PARLEX 145 Milk Street, Methuen, Massachusetts 01844
CORPORATION
October 27, 1995
Dear Stockholder,
I am pleased to invite you to attend Parlex Corporation's annual
meeting. The meeting will be held at 9:30 a.m. on Tuesday, December 5, 1995,
on the eighth floor of the Shawmut Bank Building, One Federal Street, Boston,
Massachusetts.
As the accompanying notice and proxy statement describe, the only action
scheduled for this year's meeting is the election of three directors each for
a term of three years.
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AT THE MEETING.
ACCORDINGLY, PLEASE SIGN, DATE, AND RETURN THE ENCLOSED PROXY AT YOUR EARLIEST
CONVENIENCE.
I look forward to meeting as many of our stockholders as possible and
hope you can be present on December 5th.
Sincerely,
/s/ Herbert W. Pollack
HERBERT W. POLLACK
Chairman of the Board
Parlex
Corporation
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
To the Stockholders of Parlex Corporation:
The Annual Meeting of Stockholders of Parlex Corporation will be held on
the eighth floor of the Shawmut Bank Building, One Federal Street, Boston,
Massachusetts, at 9:30 a.m. on Tuesday, December 5, 1995, for the following
purposes:
1. to elect three Class I members of the Board of Directors to serve
for a period of three years and until their successors are elected
and qualified; and
2. to consider and act upon any other matter that properly comes before
the meeting or any adjournment thereof.
By Order of the Board of Directors
JILL POLLACK KUTCHIN
Clerk
Methuen, Massachusetts
October 27, 1995
PARLEX CORPORATION
PROXY STATEMENT FOR
ANNUAL MEETING OF STOCKHOLDERS TO BE HELD ON
DECEMBER 5, 1995
This statement is furnished in connection with the solicitation of
proxies on behalf of the Board of Directors of Parlex Corporation (the
"Company") for use at the Company's Annual Meeting of Stockholders to be held
on Tuesday, December 5, 1995, notice of which is attached, and at any
adjournment(s) thereof. Persons holding stock for others, such as brokers and
nominees, are being asked to forward proxy solicitation materials to their
principals at the Company's expense. The Company will bear the entire cost of
proxy solicitation.
A stockholder who gives a proxy may revoke it at any time before it is
exercised.
The Board of Directors of the Company has fixed the close of business on
October 13, 1995 as the record date for the determination of stockholders who
are entitled to notice of and to vote at the meeting. At the close of business
on that date, 2,370,659 shares of Common Stock, par value $.10 per share, were
outstanding. Holders of the Common Stock are entitled to one vote for each
share held. The stock transfer books have not been closed.
This proxy statement and form of proxy will be mailed to stockholders on
or about October 27, 1995. The address of the principal executive offices of
the Company is 145 Milk Street, Methuen, Massachusetts 01844.
ELECTION OF DIRECTORS
At this year's annual meeting, three Class I Directors are to be elected
to serve until the Company's annual meeting in 1998 and until their successors
are elected and qualified.
The individuals named in the enclosed form of proxy will, if so
authorized, vote to elect as Class I Directors the persons named below under
the caption Class I Director Nominees. The management of the Company is not
aware of any reason why the nominees for director would not be able to serve.
If any of the nominees are unable to serve, the individuals named in the
enclosed form of proxy will vote in favor of such other person as the Board of
Directors may at the time recommend. Information regarding these nominees is
set forth below. Each Class I Director Nominee currently serves as a Class I
Director.
Class I Director Nominees
Lester Pollack (age 62).
Mr. Pollack has been a managing director of Lazard Freres & Co. LLC., an
investment partnership, and the chief executive officer of Centre Partners
L.P., an investment firm, since June 1986, and in October 1986 became senior
managing director of Corporate Partners L.P. Both Centre Partners L.P. and
Corporate Partners L.P. are investment affiliates of Lazard Freres & Co. LLC.
He is a director of Sphere Drake Holdings Ltd., Continental Cablevision, Inc.,
SunAmerica, Inc., Kaufman and Broad Home Corp., Polaroid Corporation and
Tidewater. Lester Pollack is the brother of Herbert W. Pollack. He has been a
director of the Company since 1970.
