-----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, CtoDWfViGXoQLtqidO/oz+sKvibS7hEHfKkPYf81rUmfNWk4UWL9dYG/rOAQodad iAGQp5jUIGL5tI3rbIcSBQ== 0000738076-95-000017.txt : 19951016 0000738076-95-000017.hdr.sgml : 19951016 ACCESSION NUMBER: 0000738076-95-000017 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950831 FILED AS OF DATE: 19951013 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: 3COM CORP CENTRAL INDEX KEY: 0000738076 STANDARD INDUSTRIAL CLASSIFICATION: COMPUTER PERIPHERAL EQUIPMENT, NEC [3577] IRS NUMBER: 942605794 STATE OF INCORPORATION: CA FISCAL YEAR END: 0531 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-12867 FILM NUMBER: 95580270 BUSINESS ADDRESS: STREET 1: 5400 BAYFRONT PLZ CITY: SANTA CLARA STATE: CA ZIP: 95052 BUSINESS PHONE: 4087645000 10-Q 1 _____________________________________________________________________ UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-Q X Quarterly report pursuant to section 13 or 15(d) of the securities exchange act of 1934 For the Quarterly Period Ended Commission File No. 0-12867 August 31, 1995 or Transition report pursuant to section 13 or 15(d) of the securities exchange act of 1934 For the transition period from to ____________ 3Com Corporation (Exact name of registrant as specified in its charter) California 94-2605794 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 5400 Bayfront Plaza 95052 Santa Clara, California (Zip Code) (Address of principal executive offices) Registrant's telephone number, including area code (408) 764-5000 Former name, former address and former fiscal year, if changed since last report: N/A 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 ....XX.... No ................ As of August 31, 1995, 143,992,931 shares of the Registrant's Common Stock were outstanding. _____________________________________________________________________ 3Com Corporation Table of Contents PART I. FINANCIAL INFORMATION Item 1. Financial Statements Consolidated Balance Sheets August 31, 1995 and May 31, 1995 Consolidated Income Statements Quarters Ended August 31, 1995 and 1994 Consolidated Statements of Cash Flows Quarters Ended August 31, 1995 and 1994 Notes to Consolidated Financial Statements Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations PART II. OTHER INFORMATION Item 1. Legal Proceedings Item 2. Changes in Securities Item 3. Defaults Upon Senior Securities Item 4. Submission of Matters to a Vote of Security Holders Item 5. Other Information Item 6. Exhibits and Reports on Form 8-K Signatures PART I. FINANCIAL INFORMATION Item 1. Financial Statements 3Com Corporation Consolidated Balance Sheets (dollars in thousands) August 31, May 31, 1995 1995 ---------- ---------- (unaudited) ASSETS Current Assets: Cash and cash equivalents $186,428 $149,210 Temporary cash investments 151,385 184,338 Trade receivables 237,401 199,939 Inventories 141,843 124,058 Deferred income taxes 45,608 43,922 Other 18,522 21,868 ------- ------- Total current assets 781,187 723,335 Property and equipment-net 131,989 110,449 Other assets 15,288 24,022 ------- ------- Total $928,464 $857,806 ======= ======= LIABILITIES AND SHAREHOLDERS' EQUITY Current Liabilities: Accounts payable $ 90,651 $ 92,750 Accrued and other liabilities 118,685 126,124 Income taxes payable 61,961 52,853 Current portion of long-term obligations 404 197 ------- ------- Total current liabilities 271,701 271,924 Long-term debt 110,000 110,000 Other long-term obligations 280 1,094 Shareholders' Equity: Preferred stock, no par value, 3,000,000 shares authorized; none outstanding - - Common stock, no par value, 400,000,000 shares authorized; shares outstanding: August 31, 1995: 143,992,931; May 31, 1995: 143,064,572 324,237 311,075 Unamortized restricted stock grants (2,647) (2,037) Retained earnings 225,156 165,735 Unrealized gain on available-for-sale securities 270 184 Accumulated translation adjustments (533) (169) ------- ------- Total shareholders' equity 546,483 474,788 ------- ------- Total $928,464 $857,806 ======= ======= See notes to consolidated financial statements. 3Com Corporation Consolidated Income Statements (in thousands except per share data) (unaudited) Quarters Ended August 31, ---------------- 1995 1994 ---- ---- Sales $430,354 $262,801 Costs and expenses: Cost of sales 199,874 123,892 Sales and marketing 82,113 53,104 Research and development 41,139 27,923 General and administrative 16,813 11,050 ------- ------- Total 339,939 215,969 ------- ------- Operating income 90,415 46,832 Other income-net 1,002 851 ------- ------- Income before income taxes 91,417 47,683 Income tax provision 31,996 16,911 ------- ------- Net income $ 59,421 $ 30,772 ======= ======= Net income per common and equivalent share: Primary $ .38 $ .21 Fully diluted $ .38 $ .21 Common and equivalent shares used in computing per share amounts: Primary 155,326 146,861 Fully diluted 155,773 148,276 See notes to consolidated financial statements. 