UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

                 [X] QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934
                  For the quarterly period ended June 30, 1997

                                       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 0-18645

                           TRIMBLE NAVIGATION LIMITED
             (Exact name of registrant as specified in its charter)

                California                       94-2802192
     (State or other jurisdiction of           (I.R.S. Employer
      incorporation or organization)            identification No.)

       645 North Mary Avenue, Sunnyvale, California             94088
       (Address of Principal Executive Offices)                (Zip Code)

                                 (408) 481-8000
              (Registrant's telephone number, including area code)

                                 Not Applicable
              (Former name, former address and former fiscal year,
                          if changed since last report)

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  periods 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

As of June 30, 1997, there were 22,213,300 shares of Common Stock (no par value)
outstanding.

                                       1

<PAGE>

                           TRIMBLE NAVIGATION LIMITED

This report contains  forward-looking  statements  within the meaning of Section
27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act
of 1934.  Actual  results could differ  materially  from those  indicated in the
forward-looking  statements  as a result of the risk  factors  set forth in this
report. The Company has attempted to identify forward-looking statements in this
report  by  placing  an  asterisk  (*) in the  left-hand  margin  of  paragraphs
containing those statements.


                                      INDEX
                                                                           Page

PART I.      FINANCIAL INFORMATION                                        Number



        Item 1.       Financial Statements

                      Condensed Consolidated Balance Sheets -
                      June 30, 1997 and December 31, 1996                     3

                      Condensed Consolidated Statements of Operations -
                      Three and Six Months ended June 30, 1997
                      and 1996                                                4

                      Condensed Consolidated Statements of Cash Flows -
                      Six Months ended June 30, 1997 and 1996                 5

                      Notes to Condensed Consolidated Financial

                      Statements                                              6


        Item 2.       Management's Discussion and Analysis of Financial
                      Condition and Results of Operations                     9



PART II.       OTHER INFORMATION


        Item 4.       Submission of Matters to a Vote of Security Holders    16


        Item 6.       Exhibits and Reports on Form 8-K                       17


SIGNATURES                                                                   18




                                       2

<PAGE>


  PART I. FINANCIAL INFORMATION

  Item 1. Financial Statements

                           TRIMBLE NAVIGATION LIMITED
                      CONDENSED CONSOLIDATED BALANCE SHEETS

                                                   June 30,         December 31,
                                                     1997                1996
  ------------------------------------------------------------------------------
  (In thousands)                                  (Unaudited)           (Note)
   ASSETS
   Current assets:
      Cash and cash equivalents                      $ 31,443          $ 22,671
      Short term investments                           57,028            59,867
      Accounts receivable, net                         39,484            34,374
      Inventories                                      38,481            38,858
      Other current assets                              2,895             3,633
                                                  ------------   ---------------
      Total current assets                            169,331           159,403

      Net property and equipment                       22,339            21,504
      Intangible assets                                 4,071             4,493
      Deferred income taxes                               366               383
      Other assets                                      5,026             4,058
                                                  ------------   ---------------
      Total assets                                  $ 201,133         $ 189,841
                                                  ============   ===============

   LIABILITIES AND SHAREHOLDERS' EQUITY
   Current liabilities:
      Current portion of long-term debt                 $ 356             $ 316
      Accounts payable                                 16,244            13,763
      Accrued compensation and benefits                 7,794             6,552
      Customer advances                                 3,956             3,000
      Accrued liabilities                               9,699            10,358
      Income taxes payable                              2,364               869
                                                  ------------   ---------------
      Total current liabilities                        40,413            34,858
                                                  ------------   ---------------

   Noncurrent portion of long-term debt and 
     other liabilities                                 30,789            30,938
                                                  ------------   ---------------
   Total liabilities                                   71,202            65,796
                                                  ------------   ---------------

   Shareholders' equity:
      Common stock                                    126,404           125,535
      Common stock warrants                               700               700
      Retained earnings (accumulated deficit)           2,690            (2,603)
      Unrealized gain on short term investments            26                20
      Foreign currency translation adjustment             111               393
                                                  ------------   ---------------
      Total shareholders' equity                      129,931           124,045
                                                  ------------   ---------------
      Total liabilities and shareholders' equity    $ 201,133         $ 189,841
                                                  ============   ===============


     See accompanying notes to condensed consolidated financial statements.




                                       3

<PAGE>


                           TRIMBLE NAVIGATION LIMITED
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (Unaudited)

<TABLE>
<CAPTION>

                                                    Three Months Ended                Six Months Ended
                                                         June 30,                        June 30,
                                               -----------------------------  --------------------------------
                                                   1997           1996             1997             1996
- --------------------------------------------------------------------------------------------------------------
(In thousands, except per share data)
<S>                                                 <C>             <C>             <C>              <C>    
 
 Total revenue                                     $ 68,944        $ 58,602        $ 129,495        $ 115,324
                                               -------------  --------------  ---------------  ---------------

 Operating expenses:
    Cost of sales                                    32,255          27,037           61,300           53,052
    Research and development                         10,113           9,144           19,114           17,969
    Sales and marketing                              14,916          16,844           29,264           32,908
    General and administrative                        7,306           9,057           13,712           16,468
                                               -------------  --------------  ---------------  ---------------
                                                     64,590          62,082          123,390          120,397
                                               -------------  --------------  ---------------  ---------------

 Operating income (loss)                              4,354          (3,480)           6,105           (5,073)
                                               -------------  --------------  ---------------  ---------------

 Nonoperating income (expense):
    Interest income                                   1,089           1,150            2,142            2,397
    Interest and other expenses                        (818)           (926)          (1,784)          (1,895)
    Foreign exchange gain (loss)                         63              24              154              (93)
                                               -------------  --------------  ---------------  ---------------
                                                        334             248              512              409
                                               -------------  --------------  ---------------  ---------------

 Income (loss) before income taxes                    4,688          (3,232)           6,617           (4,664)
 Income tax provision (benefit)                         823            (647)           1,323             (933)
                                               -------------  --------------  ---------------  ---------------

 Net income (loss)                                  $ 3,865        $ (2,585)         $ 5,294         $ (3,731)
                                               =============  ==============  ===============  ===============

 Net income (loss) per share                         $ 0.17           (0.12)          $ 0.24            (0.17)
                                               =============  ==============  ===============  ===============

 Weighted average common and dilutive common
    equivalent shares                                22,544          21,791           22,484           21,735
                                               =============  ==============  ===============  ===============

</TABLE>



     See accompanying notes to condensed consolidated financial statements.


                                       4

<PAGE>

                           TRIMBLE NAVIGATION LIMITED
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (Unaudited)


                                                          Six Months Ended
                                                              June 30,
                                                        1997            1996
- --------------------------------------------------------------------------------
(In thousands)

 Net cash provided (used) by operating activities        $ 12,104      $ (6,041)
                                                    -------------- -------------

 Cash flow from investing activities:
     Purchase of short term investments                   (50,160)      (46,551)
     Maturities of short term investments                  32,875        34,252
     Sales of short term investments                       20,124        15,212
     Equity investments                                      (886)       (1,400)
     Acquisition of property and equipment                 (5,889)       (6,624)
     Capitalized patent expenditures                         (341)         (438)
                                                    -------------- -------------
       Net cash used in investing activities               (4,277)       (5,549)
                                                    -------------- -------------

 Cash flow from financing activities:
     Issuance of common stock                               2,703         2,873
     Repurchase of common stock                            (1,834)            -
     Collection/(payment) of notes receivable                  (9)           49
     Proceeds/(payments) on long-term debt and 
     revolving credit facilities                               85          (963)
                                                    -------------- -------------
       Net cash provided by financing activities              945         1,959
                                                    -------------- -------------


 Net increase (decrease) in cash and cash equivalents       8,772        (9,631)

 Cash and cash equivalents -- beginning of period          22,671        29,711
                                                    -------------- -------------
 Cash and cash equivalents -- end of period              $ 31,443      $ 20,080
                                                    ============== =============


 Supplemental disclosures of cash flow information:
     Cash paid (received) during the period for:
       Interest                                          $    898      $    787
       Income taxes/(benefit), net of refunds            $   (180)     $     83



See accompanying notes to condensed consolidated financial statements.


                                       5

<PAGE>


                           TRIMBLE NAVIGATION LIMITED
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 - Basis of Presentation:

The  condensed  consolidated  financial  statements  for the three and six month
periods ended June 30, 1997, and 1996 presented in this Quarterly Report on Form
10-Q are  unaudited.  The balance  sheet at December 31, 1996,  has been derived
from the audited  financial  statements at that date but does not include all of
the  information  and  footnotes  required  by  generally  accepted   accounting
principles  for complete  financial  statements.  In the opinion of  management,
these  statements  include all adjustments  (consisting only of normal recurring
adjustments)  necessary  for a fair  statement  of the  results  for the interim
periods presented.  The condensed  consolidated  financial  statements should be
read in conjunction with the audited consolidated financial statements and notes
thereto  included in the Company's  Annual Report to  Shareholders  for the year
ended December 31, 1996.

The results of  operations  for the three month and six month periods ended June
30, 1997 are not necessarily  indicative of the results that may be expected for
the year ending December 31, 1997.


NOTE 2 - Inventories:

Inventories consist of the following:


                                     June 30,          December 31,
                                      1997                1996
- -------------------------------------------------------------------
(In thousands)

Raw materials                       $ 22,789              $ 24,145
Work-in-process                        4,710                 5,174
Finished goods                        10,982                 9,539
                                  -----------      ----------------
                                    $ 38,481              $ 38,858
                                  -----------      ----------------


NOTE 3 - New Accounting Standards:

Effective January 1, 1997, the Company adopted Statement of Financial Accounting
Standards  No. 125 ("SFAS  125"),  "Accounting  for  Transfers  and Servicing of
Financial  Assets and  Extinguishments  of  Liabilities."  At June 30, 1997, the
Company was  contingently  liable to a Japanese  bank for  $356,000 at month end
exchange rates arising from customers'  notes  receivable which the Company sold
with recourse to the bank. In accordance with SFAS 125, the Company has recorded
this amount as a liability.


                                       6

<PAGE>

* In February 1997, the Financial  Accounting  Standards Board issued  Statement
No. 128,  "Earnings Per Share",  which is required to be adopted on December 31,
1997. At that time, the Company will be required to change the method  currently
used to compute  earnings per share and to restate all prior periods.  Under the
new requirements for calculating primary earnings per share, the dilutive effect
of  stock  options  will  be  excluded.  The  impact  of  Statement  128  on the
calculation  of primary and fully  diluted  earnings  per share for the quarters
reported is not expected to be material.


NOTE 4 - Contingencies:

Shareholder Litigation

On December 6, 1995, two  shareholders  filed a class action lawsuit against the
Company and certain  directors  and officers of the Company.  Subsequent to that
date,  additional lawsuits were filed by other  shareholders.  The lawsuits were
subsequently  amended and  consolidated  into one  complaint  which was filed on
April 5, 1996. The amended consolidated complaint sought to bring an action as a
class action  consisting  of all persons who  purchased  the common stock of the
Company during the period April 18, 1995,  through  December 5, 1995 (the "Class
Period").  The  plaintiffs  alleged  that the  defendants  sought to induce  the
members of the Class to purchase  the  Company's  common  stock during the Class
Period at  artificially  inflated  prices.  The  plaintiffs  seek  recissory  or
compensatory  damages with interest  thereon,  as well as reasonable  attorneys'
fees and extraordinary  equitable and/or injunctive  relief. The Company filed a
motion to dismiss,  which was heard by the Court on August 16,  1996.  The court
rejected  the  plaintiffs'  lawsuit,  but allowed  thirty  days to resubmit  its
complaint.  On September 24, 1996, the plaintiffs filed an amended complaint. On
April 28, 1997,  the Court  granted in part,  and denied in part,  the Company's
motion to dismiss.  The Court further  granted the  plaintiffs  leave to replead
certain  dismissed claims. On June 19, 1997 the plaintiffs filed a third amended
and  consolidated  complaint.  The Company  has filed a motion to  dismiss.  The
Company  does not  believe  that it is  possible  to predict the outcome of this
litigation.

Other Litigation

* In October 1995, an employee who was terminated by the Company in 1992 filed a
Complaint  against  the  Company,  alleging  that his  incentive  stock  options
continued  to  vest  subsequent  to  his   termination.   He  seeks  damages  of
approximately  $1,000,000.  The Company has filed a general  denial in answer to
the Complaint, and a trial date has been set for September 15, 1997. The Company
does not believe that the Complaint will be successful.