Benjamin M. Rabinovici (age 73).
Dr. Rabinovici has served as president of Tympanium Corporation, a
manufacturer of electronic products, since 1980. From 1981 to 1989, he served
as president of International Microwave Corporation, a manufacturer of
microwave communications equipment. He has been a director of the Company
since 1970.
Richard W. Hale (age 57).
Mr. Hale has been chairman and chief executive officer of Hale
Industries, Inc. since 1993. From 1980 to 1993, he was vice president and
chief operating officer and a member of the board of directors of M/A-Com,
Inc. He has been a director of the Company since February 1995.
The following persons will continue to be directors of the Company:
Class II Directors
(term of office to expire with the annual meeting of stockholders to be held
in December 1996)
M. Joel Kosheff (age 57).
Mr. Kosheff has been principal of M.J. Kosheff Associates, a financial
consulting firm, since January 1989. He has been a director of the Company
since 1989.
Peter J. Murphy (age 46).
Mr. Murphy has been chief operating officer of the Company since May
1994 and on July 1, 1995 he also became president. He was executive vice
president from May 1994 to July 1995 and vice president and general manager of
the Flexible Circuit Products Division from February 1993 to May 1994. Mr.
Murphy initially served as assistant to the president from December 1992 to
February 1993. From 1989 to 1992, he was president of Teledyne Electo-
Mechanisms, a manufacturer of flexible circuits. He has been a director of the
Company since 1994.
Class III Directors
(term of office to expire with the annual meeting of stockholders to be held
in December 1997)
Herbert W. Pollack (age 68).
Mr. Pollack has served as chairman of the board, chief executive officer
and treasurer of the Company since it was founded in 1970. He was president of
the Company from 1970 to July 1, 1995.
Sheldon Buckler (age 64).
Dr. Buckler has been chairman of the board of Commonwealth Energy System
Services since May 1995. He was employed by Polaroid Corporation from 1964
until his retirement as vice chairman of the board of directors in 1994. Dr.
Buckler is a director of Aseco Corporation, Nashua Corporation and Spectrum
Information Technologies Corporation. He has been a director of the Company
since February 1995.
BOARD OF DIRECTORS MEETINGS AND COMMITTEES OF THE BOARD
The Board of Directors held four meetings during fiscal year 1995. Each
outside director received a $6,000 annual retainer for his services, plus
$1,000 for each directors' meeting he attended. As Chairman of the Board of
Directors, Herbert W. Pollack receives a fee in the amount of $1,800 per
month.
In order to continue to attract and retain outside directors of
exceptional ability, the Company maintains the 1989 Outside Directors' Stock
Option Plan (the "Director Plan") for outside directors, currently covering
75,000 shares of Common Stock. Options are granted pursuant to the Director
Plan only to non-employee members of the Board of Directors of the Company.
Each member of the Company's Board of Directors who is neither an employee nor
an officer of the Company who becomes a member of the Board of Directors for
the first time on or after August 22, 1989, will be automatically granted on
the date such membership on the Board of Directors commences, without further
action by the Board, an option to purchase 5,000 shares of the Company's
Common Stock. Each incumbent member of the Company's Board of Directors who is
neither an employee nor an officer of the Company and who has been a member of
the Board of Directors for at least five years shall receive an automatic
grant, without further action by the Board, of an option to purchase 5,000
shares of the Company's Common Stock. Options granted under the Director Plan
become exercisable in equal installments on each of the first five
anniversaries of the date of the option grant. The purchase price of stock
covered by an option granted under the Director Plan is 100% of the fair
market value of the Company's Common Stock on the date of grant.
The Board has an Audit Committee and a Compensation Committee but does
not have a nominating committee. All directors, except Sheldon Buckler,
attended at least 75% of all meetings of the Board and committees of the Board
on which they served.