3Com Corporation Consolidated Statements of Cash Flows (dollars in thousands) (unaudited) Quarters Ended August 31, ---------------- 1995 1994 ---- ---- Cash flows from operating activities: Net income $ 59,421 $30,772 Adjustments to reconcile net income to cash provided by operating activities: Depreciation and amortization 15,717 10,423 Deferred income taxes 4,579 (2,931) Adjustment to conform fiscal year of pooled entity - Primary Access - 3,013 Changes in assets and liabilities, net of effects of acquisitions: Trade receivables (37,462) (5,245) Inventories (18,263) 12,529 Other current assets 3,346 (69) Accounts payable (2,099) (9,782) Accrued and other liabilities (7,450) (14,992) Income taxes payable 17,749 16,478 Restructuring liabilities - (752) ------- ------- Net cash provided by operating activities 35,538 39,444 ------- ------- Cash flows from investing activities: Purchase of property and equipment (33,550) (13,907) Purchase of temporary cash investments (35,073) (5,092) Proceeds from temporary cash investments 67,945 4,767 Other-net (293) 2,222 ------- ------- Net cash used for investing activities (971) (12,010) ------- ------- Cash flows from financing activities: Sale of stock 3,601 2,106 Repurchases of common stock - (16,893) Repayments of notes payable and capital lease obligations (586) (933) Other-net (364) 26 ------- ------- Net cash provided by (used for) financing activities 2,651 (15,694) ------- ------- Increase in cash and cash equivalents 37,218 11,740 Cash and cash equivalents at beginning of period 149,210 69,768 ------- ------- Cash and cash equivalents at end of period $186,428 $ 81,508 ======= ======= Non-cash financing and investing activities: Tax benefit on stock option transactions $ 8,698 $ 2,497 See notes to consolidated financial statements. 3Com Corporation Notes to Consolidated Financial Statements 1. The consolidated financial statements include the accounts of 3Com Corporation (the "Company") and its wholly-owned subsidiaries. All significant intercompany balances and transactions have been eliminated. In the opinion of management, these unaudited consolidated financial statements include all adjustments necessary for a fair presentation of the Company's financial position as of August 31, 1995, and the results of operations and cash flows for the quarters ended August 31, 1995 and 1994. The results of operations for the quarter ended August 31, 1995 may not necessarily be indicative of the results for the fiscal year ending May 31, 1996. These financial statements should be read in conjunction with the consolidated financial statements and related notes thereto included in the Company's Annual Report to Shareholders for the fiscal year ended May 31, 1995. 2. Inventories consisted of (in thousands): August 31, May 31, 1995 1995 ---- ---- Finished goods $ 84,695 $ 73,061 Work-in-process 11,946 14,035 Raw materials 45,202 36,962 ------- ------- Total $141,843 $124,058 ======= ======= 3. Net Income Per Share Net income per common and equivalent share is computed based on the weighted average number of common shares and the dilutive effects of stock options outstanding during the period using the treasury stock method. The effect of the assumed conversion of the 10.25% convertible subordinated notes was antidilutive for the periods presented. Weighted average shares outstanding and per share amounts have been restated to reflect the two-for- one stock split on August 25, 1995 for shareholders of record on August 4, 1995. 4. Business Combinations On June 9, 1995, the Company acquired Primary Access Corporation (Primary Access) by issuing approximately 4.6 million shares of its common stock for all of the outstanding stock of Primary Access. The Company also assumed and exchanged all options and warrants to purchase Primary Access stock for options and warrants to purchase approximately 1.0 million shares of the Company's common stock. Primary Access develops, manufactures and markets network access systems. The acquisition was accounted for as a pooling-of-interests. All financial data of the Company has been restated to include the operating results of Primary Access. No significant adjustments were required to conform the accounting policies of the Company and Primary Access. On July 26, 1995, the Company announced a definitive agreement to acquire Chipcom Corporation (Chipcom), headquartered in Southborough, Massachusetts. Chipcom designs, manufactures