In September 1996, the British Technology Group ("BTG") brought suit for alleged
infringement  of its  RE.34,004  patent.  BTG has also  brought suit against two
other  defendants  over the same patent.  Discovery  is underway,  and a Markman
hearing is scheduled in the Eastern  District of  Pennsylvania  for September 9,
1997. Trial is set for January 8, 1998. The Company believes the suit is without
merit and intends to defend itself vigorously.


                                       7

<PAGE>


Note 5 - Line of Credit

In August 1995, the Company entered into a $30,000,000  unsecured line of credit
agreement  with two banks which  expired in July 1997.  In July 1997 the Company
has received an amendment to extend the line of credit to September 1, 1997. The
agreement enables the Company to borrow up to $30,000,000  provided that certain
financial and other  covenants are met. The agreement  provides for payment of a
commitment fee of 0.5% for the unused portion of the line of credit.  Borrowings
bear  interest at the higher of (i) one of the bank's annual prime rate and (ii)
the federal funds rate plus 0.5%.  To date,  no borrowings  have been made under
the line of credit.  Under the current line of credit the Company is  restricted
from paying  dividends.  The Company intends to obtain another line of credit on
similar terms on September 1, 1997.


Note 6 - Subsequent Events:

On July 25,  1997,  the Company  made a bridge loan for $1.5  million to Proshot
Golf, Inc, a minority  investee of the Company,  at prime plus 1.5%. The loan is
due on or before  February  25, 1998 and is secured  entirely by an  irrevocable
stand-by  letter  of  credit  with a  commercial  bank  having  the  Company  as
beneficiary and Proshot as account party.




                                       8

<PAGE>




I
tem 2.              MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATIONS



RESULTS OF OPERATIONS


Revenues

Revenues for the three month and six month  periods  ended June 30,  1997,  were
$68,944,000 and  $129,495,000 as compared with  $58,602,000 and  $115,324,000 in
the corresponding 1996 periods.The table below breaks out the Company's revenues
by business unit:


<TABLE>
<CAPTION>

                                             Three Months Ended June 30,                Six Months Ended June 30,
                                         ------------------------------------    ----------------------------------------

                                            1997         1996       Increase        1997           1996        Increase
- -------------------------------------------------------------------------------------------------------------------------
(In thousands)
<S>                                         <C>          <C>             <C>         <C>            <C>             <C>
   
   Commercial Systems                        45,042       42,442           6%         83,163         80,579            3%
   Software & Component Technologies         12,209        8,885          37%         21,785         18,491           18%
   Aerospace                                 11,693        7,275          61%         24,547         16,254           51%
                                         -----------  -----------   ---------    ------------  -------------  -----------
 Total                                     $ 68,944     $ 58,602          18%      $ 129,495      $ 115,324           12%
                                         -----------  -----------   ---------    ------------  -------------  -----------

</TABLE>


Commercial Systems

Commercial Systems revenues for the three month and six month periods ended June
30, 1997  increased  in total over the prior year period,  however,  the Company
experienced  a decrease in the Land Survey  vertical  market as compared to June
30, 1997. However,  the Company believes that it has maintained its market share
worldwide.

The  decreases in Land Survey sales in the second  quarter of 1997,  compared to
the second  quarter of 1996,  are due in part to the continued  slow down of the
European and Japanese economies.

The  decrease  in Land  Survey  sales were  offset by an increase in the overall
Commercial  Systems' revenues for the second quarter of 1997, as compared to the
second  quarter of 1996,  which occurred  primarily in the Precise  Positioning,
GIS, and Tracking vertical markets.

Tracking and  Communications  revenues have  increased in the second  quarter of
1997 compared to the second  quarter of 1996 due to the  resumption of shipments
in March 1997 to American Mobile Satellite  Corporation  (AMSC), a company based
in Reston,  Virginia,  that  provides a variety of voice and data  services  via
satellite. The shipments were originally discontinued late in the fourth quarter
of 1995 at the request of AMSC,  in part due to delays in AMSC's  completion  of
software. On February 20, 1997, an agreement was signed between Trimble and AMSC
to resume shipments of Trimble's  Galaxy/GPS  terminals at the rate of 500 units
per month,  beginning  in March 1997.  


                                       9

<PAGE>


Approximately  1,750 and 2,000  units were  shipped  in the three  month and six
month periods ending June 30, 1997, respectively.

Software and Component Technologies

Software and Component  Technologies  revenues increased for the three month and
six month  periods  ended June 30,  1997,  as  compared  with the  corresponding
periods for 1996 due primarily to a $2.2 million technology license from Pioneer
Electronic  Corporation  in  connection  with the expansion of the original 1992
license for in-car navigation technology recorded in the 1997 periods.

Aerospace

* Sales of  Aerospace  products  increased  for the three and six month  periods
ending June 30, 1997,  compared to the same periods in 1996 primarily due to the
increased  sales of the HT 9100,  Honeywell  Trimble  product line.  The Company
considers  its  Aerospace  products  to be a long term  growth  opportunity.  It
believes  that  success in this area will be  dependent  upon the success of the
current strategic alliance with Honeywell.

* Military sales increased  slightly in the second quarter of 1997,  compared to
the second  quarter of 1996.  Military  sales are highly  dependent on contracts
that are subject to government approval and are, therefore, expected to continue
to fluctuate from period to period.  The Company believes that  opportunities in
this market  have been  substantially  reduced by  cutbacks in U.S.  and foreign
military spending.

Revenue outside the US

* Sales to  unaffiliated  customers  in  locations  outside  the U.S.  comprised
approximately  45% and 48% of  revenue in the first six months of 1997 and 1996,
respectively. During the first six months of 1997, the Company experienced lower
revenues in Europe in many  product  lines,  and in Japan  primarily  related to
surveying  products.  The Company anticipates that export revenue and sales made
by its subsidiaries in locations outside the U.S. will continue to account for a
significant portion of its revenue and, therefore, the Company is subject to the
risks  inherent  in these  sales,  including  unexpected  changes in  regulatory
requirements,  exchange rates, governmental approval, tariffs or other barriers.
Even  though the U.S.  Government  announced  on March 29,  1996,  that it would
support and maintain the GPS system,  as well as eliminate  the use of Selective
Availability  (S/A) (a method of degrading GPS  accuracy),  customers in certain
foreign  markets may be reluctant to purchase  products  based on GPS technology
given the  control  of GPS by the U.S.  Government.  The  Company's  results  of
operations could be adversely affected if the Company were unable to continue to
generate significant sales in locations outside the U.S.


Gross Margin

* Gross margin varies on a quarterly basis due to a number of factors, including
product mix,  technology  license fees,  domestic  versus  international  sales,
customer type, the effects of production volumes and fixed  manufacturing  costs
on unit  product  costs  and new  product  start-up  costs.  Gross  margin  as a


                                       10

<PAGE>

percentage  of total  product  revenue  was 53% for both the three month and six
month periods  ended June 30, 1997,  as compared  with 54% in the  corresponding
1996  periods.  The 1997  margins have been  enhanced by the positive  impact of
non-product  revenues  recognized  from  Pioneer  of $2.2  million in the second
quarter of 1997. Although,  the Company has recorded similar non-recurring items
in the past,  including $2,080,000 in the first six months of 1996, there can be
no assurance that similar items will recur in the future. The lower gross margin
percentage for the 1997 three month and six month periods,  primarily  reflect a
shift in product mix from higher margin Commercial Systems sales to lower margin
Avionics  and OEM  sales  and  decreases  in the  margins  obtained  on sales of
Commercial  Systems products.  There can be no assurance that these margins will
be sustained because of mix changes within and among the business units,  market
pressures on unit selling prices,  fluctuations in unit manufacturing  costs and
other factors.  While Commercial Systems products have the highest gross margins
of all the Company's  products,  those margins have decreased  primarily because
the Company has reduced prices on these products in response to competition. The
Company expects  competition to increase in its Commercial  Systems markets and,
therefore, it is likely that further price erosion will occur, with consequently
lower gross margin percentages in the future.

* The Company  also  expects  that a higher  percentage  of its  business in the
future  will be  conducted  through  alliances  with  strategic  partners,  e.g.
Honeywell,  Caterpillar,  and  Case.  As a  result  of  volume  pricing  and the
assumption of certain operating costs in connection with such partners,  margins
are likely to be lower than sales directly to end-users.

Operating Expenses

The  following  table shows  operating  expenses for the periods  indicated  and
should be read in conjunction with the narrative descriptions of those operating
expenses below:


<TABLE>
<CAPTION>

                               Three Months Ended June 30,        Six Months Ended June 30,
                             --------------------------------  --------------------------------
                                                   Increase/                         Increase/
                                 1997        1996 (Decrease)      1997        1996  (Decrease)
- -----------------------------------------------------------------------------------------------
(In Thousands) 
<S>                            <C>          <C>       <C>        <C>         <C>        <C>
Research and development        10,113       9,144     11%        19,114      17,969      6%
Sales and marketing             14,916      16,844    (11)%       29,264      32,908    (11)%
General and administrative       7,306       9,057    (19)%       13,712      16,468    (17)%
                             ----------  ----------            ----------  ----------
     Total                    $ 32,335    $ 35,045     (8)%     $ 62,090    $ 67,345     (8)%
                             ----------  ----------            ----------  ----------
</TABLE>



Research and Development

Research  and  development  expenses  increased in the three month and six month
periods ended June 30, 1997, as compared  with the  corresponding  1996 periods.
The higher  research and  development  expense in the 1997 periods are due to an
increase in personnel and the related  expenses  which  accompany an increase in
the number of employees.  The increase in research and development  personnel is
part of the Company's continuing focus on developing future products.

* The Company  expects  that a  significant  portion of its future  revenues and
operating  income  will  continue to be derived  from sales of newly  introduced


                                       11

<PAGE>

products.  Consequently,  the Company's  future  success  depends in part on its
ability to continue to advance product technology and to develop and manufacture
new  competitive  products  with high  gross  profit  margins.  Development  and
manufacturing  schedules for technology  products are difficult to predict,  and
there can be no assurance that the Company will achieve timely initial  customer
shipments of new products.  The timely  availability of these products in volume
and their  acceptance by customers  are  important to the future  success of the
Company.  In  addition,  certain  of  the  Company's  products  are  subject  to
governmental  and similar  certifications  before they can be sold. For example,
FAA certification is required for all aviation  products.  An inability or delay
in obtaining such  certifications  could have an adverse effect on the Company's
operating results.

Sales and Marketing

The  decreased  sales and  marketing  expenses for the three month and six month
periods ended June 30, 1997, as compared with the corresponding  periods in 1996
is due primarily to a reduction in headcount and related expenses resulting from
the  Company's  restructuring  in  September  1996.  In  addition,  the  Company
experienced  decreases in  advertising  and  promotional  items related to lower
costs for the annual report and lower media development costs.

The  Company's  future  growth  will  depend  upon the  timely  development  and
continued  viability of the markets in which the Company currently  competes and
upon the  Company's  ability to continue to identify and exploit new markets for
its products. In addition, the Company has encountered  significant  competition
in selected  markets,  and the Company expects such  competition to intensify as
the market for GPS applications  receives  acceptance.  Several of the Company's
competitors  are  major  corporations  with  substantially   greater  financial,
technical,  marketing and  manufacturing  resources.  Increased  competition  is
likely to result in reduced  market share and in price  reductions  of GPS-based
products, which could adversely affect the Company's revenues and profitability.

General and Administrative

The decrease in general and  administrative  expense for the three month and six
month periods ended June 30, 1997,  as compared with the  corresponding  periods
for 1996,  primarily  reflects  lower  legal  expenses  as a result  of  reduced
litigation.

Income Taxes

The  effective tax rate was 18% for the three months ended June 30, 1997 and 20%
for the six months ended June 30, 1997 as compared with an effective tax rate of
20% for the same periods in 1996.

Inflation

The  effects of  inflation  on the  Company's  financial  results  have not been
significant to date.