During fiscal year 1995, the Audit Committee, of which Messrs. Buckler,
Kosheff and Lester Pollack were members, held two meetings. The Audit
Committee reviews the internal controls of the Company. It meets with
appropriate Company financial personnel as well as the Company's independent
auditors. The Committee reviews the scope and results of the professional
services provided by the Company's independent auditors and the fees charged
for such services and makes such recommendations to the Board as it deems
appropriate, including recommendations as to the appointment of independent
auditors. The Committee is composed entirely of independent outside directors.
During fiscal year 1995, the Compensation Committee of which Messrs.
Hale, Kosheff and Rabinovici were members, held two meetings. This is the
committee of the Board responsible for establishing the compensation of the
Chief Executive Officer and setting policy for compensation at the senior
levels of the Company, as well as administering various employee stock option
plans. The Committee is composed entirely of independent outside directors.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT
The following table sets forth certain information regarding the
beneficial ownership of the Company's Common Stock as of October 13, 1995 by:
(i) each person who is known by the Company to own beneficially more than 5%
of the outstanding Common Stock; (ii) each of the Company's directors and
nominees for director; (iii) each of the executive officers named in the
Summary Compensation Table on page 8; and (iv) all directors and executive
officers of the Company as a group.
<TABLE>
<CAPTION>
Shares of
Common Stock % of Outstanding
Owned Common Stock
Stockholder Beneficially(1) Owned Beneficially
- ----------- --------------- ------------------
<S> <C> <C>
Herbert W. Pollack(2)(3)(4) 617,760 26.1
c/o Parlex Corporation
145 Milk Street
Methuen, MA 01844
Sandra Pollack 205,667 8.7
c/o Parlex Corporation
145 Milk Street
Methuen, MA 01844
Walter A. Winshall(5) 415,416 17.5
P.O. Box 1027
Captiva, FL 33924
Benjamin M. Rabinovici(2)(6) 167,600 7.1
c/o Parlex Corporation
145 Milk Street
Methuen, MA 01844
Lester Pollack(2)(7) 27,080 1.1
c/o Centre Partners L.P.
One Rockefeller Plaza
New York, NY 10020
Peter J. Murphy(2)(3)(8) 18,750 *
c/o Parlex Corporation
145 Milk Street
Methuen, MA 01844
M. Joel Kosheff(2)(9) 10,000 *
31 Pier 7
Charlestown, MA 02129
Alfred R. Calvetti(3)(10) 5,124 *
c/o Parlex Corporation
145 Milk Street
Methuen, MA 01844
Sheldon Buckler(2) 1,000 *
200 Dudley Road
Newton Centre, MA 02159
Richard W. Hale(2) -- *
c/o Furnex
17 Foss Road
Lewiston, ME 04240
All directors and officers
as a group (10 persons)(11) 942,997 39.2
- --------------------
<F*> Less than one percent.
<F1> For purposes of this table, any person who directly or indirectly has or
shares voting or investment power with respect to shares of Common Stock
is deemed a beneficial owner of those shares. Thus, more than one person
may be the beneficial owner of particular shares. Each person listed above
is deemed to have sole voting and investment power with respect to the
shares shown, unless otherwise indicated.
<F2> Denotes a director or a director nominee of the Company.
<F3> Denotes an executive officer of the Company.
<F4> The shares shown as owned by Herbert W. Pollack include 205,667 shares,
of which he disclaims beneficial ownership, owned directly by his wife,
Sandra Pollack. The shares shown as owned by Mr. Pollack include 12,500
shares which he has the right to acquire within 60 days of October 13,
1995, by the exercise of stock options granted under the Company's 1989
Employees' Stock Option Plan (the "1989 Option Plan").
<F5> The shares shown as owned by Walter A. Winshall are as reported in a
Statement on Schedule 13D filed by him with respect to his holdings of
Common Stock as of November 12, 1991.
<F6> The shares shown as owned by Dr. Rabinovici include 67,600 shares, of
which he disclaims beneficial ownership, owned directly by his wife. The
shares shown as owned by Dr. Rabinovici also include 5,000 shares which he
has the right to acquire within 60 days of October 13, 1995, by the
exercise of stock options granted under the Company's Director Plan.
