluted earnings per share - adjusted weighted-average shares and assumed conversions 195,128 186,576 189,852 186,114 ======= ======= ======= ======= Basic earnings per share $0.46 $0.35 $1.49 $1.03 ======= ======= ======= ======= Diluted earnings per share $0.45 $0.34 $1.45 $1.00 ======= ======= ======= ======= -8- MANAGEMENT'S DISCUSSION AND ANALYSIS LIQUIDITY AND CAPITAL RESOURCES During the first nine months of 1998, the Company's cash and cash equivalents increased to $233,455,000 from the 1997 year-end balance of $109,048,000. The increase was driven by cash flows from operations of approximately $178,275,000, offset by payments to invest in marketable securities, net of proceeds from maturities, of approximately $51,576,000. The value of the Company's marketable securities portfolio at the end of the third quarter of 1998 remained almost unchanged when compared to the 1997 year-end balance. The aforementioned net purchases of investments in marketable securities were offset by a decrease in the market value of a particular investment. Accounts receivable, net of allowance, increased $38,219,000 during the first three quarters of 1998 due to record third-quarter sales. The increase in the inventory balance of $50,079,000, when compared to the 1997 year-end balance, reflects levels necessary to support expected fourth-quarter sales. During the second quarter of 1998, the Company determined that the value of assets acquired as part of the 1996 acquisition of the Company's Wireless Systems Division was impaired, resulting in the write-off of goodwill and other assets. Goodwill decreased $8,030,000 during the first nine months of 1998 as a result of the aforementioned write-off and the regular amortization of the balance. Other long-term assets increased $10,241,000 due to further capitalization of the Company's costs to develop a globally-integrated information system and the addition of various intangible assets and other long-term investments. The Company made a net investment of approximately $63,000,000 in property, plant and equipment during the first nine months of the year. The additions were primarily comprised of the Company's continued expansion of manufacturing and research and development capacity worldwide. The expansion of the facilities in Finland was completed during the first half of 1998, while the new facility in Ireland was opened during the third quarter of 1998. The Company expects net capital additions for 1998 to approximate $85,000,000, the majority of which is planned for the purchase of equipment and other tangible assets to be installed in the newly-expanded facilities. Accrued liabilities decreased $44,166,000 from the balance at January 2, 1998 primarily due to a decrease in deferred taxes related to the mark-to-market adjustment of marketable securities. Approximately 11,200,000 shares of common stock were issued as part of the third quarter merger with Coherent. The issuance of these shares contributed to the increase in common stock and additional paid-in capital of $51,828,000. Also as a result of the merger with Coherent, the Company acquired approximately $39,670,000 of retained earnings. -9- Net working capital at October 2, 1998 was $902,666,000, compared with net working capital of $637,114,000 at January 2, 1998. The Company's current ratio at the end of the third quarter was 6.1 to 1. The increase in net working capital when compared to the 1997 year-end level was primarily due to the net cash generated by operating activities. Management believes that this level of working capital will be adequate for the Company's liquidity needs related to normal operations, both currently and in the foreseeable future. Sufficient resources exist to support the Company's growth either through currently available cash, through cash generated from future operations, or through additional short-term or long-term financing. RESULTS OF OPERATIONS Sales during the third quarter of 1998 were $423,548,000, the highest sales in any quarter in the Company's history, which was an increase of 37 percent from sales in the third quarter of 1997 of $309,408,000. Substantial growth was realized in both the domestic and international markets. The domestic growth was driven by the Company's SONET-based TITAN (a registered trademark of Tellabs Operations, Inc.) 5500 digital cross-connect systems (the TITAN 5500 system), which experienced overall sales growth of 34 percent over the same period in 1997. Sales of the MartisDXX (a trademark of Tellabs Oy) integrated access and transport systems (the MartisDXX system) pushed the international sales growth by showing a sales increase of 29 percent in the third quarter of 1998, when compared to the third quarter of 1997. Digital echo canceller sales increased over 150 percent from 1997 sales levels, due in large part to the additional sales from the merger with Coherent. Earnings for the third quarter of 1998 were $87,763,000, up 37 percent from the 1997 third quarter earnings of $64,307,000. Third quarter 1998 earnings included a pre-tax charge of $12,991,000 for costs related to the Coherent merger and the unsuccessful merger attempt with CIENA Corporation. Excluding this one-time charge, third quarter 1998 earnings are 50 percent higher than the earnings in third quarter of 1997. Diluted earnings per share were 45 cents in the third quarter of 1998 (or, 49 cents per share, excluding such merger costs), compared with 34 cents per share for the third quarter of 1997. The gross profit margin percentage for the third quarter of 1998 increased to 65.5 