SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the registrant [X]
Filed by a party other than the registrant [ ]
Check the appropriate box:
[X] Preliminary proxy statement
[ ] Definitive proxy statement
[ ] Definitive additional materials
[ ] Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
Park Electrochemical Corp.
(Name of Registrant as Specified in Its Charter)
Park Electrochemical Corp.
(Name of Person(s) Filing Proxy Statement
Payment of filing fee (Check the appropriate box):
[X] $125 per Exchange Act Rule 0-11(c)(l)(ii), 14a-6(i)(l), or
14a-6(j)(2)
[ ] $500 per each party to the controversy pursuant to Exchange
Act Rule 14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules
14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction
applies:
(2) Aggregate number of securities to which transactions applies:
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:
(4) Proposed maximum aggregate value of transaction:
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for which
the offsetting fee was paid previously. Identify the previous
filing by registration statement number, or the form or
schedule and the date of its filing.
(1) Amount previously paid:
(2) Form, schedule or registration no.:
(3) Filing party:
(4) Date filed:
APPENDIX to electronically filed Preliminary Proxy Statement dated
May 26, 1995 of Park Electrochemical Corp. listing all graphic
information included in such proxy statement:
1. Stock Performance Graph appearing on page __ of proxy
statement dated May 26, 1995 comparing the yearly percentage
change in the cumulative total shareholder return on the
Registrant's Common Stock with the cumulative total return of
the New York Stock Exchange Market Index and a peer group
index comprised of the Company and 192 other companies for the
period of the Company's five fiscal years commencing February
25, 1990 and ending February 26, 1995, assuming that $100 had
been invested in the Company's Common Stock and each index on
February 25, 1990 and that all dividends on the Company's
Common Stock and on each stock included in each index were
reinvested.
Such graph shows that such $100 invested in the Company's
Common Stock would have had a value of $91.70 on March 3,
1991, $108.57 on March 1, 1992, $102.88 on February 28, 1993,
$231.02 on February 27, 1994 and $300.23 on February 26, 1995,
that such $100 invested in the New York Stock Exchange Market
Index would have had a value of $113.41, $130.25, $140.21,
$158.37 and $160.81, respectively, on such dates and that such
$100 invested in the peer group index would have had a value
of $113.99, $133.46, $169.97, $233.24 and $276.12,
respectively, on such dates.
Preliminary Copy
PARK ELECTROCHEMICAL CORP.
_______________
Notice of Annual Meeting of Shareholders
July 12, 1995
_______________
The Annual Meeting of Shareholders of PARK ELECTROCHEMICAL
CORP. (the "Company") will be held at The Chase Manhattan Bank, One
Chase Manhattan Plaza, New York, New York on July 12, 1995, at 10:00
o'clock A.M., New York time, for the purpose of considering and
acting upon the following:
1. The election of six (6) directors, to serve
until the next annual meeting of shareholders
and until their successors are elected and
qualified.
2. The authorization of an amendment to the
Company's Certificate of Incorporation to
increase the number of authorized shares of
Common Stock of the Company from 15,000,000
shares to 30,000,000 shares.
3. The transaction of such other business as may
properly come before the meeting.
Only holders of record of Common Stock at the close of
business on May 23, 1995 will be entitled to notice of, and to vote
at, the meeting or any adjournment thereof.
By Order of the Board of Directors,
Jerry Shore,
Chairman of the Board
Dated: May 26, 1995
ALL SHAREHOLDERS ARE CORDIALLY INVITED TO ATTEND THE
MEETING. IF YOU DO NOT EXPECT TO BE PRESENT, PLEASE DATE
AND SIGN THE ENCLOSED FORM OF PROXY AND RETURN IT
PROMPTLY TO THE COMPANY IN THE ENCLOSED ENVELOPE. NO
POSTAGE IS REQUIRED.
Preliminary Copy
PARK ELECTROCHEMICAL CORP.
5 Dakota Drive
Lake Success, New York 11042
__________________
P R O X Y S T A T E M E N T
Annual Meeting of Shareholders
July 12, 1995
__________________
This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors ("Board") of Park Electrochemical Corp. (the "Company")
of proxies with respect to the Annual Meeting of Shareholders of the Company to
be held on July 12, 1995, and any adjournment thereof ("Meeting"). Any
shareholder giving such a proxy (the form for which is enclosed with this Proxy
Statement) has the power to revoke the same at any time before it is voted by
delivering written notice of such revocation to the Secretary of the Company.
All expenses in connection with the solicitation of these proxies will be borne
by the Company. Proxies may be solicited by certain officers and employees of
the Company by mail, telephone, telegraph, facsimile transmission or personal
interview.
This Proxy Statement and the accompanying form of proxy are being mailed
on or about May 26, 1995 to all shareholders of record as of the close of
business on May 23, 1995.