<F7> The shares shown as owned by Lester Pollack include 5,000 shares which he
has the right to acquire within 60 days of October 13, 1995, by the
exercise of stock options granted under the Company's Director Plan.
<F8> The shares shown as owned by Mr. Murphy are shares which he has the right
to acquire within 60 days of October 13, 1995, by the exercise of stock
options granted under the Company's 1989 Option Plan, and the 1985
Employees' Non-Qualified Stock Option Plan (the "1985 Option Plan").
<F9> The shares shown as owned by Mr. Kosheff include 5,000 shares which he
has the right to acquire within 60 days of October 13, 1995, by the
exercise of stock options granted under the Company's Director Plan.
<F10>The shares shown as owned by Mr. Calvetti include 4,124 shares which he
has the right to acquire within 60 days of October 13, 1995, by the
exercise of stock options granted under the Company's 1989 Option Plan and
the 1985 Option Plan.
<F11>The number of shares shown as beneficially owned by officers and
directors include 52,374 shares which they have the right to acquire
within 60 days of October 13, 1995, by the exercise of stock options.
</TABLE>
--------------------
EXECUTIVE OFFICERS
The executive officers of the Company, together with a description of
the business experience backgrounds of all of them except Herbert W. Pollack
and Peter J. Murphy (whose backgrounds are described under the caption
Election of Directors) are as follows:
<TABLE>
<CAPTION>
Name Age Position with the Company
- ---- --- -------------------------
<S> <C> <S>
Herbert W. Pollack(1) 68 Chairman of the Board of Directors, Chief
Executive Officer and Treasurer
Peter J. Murphy(2) 46 President, Chief Operating Officer
and Director
Alfred R. Calvetti 52 Vice President and General Manager--
Laminated Cable Division
Jill Pollack Kutchin 43 Vice President--Corporate Affairs and
Clerk of the Company
Steven M. Millstein 51 Vice President--Finance
- --------------------
<F1> Mr. Pollack relinquished his duties as president, effective July 1, 1995
and remains as chairman of the board of directors, chief executive officer
and treasurer of the Company.
<F2> Mr. Murphy became president as of July 1, 1995.
</TABLE>
--------------------
Mr. Calvetti joined the Company in July 1971 and served in a variety of
technical and managerial roles. From December 1988 to February 1993, he was
divisional vice president and general manager of the Laminated Cable Division.
In February 1993, he became a corporate vice president and general manager of
the Laminated Cable Division.
Ms. Kutchin joined the Company in January 1977 and served as manager--
marketing administration until December 1983, when she became vice president--
corporate affairs. Since November 1980, she has also been clerk of the
Company. Ms. Kutchin is the daughter of Herbert W. Pollack.
Mr. Millstein joined the Company in March 1977, serving initially as
controller and from February 1979 to February 1988 as vice president--
controller. In February 1988, he became vice president--finance.
COMPENSATION OF EXECUTIVE OFFICERS
The following table shows, for the fiscal years ending June 30, 1995,
1994, and 1993, all compensation earned or paid to the Company's Chief
Executive Officer and each of the Company's most highly compensated executive
officers whose total annual salary and bonus exceeded $100,000 in each year
for all services rendered in all capacities to the Company.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long-Term
Annual Compensation Compensation
------------------- ------------
Awards
------
Securities Underlying
Name and Stock Options(2) All Other
Principal Position Year Salary($) Bonus($)(1) (Number of Shares) Compensation($)
- ------------------ ---- --------- ----------- ------------------ ---------------
<S> <C> <C> <C> <C> <C>
Herbert W. Pollack(3)(4) 1995 $218,640 -- -- --
Chairman and Chief 1994 218,640 -- 50,000 --
Executive Officer 1993 218,640 -- -- --
Peter J. Murphy(5)(6) 1995 $150,000 $25,000 -- --
President and Chief 1994 132,507 -- 25,000 --
Operating Officer
Alfred R. Calvetti 1995 $100,860 $32,118 -- --
Vice President and General 1994 95,336 15,000 10,000 --
Manager--Laminated Cable 1993 90,060 45,030 3,250 --
Division
- --------------------
<F1> Amounts shown were earned in the years indicated. Bonuses are generally
paid in the first quarter of the following fiscal year.