Liquidity and Capital Resources

* For the six month period ended June 30, 1997,  cash  provided  from  operating
activities  was  $12,104,000  as  compared  to cash  used of  $6,041,000  in the
corresponding  period in 1996.  Cash  provided by sales of common  stock in 1997


                                       12

<PAGE>


represents  proceeds from purchases made pursuant to the Company's  stock option
and employee  stock  purchase  plans and totaled  $2,703,000  for the six months
ended June 30,  1997.  The  Company  has relied  primarily  on cash  provided by
financing activities and net sales of short-term investments to fund operations,
capital  expenditures,  the repurchase  the Company's  common stock (see further
explanation  below),  and other investing  activities.  The Company's ability to
generate  cash from  operations  will depend in a large part on revenues and the
rate of collections of accounts  receivable.  Management believes that its cash,
cash equivalents and short-term  investment  balances,  with its existing credit
line,  will be  sufficient to meet its  anticipated  cash needs for at least one
year. At June 30, 1997, the Company had cash and cash equivalents of $31,443,000
and short-term investments of $57,028,000.

* In August 1995,  the Company  entered  into an agreement  with two banks for a
$30.0 million  unsecured  line of credit that expired in July 1997.  The line of
credit was  amended in July 1997 to extend  the line of credit to  September  1,
1997. The agreement  enables the Company to borrow up to $30.0 million  provided
that certain  financial and other covenants are met. The agreement  provides for
payment  of a  commitment  fee of 0.5%  for the  unused  portion  of the line of
credit.  Borrowings  bear interest at the higher of (i) one of the bank's annual
prime rate,  and (ii) the federal funds rate plus 0.5%. No borrowings  have been
made under this line of credit.  The Company  intends to obtain  another line of
credit on similar terms after this line expires.

In February  1996, the Company  announced  that it had approved a  discretionary
program  whereby up to 600,000  shares of its common stock may be repurchased by
the Company to offset potential  dilutive effects to earnings per share from the
issuance  of stock  options.  The Company  intends to use  existing  cash,  cash
equivalents  and short-term  investments  to finance any such stock  repurchases
under this program.  In 1996, the Company  purchased 250,000 shares at a cost of
$3,545,000. In the first quarter of 1997, the Company purchased 50,000 shares at
a cost of $673,000.  In the second quarter of 1997 the Company  purchased 89,500
shares at a cost of $1,161,000.

The  Company  is  continually   evaluating  potential  external  investments  in
technologies  related  to its  business  and to date has made  relatively  small
investments in GPS related technology companies.  There can be no assurance that
investments made to date and potential future investments will be successful.

Other Risk Factors

In the past,  revenue has tended to  fluctuate  on a quarterly  basis due to the
timing of shipments of products under contracts,  the sale of license rights and
seasonal  patterns  favoring  spring  and  summer  for  the  Commercial  Systems
business.  However,  the seasonal  patterns were not repeated in 1996,  however,
there  can  be  no  assurances  that  prior  seasonal  revenue  trends  will  be
experienced  during  1997.  A  significant  portion of the  Company's  quarterly
revenues are derived from orders received and  immediately  shipped to customers
in the last few weeks and days of a  quarter.  If orders  are not  received,  or
shipments are delayed  beyond the end of a quarter,  operating  results would be
significantly adversely impacted.



                                       13

<PAGE>


* The Company has a relatively  fixed cost  structure in the short term which is
determined by the business plans and strategies the Company intends to implement
in the markets it addresses.  This effective  leveraging means that increases or
decreases  in  revenues  have more than a  proportional  impact on net income or
losses.  The Company  estimates  that a change in product  revenue of $1 million
would cause a corresponding change in the Company's earnings per share by 2 to 3
cents.

* In the longer term,  the Company  believes  that the  Software  and  Component
Technologies  business unit will comprise a significant portion of the Company's
business.  The  Software and  Component  Technologies  business  unit differs in
nature from most of the Company's  markets  because volumes are high and margins
relatively  low.  Software and  Component  Technologies  customers are extremely
price   sensitive.   To  the  extent,   if  any,  that  costs  decrease  through
technological advances, a portion of these cost savings will be passed on to the
customer. To compete in the Software and Component  Technologies market requires
high-volume  production  and  manufacturing  techniques.  Customers  expect high
quality  standards  with  very low  defect  rates.  The  Company  is  relatively
inexperienced  compared  to  competitors  with  far  greater  resources  in such
high-volume  manufacturing  and  associated  support  activities.  The Company's
failure to meet customer  expectations in this market could cause the Company to
lose customer  orders,  which could result in a material  adverse  effect on the
Company's operating results.

The  Company's  stock price is subject to  significant  volatility.  If revenues
and/or earnings fail to meet the expectations of the investment community, there
could  be an  immediate  and  significant  impact  on the  trading  price of the
Company's stock.

The  value of the  Company's  products  relies  substantially  on the  Company's
technical  innovation in fields in which there are many current patent  filings.
The  Company  recognizes  that as new  patents  are issued or are brought to the
Company's  attention by the holders of such patents, it may be necessary for the
Company to withdraw  products  from the market,  take a license from such patent
holders,  or redesign  its  products.  The  Company  does not believe any of its
products  infringe  patents or other  proprietary  rights of third parties,  but
cannot  be  certain  they  do  not do so.  In  addition,  the  legal  costs  and
engineering  time  required  to  safeguard  intellectual  property  or to defend
against litigation could become a significant expense of operations. Such events
could have a material adverse effect on the Company's revenues or profitability.
(See Note 4- Other Litigation:, to the financial statements)

The Company is  continually  evaluating  alliances and external  investments  in
technologies  related to its business and has already entered into alliances and
made  relatively  small  investments  in  GPS  related   technology   companies.
Acquisitions  of companies,  divisions of  companies,  or products and alliances
entail  numerous  risks,  including (i) the potential  inability to successfully
integrate acquired operations and products or to realize anticipated  synergies,
economies of scale or other value, (ii) diversion of management's attention, and
(iii) loss of key employees of acquired operations. Any such problems could have
a material  adverse effect on the Company's  business,  financial  condition and
results of  operations.  No  assurances  can be given that the Company  will not
incur problems from current or future alliances,  acquisitions,  or investments.
Furthermore,  there can be no assurance that the Company will realize value from
any such alliances, acquisitions, or investments.


                                       14

<PAGE>


The  Company's  products rely on signals from the GPS Navstar  satellite  system
built and maintained by the U.S.  Department of Defense.  Navstar satellites and
their  ground  support  systems  are  complex   electronic  systems  subject  to
electronic  and  mechanical  failures  and possible  sabotage.  Some of these 24
satellites have exceeded their design lives of 7.5 years and are also subject to
damage by the hostile space environment in which they operate. Repair of damaged
or  malfunctioning   satellites  is  impossible.  If  a  significant  number  of
satellites were to become inoperable,  there could be a substantial delay before
they are replaced  with new  satellites.  A reduction in the number of operating
satellites  would impair the current utility of the GPS system and the growth of
current  and  additional  market  opportunities.  In  addition,  there can be no
assurance that the U.S.  Government  will remain  committed to the operation and
maintenance of GPS  satellites  over a long period of time, nor that policies of
the U.S.  Government  allowing  for the use of GPS  without  charge  will remain
unchanged. Because of ever increasing commercial applications of GPS, other U.S.
Government  agencies may become involved in the administration or the regulation
of the  use of GPS  signals.  Any of the  foregoing  factors  could  affect  the
willingness  of buyers of the  Company's  products to select  GPS-based  systems
instead of products  based on competing  technologies.  Any resulting  change in
market  demand for GPS  products  would have a  material  adverse  effect on the
Company's  financial  results.  Certain European  government  organizations have
expressed concern  regarding the  susceptibility of GPS equipment to intentional
or inadvertent  signal  interference.  Such concern could translate into reduced
demand for GPS products in certain geographic regions.


                                       15

<PAGE>




P
ART II.  OTHER INFORMATION


ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

The  annual  meeting  of  shareholders  of the  company  was held in  Sunnyvale,
California, on May 15, 1997.

At the annual  shareholder  meeting,  an election of Directors was held with the
following individuals being elected to the Company's Board of Directors.

                                                       VOTE
                                        -----------------------------------
                                             For               Withheld
     Robert S. Cooper                     20,078,982            379,410
     John B. Goodrich                     20,075,615            382,777
     William Hart                         20,059,077            399,315
     Bradford W. Parkinson                20,064,572            393,820
     Charles R. Trimble                   20,057,789            400,603

Other  matters  voted upon at the  meeting  and the  results of the voting  with
respect to each such matter were as follows:

(1)  Approval of an increase of 600,000  shares of Common  Stock  available  for
     issuance under the Company's  1993 Stock Option Plan  (16,858,081 in favor,
     3,456,518 opposed, 143,793 abstentions, 1,845,522 broker non-votes).

(2)  Ratification  of the  appointment  of  Ernst & Young  LLP as the  Company's
     independent  auditors for the year ending December 31, 1997 ( 20,249,572 in
     favor, 123,205 opposed, 85,615 abstentions, 0 broker non-votes).


                                       16

<PAGE>





ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
                                                                           Page
           A.     Exhibits                                                Number

                  3.7    Bylaws of the Company, as amended.               19-40 

                  10.57  Revolving Credit Agreement - Fourth Amendment    41-43

                  11.1   Computation of Earnings Per Share                   44

                  27     Financial Data Schedule                             45

           B.     Report on Form 8-K

                  There were no reports on Form 8-K filed  during the
                  quarter ended June 30, 1997.






                                       17

<PAGE>





                                   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.




TRIMBLE NAVIGATION LIMITED
(Registrant)



By:   /S/Dennis R. Ing
   -------------------------------------------------
         Dennis R. Ing
        (Vice President Finance, Chief Financial
         Officer, and principal financial and principal accounting officer)


DATE:  August  14, 1997






                                       18

<PAGE>







                           TRIMBLE NAVIGATION LIMITED

                                   EXHIBIT 3.7
                               BY LAWS, AS AMENDED

                                     BY-LAWS

                                       OF

                           TRIMBLE NAVIGATION LIMITED
                          (restated as of May 15, 1997)




                                       19

<PAGE>



<TABLE>
<CAPTION>

TABLE OF CONTENTS
                                                                                              Page
<S>                                                                                             <C>    
ARTICLE I - CORPORATE OFFICES....................................................................1

        1.1    PRINCIPAL OFFICE..................................................................1
        1.2    OTHER OFFICES.....................................................................1

ARTICLE II - MEETINGS OF SHAREHOLDERS............................................................1

        2.1    PLACE OF MEETINGS.................................................................1
        2.2    ANNUAL MEETING....................................................................1
        2.3    SPECIAL MEETING...................................................................2
        2.4    NOTICE OF SHAREHOLDERS' MEETINGS..................................................2
        2.5    MANNER OF GIVING NOTICE; AFFIDAVIT OF NOTICE......................................2
        2.6    QUORUM............................................................................3
        2.7    ADJOURNED MEETING; NOTICE.........................................................3
        2.8    VOTING............................................................................4
        2.9    VALIDATION OF MEETINGS: WAIVER OF NOTICE; CONSENT.................................4
        2.10   SHAREHOLDER ACTION BY WRITTEN CONSENT WITHOUT A MEETING ..........................5
        2.11   RECORD DATE FOR SHAREHOLDER NOTICE, VOTING AND GIVING CONSENTS....................5
        2.12   PROXIES...........................................................................6
        2.13   INSPECTORS OF ELECTION............................................................6

ARTICLE III - DIRECTORS..........................................................................7

        3.1    POWERS............................................................................7
        3.2    NUMBER AND QUALIFICATION OF DIRECTORS.............................................7
        3.3    ELECTION AND TERM OF OFFICE OF DIRECTORS..........................................8
        3.4    VACANCIES.........................................................................8
        3.5    PLACE OF MEETINGS; MEETINGS BY TELEPHONE..........................................8
        3.6    REGULAR MEETINGS..................................................................9
        3.7    SPECIAL MEETINGS..................................................................9
        3.8    QUORUM............................................................................9
        3.9    WAIVER OF NOTICE.................................................................10
        3.10   ADJOURNMENT......................................................................10
        3.11   NOTICE OF ADJOURNMENT............................................................10
        3.12   ACTION WITHOUT MEETING...........................................................10
        3.13   FEES AND COMPENSATION OF DIRECTORS  10

ARTICLE IV - COMMITTEES.........................................................................11

        4.1    COMMITTEES OF DIRECTORS..........................................................11
        4.2    MEETINGS AND ACTION OF COMMITTEES................................................11

</TABLE>


                                       20

<PAGE>


<TABLE>


<S>                                                                                            <C>  
ARTICLE
 V - OFFICERS............................................................................12