and distributes computer networking intelligent switching systems, including hubs, internetworking and network management products. The transaction will be accounted for as a pooling-of-interests. Chipcom's revenue and net income for the quarter ended July 1, 1995 were $71.5 million and $1.2 million, respectively. As of July 1, 1995, Chipcom's assets totaled $236.1 million and stockholder's equity was $172.7 million. Under the terms of the agreement, each outstanding share of common stock of Chipcom will be converted into the right to receive 1.06 shares of common stock of the Company. The Company expects to issue approximately 18.1 million shares of its common stock and options to purchase 1.4 million shares of the Company's common stock in exchange for all outstanding common stock and options of Chipcom. The merger is subject to approval by the stockholders of Chipcom and is expected to be completed in October 1995. It is expected that as a result of the merger, the combined company will incur approximately $60 to $70 million of direct transaction costs and restructuring expenses relating to the business combination, including writedown of certain assets, elimination of duplicate management information systems and facilities, and severance and outplacement costs. These nonrecurring costs will be charged to operations in the fiscal quarter in which the merger is consummated. 3Com Corporation Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Acquisitions During the quarter ended August 31, 1995, 3Com extended its High Performance Scalable Networking (HPSN) solutions to network service providers and carriers with the acquisition of Primary Access Corporation (Primary Access), a provider of integrated network access systems, on June 9, 1995. The Company issued approximately 4.6 million shares of its common stock in exchange for all the outstanding stock of Primary Access. The Company also assumed and exchanged all options and warrants to purchase Primary Access stock for options and warrants to purchase approximately 1.0 million shares of the Company's common stock. The acquisition was accounted for as a pooling-of-interests and all financial data of the Company prior to the acquisition has been restated to include the historical financial data of Primary Access. On July 26, 1995, the Company announced a definitive agreement to acquire Chipcom Corporation (Chipcom). The merger is expected to be consummated in October 1995. See Note 4 of Notes to Consolidated Financial Statements for additional information on the above business combinations. Results of Operations The Company achieved record sales in the first quarter of fiscal 1996 totaling $430.4 million, an increase of $167.6 million or 64 percent from the corresponding quarter a year ago. Compared with the fourth quarter of fiscal 1995, sales for the first quarter of fiscal 1996 increased $37.0 million or nine percent. The Company believes that the year-over-year increase in first quarter sales is due to several factors, including strong market acceptance of the Company's new products, continued strength in the data networking market as customers embrace new technologies such as switching, increases in personal computer sales, the breadth of 3Com's product offerings and its ability to deliver complete data networking solutions for different connectivity environments. Sales from products introduced in the last 12 months represented 60 percent of total sales in the first quarter of fiscal 1996, an increase from 24 percent of total sales in the first quarter of fiscal 1995. Sales of network systems products (i.e., internetworking platforms, remote access servers, hubs and switching products) in the first quarter of fiscal 1996 represented 52 percent of total sales and increased 99 percent from the same quarter one year ago. In the first quarter of fiscal 1995, sales of network systems products represented 43 percent of total sales. The increase was led primarily by the LinkBuilder(R) FMS(TM) II stackable hub, a component of 3Com's SuperStack(TM) family of network systems products, the LANplex(R) family of switching products and the NETBuilder(R) Remote Office internetworking system. Also contributing to the sales increase was the introduction of the LinkSwitch(TM) 1000 stackable switch during the quarter. The Company believes there is an increasing demand for fully functional, fault-tolerant, lower-priced network systems in a stackable format. 