<F2> As of June 30, 1995, the total holdings of restricted stock and the
market value at such date of the shares for each of the persons listed in
the Summary Compensation Table were as follows: Mr. Pollack: 50,000 shares
($512,500); Mr. Murphy: 50,000 shares ($512,500); Mr. Calvetti: 13,250
shares ($135,813). In fiscal year 1993, the Company granted to Mr. Murphy
an option to purchase 25,000 shares under the 1989 Option Plan.
<F3> For a description of the employment agreement between the Company and Mr.
Pollack, see EMPLOYMENT AGREEMENTS below.
<F4> The amounts shown for Mr. Pollack for fiscal years 1995, 1994, and 1993
include a fee as Chairman of the Board of Directors in the amount of
$1,800 per month. The amounts shown for fiscal years 1994 and 1993 also
include deferred compensation in the amount of $3,350 per month.
<F5> For a description of the employment agreement between the Company and Mr.
Murphy, see EMPLOYMENT AGREEMENTS below.
<F6> Mr. Murphy became an executive officer for reporting purposes for the
first time in fiscal year 1994 and, therefore, no information is provided
for earlier years.
</TABLE>
EMPLOYMENT AGREEMENTS
The Company entered into an employment agreement with Mr. Pollack in
July 1994, for a period of three years ending June 30, 1997 which provides for
current compensation of $16,420 per month. The agreement provides for a death
benefit payment equal to 75% of his current compensation for a period of 24
months after his death. The agreement also provides that the employee will not
own, operate, or manage any business in competition with that of the Company
so long as he is employed by the Company and, in certain instances, for a one-
year period thereafter.
The Company entered into an employment agreement with Mr. Murphy in May
1994, for a period of two years ending June 30, 1996, which provided for
current compensation of $12,500 per month. Mr. Murphy's current compensation
was increased to $14,584 per month on July 1, 1995. The agreement provides for
a death benefit payment equal to 50% of his current compensation for a period
of 12 months after his death. The agreement also provides that the employee
will not own, operate, or manage any business in competition with that of the
Company so long as he is employed by the Company and, in certain instances,
for a one-year period thereafter.
The table entitled OPTION GRANTS IN LAST FISCAL YEAR has been eliminated
as a result of there being no option grants in fiscal 1995 to the named
executive officers.
AGGREGATED OPTION EXERCISES IN FISCAL YEAR 1995
AND FISCAL YEAR-END OPTION VALUES
The following table sets forth information relating to the aggregate
exercised and unexercised stock options held by the named executive officers
during fiscal year 1995 and the value of their unexercised stock options as of
June 30, 1995.
<TABLE>
<CAPTION>
Number of Securities Value of Unexercised
Shares Underlying Unexercised In-The-Money
Acquired Options at 6/30/95(#) Options at 6/30/95($)(1)
on Value --------------------------- ---------------------------
Name Exercise(#) Realized($) Exercisable Unexercisable Exercisable Unexercisable
- ---- ----------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Herbert W. Pollack -- -- 12,500(2) 37,500(2) $ 42,125 $126,375
Chairman and Chief
Executive Officer
Peter J. Murphy -- -- 18,750(2) 31,250(2) $103,125 $153,125
President and Chief
Operating Officer
Alfred R. Calvetti 6,750(3) 13,500 4,124(4) 9,126(4) $ 20,775 $ 42,038
Vice President and General
Manager--Laminated Cable
Division
- --------------------
<F1> The "value of unexercised in-the-money options at June 30, 1995" was
calculated by determining the difference between the fair market value of
the underlying Common Stock at June 30, 1995 (closing price of the
Company's Common Stock on the Nasdaq National Market System on June 30,
1995 was $10.25 per share) and the exercise prices of the stock options.
An option is "in-the-money" when the fair market value of the underlying
Common Stock exceeds the exercise price of the option.
<F2> These shares were granted under the 1989 Option Plan.
<F3> These shares were granted under the 1980 Employee Stock Option Plan
("1980 Option Plan").