        5.1    OFFICERS.........................................................................12
        5.2    ELECTION OF OFFICERS.............................................................12
        5.3    SUBORDINATE OFFICERS.............................................................12
        5.4    REMOVAL AND RESIGNATION OF OFFICERS..............................................12
        5.5    VACANCIES IN OFFICES.............................................................13
        5.6    CHAIRMAN OF THE BOARD............................................................13
        5.7    PRESIDENT........................................................................13
        5.8    VICE PRESIDENTS..................................................................13
        5.9    SECRETARY........................................................................13
        5.10   CHIEF FINANCIAL OFFICER..........................................................14

ARTICLE VI - INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES, AND OTHER  AGENTS...............14

        6.1    INDEMNIFICATION OF DIRECTORS AND OFFICERS........................................14
        6.2    INDEMNIFICATION OF OTHERS........................................................14
        6.3    PAYMENT OF EXPENSES IN ADVANCE...................................................15
        6.4    INDEMNITY NOT EXCLUSIVE..........................................................15
        6.5    INSURANCE INDEMNIFICATION........................................................15
        6.6    CONFLICTS........................................................................15

ARTICLE VII - RECORDS AND REPORTS...............................................................16

        7.1    MAINTENANCE AND INSPECTION OF SHARE REGISTER.....................................16
        7.2    MAINTENANCE AND INSPECTION OF BY-LAWS............................................16
        7.3    MAINTENANCE AND INSPECTION OF OTHER CORPORATE RECORDS............................17
        7.4    INSPECTION BY DIRECTORS..........................................................17
        7.5    ANNUAL REPORT TO SHAREHOLDERS; WAIVER............................................17
        7.6    FINANCIAL STATEMENTS.............................................................17

ARTICLE VIII - GENERAL MATTERS..................................................................18

        8.1    RECORD DATE FOR PURPOSES OTHER THAN NOTICE AND VOTING............................18
        8.2    CHECKS, DRAFTS, EVIDENCES OF INDEBTEDNESS........................................19
        8.3    CORPORATE CONTRACTS AND INSTRUMENTS:  HOW EXECUTED...............................19
        8.4    CERTIFICATES FOR SHARES..........................................................19
        8.5    LOST CERTIFICATES................................................................19
        8.6    CONSTRUCTION AND DEFINITIONS.....................................................20

ARTICLE IX - AMENDMENTS.........................................................................20

        9.1    AMENDMENT BY SHAREHOLDERS........................................................20
        9.2    AMENDMENT BY DIRECTORS...........................................................20

</TABLE>


                                       21

<PAGE>

                                    ARTICLE I

                                CORPORATE OFFICES

       I.1    PRINCIPAL OFFICE

        The board of directors shall fix the location of the principal executive
office  of the  corporation  at  any  place  within  or  outside  the  State  of
California. If the principal executive office is located outside such state, and
the  corporation  has one or more business  offices in such state,  the board of
directors  shall fix and designate a principal  business  office in the State of
California.

        I.2    OTHER OFFICES.

        The board of directors may at any time  establish  branch or subordinate
offices  at any  place or  places  where  the  corporation  is  qualified  to do
business.

                                   ARTICLE II

                            MEETINGS OF SHAREHOLDERS

        II.1   PLACE OF MEETINGS.

        Meetings of  shareholders  shall be held at any place  within or outside
the State of California designated by the board of directors.  In the absence of
any such  designation,  shareholders'  meetings  shall be held at the  principal
executive office of the corporation.

        II.2   ANNUAL MEETING.

        The annual meeting of shareholders shall be held each year on a date and
at a  time  designated  by the  board  of  directors.  In the  absence  of  such
designation,  the  annual  meeting of  shareholders  shall be held on the fourth
Thursday  of April in each  year at 4:00  p.m.  However,  if such day falls on a
legal holiday,  then the meeting shall be held at the same time and place on the
next succeeding  full business day. At the meeting,  directors shall be elected,
and any other proper business may be transacted.




                                       22

<PAGE>                                                  

                                                   
        II.3   SPECIAL MEETING

        A special meeting of the  shareholders  may be called at any time by the
board of directors,  or by the chairman of the board, or by the president, or by
one or more  shareholders  holding shares in the aggregate  entitled to cast not
less than ten percent (10%) of the votes at that meeting.

        If a special  meeting is called by any person or persons  other than the
board of directors, the request shall be in writing, specifying the time of such
meeting and the general nature of the business  proposed to be  transacted,  and
shall be delivered  personally or sent by registered  mail or by  telegraphic or
other facsimile  transmission to the chairman of the board,  the president,  any
vice president or the secretary of the  corporation.  The officer  receiving the
request shall cause notice to be promptly given to the shareholders  entitled to
vote,  in  accordance  with  the  provisions  of  Sections  2.4 and 2.5 of these
by-laws,  that a meeting  will be held at the time  requested  by the  person or
persons calling the meeting,  not less than thirty-five (35) nor more than sixty
(60) days after the receipt of the  request.  If the notice is not given  within
twenty (20) days after receipt of the request,  the person or persons requesting
the meeting may give the notice.  Nothing  contained  in this  paragraph of this
Section 2.3 shall be construed as limiting,  fixing or affecting the time when a
meeting of shareholders called by action of the board of directors may be held.

        II.4   NOTICE OF SHAREHOLDERS' MEETINGS.

        All notices of meetings of shareholders shall be sent or otherwise given
in accordance  with Section 2.5 of these by-laws not less than ten (10) nor more
than sixty (60) days before the date of the meeting.  The notice  shall  specify
the  place,  date  and  hour of the  meeting  and (i) in the  case of a  special
meeting,  the general nature of the business to be transacted (no business other
than that  specified in the notice may be transacted) or (ii) in the case of the
annual  meeting,  those  matters  which the board of  directors,  at the time of
giving the notice, intends to present for action by the shareholders. The notice
of any meeting at which  directors  are to be elected  shall include the name of
any nominee or nominees whom, at the time of the notice,  management  intends to
present for election.

        If action is proposed  to be taken at any meeting for  approval of (i) a
contract or transaction  in which a director has a direct or indirect  financial
interest,  pursuant to Section 310 of the  Corporations  Code of California (the
"Code"), (ii) an amendment of the articles of incorporation, pursuant to Section
902 of the Code, (iii) a reorganization of the corporation,  pursuant to Section
1201 of the Code, (iv) a voluntary  dissolution of the corporation,  pursuant to
Section 1900 of the Code, or (v) a  distribution  in  dissolution  other than in
accordance with the rights of outstanding preferred shares,  pursuant to Section
2007 of the  Code,  the  notice  shall  also  state the  general  nature of that
proposal.

        II.5   MANNER OF GIVING NOTICE; AFFIDAVIT OF NOTICE.

        Notice of any meeting of shareholders  shall be given either  personally
or by first-class  mail or telegraphic or other written  communication,  charges
prepaid,  addressed  to the  shareholder  at the  address  of  that  shareholder
appearing on the books of the  corporation  or given by the  shareholder  to the
corporation  for the  purpose  of  notice.  If no such  address  appears  on the
corporation's  books or is given,  notice  shall be deemed to have been given if
sent to that  shareholder  by  first-class  mail or telegraphic or other written
communication to the corporation's  principal  executive office, or if published
at least once in a newspaper  of general  circulation  in the county  where that
office is  located.  Notice  shall be deemed to have been given at the time when
delivered personally or deposited in the mail or sent by telegram or other means
of written communication.


                                       23

<PAGE>


        If any  notice  addressed  to a  shareholder  at  the  address  of  that
shareholder  appearing  on the  books  of the  corporation  is  returned  to the
corporation  by the United  States  Postal  Service  marked to indicate that the
United States Postal Service is unable to deliver the notice to the  shareholder
at that address, all future notices or reports shall be deemed to have been duly
given without  further mailing if the same shall be available to the shareholder
on written demand of the  shareholder at the principal  executive  office of the
corporation  for a period  of one (1) year  from the date of the  giving  of the
notice.

        An  affidavit  of the mailing or other means of giving any notice of any
shareholders'  meeting,  executed by the secretary,  assistant  secretary or any
transfer  agent of the  corporation  giving  the  notice,  shall be prima  facie
evidence of the giving of such notice.

        II.6   QUORUM

        The  presence  in person or by proxy of the holders of a majority of the
shares  entitled to vote thereat  constitutes  a quorum for the  transaction  of
business at all meetings of  shareholders.  The  shareholders  present at a duly
called or held  meeting at which a quorum is present may continue to do business
until  adjournment,  notwithstanding  the withdrawal of enough  shareholders  to
leave less than a quorum,  if any  action  taken  (other  than  adjournment)  is
approved by at least a majority of the shares required to constitute a quorum.

        II.7   ADJOURNED MEETING; NOTICE.

        Any shareholders' meeting, annual or special, whether or not a quorum is
present,  may be adjourned  from time to time by the vote of the majority of the
shares  represented  at that meeting,  either in person or by proxy,  but in the
absence of a quorum, no other business may be transacted at that meeting, except
as provided in Section 2.6 of these by-laws.

        When any meeting of shareholders, either annual or special, is adjourned
to another time or place,  notice need not be given of the adjourned  meeting if
the time and place are  announced  at the  meeting at which the  adjournment  is
taken,  unless a new record date for the adjourned  meeting is fixed,  or unless
the  adjournment is for more than forty-five (45) days from the date set for the
original meeting,  in which case notice of the adjourned meeting shall be given.
Notice  of any such  adjourned  meeting  shall be given to each  shareholder  of
record  entitled  to  vote at the  adjourned  meeting  in  accordance  with  the
provisions of Sections 2.4 and 2.5 of these  by-laws.  At any adjourned  meeting
the  corporation  may transact any business which might have been  transacted at
the original meeting.

        II.8   VOTING.

        The shareholders  entitled to vote at any meeting of shareholders  shall
be  determined  in  accordance  with the  provisions  of  Section  2.11 of these
by-laws,  subject to the  provisions of Sections 702 to 704,  inclusive,  of the
Code  (relating  to  voting  shares  held  by a  fiduciary,  in  the  name  of a
corporation or in joint ownership).

        The  shareholders'  vote may be by voice  vote or by  ballot;  provided,
however,  that any election for  directors  must be by ballot if demanded by any
shareholder before the voting has begun.

        On any matter other than the election of directors,  any shareholder may
vote part of the shares in favor of the  proposal  and  refrain  from voting the
remaining  shares or vote them  against the  proposal,  but, if the  shareholder
fails  to  specify  the  number  of  shares  which  the  shareholder  is  voting
affirmatively, it will be conclusively presumed that the shareholder's approving
vote is with respect to all shares which the shareholder is entitled to vote.

                                       24

<PAGE>

        If a quorum is  present,  the  affirmative  vote of the  majority of the
shares  represented  and voting at a  duly-held  meeting  (which  shares  voting
affirmatively  also constitute at least a majority of the required quorum) shall
be the act of the  shareholders,  unless the vote of a greater number, or voting
by classes, is required by the Code or by the articles of incorporation.

        At a  shareholders'  meeting at which  directors  are to be elected,  no
shareholder  shall be entitled to cumulate votes (i.e.  cast for any candidate a
number of votes greater than the number of votes which such shareholder normally
is entitled to cast) unless the candidates' names have been placed in nomination
prior to  commencement of the voting and a shareholder has given notice prior to
commencement of the voting of the shareholder's  intention to cumulate votes. If
any shareholder has given such a notice, then every shareholder entitled to vote
may cumulate votes for candidates  placed in nomination and give one candidate a
number of votes equal to the number of directors to be elected multiplied by the
number of votes to which that shareholder's  shares are entitled,  or distribute
the  shareholder's  votes  on  the  same  principle  among  any  or  all  of the
candidates,  as the shareholder thinks fit. The candidates receiving the highest
number of votes, up to the number of directors to be elected, shall be elected.

        II.9   VALIDATION OF MEETINGS: WAIVER OF NOTICE; CONSENT.

        The  transactions  of any  meeting  of  shareholders,  either  annual or
special,  however called and noticed,  and wherever  held,  shall be as valid as
though had at a meeting duly held after regular call and notice,  if a quorum be
present  either  in  person  or by  proxy,  and if,  either  before or after the
meeting,  each  person  entitled  to vote,  who was not  present in person or by
proxy,  signs a written  waiver of notice  or a consent  to the  holding  of the
meeting or an approval of the minutes  thereof.  The waiver of notice or consent
need not  specify  either the  business to be  transacted  or the purpose of any
annual or special  meeting of  shareholders,  except  that if action is taken or
proposed  to be taken for  approval  of any of those  matters  specified  in the
second  paragraph  of  Section  2.4 of these  by-laws,  the  waiver of notice or
consent  shall  state the  general  nature of the  proposal.  All such  waivers,
consents and approvals shall be filed with the corporate  records or made a part
of the minutes of the meeting.