3Com is currently delivering hubs, remote office routers, LAN switching products and a redundant power system in a stackable format, which can be used in various combinations within the Company's SuperStack network system. Sales of network adapters in the first quarter of fiscal 1996 represented 44 percent of total sales and increased 36 percent from the year-ago period. In the first quarter of fiscal 1995, sales of network adapters represented 52 percent of total sales. The increase in network adapter sales represented an increase in unit volume partially offset by continuation of the industry-wide trend toward decreasing average selling prices, particularly in the Token Ring market. The increase in unit volume primarily resulted from sales of the EtherLink(R) III network adapters, but was also favorably impacted by sales of the PC Card adapter and the Fast EtherLink PCI adapter. Sales of other products (i.e., terminal servers, customer service, protocols and other products) represented four percent of total sales in the first quarter of fiscal 1996. Sales of other products increased 47 percent from the year-ago period, although they continued to represent a decreasing percentage of the Company's total sales, as expected. Sales outside of the United States comprised 52 percent of total sales in the first quarter of fiscal 1996, compared to 48 percent for the same period last year. International sales increased in all geographic regions, especially in the Asia Pacific and Latin American regions. The Company believes that this increase reflected its continued global expansion through the opening of new sales offices in Latin America and Asia and the expansion of its worldwide service and support programs. The Company's operations were not significantly impacted by fluctuations in foreign currency exchange rates in the first quarters of fiscal 1996 and 1995. Cost of sales as a percentage of sales was 46.4 percent in the first quarter of fiscal 1996, compared to 47.1 percent for the first quarter of fiscal 1995. The resulting improvement in gross margin in the first quarter of fiscal 1996 primarily reflected a favorable shipment mix to the Company's switching products and reductions in adapter product material costs improving gross margin by 1.2 percentage points. However, higher freight and duties partially offset this improvement by 0.7 percentage points. Total operating expenses in the first quarter of fiscal 1996 were $140.1 million, or 32.5 percent of sales, compared to $92.1 million, or 35.0 percent of sales, in the first quarter of fiscal 1995. Sales and marketing expenses in the first quarter of fiscal 1996 increased $29.0 million or 55 percent from fiscal 1995. The increase in such expenses reflected increased selling costs related to the 64 percent increase in sales volume, the cost of promoting the Company's new and existing products, and a 38 percent year-over-year increase in sales and marketing personnel. However, as a percentage of sales, sales and marketing expenses decreased to 19.1 percent in the first quarter of fiscal 1996, from 20.2 percent in the corresponding fiscal 1995 period. Research and development expenses in the first quarter of fiscal 1996 increased $13.2 million or 47 percent from the year- ago period. As a percentage of sales, such expenses decreased to 9.6 percent in fiscal 1996, compared to 10.6 percent in the first quarter of fiscal 1995. The increase in research and development expenses was primarily attributable to the cost of developing 3Com's new products including the Company's expansion into new technologies and markets. The Company believes the timely introduction of new technologies and products is crucial to its success, and will continue to make strategic acquisitions to accelerate time to market where appropriate. Most of the research and development projects acquired in connection with the Company's business acquisitions since December 1993 have been completed. The projects that are still in process primarily include the development of ATM-based products for the enterprise market and products based on ISDN technology for the small office/home office environments. The nature of costs for such development activities is primarily labor costs for design, prototype development and testing. The Company estimates that an aggregate of approximately $10 to $15 million will be expensed over the next four to twelve months in connection with completion of all acquired research and development projects. The Company anticipates total future research and development spending as a percent of sales will not significantly differ from its historical trend. General and administrative expenses in the first quarter of fiscal 1996 increased $5.8 million or 52 percent from the same period a year-ago. The increase in general and administrative expenses reflected expansion of the Company's infrastructure through internal growth and acquisitions. General and