VOTING SECURITIES
At May 23, 1995, the outstanding voting securities of the Company
consisted of _________ shares of Common Stock, $.10 par value, of the
Company ("Common Stock"), each share of which, held of record at the close
of business on May 23, 1995, is entitled to one vote. Presence in person or
by proxy of holders of a majority of the outstanding shares of Common Stock
will constitute a quorum for the transaction of business at the Meeting. At
May 23, 1995, all executive officers and directors of the Company as a group
beneficially owned an aggregate of _________ shares of Common Stock
(including options to purchase an aggregate of _______ shares), constituting
approximately ____% of the outstanding shares of Common Stock (giving effect
to the exercise of such options).
The following table sets forth information at May 23, 1995 with
respect to each person (including any "group" of persons as that term is
used in Section 13(d)(3) of the Securities Exchange Act of 1934, as amended)
who is known to the Company to be the beneficial owner of more than 5% of
the Common Stock:
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Amount and
Nature of Percent
Title Name and Address Beneficial of
of Class of Beneficial Owner Ownership Class
Common Stock............Jerry Shore _______ (1) ____%
5 Dakota Drive
Lake Success, NY 11042
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Amount and
Nature of Percent
Title Name and Address Beneficial of
of Class of Beneficial Owner Ownership Class
Common Stock............FMR Corp. 373,456 (2) ___%
Fidelity Management & Research
Company
Edward C. Johnson 3rd
82 Devonshire Street
Boston, MA 02109
Common Stock............The Capital Group 338,600 (3) ___%
Companies, Inc.
Capital Research and
Management Company
333 South Hope Street
Los Angeles, CA 90071
_____________________
<FN>
(1) This amount (a) includes 32,500 shares of Common Stock which Jerry Shore may
acquire pursuant to options, and (b) excludes 56,205 shares owned by a member
of Jerry Shore's family. Jerry Shore disclaims beneficial ownership of the
shares described in clause (b) of this footnote.
(2) Information based on joint Schedule 13G of FMR Corp., Fidelity Management &
Research Company ("Fidelity") and Edward C. Johnson 3rd, as amended January 6,
1995. According to the aforesaid document, FMR Corp., its wholly owned
subsidiary, Fidelity, an investment adviser registered under the Investment
Advisers Act of 1940, and Edward C. Johnson 3rd, each had sole power to
dispose of all 373,456 shares owned by the Funds. Neither FMR Corp. nor
Edward C. Johnson 3rd, Chairman of FMR Corp., has the sole power to vote or
direct the voting of the shares owned directly by the Fidelity Funds, which
power resides with the Funds' Boards of Trustees. Fidelity carries out the
voting of the shares under written guidelines established by the Funds' Boards
of Trustees.
(3) Information based on joint Schedule 13G of The Capital Group Companies, Inc.
("Capital Group") and Capital Research and Management Company ("Capital
Research"), as amended February 8, 1995. According to the aforesaid document,
(i) Capital Research, a registered investment adviser and an operating
subsidiary of Capital Group, had sole power to dispose of all of such 338,600
shares, (ii) neither Capital Group nor Capital Research had the power to vote
any of such 338,600 shares and (iii) both Capital Group and Capital Research
disclaimed beneficial ownership of all of such 338,600 shares pursuant to Rule
13d-4 of the Securities Exchange Act of 1934, as amended.
</TABLE>
For information with respect to the beneficial ownership of shares by
each director and each nominee for director of the Company, see "Election of
Directors" below.
ELECTION OF DIRECTORS
The Board to be elected at the Meeting consists of six (6) members.
Proxies will be voted in accordance with their terms and, in the absence of
contrary instructions, for the election as directors of the nominees whose
names appear in the following table, to serve for the ensuing year and until
their successors are elected and qualified. Should any of the nominees not
remain a candidate at the time of the Meeting (a situation which is not now
anticipated), proxies solicited hereunder will be voted in favor of those
nominees who do remain as candidates and may be voted for substituted
nominees. The six nominees who receive a plurality of the votes cast at the
Meeting in person or by proxy shall be elected. Each of the nominees is
presently a member of the Board.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Principal Occupation; Shares of Common
Positions and Offices Stock Beneficially
with the Company; Director Owned at May 23, 1995
Name Other Directorships Age Since Number Percent of Class
Anthony Chiesa..... Former Vice President 74 1954 37,500 Less than 1%
of the Company
Lloyd Frank........ Partner, Parker Chapin 69 1985 1,000 Less than 1%
Flattau & Klimpl, New
York City; director of
Grow Group, Inc. and
Metro-Tel Corp.
Norman M. Schneider Business Consultant; 84 1981 4,837 Less than 1%
director of Toys "R"
Us, Inc. and Datascope
Corp.
Brian E. Shore..... Executive Vice President 43 1983 _____(1) Less than 1%
of the Company
Jerry Shore........ Chairman of the Board, 69 1954 _______(2) ____%
Chief Executive Officer
and President of the
Company
E. Philip Smoot.... Executive Vice President 57 1988 ______(3) Less than 1%
of the Company
_________________
<FN>
(1) This amount includes _____ shares of Common Stock which Brian Shore may
acquire pursuant to options.