        Attendance  by a person at a meeting  shall also  constitute a waiver of
notice of that meeting,  except when the person objects, at the beginning of the
meeting,  to the transaction of any business because the meeting is not lawfully
called or convened,  and except that  attendance at a meeting is not a waiver of
any right to object to the  consideration of a matter not included in the notice
of the meeting, if that objection is expressly made at the meeting.

        II.10  SHAREHOLDER ACTION BY WRITTEN CONSENT WITHOUT A MEETING

        Any  action  which may be taken at any  annual  or  special  meeting  of
shareholders  may be taken  without a meeting and  without  prior  notice,  if a
consent in writing,  setting forth the action so taken, is signed by the holders
of  outstanding  shares  having not less than the  minimum  number of votes that
would be  necessary  to  authorize or take that action at a meeting at which all
shares entitled to vote on that action were present and voted.

        In the case of election of directors,  such a consent shall be effective
only if signed by the holders of all outstanding shares entitled to vote for the
election of directors.

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<PAGE>

        All such consents  shall be maintained  in the  corporate  records.  Any
shareholder giving a written consent,  or the shareholder's  proxy holders, or a
transferee of the shares, or a personal  representative  of the shareholder,  or
their respective proxy holders,  may revoke the consent by a writing received by
the secretary of the corporation before written consents of the number of shares
required to authorize the proposed action have been filed with the secretary.

        If the  consents  of all  shareholders  entitled  to vote  have not been
solicited  in  writing,  and if  the  unanimous  written  consent  of  all  such
shareholders  shall not have been  received,  the  secretary  shall give  prompt
notice of the corporate action approved by the  shareholders  without a meeting.
Such  notice  shall be given in the manner  specified  in  Section  2.5 of these
by-laws.  In the case of approval of (i) a contract  or  transaction  in which a
director has a direct or indirect financial interest, pursuant to Section 310 of
the Code, (ii)  indemnification of a corporate "agent",  pursuant to Section 317
of the Code, (iii) a reorganization of the corporation, pursuant to Section 1201
of the Code,  and (iv) a distribution  in  dissolution  other than in accordance
with the rights of outstanding preferred shares, pursuant to Section 2007 of the
Code,  the notice shall be given at least ten (10) days before the  consummation
of any action authorized by that approval.

        II.11  RECORD DATE FOR SHAREHOLDER NOTICE, VOTING AND GIVING CONSENTS.

        For purposes of determining the  shareholders  entitled to notice of any
meeting or to vote  thereat or  entitled  to give  consent to  corporate  action
without a meeting,  the board of directors  may fix, in advance,  a record date,
which  shall not be more than sixty (60) days nor less than ten (10) days before
the date of any such  meeting  nor more than  sixty  (60) days  before  any such
action without a meeting,  and in such event only  shareholders of record on the
date so fixed are  entitled  to notice and to vote or to give  consents,  as the
case may be,  notwithstanding  any  transfer  of any  shares on the books of the
corporation after the record date, except as otherwise provided in the Code.

        If the board of directors does not so fix a record date:

               (a) the record  date for  determining  shareholders  entitled  to
notice  of or to vote at a  meeting  of  shareholders  shall be at the  close of
business on the business day next preceding the day on which notice is given or,
if notice is waived, at the close of business on the business day next preceding
the day on which the meeting is held; and

               (b) the record date for determining shareholders entitled to give
consent  to  corporate  action in writing  without a meeting,  (i) when no prior
action by the board has been taken,  shall be the day on which the first written
consent is given or (ii) when prior action by the board has been taken, shall be
the day on which the board adopts the resolution relating to that action, or the
sixtieth (60th) day before the date of such other action, whichever is later.

        The record  date for any other  purpose  shall be as provided in Article
VIII of these by-laws.

        II.12  PROXIES

        Every person  entitled to vote for  directors,  or on any other  matter,
shall  have  the  right  to do so  either  in  person  or by one or more  agents
authorized  by a written proxy signed by the person and filed with the secretary
of the corporation.  A proxy shall be deemed signed if the shareholder's name is
placed  on the proxy  (whether  by manual  signature,  typewriting,  telegraphic
transmission   or   otherwise)   by  the   shareholder   or  the   shareholder's
attorney-in-fact.  A validly  executed  proxy  which  does not state  that it is


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<PAGE>

irrevocable  shall  continue in full force and effect  unless (i) revoked by the
person  executing  it,  before the vote  pursuant  to that  proxy,  by a writing
delivered  to the  corporation  stating  that  the  proxy  is  revoked,  or by a
subsequent  proxy executed by the person executing the prior proxy and presented
to the meeting, or as to any meeting by attendance at such meeting and voting in
person by the person  executing the proxy or (ii) written notice of the death or
incapacity of the maker of that proxy is received by the corporation  before the
vote pursuant to that proxy is counted;  provided,  however, that no proxy shall
be valid after the  expiration of eleven (11) months from the date of the proxy,
unless otherwise  provided in the proxy. The revocability of a proxy that states
on its face  that it is  irrevocable  shall be  governed  by the  provisions  of
Sections 705(e) and 705(f) of the Code.

        II.13  INSPECTORS OF ELECTION

        Before any meeting of  shareholders,  the board of directors may appoint
an inspector or inspectors of election to act at the meeting or its adjournment.
If no  inspector of election is so  appointed,  the chairman of the meeting may,
and on the request of any shareholder or a shareholder's proxy shall, appoint an
inspector  or  inspectors  of  election  to act at the  meeting.  The  number of
inspectors  shall be either one (1) or three (3). If inspectors are appointed at
a meeting  pursuant to the request of one (1) or more  shareholders  or proxies,
the  holders of a majority  of shares or their  proxies  present at the  meeting
shall determine whether one (1) or three (3) inspectors are to be appointed.  If
any person  appointed as  inspector  fails to appear or fails or refuses to act,
the chairman of the meeting may,  and upon the request of any  shareholder  or a
shareholder's proxy shall, appoint a person to fill that vacancy.

        Such inspectors shall:

               (a)  Determine  the number of shares  outstanding  and the voting
power of each, the number of shares represented at the meeting, the existence of
a quorum, and the authenticity, validity and effect of proxies;

               (b)    Receive votes, ballots or consents;

               (c)    Hear and  determine  all  challenges  and questions in any
way arising in connection with the right to vote;

               (d)    Count and tabulate all votes or consents;

               (e)    Determine when the polls shall close;

               (f)    Determine the result; and

               (g) Do any other acts that may be proper to conduct the  election
or vote with fairness to all shareholders.



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<PAGE>




                                   ARTICLE III

                                    DIRECTORS

        III.1  POWERS.

        Subject  to the  provisions  of the  Code  and  any  limitations  in the
articles of  incorporation  and these by-laws  relating to action required to be
approved by the  shareholders  or by the  outstanding  shares,  the business and
affairs of the  corporation  shall be managed and all corporate  powers shall be
exercised by or under the direction of the board of directors.

        III.2  NUMBER AND QUALIFICATION OF DIRECTORS

        The number of directors of the  corporation  shall be not less than four
(4) nor more than seven (7).  The exact  number of  directors  shall be five (5)
until  changed,  within the limits  specified  above,  by a bylaw  amending this
Section 3.2, duly adopted by the board of directors or by the shareholders.  The
indefinite  number of  directors  may be  changed,  or a definite  number  fixed
without  provision for an indefinite  number, by a duly adopted amendment to the
articles of  incorporation  or by an amendment to this bylaw duly adopted by the
vote or written  consent of holders  of a  majority  of the  outstanding  shares
entitled to vote;  provided,  however,  that an amendment reducing the number or
the minimum number of directors to a number less than five (5) cannot be adopted
if the votes cast against its adoption at a meeting of the shareholders,  or the
shares not  consenting  in the case of action by written  consent,  are equal to
more than sixteen and two-thirds  percent  (16-2/3%) of the  outstanding  shares
entitled to vote thereon.  No amendment may change the stated  maximum number of
authorized  directors to a number  greater than two (2) times the stated minimum
number of directors minus one (1).

        III.3  ELECTION AND TERM OF OFFICE OF DIRECTORS

        Directors  shall be elected at each annual  meeting of  shareholders  to
hold  office  until the next such annual  meeting.  Each  director,  including a
director  elected to fill a vacancy,  shall hold office until the  expiration of
the term for which elected and until a successor has been elected and qualified.

        III.4  VACANCIES

        Vacancies in the board of  directors  may be filled by a majority of the
remaining directors, though less than a quorum, or by a sole remaining director,
except  that a vacancy  created  by the  removal  of a  director  by the vote or
written consent of the  shareholders or by court order may be filled only by the
vote  of  a  majority  of  the  outstanding  shares  entitled  to  vote  thereon
represented  at a duly  held  meeting  at which a quorum is  present,  or by the
unanimous written consent of all shares entitled to vote thereon.  Each director
so elected shall hold office until the next annual  meeting of the  shareholders
and until a successor has been elected and qualified.

        A vacancy  or  vacancies  in the board of  directors  shall be deemed to
exist in the event of the death,  resignation or removal of any director,  or if
the board of directors by  resolution  declares  vacant the office of a director
who has been  declared of unsound  mind by an order of court or  convicted  of a
felony,  or if the  authorized  number  of  directors  is  increased,  or if the
shareholders  fail,  at any  meeting of  shareholders  at which any  director or
directors  are  elected,  to elect the number of directors to be elected at that
meeting.

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<PAGE>

        The  shareholders  may elect a director or directors at any time to fill
any vacancy or  vacancies  not filled by the  directors,  but any such  election
other than to fill a vacancy created by removal,  if by written  consent,  shall
require  the  consent of the  holders of a majority  of the  outstanding  shares
entitled to vote thereon.

        Any  director  may  resign  effective  on giving  written  notice to the
chairman of the board,  the president,  the secretary or the board of directors,
unless  the  notice  specifies  a later  time for  that  resignation  to  become
effective.  If the  resignation of a director is effective at a future time, the
board of  directors  may elect a successor  to take office when the  resignation
becomes effective.

        No reduction of the authorized number of directors shall have the effect
of removing any director before that director's term of office expires.

        III.5  PLACE OF MEETINGS; MEETINGS BY TELEPHONE

        Regular  meetings  of the  board of  directors  may be held at any place
within or outside the State of California  that has been designated from time to
time by resolution of the board.  In the absence of such a designation,  regular
meetings  shall be held at the principal  executive  office of the  corporation.
Special  meetings  of the board may be held at any place  within or outside  the
State of California that has been designated in the notice of the meeting or, if
not stated in the notice or if there is no notice,  at the  principal  executive
office of the corporation.

        Any meeting,  regular or special, may be held by conference telephone or
similar communication  equipment,  so long as all directors participating in the
meeting  can hear one  another;  and all such  directors  shall be  deemed to be
present in person at the meeting.

        III.6  REGULAR MEETINGS

        Regular meetings of the board of directors may be held without notice if
the times of such meetings are fixed by the board of directors.

        III.7  SPECIAL MEETINGS

        Special  meetings of the board of directors  for any purpose or purposes
may be called at any time by the chairman of the board, the president,  any vice
president, the secretary or any two directors.

        Notice  of the time and place of  special  meetings  shall be  delivered
personally  or by  telephone  to each  director or sent by  first-class  mail or
telegram, charges prepaid, addressed to each director at that director s address
as it is shown on the records of the  corporation.  If the notice is mailed,  it
shall be deposited  in the United  States mail at least four (4) days before the
time of the holding of the meeting. If the notice is delivered personally, or by
telephone or telegram,  it shall be delivered  personally  or by telephone or to
the  telegraph  company at least  forty-eight  (48) hours before the time of the
holding of the meeting.  Any oral notice given personally or by telephone may be
communicated either to the director or to a person at the office of the director
who the person giving the notice has reason to believe will promptly communicate
it to the director.  The notice need not specify the purpose or the place of the
meeting,  if the meeting is to be held at the principal  executive office of the
corporation.

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<PAGE>

        III.8  QUORUM

        A majority of the  authorized  number of  directors  shall  constitute a
quorum for the transaction of business, except to adjourn as provided in Section
3.10 of these  by-laws.  Every act or decision done or made by a majority of the
directors  present at a duly held meeting at which a quorum is present  shall be
regarded  as the act of the board of  directors,  subject to the  provisions  of
Section 310 of the Code (as to approval of contracts or  transactions in which a
director has a direct or indirect material financial  interest),  Section 311 of
the Code (as to appointment of committees) and Section 317(e) of the Code (as to
indemnification of directors).