administrative personnel increased 32 percent from the prior year. However, as a percentage of sales, such expenses decreased to 3.9 percent in the first quarter of fiscal 1996, from 4.2 percent in the corresponding fiscal 1995 period. Other income (net) was $1.0 million in the first quarter of fiscal 1996, compared to $0.9 million in the first quarter of fiscal 1995. These amounts consisted primarily of interest income, which increased $3.2 million in the first quarter of fiscal 1996 due to larger cash and investment balances, partially offset by the increase in interest expense associated with the $110.0 million of convertible subordinated notes issued in the second quarter of fiscal 1995. The Company's effective income tax rate was approximately 35 percent in the first quarter of fiscal 1996 and 1995. Net income for the first quarter of fiscal 1996 was $59.4 million, or $0.38 per share, compared to net income of $30.8 million, or $0.21 per share, for the first quarter of fiscal 1995. Net income per share for fiscal 1995 has been restated to reflect the two-for-one stock split on August 25, 1995. Business Environment and Risk Factors The Company's future operating results may be affected by various trends and factors which the Company must successfully manage in order to achieve favorable operating results. In addition, there are trends and factors beyond the Company's control which affect its operations. Such trends and factors include adverse changes in general economic conditions or conditions in the specific markets for the Company's products, governmental regulation or intervention affecting communications or data networking, fluctuations in foreign exchange rates, and other factors, including those listed below. The data networking industry has become increasingly competitive, and the Company's results may be adversely affected by the actions of existing or future competitors. Such actions may include the development or acquisition of new technologies, the introduction of new products, the assertion by third parties of patent or similar intellectual property rights, and the reduction of prices by competitors to gain or retain market share. Industry consolidation or alliances may also affect the competitive environment. The market for the Company's products is characterized by rapidly changing technology. The Company's success depends in substantial part on the timely and successful introduction of new products. An unexpected change in one or more of the technologies affecting data networking or in market demand for products based on a particular technology could have a material adverse effect on the Company's operating results if the Company does not respond timely and effectively to such changes. The Company is engaged in research and development activities in certain emerging LAN and WAN high-speed technologies, such as ATM, ISDN and Fast Ethernet. As the industry standardizes on high-speed technologies, there can be no assurance that the Company will be able to respond timely to compete in the marketplace. Some key components of the Company's products are currently available only from single sources. There can be no assurance that in the future the Company's suppliers will be able to meet the Company's demand for components in a timely and cost effective manner. The Company's operating results and customer relationships could be adversely affected by either an increase in prices for, or an interruption or reduction in supply of, any key components. The Company is currently increasing its manufacturing facility capabilities in the United States and Ireland and has begun investigating the creation of a manufacturing operation in Asia. While the Company has significant experience in expanding its manufacturing operations, such expansion may be subject to delay and unexpected costs due to labor issues, adverse weather and construction or other unforeseeable factors. Acquisitions of complementary businesses and technologies, including technologies and products under development, are an active part of the Company's overall business strategy. The Company has recently consummated acquisitions of several companies, including Sonix Communications, Ltd. and Primary Access, and announced the acquisition of Chipcom. There can be no assurance that products, technologies and businesses of acquired companies will be effectively assimilated into the Company's business or product offerings, or that the effects of such integration will not adversely affect the Company's business, financial condition or results of operations. The difficulties of such integration may be increased by the necessity of coordinating geographically separated organizations. There