<F4> These shares were granted under the 1985 Option Plan and the 1989 Option
Plan.
</TABLE>
--------------------
REPORT OF THE COMPENSATION COMMITTEE
The Committee
The Compensation Committee (the "Committee") is comprised of Messrs.
Hale, Kosheff and Rabinovici. This is the committee of the Board responsible
for establishing the compensation of the Chief Executive Officer and setting
policy for compensation at the senior levels of the Company, as well as
administering various employee stock option plans. The Committee is composed
entirely of independent outside Directors.
Compensation Philosophy
The Committee maintains a philosophy that executive compensation levels
should be competitive and consistent with printed circuit board industry
standards to enable the Company to attract, motivate and retain executive
officers of outstanding ability who are capable of making significant
contributions which are critical to the Company's success. The Committee
believes that such compensation also should be meaningfully related to both an
individual's job performance, as measured by the achievement of qualitative
objectives, and the performance of the Company, as measured by its
profitability, the value created for stockholders and the realization of the
Company's short- and long-term strategic goals. The Company's compensation
policies are designed to attract and retain talented managers and motivate
such managers to enhance the Company's performance, thereby building value
into the Company's business. The Company also seeks to align the interests of
its executives with the long-term interests of stockholders in the enhancement
of stockholder value through stock option awards that can result in the
ownership of the Company's common stock.
At present, compensation of the Company's executive officers is composed
of the following elements: annual base salary, annual performance incentives
in the form of cash bonuses and long-term performance incentives in the form
of stock option awards under the 1985 Option Plan and the 1989 Option Plan.
Base Salary
The Committee's general approach to compensating executive officers is
to pay cash salaries competitive with industry standards based upon the
individual's experience and past and potential contribution to the success of
the Company. In determining industry standards, the Committee compares
compensation levels paid by a self-selected group of printed circuit board
companies that compete in the Company's line of business. Such compensation
information is obtained from various publicly available sources.
The Committee also believes that compensation should be meaningfully
related to the value created by individual executive officers for the
stockholders. Accordingly, the Committee considers the quality of an
individual executive's contribution to the Company's overall profitability and
success in determining the executive's salary. The Committee reviews on an
annual basis the salaries of its executive officers in light of the foregoing
factors. The Company believes that the base salaries of its executive officers
have been at or below the median of the base salaries for executive officers
in the printed circuit board industry.
In fiscal year 1995, Mr. Calvetti's annual base salary was increased to
$105,120 in recognition of the continued profitability and performance of the
Laminated Cable Division.
Annual Incentives
The Company has traditionally paid employee performance bonuses once a
year, usually during the first quarter of the following fiscal year for which
the bonus is earned. Bonuses are traditionally based on both individual
performance and Company performance. Except for a particular incentive bonus
arrangement entered into with Mr. Calvetti, the Board has not utilized any
specific formula for determination of bonus amounts. For fiscal year 1995, Mr.
Calvetti received a bonus based upon the achievement of financial and
operating performance objectives as provided in his incentive bonus
arrangement and Mr. Murphy received a bonus in recognition of his individual
performance and the Committee's assessment of his role in promoting the long-
term strategic growth of the Company.
Stock Options
Stock options are used as the primary long-term incentive vehicle. The
Committee believes that reliance upon such incentives is advantageous to the
Company because they foster a long-term commitment by the recipient to the
Company and motivate the employees to seek to improve the long-term market
performance of the Company's stock. Thus, stock option grants provide an
incentive for the executive to manage the Company from the perspective of an
owner with an equity stake in the business. During fiscal year 1995, the Board
did not authorize the grant of stock options to any executive officers. Stock
option grants to executive officers are discretionary and reflect the relative
value of the individual's position as well as the current performance and
continuing contribution of that individual to the Company. The Board does not
utilize any specific formula for determination of option grants.
Compensation of the Chief Executive Officer
Mr. Pollack has served as Chairman of the Board and Chief Executive
Officer of the Company since it was founded in 1970. As described in the
section above entitled EMPLOYMENT AGREEMENTS, Mr. Pollack entered into a new
employment agreement in July 1994. Mr. Pollack did not receive a salary
increase or a bonus payment in fiscal year 1995.