        A  meeting  at which a quorum  is  initially  present  may  continue  to
transact  business  notwithstanding  the withdrawal of directors,  if any action
taken is  approved  by at  least a  majority  of the  required  quorum  for that
meeting.

        III.9  WAIVER OF NOTICE.

        The  transactions  of any  meeting  of the board of  directors,  however
called  and  noticed  or  wherever  held,  shall be as valid as though  had at a
meeting  duly held after  regular call and notice if a quorum is present and if,
either  before or after the meeting,  each of the  directors not present signs a
written waiver of notice, a consent to holding the meeting or an approval of the
minutes thereof. The waiver of notice or consent need not specify the purpose of
the meeting.  All such waivers,  consents and approvals  shall be filed with the
corporate  records  or made a part of the  minutes of the  meeting.  Notice of a
meeting  shall also be deemed  given to any  director  who  attends  the meeting
without  protesting,  before or at its commencement,  the lack of notice to that
director.

        III.10 ADJOURNMENT

        A majority  of the  directors  present,  whether or not  constituting  a
quorum, may adjourn any meeting to another time and place.

        III.11 NOTICE OF ADJOURNMENT

        Notice of the time and place of holding an adjourned meeting need not be
given,  unless the meeting is adjourned for more than twenty-four (24) hours, in
which case  notice of the time and place  shall be given  before the time of the
adjourned meeting,  in the manner specified in Section 3.7 of these by-laws,  to
the directors who were not present at the time of the adjournment.

        III.12 ACTION WITHOUT MEETING

        Any action  required or  permitted to be taken by the board of directors
may be taken without a meeting,  if all members of the board shall  individually
or  collectively  consent  in  writing to that  action.  Such  action by written
consent shall have the same force and effect as a unanimous vote of the board of
directors. Such written consent and any counterparts thereof shall be filed with
the minutes of the proceedings of the board.

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<PAGE>

        III.13 FEES AND COMPENSATION OF DIRECTORS

        Directors and members of committees  may receive such  compensation,  if
any, for their services,  and such reimbursement of expenses, as may be fixed or
determined by resolution of the board of directors.  This Section 3.13 shall not
be construed to preclude any director from serving the  corporation in any other
capacity as an officer, agent, employee or otherwise, and receiving compensation
for those services.

                                   ARTICLE IV

                                   COMMITTEES

        IV.1   COMMITTEES OF DIRECTORS

        The board of directors  may, by resolution  adopted by a majority of the
authorized  number of  directors,  designate  one (1) or more  committees,  each
consisting of two or more directors,  to serve at the pleasure of the board. The
board may  designate  one (1) or more  directors  as  alternate  members  of any
committee,  who may replace any absent  member at any meeting of the  committee.
The appointment of members or alternate members of a committee requires the vote
of a majority of the  authorized  number of  directors.  Any  committee,  to the
extent provided in the resolution of the board,  shall have all the authority of
the board, except with respect to:

               (a) the  approval  of any  action  which,  under the  Code,  also
requires shareholders' approval or approval of the outstanding shares;

               (b)    the filling of vacancies in the board of directors or in 
any committee;

               (c)    the  fixing  of  compensation  of the  directors  for 
serving  on the  board or any committee;

               (d)    the amendment or repeal of these by-laws or the adoption 
of new by-laws;

               (e) the  amendment  or repeal of any  resolution  of the board of
directors which by its express terms is not so amendable or repealable;

               (f) a distribution to the shareholders of the corporation, except
at a rate or in a  periodic  amount or within a price  range  determined  by the
board of directors; or

               (g) the  appointment  of any  other  committees  of the  board of
directors or the members of such committees.

        IV.2   MEETINGS AND ACTION OF COMMITTEES.

        Meetings  and actions of  committees  shall be governed by, and held and
taken in  accordance  with,  the  provisions  of Article  III of these  by-laws,
Section 3.5 (place of  meetings),  Section 3.6 (regular  meetings),  Section 3.7
(special  meetings and  notice),  Section 3.8  (quorum),  Section 3.9 (waiver of
notice),  Section 3.10  (adjournment),  Section 3.11 (notice of adjournment) and
Section 3.12 (action without meeting), with such changes in the context of those
by-laws as are  necessary to  substitute  the  committee and its members for the
board of directors and its members,  except that the time of regular meetings of
committees  may be determined  either by resolution of the board of directors or
by  resolution of the  committee;  special  meetings of  committees  may also be
called by resolution of the board of directors;  and notice of special  meetings
of committees shall also be given to all alternate  members,  who shall have the
right to attend all meetings of the committee.  The board of directors may adopt


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<PAGE>

rules for the government of any committee not  inconsistent  with the provisions
of these by-laws.

                                    ARTICLE V

                                    OFFICERS

        V.1    OFFICERS.

        The officers of the corporation shall be a president, a secretary, and a
chief financial officer. The corporation may also have, at the discretion of the
board of directors, a chairman of the board, one or more vice presidents, one or
more assistant  secretaries,  one or more assistant  treasurers,  and such other
officers as may be appointed in accordance with the provisions of Section 5.3 of
these by-laws. Any number of offices may be held by the same person.

        V.2    ELECTION OF OFFICERS.

        The  officers  of  the  corporation,  except  such  officers  as  may be
appointed in  accordance  with the  provisions  of Section 5.3 or Section 5.5 of
these by-laws,  shall be chosen by the board,  subject to the rights, if any, of
an officer under any contract of employment.

        V.3    SUBORDINATE OFFICERS.

        The board of  directors  may  appoint,  or may empower the  president to
appoint,  such other  officers as the business of the  corporation  may require,
each of whom shall hold office for such period,  have such authority and perform
such duties as are provided in these  by-laws or as the board of  directors  may
from time to time determine.

        V.4    REMOVAL AND RESIGNATION OF OFFICERS.

        Subject to the  rights,  if any,  of an officer  under any  contract  of
employment,  any officer may be removed,  either with or without  cause,  by the
board of directors at any regular or special  meeting of the board or, except in
case of an officer  chosen by the board of  directors,  by any officer upon whom
such power of removal may be conferred by the board of directors.

        Any  officer  may  resign  at any time by giving  written  notice to the
corporation.  Any  resignation  shall take  effect at the date of the receipt of
that notice or at any later time specified in that notice; and, unless otherwise
specified  in that  notice,  the  acceptance  of the  resignation  shall  not be
necessary to make it  effective.  Any  resignation  is without  prejudice to the
rights,  if any, of the corporation under any contract to which the officer is a
party.

        V.5    VACANCIES IN OFFICES.

        A  vacancy  in  any  office  because  of  death,  resignation,  removal,
disqualification  or any other cause shall be filled in the manner prescribed in
these by-laws for regular appointments to that office.

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<PAGE>

        V.6    CHAIRMAN OF THE BOARD.

        The  chairman  of the board,  if such an officer be elected,  shall,  if
present,  preside at meetings of the board of directors and exercise and perform
such other powers and duties as may be from time to time  assigned to him by the
board of directors or prescribed by these by-laws. If there is no president, the
chairman  of  the  board  shall  also  be the  chief  executive  officer  of the
corporation  and shall have the powers and duties  prescribed  in Section 5.7 of
these by-laws.

        V.7    PRESIDENT.

        Subject to such supervisory powers, if any, as may be given by the board
of  directors  to the  chairman of the board,  if there be such an officer,  the
president  shall be the chief  executive  officer of the  corporation and shall,
subject to the  control of the board of  directors,  have  general  supervision,
direction  and control of the business and the officers of the  corporation.  He
shall  preside at all  meetings of the  shareholders  and, in the absence of the
chairman  of the board,  or if there be none,  at all  meetings  of the board of
directors.  He shall have the general  powers and duties of  management  usually
vested in the office of  president of a  corporation,  and shall have such other
powers  and  duties  as may be  prescribed  by the board of  directors  or these
by-laws.

        V.8    VICE PRESIDENTS.

        In the absence or disability of the president,  the vice presidents,  if
any,  in order of their  rank as fixed  by the  board of  directors  or,  if not
ranked, a vice president designated by the board of directors, shall perform all
the duties of the president and when so acting shall have all the powers of, and
be subject to all the  restrictions  upon,  the president.  The vice  presidents
shall have such other  powers and perform such other duties as from time to time
may be  prescribed  for  them  respectively  by the  board of  directors,  these
by-laws, the president or the chairman of the board.

        V.9    SECRETARY.

        The secretary shall keep or cause to be kept, at the principal executive
office of the  corporation,  or such other place as the board of  directors  may
direct,  a book of minutes of all meetings and actions of directors,  committees
of  directors,  and  shareholders,  with the time and place of holding,  whether
regular or special (and, if special,  how authorized and the notice given),  the
names of those present at directors meetings or committee  meetings,  the number
of shares present or represented at shareholders'  meetings, and the proceedings
thereof.

        The  secretary  shall  keep,  or  cause  to be  kept,  at the  principal
executive  office  of the  corporation  or at the  office  of the  corporation's
transfer  agent or  registrar,  as  determined  by  resolution  of the  board of
directors, a share register, or a duplicate share register, showing the names of
all shareholders  and their addresses,  the number and classes of shares held by
each, the number and date of certificates evidencing such shares, and the number
and date of cancellation of every certificate surrendered for cancellation.

        The secretary  shall give, or cause to be given,  notice of all meetings
of the shareholders  and of the board of directors  required by these by-laws or
by law to be given,  and he shall  keep the seal of the  corporation,  if one be
adopted, in safe custody and shall have such other powers and perform such other
duties as may be prescribed by the board of directors or by these bylaws.

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<PAGE>

       V.10   CHIEF FINANCIAL OFFICER

        The chief financial officer shall keep and maintain, or cause to be kept
and  maintained,  adequate  and  correct  books and  records of  accounts of the
properties and business  transactions of the corporation,  including accounts of
its  assets,  liabilities,  receipts,  disbursements,  gains,  losses,  capital,
retained earnings and shares. The books of account shall at all reasonable times
be open to inspection by any director.

        The chief financial  officer shall deposit all money and other valuables
in the name and to the credit of the corporation  with such  depositaries as may
be  designated  by the board of  directors.  He shall  disburse the funds of the
corporation  as may be ordered by the board of  directors,  shall  render to the
president  and  directors,  whenever  they  request it, an account of all of his
transactions  as chief financial  officer and of the financial  condition of the
corporation,  and shall have such other  powers and perform such other duties as
may be prescribed by the board of directors or these by-laws.

                                   ARTICLE VI

               INDEMNIFICATION OF DIRECTORS, OFFICERS, EMPLOYEES,
                                AND OTHER AGENTS

        VI.1   INDEMNIFICATION OF DIRECTORS AND OFFICERS

        The corporation shall, to the maximum extent and in the manner permitted
by the Code,  indemnify each of its directors and officers  against expenses (as
defined in Section 317(a) of the Code), judgments, fines, settlements, and other
amounts  actually and reasonably  incurred in connection with any proceeding (as
defined in Section 317(a) of the Code),  arising by reason of the fact that such
person is or was an agent of the corporation. For purposes of this Article VI, a
"director" or "officer" of the corporation includes any person (i) who is or was
a  director  or officer of the  corporation,  (ii) who 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,  or (iii)  who was a
director or officer of a corporation which was a predecessor  corporation of the
corporation  or of  another  enterprise  at  the  request  of  such  predecessor
corporation.

        VI.2   INDEMNIFICATION OF OTHERS

        The  corporation  shall have the power,  to the extent and in the manner
permitted by the Code, to indemnify each of its employees and agents (other than
directors and officers)  against  expenses (as defined in Section  317(a) of the
Code), judgments, fines, settlements,  and other amounts actually and reasonably
incurred in connection  with any proceeding (as defined in Section 317(a) of the
Code),  arising by reason of the fact that such person is or was an agent of the
corporation.  For purposes of this Article VI, an  "employee"  or "agent" of the
corporation (other than a director or officer) includes any person (i) who is or
was an employee or agent of the  corporation,  (ii) who 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,  or (iii)  who was an
employee or agent of a corporation  which was a predecessor  corporation  of the
corporation  or of  another  enterprise  at  the  request  of  such  predecessor
corporation.