can be no assurance that any acquired products, technologies or businesses will contribute to the Company's revenues or earnings. The pending acquisition of Chipcom represents the largest acquisition the Company has engaged in to date. The complexity, and thus risk, of this transaction may well be more significant than any of the Company's past acquisitions. The market price of the Company's common stock has been, and may continue to be, extremely volatile. Factors such as new product announcements by the Company or its competitors, quarterly fluctuations in the Company's operating results, challenges associated with integration of acquired businesses and general conditions in the data networking market may have a significant impact on the market price of the Company's common stock. These conditions, as well as factors which generally affect the market for stocks of high technology companies, could cause the price of the Company's stock to fluctuate substantially over short periods. The Company's corporate headquarters and a large portion of its research and development activities and other critical business operations are located near major earthquake faults. The Company's business, financial condition and operating results could be materially adversely affected in the event of a major earthquake. Because of the foregoing factors, as well as other factors affecting the Company's operating results, past trends and performance should not be presumed by investors to be an accurate indicator of future results or trends. Liquidity and Capital Resources Cash, cash equivalents and temporary cash investments at August 31, 1995 were $337.8 million, increasing $4.3 million from May 31, 1995. For the three months ended August 31, 1995, net cash generated from operating activities was $35.5 million. Trade receivables at August 31, 1995 increased $37.5 million from May 31, 1995 due primarily to an increase in sales. Days sales outstanding in receivables was 50 days at August 31, 1995, compared to 46 days at May 31, 1995. Inventory levels at August 31, 1995 increased $17.8 million from the prior fiscal year-end, with inventory turnover at 6.0 turns at August 31, 1995, compared to 6.6 turns at May 31, 1995. During the three months ended August 31, 1995, the Company made $33.6 million in capital expenditures. Major capital expenditures included upgrades and additions to product manufacturing lines and facilities in Santa Clara and Ireland, furnishings and improvements to new facilities in Santa Clara and the Boston area, and upgrades of desktop systems. During the first quarter of fiscal 1996, the Company received cash of $3.6 million from the sale of its common stock to employees through its employee stock purchase and option plans. During the first quarter of fiscal 1995, the Company signed a five-year lease for 225,000 square feet of office and manufacturing space to be built on land adjacent to its existing headquarters in Santa Clara. This arrangement provides the Company with an option to purchase the related property during the lease term, and at the end of the lease term the Company is obligated to either purchase the property or arrange for the sale of the property to a third party with a guaranteed residual value of up to $33.5 million to the seller of the property. The Company commenced occupancy of the facility in the first quarter of fiscal 1996, with payments on the lease starting in September 1995. The Company has a $40 million revolving bank credit agreement which expires December 31, 1996. No amount is outstanding under the credit agreement and the Company is in compliance with all financial ratio and minimum net worth requirements. Based on current plans and business conditions, the Company believes that its existing cash and equivalents, temporary cash investments, cash generated from operations and the available revolving credit agreement will be sufficient to satisfy anticipated operating cash requirements for at least the next twelve months. PART II. OTHER INFORMATION Item 1. Legal Proceedings Not applicable. Item 2. Changes in Securities None. Item 3. Defaults Upon Senior Securities None. Item 4. Submission of Matters to a Vote of Security Holders None. Item 5. Other Information None. Item 6. Exhibits and Reports on Form 8-K (a) Exhibits Exhibit Number Description ------ ----------- 3.1 Amended and Restated Articles of Incorporation (Exhibit 19.1 to Form 10-Q) (6) 3.2 Certificate of Amendment of the Amended and Restated Articles of Incorporation (Exhibit 3.2 to Form 10-K) (14) 3.3 Bylaws, as amended and restated (Exhibit 3.2 to Form 10-K) (7) 4.1 Reference is made to Exhibit 3.1 (Exhibit 4.1 to Form 10-K) (14) 4.2 Indenture