Benefits
The Company provides medical, life insurance and profit sharing benefits
to the executive officers that generally are available to all Company
employees.
Section 162(m) of the Internal Revenue Code
The new Section 162(m) of the Internal Revenue Code of 1986 (the "Code")
limits a company's ability to take a deduction for federal tax purposes for
certain compensation paid to its executives. The Company currently expects
that all compensation payable to executive officers during fiscal year 1995
will be deductible by the Company for federal income tax purposes. The
Committee's policy with respect to compensation to be paid to executive
officers is to structure compensation payments to executive officers so as to
be deductible under Section 162(m).
COMPENSATION COMMITTEE
Benjamin M. Rabinovici, Chairman
Richard W. Hale
M. Joel Kosheff
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
In fiscal year 1995, the Committee has been composed of outside
directors, none of whom has ever been employed by the Company. Further, the
Board of Directors is unaware of any relationship of any member of the
Compensation Committee required to be disclosed under Item 402(j)(3) or 404 of
Regulation S-K promulgated by the Securities and Exchange Commission. For
example, the Board of Directors is unaware of any relationship pursuant to
which an executive officer of the Company serves as a member of the
compensation committee of another entity, one of whose executive officers
serves on the Compensation Committee of the Company.
STOCK PERFORMANCE GRAPH
The following Stock Performance Graph compares the cumulative total
shareholder return on the Company's Common Stock for a five year period (July
1, 1990 to June 30, 1995) with the cumulative total return of the CRSP Total
Return Index for the Nasdaq Stock Market and a group of peer companies. The
companies included in the peer group are Adflex Solutions, Inc., Advance
Circuits, Inc., Altron Incorporated, Hadco Corporation, Merix Corporation and
Sheldahl, Inc. The Performance Graph assumes the investment of $100 on July 1,
1990 in the Company's Common Stock, in the Nasdaq Stock Market companies and
in the peer group and also assumes the reinvestment of all dividends. The
returns for each company in the peer group have been weighted to reflect stock
market capitalization.
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
PARLEX CORPORATION, NASDAQ MARKET INDEX, AND PEER GROUP
<TABLE>
<CAPTION>
6/90 6/91 6/92 6/93 6/94 6/95
- ---------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Parlex $100 $114 $ 82 $179 $175 $293
NASDAQ $100 $106 $127 $160 $162 $215
Peer Group $100 $ 94 $117 $171 $165 $405
- ---------------------------------------------------------------
</TABLE>
INDEPENDENT AUDITORS
The Board of Directors has selected Deloitte & Touche LLP to be the
independent auditors to audit the consolidated financial statements of the
Company for the fiscal year ending June 30, 1996. Deloitte & Touche LLP has
been regularly employed by the Company for audit of consolidated financial
statements and other purposes since the Company's organization in 1970.
Representatives of Deloitte & Touche LLP expect to be present at the
meeting, and, while they do not plan to make a statement at the meeting, such
representatives will be available to respond to appropriate questions from
stockholders in attendance.
FUTURE STOCKHOLDER PROPOSALS
Any stockholder proposal intended for inclusion in next year's proxy
statement should be sent to
the Clerk of the Company at 145 Milk Street, Methuen, Massachusetts 01844, and
must be received by August 9, 1996.
COMPLIANCE WITH SECTION 16(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors and executive officers, and persons who own more than ten
percent of a registered class of the Company's equity securities, to file with
the Securities and Exchange Commission (the "Commission") and the National
Association of Securities Dealers, Inc. initial reports of ownership and
reports of changes in ownership of Common Stock and other equity securities of
the Company. Officers, directors and greater than ten percent shareholders are
required by the Commission's regulation to furnish the Company with copies of
all Section 16(a) forms they file.
To the Company's knowledge, based solely on review of the copies of such
reports furnished to the Company and written representations that no other
reports were required during the fiscal year ended June 30, 1995, all Section
16(a) filing requirements applicable to its executive officers, directors and
greater than ten percent beneficial owners were complied with.