        VI.3   PAYMENT OF EXPENSES IN ADVANCE

        Expenses   incurred  in  defending  any  civil  or  criminal  action  or
proceeding for which  indemnification is required pursuant to Section 6.1 or for
which   indemnification   is  permitted   pursuant  to  Section  6.2   following
authorization thereof by the Board of Directors shall be paid by the corporation
in advance of the final disposition of such action or proceeding upon receipt of
an undertaking by or on behalf of the indemnified  party to repay such amount if
it shall ultimately be determined that the indemnified  party is not entitled to
be indemnified as authorized in this Article VI.

                                       34

<PAGE>

        VI.4   INDEMNITY NOT EXCLUSIVE

        The  indemnification  provided  by this  Article  VI shall not be deemed
exclusive  of any other  rights to which those  seeking  indemnification  may be
entitled  under any bylaw,  agreement,  vote of  shareholders  or  disinterested
directors  or  otherwise,  both as to action in an official  capacity  and as to
action in another  capacity  while holding such office,  to the extent that such
additional  rights  to  indemnification   are  authorized  in  the  Articles  of
Incorporation.

        VI.5   INSURANCE INDEMNIFICATION

        The corporation shall have the power to purchase and maintain  insurance
on behalf of any person who is or was a director,  officer, employee or agent of
the  corporation  against  any  liability  asserted  against or incurred by such
person in such capacity or arising out of such person's status as such,  whether
or not the  corporation  would  have the power to  indemnify  him  against  such
liability under the provisions of this Article VI.

        VI.6   CONFLICTS

        No  indemnification  or advance  shall be made under  this  Article  VI,
except  where such  indemnification  or advance is mandated by law or the order,
judgment or decree of any court of competent  jurisdiction,  in any circumstance
where it appears:

               (1)  That  it  would  be  inconsistent  with a  provision  of the
Articles of Incorporation,  these bylaws, a resolution of the shareholders or an
agreement  in  effect at the time of the  accrual  of the  alleged  cause of the
action  asserted in the  proceeding in which the expenses were incurred or other
amounts were paid, which prohibits or otherwise limits indemnification; or

               (2) That it would be  inconsistent  with any condition  expressly
imposed by a court in approving a settlement.

                                   ARTICLE VII

                               RECORDS AND REPORTS

        VII.1  MAINTENANCE AND INSPECTION OF SHARE REGISTER

        The corporation shall keep at its principal  executive office, or at the
office  of its  transfer  agent or  registrar,  if either  be  appointed  and as
determined  by   resolution  of  the  board  of  directors,   a  record  of  its
shareholders,  giving the names and addresses of all shareholders and the number
and class of shares held by each shareholder.

        A shareholder or shareholders  of the corporation  holding at least five
percent  (5%)  in  the  aggregate  of  the  outstanding  voting  shares  of  the
corporation or who holds at least one percent (1%) of such voting shares and has
filed a Schedule 14B with the Securities and Exchange Commission relating to the
election of  directors,  may (i)  inspect and copy the records of  shareholders'
names and addresses and  shareholdings  during usual  business hours on five (5)
days' prior  written  demand on the  corporation,  (ii) obtain from the transfer
agent of the  corporation,  on written demand and on the tender of such transfer
agent's  usual  charges for such list, a list of the names and  addresses of the


                                       35

<PAGE>

shareholders  who are entitled to vote for the election of directors,  and their
shareholdings,  as of the most  recent  record date for which that list has been
compiled or as of a date specified by the shareholder  after the date of demand.
Such list shall be made available to any such  shareholder by the transfer agent
on or before the later of five (5) days after the demand is received or five (5)
days after the date  specified in the demand as the date as of which the list is
to be compiled.

        The  record of  shareholders  shall  also be open to  inspection  on the
written demand of any  shareholder or holder of a voting trust  certificate,  at
any time during usual business hours,  for a purpose  reasonably  related to the
holder's  interests  as a  shareholder  or  as  the  holder  of a  voting  trust
certificate.

        Any  inspection and copying under this Section 7.1 may be made in person
or by an agent or  attorney  of the  shareholder  or  holder  of a voting  trust
certificate making the demand.

        VII.2  MAINTENANCE AND INSPECTION OF BY-LAWS.

        The corporation shall keep at its principal  executive office, or if its
principal  executive office is not in the State of California,  at its principal
business  office in such  state,  the  original  or a copy of these  by-laws  as
amended to date,  which by-laws shall be open to inspection by the  shareholders
at all reasonable  times during office hours. If the principal  executive office
of the corporation is outside the State of California and the corporation has no
principal  business office in such state, the secretary shall,  upon the written
request of any shareholder,  furnish to that shareholder a copy of these by-laws
as amended to date.

        VII.3  MAINTENANCE AND INSPECTION OF OTHER CORPORATE RECORDS

        The accounting books and records,  and the minutes of proceedings of the
shareholders  and the board of directors  and any committee or committees of the
board of  directors,  shall be kept at such  place or places  designated  by the
board  of  directors  or,  in  absence  of such  designation,  at the  principal
executive office of the  corporation.  The minutes shall be kept in written form
and the accounting  books and records shall be kept either in written form or in
any other form capable of being converted into written form.

        The minutes and accounting books and records shall be open to inspection
upon  the  written  demand  of any  shareholder  or  holder  of a  voting  trust
certificate,  at any reasonable time during usual business hours,  for a purpose
reasonably  related to the holder's  interests as a shareholder or as the holder
of a voting trust  certificate.  The  inspection  may be made in person or by an
agent or attorney,  and shall include the right to copy and make extracts.  Such
rights of inspection shall extend to the records of each subsidiary  corporation
of the corporation.

        VII.4  INSPECTION BY DIRECTORS.

        Every director  shall have the absolute right at any reasonable  time to
inspect  all  books,  records  and  documents  of every  kind  and the  physical
properties of the  corporation  and each of its  subsidiary  corporations.  Such
inspection  by a director may be made in person or by an agent or attorney,  and
the  right of  inspection  includes  the  right to copy  and  make  extracts  of
documents.

        VII.5  ANNUAL REPORT TO SHAREHOLDERS; WAIVER.

        The board of  directors  shall cause an annual  report to be sent to the
shareholders not later than one hundred twenty (120) days after the close of the

                                       36

<PAGE>

fiscal  year  adopted by the  corporation.  Such  report  shall be sent at least
fifteen (15) days before the annual  meeting of  shareholders  to be held during
the next fiscal year and in the manner specified in Section 2.5 of these by-laws
for giving notice to shareholders of the corporation.

        The annual  report  shall  contain a balance  sheet as of the end of the
fiscal  year and an income  statement  and  statement  of changes  in  financial
position  for  the  fiscal  year,  accompanied  by  any  report  of  independent
accountants  or, if there is no such report,  the  certificate  of an authorized
officer of the corporation  that the statements were prepared without audit from
the books and records of the corporation.

        The foregoing requirement of an annual report shall be waived so long as
the shares of the corporation are held by less than one hundred (100) holders of
record.

        VII.6  FINANCIAL STATEMENTS.

        A copy of any annual financial statement and any income statement of the
corporation for each quarterly  period of each fiscal year, and any accompanying
balance  sheet of the  corporation  as of the end of each such period,  that has
been  prepared  by the  corporation  shall  be kept  on  file  in the  principal
executive  office of the  corporation  for  twelve  (12)  months;  and each such
statement  shall  be  exhibited  at all  reasonable  times  to  any  shareholder
demanding an  examination of any such statement or a copy shall be mailed to any
such shareholder.

        If a shareholder or  shareholders  holding at least five percent (5%) of
the outstanding  shares of any class of stock of the corporation makes a written
request to the  corporation  for an income  statement of the corporation for the
three-month,  six-month or  nine-month  period of the then  current  fiscal year
ended  more than  thirty  (30) days  before the date of the  request,  and for a
balance  sheet  of the  corporation  as of the end of  that  period,  the  chief
financial  officer  shall cause that  statement to be  prepared,  if not already
prepared,  and shall deliver  personally or mail that statement or statements to
the person  making the request  within thirty (30) days after the receipt of the
request.  If the corporation has not sent to the  shareholders its annual report
for the last fiscal year,  such report shall  likewise be delivered or mailed to
the shareholder or shareholders within thirty (30) days after the request.

        The corporation  shall also, on the written request of any  shareholder,
mail to the  shareholder  a copy of the last  annual,  semi-annual  or quarterly
income  statement  which it has  prepared,  and a balance sheet as of the end of
that period.

        The quarterly  income  statements and balance sheets referred to in this
section  shall  be  accompanied  by the  report,  if  any,  of  any  independent
accountants  engaged by the  corporation  or the  certificate  of an  authorized
officer of the corporation  that the financial  statements were prepared without
audit from the books and records of the corporation.

                                  ARTICLE VIII

                                 GENERAL MATTERS

        VIII.1 RECORD DATE FOR PURPOSES OTHER THAN NOTICE AND VOTING.

        For purposes of determining the shareholders entitled to receive payment
of any dividend or other  distribution or allotment of any rights or entitled to
exercise any rights in respect of any other lawful  action (other than action by
shareholders by written  consent without a meeting),  the board of directors may
fix, in  advance,  a record  date,  which shall not be more than sixty (60) days


                                       37

<PAGE>

before  any such  action,  and in that case only  shareholders  of record at the
close of  business on the date so fixed are  entitled  to receive the  dividend,
distribution or allotment of rights, or to exercise such rights, as the case may
be,  notwithstanding  any transfer of any shares on the books of the corporation
after the record date so fixed, except as otherwise provided in the Code.

        If the board of directors does not so fix a record date, the record date
for  determining  shareholders  for any such  purpose  shall be at the  close of
business on the day on which the board adopts the  applicable  resolution or the
sixtieth (60th) day before the date of that action, whichever is later.

        VIII.2 CHECKS, DRAFTS, EVIDENCES OF INDEBTEDNESS.

        All checks,  drafts,  or other  orders for payment of money,  notes,  or
other  evidences  of  indebtedness,  issued  in the  name of or  payable  to the
corporation,  shall be signed or  endorsed by such person or persons and in such
manner as, from time to time,  shall be determined by resolution of the board of
directors.

        VIII.3 CORPORATE CONTRACTS AND INSTRUMENTS:  HOW EXECUTED.

        The board of directors,  except as otherwise  provided in these by-laws,
may  authorize  any officer or officers,  or agent or agents,  to enter into any
contract  or  execute  any  instrument  in the  name  of and  on  behalf  of the
corporation,  and  such  authority  may  be  general  or  confined  to  specific
instances;  and,  unless so  authorized or ratified by the board of directors or
within the agency power of an officer, no officer,  agent or employee shall have
any power or authority to bind the  corporation by any contract or engagement or
to pledge its credit or to render it liable for any purpose or for any amount.

        VIII.4 CERTIFICATES FOR SHARES

        A certificate or  certificates  for shares of the  corporation  shall be
issued to each shareholder when any of such shares are fully paid, and the board
of directors may authorize the issuance of certificates or shares as partly paid
provided that these  certificates shall state the amount of the consideration to
be paid for them and the amount paid.  All  certificates  shall be signed in the
name of the  corporation  by the  chairman of the board or vice  chairman of the
board or the president or a vice president and by the chief financial officer or
an assistant  treasurer or the secretary or an assistant  secretary,  certifying
the number of shares and the class or series of shares owned by the shareholder.
Any or all of the signatures on the certificate may be facsimile.

        In case any officer, transfer agent or registrar who has signed or whose
facsimile  signature  has been placed on a  certificate  shall have ceased to be
that officer,  transfer agent or registrar before that certificate is issued, it
may be issued by the corporation  with the same effect as if that person were an
officer, transfer agent or registrar at the date of issue.

        VIII.5 LOST CERTIFICATES.

        Except as provided in this Section 8.5, no new  certificates  for shares
shall be issued to replace a previously issued  certificate unless the latter is
surrendered  to the  corporation  and  canceled  at the same time.  The board of
directors  may,  in case any  share  certificate  or  certificate  for any other
security is lost,  stolen or destroyed,  authorize  the issuance of  replacement
certificates  on such terms and  conditions as the board may require,  including
provision  for  indemnification  of the  corporation  secured by a bond or other
adequate security  sufficient to protect the corporation  against any claim that
may be made against it,  including any expense or  liability,  on account of the
alleged loss,  theft or  destruction  of the  certificate or the issuance of the
replacement certificate.

                                       38

<PAGE>

        VIII.6 CONSTRUCTION AND DEFINITIONS.

        Unless the context requires otherwise, the general provisions,  rules of
construction  and definitions in the Code shall govern the construction of these
by-laws.  Without limiting the generality of this provision, the singular number
includes  the plural,  the plural  number  includes the  singular,  and the term
"person" includes both a corporation and a natural person.