Agreement between 3Com Corporation and The First National Bank of Boston for the private placement of convertible subordinated notes dated as of November 1, 1994 (Exhibit 5.2 to Form 8-K) (17) 4.3 Placement Agreement for the private placement of convertible subordinated notes dated November 8, 1994 (Exhibit 5.1 to Form 8-K) (17) 4.4 Amended and Restated Rights Agreement dated December 31, 1994 (Exhibit 10.27 to Form 10-Q) (18) 10.1 1983 Stock Option Plan, as amended (Exhibit 10.1 to Form 10-K) (7)* 10.2 Amended and Restated Incentive Stock Option Plan (4)* 10.3 License Agreement dated March 19, 1981 (1) 10.4 First Amended and Restated 1984 Employee Stock Purchase Plan, as amended (Exhibit 19.1 to Form 10-Q) (8)* 10.5 License Agreement dated as of June 1, 1986 (Exhibit 10.16 to Form 10-K) (3) 10.6 3Com Corporation Director Stock Option Plan, as amended (Exhibit 19.3 to Form 10-Q) (8)* 10.7 Bridge Communications, Inc. 1983 Stock Option Plan, as amended (Exhibit 4.7 to Form S-8) (2)* 10.8 3Com Headquarters Lease dated December 1, 1988, as amended (Exhibit 10.14 to Form 10-K) (7) 10.9 Ground Lease dated July 5, 1989 (Exhibit 10.19 to Form 10-K) (5) 10.10 Sublease Agreement dated February 9, 1989 (Exhibit 10.20 to Form 10-K) (5) 10.11 Credit Agreement dated April 21, 1993 (Exhibit 10.11 to Form 10-K) (11) 10.12 Amendment to Credit Agreement (Exhibit 10.20 to Form 10-Q) (12) 10.13 Second Amendment to Credit Agreement (Exhibit 10.21 to Form 10-Q) (12) 10.14 3Com Corporation Restricted Stock Plan dated July 9, 1991 (Exhibit 19.2 to Form 10-Q) (8)* 10.15 Form of Escrow and Indemnification Agreement for Directors and Officers (Exhibit 10.15 to Form 10-Q) (13) 10.16 Agreement and Plan of Reorganization dated December 16, 1993 among 3Com Corporation, 3Sub Corporation and Synernetics, Inc. (Exhibit 7.1 to Form 8-K) (9) 10.17 Side Agreement Regarding Agreement and Plan of Reorganization dated January 14, 1993 among 3Com Corporation, 3Sub Corporation and Synernetics, Inc. (Exhibit 7.2 to Form 8-K) (9) 10.18 Agreement and Plan of Reorganization dated January 18, 1994 (Exhibit 7.2 to Form 8-K) (10) 10.19 Indemnification and Escrow Agreement dated February 2, 1994 (Exhibit 7.3 to Form 8-K) (10) 10.20 1994 Stock Option Plan (Exhibit 10.22 to Form 10-K) (14)* 10.21 Lease Agreement between BNP Leasing Corporation, as Landlord, and 3Com Corporation, as Tenant, effective as of July 14, 1994 (Exhibit 10.23 to Form 10-Q) (15) 10.22 Purchase Agreement between BNP Leasing Corporation and 3Com Corporation, dated July 14, 1994 (Exhibit 10.24 to Form 10-Q) (15) 10.23 Asset Purchase Agreement dated September 18, 1994 among 3Com Corporation, NiceCom, Ltd., and Nice Systems, Ltd. (Exhibit 7.1 to Form 8-K) (16) 10.24 First Amendment to Asset Purchase Agreement dated October 17, 1994 among 3Com Corporation, NiceCom, Ltd., and Nice Systems, Ltd. (Exhibit 7.2 to Form 8-K) (16) 10.25 Acquisition and Exchange Agreement dated March 22, 1995 among 3Com Corporation and Shareholders of Sonix Communications Limited (Exhibit 7.1 to Form 8-K) (19) 10.26 Agreement and Plan of Reorganization, dated March 21, 1995, by and among 3Com Corporation, Anuinui Acquisition Corporation and Primary Access Corporation (Appendix A to prospectus included in Form S-4) (20) 10.27 Amendment to Agreement and Plan of Reorganization, dated May 30, 1995 by and among 3Com Corporation, Anuinui Acquisition Corporation and Primary Access Corporation (Appendix A-1 to prospectus included in Form S-4) (20) 10.28 Escrow Agreement, dated June 9, 1995 by and among 3Com Corporation, The First National Bank of Boston and Tench Coxe, Kathryn C. Gould and William R. Stensrud as Shareholders' Agents (Exhibit 10.27 to Form S-4) (20) 10.29 Agreement and Plan of Merger dated as of July 26, 1995 among 3Com Corporation, Chipcom Acquisition Corporation and Chipcom Corporation (Exhibit 2.1 to Form S-4) (21) - ----------------------------------------------------------------------------- *Indicated a management contract or compensatory plan. (1) Incorporated by reference to the corresponding Exhibit previously filed as an Exhibit to Registrant's Registration Statement on Form S-1 filed January 25, 1984 (File No. 2-89045) (2) Incorporated by reference to the Exhibit identified in parentheses previously filed as an Exhibit to Registrant's Registration Statement on Form S-8 filed October 13, 1987 (File No. 33-17848) (3) Incorporated by reference to the corresponding Exhibit or the Exhibit identified in parentheses previously filed as an Exhibit to Registrant's Form 10-K filed August 29, 1987 (File No. 0-12867) (4) Incorporated by reference to Exhibit 10.2 to Registrant's Registration Statement on Form S-4 filed on August 31, 