AVAILABILITY OF FORM 10-K
Copies of the Company's Annual Report on Form 10-K with respect to the
fiscal year ended June 30, 1995 (without exhibits), as filed with the
Securities and Exchange Commission, are available to stockholders free of
charge by writing to: Investor Relations Department, Parlex Corporation, 145
Milk Street, Methuen, Massachusetts 01844.
GENERAL
The enclosed proxy is solicited on behalf of the Company's Board of
Directors. The individuals named in the enclosed proxy will, if so authorized,
vote for the election of directors as set forth above. If a quorum is present
(the holders of a majority of the number of shares of Common Stock issued and
outstanding constitute a quorum), the election of directors is determined by a
plurality of the votes cast.
Management of the Company is not aware of any other matter to be
presented for action at the meeting. If any matter other than that described
above does properly come before the meeting, the individuals named in the
enclosed proxy will vote the shares represented thereby in accordance with
their best judgment.
PARLEX CORPORATION
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Herbert W. Pollack, Steven M. Millstein,
and Jill Pollack Kutchin, and each of them, proxies with full power of
substitution, to vote on behalf of the undersigned at the Annual Meeting
of Stockholders of Parlex Corporation (the "Company") to be held on the
eighth floor of the Shawmut Bank Building, One Federal Street, Boston,
Massachusetts on Tuesday, December 5, 1995, at 9:30 a.m. and at any
adjournment(s) thereof, all shares of Common Stock held of record in the
name of the undersigned, hereby granting full power and authority to act
on behalf of the undersigned at said meeting or any adjournment(s)
thereof.
THE SHARES REPRESENTED HEREBY SHALL BE VOTED AS SPECIFIED. IF NO
SPECIFICATION IS MADE, SUCH SHARES SHALL BE VOTED "FOR" THE NOMINEES
PROPOSED FOR ELECTION AS DIRECTORS AS INDICATED IN THE PROXY STATEMENT.
PLEASE VOTE AND SIGN ON OTHER SIDE AND RETURN PROMPTLY
IN ENCLOSED ENVELOPE.
Please sign this proxy exactly as your name appears on this card. Joint
owners should each sign personally. Trustees and other fiduciaries
should indicate the capacity in which they sign, and where more than one
name appears, a majority must sign. If a corporation, this signature
should be that of an authorized officer who should state his or her
title.
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
__________________________________ ________________________________
__________________________________ ________________________________
__________________________________ ___________________________PRXCM
[X] PLEASE MARK VOTES AS IN THIS EXAMPLE
(1) to elect three Class 1 directors to hold office for a term expiring
with the annual stockholders' meeting to be held in 1998 or until their
successors are elected and qualified:
Richard W. Hale, Lester Pollack and Benjamin M. Rabinovici
INSTRUCTIONS: To withhold authority to vote for a nominee, mark the "For
All Except" box and strike a line through that nominees name.
For [ ] Withhold [ ] For all Except [ ]
(2) in their discretion, to vote upon such other business as may
properly come before the meeting.
RECORD DATE SHARES:
The undersigned hereby revokes any proxy previously given and
acknowledges receipt of written notice of, and the statement for, the
1995 Annual Meeting of Stockholders and the 1995 Annual Report of the
Company.
Mark box at right if comments or address change has been noted on the
reverse side of this card. [ ]
Please be sure to sign and date this Proxy. Date_______________
__________________________________ ______________________________
Shareholder sign here Co-owner sign here
DETACH CARD DETACH CARD
PARLEX CORPORATION
Dear Stockholders:
Please take note of the important information enclosed with this Proxy
Ballot. The issues related to the management of your company requires
your immediate attention and approval. This is discussed in detail in
the enclosed proxy materials.
Your vote counts, and you are strongly encouraged to exercise your right
to vote your shares.
Please mark the boxes on the proxy card to indicate how your shares
shall be voted. Then sign the card, detach it and return your proxy vote
in the enclosed postage paid envelope.
Your vote must be received prior to the Annual Meeting of Stockholders
on December 5, 1995.
Thank you in advance for your prompt consideration of these matters.
Sincerely,
Parlex Corporation