                                   ARTICLE IX

                                   AMENDMENTS

        IX.1   AMENDMENT BY SHAREHOLDERS

        New by-laws  may be adopted or these  by-laws may be amended or repealed
by the vote or written  consent of  holders  of a  majority  of the  outstanding
shares  entitled  to  vote;   provided,   however,   that  if  the  articles  of
incorporation of the corporation set forth the number of authorized directors of
the  corporation,  the authorized  number of directors may be changed only by an
amendment as required by applicable law.

        IX.2   AMENDMENT BY DIRECTORS.

        Subject to the rights of the  shareholders as provided in Section 9.1 of
these by-laws, by-laws, other than a by-law or an amendment of a by-law changing
the  authorized  number of  directors  (except to fix the  authorized  number of
directors  pursuant to a by-law  providing for a variable  number of directors),
may be adopted, amended, or repealed by the board of directors.


                                       39

<PAGE>





                       CERTIFICATE OF ADOPTION OF BY-LAWS

                                       OF

                           TRIMBLE NAVIGATION LIMITED


                 Certificate by Secretary of Adoption of By-Laws

        The undersigned hereby certifies that he is the duly elected,  qualified
and acting Secretary of Trimble Navigation Limited (the  "Corporation") and that
the foregoing By-Laws,  comprising twenty (20) pages,  constitute the By-Laws of
the  Corporation as originally  adopted on January 5, 1981, and as  subsequently
amended and restated by the board of directors  of the  Corporation  through the
date hereof.

        IN  WITNESS  WHEREOF,  the  undersigned  has  hereunto  set his hand and
affixed the corporate seal this 15th day of May, 1997.



                                                   /S/ Robert A. Trimble
                                                   Robert A. Trimble
                                                   Secretary




                                       40

<PAGE>




                           TRIMBLE NAVIGATION LIMITED
                                  EXHIBIT 10.57

                                FOURTH AMENDMENT
                                       TO
                           REVOLVING CREDIT AGREEMENT



        This FOURTH AMENDMENT (the  "Amendment"),  dated as of July 30, 1997, is
among Trimble Navigation Limited (the "Borrower"),  BankBoston,  N.A., f/k/a The
First National Bank of Boston ("BKB"), Mellon Bank, N.A. ("Mellon", and together
with BKB, the "Banks"),  and BankBoston,  N.A., f/k/a The First National Bank of
Boston as agent for itself and the other Banks (the "Agent").

        WHEREAS,  the  Borrower,  the Banks and the  Agent are  parties  to that
certain  Revolving Credit  Agreement,  dated as of August 4, 1995 (as amended by
the First Amendment to Revolving Credit  Agreement,  dated as of April 30, 1996,
the Second Amendment to Revolving Credit  Agreement,  dated as of June 30, 1996,
and the Third amendment to Revolving Credit Agreement, dated as of September 30,
1996, the "Credit  Agreement"),  pursuant to which the Banks, upon certain terms
and  conditions,  have made  loans to an may  issue  letters  of credit  for the
benefit of the Borrower; and

        WHEREAS,  the Borrower had requested that the Banks agree, and the Banks
have agreed,  on the terms and subject to the  conditions  set forth herein,  to
make certain changes to the Credit Agreement;

        NOW, THEREFORE, the parties hereto hereby agree as follows:

        Section
  1.  Defined  Terms.  Capitalized  terms  which are used  herein
without  definition and which are defined in the Credit Agreement Shall have the
same meanings herein as in the Credit Agreement.

        Section 2.    Amendment of Credit Agreement.  The Credit Agreement is 
hereby amended as follows:

        (a)  Section  1.1 of the Credit  Agreement  is amended by  deleting  the
definition  of Maturity  Date  contained in such section 1.1 and restating it in
its entirety as follows:

               Maturity Date.       September 1, 1997.

        (b) Section 8.3 (q) of the Credit  Agreement  is amended by deleting the
amount  "$2,000,000"  contained  in such  Section 8.3 (q) and  substituting  the
amount "$4,000,000 therefor.

        Section 3. Affirmation and Acknowledgment of the Borrower.  The Borrower
hereby  ratifies and confirms all of its  Obligations  to the Banks,  including,
without  limitation the Revolving  Credit Loans, and the Borrower hereby affirms
its absolute and unconditional  promise to pay to the Banks the Revolving Credit
Loans and all other amounts due under the Credit Agreement as amended hereby.

        Section 4.    Representations  and  Warranties.  The Borrower  hereby  
represents  and warrants to the Banks as follows:

                                       41

<PAGE>

        (a) The execution and delivery by the Borrower of this Amendment and the
performance  by the  Borrower  of its  obligations  and  agreements  under  this
Amendment and the Credit  Agreement as amended hereby,  are within the corporate
authority of the  Borrower,  have been  authorized  by all  necessary  corporate
proceedings  on behalf of the Borrower,  and do not an will not  contravene  any
provision  of law or any  other  the  Borrower's  charter,  other  incorporation
papers,  by-laws,  or any stock  provision  or any  amendment  thereof or of any
indenture, agreement, instrument or undertaking binding upon the Borrower.

        (b) This Amendment and the Credit Agreement as amended hereby constitute
legal, valid and binding obligations of the Borrower,  enforceable in accordance
with  their  respective  terms,  except as limited  by  bankruptcy,  insolvency,
reorganization,  moratorium or similar laws  relating to or affecting  generally
the enforcement of creditors' rights.

        (c) No approval or consent of, or filing with, any  governmental  agency
or  authority  is  required to make valid and  legally  binding  the  execution,
delivery  or  performance  by the  Borrower  of  this  Amendment  or the  Credit
Agreement  as  amended  hereby,  or  the  consummation  by the  Borrower  of the
transactions  among the  parties  contemplated  hereby and  thereby or  referred
herein.

        (d) The  representations  and  warranties  contained in Section 6 of the
Credit  Agreement were correct at and as of the date made.  Except to the extent
that the facts upon which such  representations  and warranties  were based have
changed in the ordinary course of business  (which changes,  either singly or in
the aggregate,  have not been materially adverse) and after giving effect to the
provisions hereof,  such  representations and warranties also are correct at and
as of the date hereof.

        (e) The Borrower  has  performed  and complied in all material  respects
with all terms and conditions  herein  required to be performed or complied with
by it prior to or at the time hereof,  and as of the date  hereof,  after giving
effect to the provisions hereof, there exists no Event of Default or Default.

        Section 5.    Effectiveness.  The  effectiveness  of the Amendment  
shall be subject to receipt by the Agent of this Amendment executed by each of 
the Borrower, the Banks and the Agent.

        Section 6. Miscellaneous  Provisions.  (a) Except as otherwise expressly
provided by this Amendment,  all of the terms,  conditions and provisions of the
Credit Agreement shall remain the same. It is declared and agreed by each of the
parties hereto that the Credit Agreement,  as amended hereby,  shall continue in
full force and effect,  and that the Amendment and the Credit Agreement shall be
read and construed as one instrument.

        (b) THIS AMENDMENT IS INTENDED TO TAKE EFFECT AS AN AGREEMENT UNDER SEAL
AND SHALL BE CONSTRUED ACCORDING TO AND GOVERNED BY THE LAWS OF THE COMMONWEALTH
OF MASSACHUSETTS.

        (c) This  Amendment may be executed in any number of  counterparts,  but
all such counterparts  shall together  constitute but one instrument.  In making
proof of this Amendment it shall not be necessary to produce or account for more
than  one  counterpart  signed  by  each  party  hereto  by  and  against  which
enforcement hereof is sought.

                                       42

<PAGE>

        (d) Pursuant to Section 15 of the Credit Agreement,  the Borrower hereby
agrees to pay to the Agent, on demand by the Agent, all reasonable out-of-pocket
costs and expenses  incurred or sustained  by the Agent in  connection  with the
preparation of this Amendment (including reasonable legal fees).

        IN WITNESS WHEREOF, the parties hereto have executed the Amendment as of
the date first written above.


                                            TRIMBLE NAVIGATION LIMITED

                                              By:/S/ John E. Huey
                                                Name: John E. Huey
                                                 Title: Treasurer


                                                  BANKBOSTON, N.A.
                                        f/k/a THE FIRST NATIONAL BANK OF
                                        BOSTON, individually and as Agent

                                              By: /S/ Teresa Heller
                                                 Name: Teresa Heller
                                                 Title: Director


                                                  MELLON BANK, N.A.

                                              By: /S/ Sean C. Gannon
                                                 Name: Sean C. Gannon
                                                 Title: Vice President



                                       43

<PAGE>





<TABLE>
<CAPTION>

                           TRIMBLE NAVIGATION LIMITED
                                  EXHIBIT 11.1

                 Computation of Earnings (Loss) Per Common Share

                                                              Three Months Ended            Six Months Ended
                                                                    June 30,                   June 30,
                                                              1997           1996          1997          1996
- -----------------------------------------------------------------------------------------------------------------
(In thousands, except per share data)
<S>                                                          <C>            <C>            <C>           <C>    

PRIMARY EARNINGS (LOSS) PER COMMON SHARE

 Computation of common and common
   equivalent shares outstanding:
    Common stock outstanding                                   22,081         21,791        22,073        21,735
    Common stock options                                          374              -           336             -
    Common stock warrants                                          89              -            75             -
                                                          ------------   ------------  ------------ -------------
 Total weighted average common
    and dilutive common equivalent shares outstanding          22,544         21,791        22,484        21,735
                                                          ============   ============  ============ =============


 Net income (loss)                                            $ 3,865       $ (2,585)      $ 5,294      $ (3,731)
                                                          ============   ============  ============ =============


 Primary earnings (loss) per share                             $ 0.17          (0.12)       $ 0.24         (0.17)
                                                          ============   ============  ============ =============


FULLY DILUTED EARNINGS (LOSS) PER COMMON SHARE

 Computation of common and common
   equivalent shares outstanding:
    Common stock outstanding                                   22,081         21,791        22,073        21,735
    Common stock options                                          712              -           708             -
    Common stock warrants                                         153              -           153             -
                                                          ------------   ------------  ------------ -------------
 Total weighted average common
    and dilutive common equivalent shares outstanding          22,946         21,791        22,934        21,735
                                                          ============   ============  ============ =============


 Net income (loss)                                            $ 3,865       $ (2,585)      $ 5,294      $ (3,731)
                                                          ============   ============  ============ =============


 Fully diluted earnings (loss) per share                       $ 0.17          (0.12)       $ 0.23         (0.17)
                                                          ============   ============  ============ =============

</TABLE>



                                                 
                                       44

<PAGE>






<TABLE> <S> <C>
                                    
<ARTICLE>                                5
<LEGEND>                             
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE CONDENSED
CONSOLIDATED BALANCE SHEET AND CONDENSED  CONSOLIDATED  STATEMENT OF ARNINGS AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS
</LEGEND>                            
<MULTIPLIER>                                    1,000
                                          
<S>                                        <C>
<PERIOD-TYPE>                            6-MOS
<FISCAL-YEAR-END>                        DEC-31-1997
<PERIOD-END>                             JUN-30-1997

<CASH>                                         31,443
<SECURITIES>                                   57,028
<RECEIVABLES>                                  39,484
<ALLOWANCES>                                        0
<INVENTORY>                                    38,481
<CURRENT-ASSETS>                              169,331
<PP&E>                                         22,339
<DEPRECIATION>                                      0
<TOTAL-ASSETS>                                201,133
<CURRENT-LIABILITIES>                          40,413
<BONDS>                                             0
<PREFERRED-MANDATORY>                               0
<PREFERRED>                                         0
<COMMON>                                      127,104
<OTHER-SE>                                      2,827
<TOTAL-LIABILITY-AND-EQUITY>                  201,133
<SALES>                                       129,495
<TOTAL-REVENUES>                              129,495
<CGS>                                          61,300
<TOTAL-COSTS>                                  61,300
<OTHER-EXPENSES>                               62,090
<LOSS-PROVISION>                                    0
<INTEREST-EXPENSE>                                358
<INCOME-PRETAX>                                 6,617
<INCOME-TAX>                                    1,323
<INCOME-CONTINUING>                             5,294
<DISCONTINUED>                                      0
<EXTRAORDINARY>                                     0
<CHANGES>                                           0
<NET-INCOME>                                    5,294
<EPS-PRIMARY>                                       0.24
<EPS-DILUTED>                                       0.24
        
 

</TABLE>