percent from 62.6 percent in the third quarter of 1997. This increase is primarily the result of increased service revenue related to TITAN 5500 installations, along with greater efficiencies realized by the Company's manufacturing operations. Excluding the merger costs expensed during the third quarter of 1998, operating expenses increased by 37 percent over the third quarter of 1997. Expenses incurred for the installation of TITAN products and the Company's commitment to expand its service and support capabilities and research and development efforts worldwide were the drivers of the increase. In addition, 1998 third quarter operating expenses included expenses of the Coherent operations, which are not included in the 1997 results. The Company incurred an other non-operating loss of $3,853,000 during the third quarter of 1998, compared to other income of $1,104,000 during the third quarter of 1997. The strength of the U.S. dollar and Swedish -10- krona versus the Finnish markka, and the U.S. dollar versus the Irish punt during 1997, and the subsequent weakening of the same currencies in 1998 caused the swing in other income. Interest income increased to $6,948,000 in the third quarter of 1998, up 129 percent from $3,031,000 in the third quarter of 1997. This increase was due to significantly higher cash balances. The effective tax rate was approximately 32.5 percent for the third quarter of 1998 and 34.0 percent for the third quarter of 1997. The decrease in the effective tax rate for 1998 in comparison to the rate for 1997 is primarily due to the tax benefits associated with contributions to the Tellabs Foundation, as well as the asset impairment charge at the Company's Wireless Systems Division. Overall, the Company's 1998 and 1997 effective tax rates reflect the benefits of lower foreign tax rates as compared to the U.S. Federal statutory rate. Sales for the first nine months of 1998 were $1,138,769,000, which was an increase of 34 percent from sales of $849,232,000 for the same period in 1997. Domestic sales increased 43 percent for the first nine months of 1998, compared to 1997, primarily due to a 42 percent increase in TITAN 5500 system sales. MartisDXX system sales increased 25 percent over sales levels in 1997 driving the international sales growth of 17 percent. Sales of digital echo cancellers during the first nine months of 1998 increased 57 percent when compared to 1997 partially due to the inclusion of Coherent products. Net earnings for the first nine months of 1998 were $275,049,000, which included a pre-tax gain of on the sales of stock held as an investment and the settlement of related hedge contracts of $73,374,000, a pre-tax charge for impaired assets of $24,793,000, and a pre-tax charge for the aforementioned merger costs of $12,991,000, compared to $186,155,000, which included a pre-tax gain of $20,803,000 for the sale of stock held as an investment. Diluted earnings per share were $1.45 for the first nine months of the year ($1.32 excluding the effect of the stock sale, the asset impairment charge, and the merger costs) compared to $1.00 for the same period in 1997 (93 cents per share excluding the effect of the stock sale). The gross profit margin for the first nine months of 1998 improved to 64.4 percent versus 62.0 percent for the first nine months of 1997. This increase reflects higher service revenues related to new TITAN installations and increased efficiencies in the Company's production efforts. Operating expenses for the first nine months of 1998 increased 36 percent over the same period in 1997, excluding the asset impairment charge taken in the second quarter of 1998 and the charge for merger costs taken in the third quarter of 1998. Contributing to the overall increase are expenses incurred for the installation of TITAN products and the continuing international and domestic research and development efforts. Other income was $69,790,000 for the first nine months of 1998, compared to $22,862,000 during the same period in 1997. The first nine months of both 1998 and 1997 included gains on the sale of stock held as an investment. The gain in 1997 was $20,803,000, while the gain on the stock sale, along with the settlement of related hedge contracts was -11- $73,374,000 in 1998. Other income in the first nine months of 1998 included foreign exchange losses of $3,183,000, compared to gains in 1997 of $1,612,000. The strength of the U.S. dollar and Swedish krona versus the Finnish markka, and the U.S. dollar versus the Irish punt during 1997, and the subsequent weakening of the same currencies in 1998 caused the swing in foreign exchange income. Interest income contributed $15,697,000 to pre-tax income in the first three quarters of 1998, up 86 percent from $8,446,000 in 1997, primarily due to significantly higher average cash balances in 1998. The effective tax rate was approximately 32.5 percent for the first nine months of 1998 and 34.0 percent for the same period in 1997. The decrease in the 1998 effective tax rate is primarily due to the tax benefits associated with contributions to the Tellabs Foundation, as well as the asset impairment charge at the Company's Wireless Systems Division. Overall, the Company's 1998 and 1997 effective tax rates reflect the benefits of lower foreign tax rates as compared to the U.S. Federal statutory rate. YEAR 2000 READINESS The Company continues to address its readiness for Year 2000 issues. At the end of the third quarter of 1998, the Company's products are Year 2000 compliant. However, the Company's information technology (IT) systems and non-IT systems are not fully compliant, but are expected to be compliant by the second quarter of 1999. Potentially non-compliant systems consist only of non-critical systems. The extent of the impact of the non-compliance would be limited to minor personnel productivity inefficiencies caused by the need for alternative processes and procedures. The Company expects to incur expenses of approximately $1,000,000. In addition, the Company believes that no Year 2000 issues exist with a material third party. However, actual outcomes and results could be affected by other factors, including, but not limited to the continued availability of skilled personnel, cost control, the ability to locate and remediate software code problems, critical suppliers and subcontractors meeting their commitments to be Year 2000 ready, and timely actions by customers. Except for historical information, the matters discussed or incorporated by reference in this Quarterly Report on Form 10-Q are forward-looking statements that involve risks and uncertainties including, but not limited to, economic conditions, product demand and industry capacity, competitive products and pricing, manufacturing efficiencies, research and new product development, protection of and access to intellectual property, patents and technology, ability to attract and retain highly qualified personnel, availability of components and critical manufacturing equipment, Year 2000 readiness, facility construction and start-ups, the regulatory and trade environment, the availability and terms of future acquisitions and the uncertainties relating to the synergies, charges, and expenses associated with the proposed mergers described in the Company's filings, as well as other risks that may be detailed from time to time in the Company's filings with the Securities and Exchange Commission. The Company's actual future results could differ materially from those discusssed here. The Company undertakes no obligation to revise or update these forward-looking statements. -12- PART II. OTHER INFORMATION ITEM 5. Other Information The following is notice pursuant to Rule 14a-5(e)(2) and Rule 14a-4(c)(1) under the Securities Exchange Act of 1934, as amended, regarding the Company's use of discretionary authority with respect to non-Rule 14a-8 stockholder proposals which may be made at the 1999 Annual Meeting of Stockholders (the "1999 Annual Meeting"). If a proponent of a stockholder proposal at the 1999 Annual Meeting fails to provide notice of the intent to make such proposal by personal delivery or mail to the Secretary of the Company on or before February 1, 1999 (or by an earlier or later date, if such date is established by amendment to the Company's Bylaws), then any proxy solicited by management may confer discretionary authority to vote on such proposal. The foregoing does not apply to proposals submitted for inclusion in the Company's proxy statement for the 1999 Annual Meeting or to nominations of one or more directors for consideration at the 1999 Annual Meeting. As stated more fully in the Company's proxy statement for its 1998 Annual Meeting of Stockholders, notice of such proposals or of the intent to make such nomination or nominations must be made by personal delivery or by mail to the Secretary of the Company no later than November 16, 1998. ITEM 6. Exhibits and Reports on Form 8-K (A) Exhibits: Exhibit 27 - Financial Data Schedule (B) Reports on Form 8-K The Registrant filed a report on Form 8-K on August 17, 1998, with respect to the issuance of a press release announcing third quarter results for CIENA Corporation ("CIENA"), reaffirmations of their recommendations in favor of the proposed merger by the Boards of Directors of the Registrant and CIENA, and a clarification of previously reported proxy material. The Registrant filed a report on Form 8-K on August 21, 1998, with respect to the issuance of a press release announcing the adjournment of the Registrant's and CIENA's August 21, 1998, stockholders meetings to vote on the proposed merger. The Registrant filed a report on Form 8-K on August 31, 1998, detailing amendments to the Agreement and Plan of Merger between the Registrant, CIENA, and White Oak Merger Corporation, as well as the Stock Option Agreement between the Registrant and CIENA. -13- PART II. OTHER INFORMATION (continued) (B) Reports on Form 8-K (continued) The Registrant filed a report on Form 8-K on September 3, 1998, with respect to a press release announcing the adjournment of the Registrant's and CIENA's special stockholders meetings scheduled for September 9, 1998. The Registrant filed a report on Form 8-K on September 14, 1998, announcing the termination of its proposed merger with CIENA. SIGNATURE Pursuant to the requirements 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. TELLABS, INC. ---------------- (Registrant) s\ J. Peter Johnson -------------------- J. Peter Johnson Vice President/Controller & Chief Accounting Officer November 12, 1998 - ----------------- (Date) -14- EX-27 2
5 This schedule contains summary financial information extracted from the October 2, 1998, Income Statement and Balance Sheet and is qualified in its entirety by reference to such 10-Q. 9-MOS JAN-01-1999 OCT-02-1998 233455000 376350000 332911000 10608000 139693000 1080927000 401406000 154157000 1441503000 178261000 2850000 0 0 1943000 1231586000 1441503000 1138769000 1138769000 405344000 405344000 411192000 6382000 (15457000) 407480000 132431000 275049000 0 0 0 275049000 1.49 1.45
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