1987 (File No. 33-16850) (5) Incorporated by reference to the corresponding Exhibit or the Exhibit identified in parentheses previously filed as an Exhibit to Registrant's Form 10-K filed on August 28, 1989 (File No. 0-12867) (6) Incorporated by reference to the Exhibit identified in parentheses previously filed as an Exhibit to Registrant's Form 10-Q filed on January 2, 1991 (File No. 0-12867) (7) Incorporated by reference to the Exhibit identified in parentheses previously filed as an Exhibit to Registrant's Form 10-K filed on August 27, 1991 (File No. 0-12867) (8) Incorporated by reference to the Exhibit identified in parentheses previously filed as an Exhibit to Registrant's Form 10-Q filed January 10, 1992 (File No. 0-12867) (9) Incorporated by reference to the Exhibit identified in parentheses previously filed as an Exhibit to Registrant's Form 8-K filed on January 31, 1994 (File No. 0-12867) (10) Incorporated by reference to the Exhibit identified in parentheses previously filed as an Exhibit to Registrant's Form 8-K filed on February 11, 1994 (File No. 0-12867) (11) Incorporated by reference to the Exhibit identified in parentheses previously filed as an Exhibit to Registrant's Form 10-K filed on August 27, 1993 (File No. 0-12867) (12) Incorporated by reference to the Exhibit identified in parentheses previously filed as an Exhibit to Registrant's Form 10-Q filed on April 13, 1994 (File No. 0-12867) (13) Incorporated by reference to the Exhibit identified in parentheses previously filed as an Exhibit to Registrant's Form 10-Q filed on January 14, 1994 (File No. 0-12867) (14) Incorporated by reference to the Exhibit identified in parentheses previously filed as an Exhibit to Registrant's Form 10-K filed on August 31, 1994 (File No. 0-12867) (15) Incorporated by reference to the Exhibit identified in parentheses previously filed as an Exhibit to Registrant's Form 10-Q filed on October 16, 1994 (File No. 0-12867) (16) Incorporated by reference to the Exhibit identified in parentheses previously filed as an Exhibit to Registrant's Form 8-K filed on November 1, 1994 (File No. 0-12867) (17) Incorporated by reference to the Exhibit identified in parentheses previously filed as an Exhibit to Registrant's Form 8-K filed on November 16, 1994 (File No. 0-12867) (18) Incorporated by reference to the Exhibit identified in parentheses previously filed as an Exhibit to Registrant's Form 10-Q filed on January 13, 1995 (File No. 0-12867) (19) Incorporated by reference to the Exhibit identified in parentheses previously filed as an Exhibit to Registrant's Form 8-K filed on May 16, 1995 (File No. 0-12867) (20) Incorporated by reference to the Exhibit or other item identified in parentheses previously filed as an Exhibit to or included in Registrant's Registration Statement on Form S-4, originally filed on March 23, 1995 (File No. 33-58203) (21) Incorporated by reference to the Exhibit identified in parentheses previously filed as an Exhibit to Registrant's Registration Statement on Form S-4, originally filed on August 31, 1995 (File No. 33-62297) (b) Reports on Form 8-K The Company filed two reports on Form 8-K during the fiscal quarter covered by this report as follows: (i) Report on Form 8-K filed on June 20, 1995, reporting under Item 2 the completion of the acquisition of Primary Access Corporation effective June 9, 1995. (ii) Report on Form 8-K filed July 31, 1995, reporting under Item 5 the press release announcing the agreement to merge Chipcom Corporation into a wholly-owned subsidiary of 3Com Corporation. A report on Form 8-K/A amending the Report on Form 8-K, dated May 16, 1995 relating to the acquisition of Sonix Communications, Ltd., was filed on June 5, 1995, and included the following exhibits filed in their entirety: - Acquisition and Exchange Agreement dated March 22, 1995 among 3Com Corporation and all the holders of Ordinary Shares and options of Sonix Communications Limited. - Escrow Agreement dated March 22, 1995 among 3Com Corporation, the Shareholders of Sonix Communications Limited and the Escrow Agent. Signatures 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. 3Com Corporation (Registrant) Dated: October 12, 1995 By: /s/ Christopher B. Paisley ---------------- ---------------------------------- Christopher B. Paisley Vice President Finance and Chief Financial Officer (Principal Financial Officer) EX-27 2
5 0000738076 3COM CORPORATION 1000 3-MOS MAY-31-1996 AUG-31-1995 186,428 151,385 254,597 (17,196) 141,843 781,187 269,497 (137,508) 928,464 271,701 0 324,237 0 0 222,246 928,464 430,354 430,354 199,874 281,987 52,678 1,316 2,956 91,417 31,996 0 0 0 0 59,421 .38 .38
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