(2) See footnote (1) to the table under "Voting Securities" for information
with respect to these shares.
(3) This amount includes ______ shares of Common Stock which E. Philip Smoot
may acquire pursuant to options.
</TABLE>
Each of the persons named in the above table has had the principal
occupation set forth opposite his name for at least the past five years,
except for Brian E. Shore, who was elected an Executive Vice President of
the Company in May 1994 and a Vice President of the Company in January 1993.
Brian Shore served as the Company's General Counsel for more than the past
five years until April 1994. Parker Chapin Flattau & Klimpl, a law firm of
which Lloyd Frank is a partner, was retained to provide counsel to the
Company during its last fiscal year and the Company has retained this firm
during its present fiscal year.
By virtue of his ownership of approximately ____% of the outstanding
voting securities of the Company and his positions as Chairman of the Board,
President and a director of the Company, Jerry Shore may be deemed to be a
"control person" of the Company, as such term is defined in the rules
promulgated under the Securities Exchange Act of 1934, as amended.
There are no family relationships among any of the persons named in
the above table or among any of such persons and any of the other executive
officers of the Company, except that Jerry Shore is the father of Brian E.
Shore.
The Company's Audit Committee consists of Anthony Chiesa, Lloyd Frank
and Norman M. Schneider. Its functions are to review the Company's
financial statements with the Company's independent auditors, recommend to
the Board the appointment of the independent auditors, review the
performance and scope of services to be provided by the independent auditors
and review the adequacy of internal auditing and accounting procedures and
controls. The Company has a CEO Compensation Committee consisting of
Anthony Chiesa, Lloyd Frank and Norman M. Schneider. Its functions are
described herein under "Compensation Report". The Company does not have a
nominating committee or other compensation committee or committees
performing similar functions.
The Board met four times and the Audit Committee met once during the
Company's last fiscal year. Each of the directors attended at least 75% of
the meetings of the Board and each committee thereof of which he was a
member held during the Company's last fiscal year.
Each director who is not an employee of the Company or any of its
subsidiaries receives a fee of $5,000 per annum, plus travel expenses, for
attendance at meetings of the Board of Directors of the Company.
INCREASE IN COMMON STOCK
At the Meeting, shareholders will be asked to authorize an amendment
to the Company's Certificate of Incorporation to increase the number of
shares of Common Stock which the Company is authorized to issue from
15,000,000 shares to 30,000,000 shares.
At May 23, 1995, the authorized capital stock of the Company consisted
of 15,000,000 shares of Common Stock, of which ___________ shares were
outstanding, and 500,000 shares of Preferred Stock, none of which were
outstanding. In addition, at that date, __________ shares of Common Stock
were reserved for issuance upon exercise of outstanding options granted or
which may be granted under the Company's stock option plans. Accordingly,
only __________ shares of Common Stock were available and not reserved for
future issuance at that date.
The Board believes that the increase in the number of authorized
shares of Common Stock is in the best interests of the Company and its
shareholders because additional shares of Common Stock will be available for
use in acquisitions, in raising additional capital, in connection with stock
splits and stock dividends and for other corporate purposes. At present the
Company has no specific plans and is not a party to any negotiations as to
the issuance of any of the additional shares of Common Stock which are
proposed to be authorized.
If the proposed amendment is authorized by the Company's shareholders,
the additional shares of Common Stock would be issuable at any time, and
from time to time, by action of the Board of Directors without further
authorization from the Company's shareholders except as otherwise required
by applicable law or rules and regulations (including those of stock
exchanges) to which the Company may be subject. Holders of the Common Stock
have no preemptive rights therein. The shareholders of the Company are not
entitled to appraisal rights as a result of the submission or authorization
of the proposed amendment.
The additional authorized shares of Common Stock could be used by the
Board to make more difficult a change in control of the Company, although
that is not the Board's purpose in recommending the increase in authorized
shares of Common Stock. Under certain circumstances, such shares may be
used (alone or in conjunction with the Company's authorized and unissued
Preferred Stock) to create voting impediments or to frustrate persons
seeking to effect a takeover or otherwise to gain control of the Company.
The Board of Directors is not aware of any proposed takeover or any proposal
to gain control of the Company.
The affirmative vote of the holders of a majority of the outstanding
shares of Common Stock entitled to vote at the Meeting is required for the
authorization of the proposed amendment. The Board unanimously recommends
that shareholders vote FOR the proposed increase in the number of authorized
shares of Common Stock. Proxies will be voted on this proposal in
accordance with their terms and, in the absence of contrary instructions,
for authorization of the amendment of the Certificate of Incorporation.
EXECUTIVE COMPENSATION
Summary Compensation
The following table shows the annual compensation and long-term
compensation for each of the three most recent fiscal years for the
Company's Chief Executive Officer and the three executive officers whose
salary and bonus for the most recent fiscal year exceeded $100,000.
Insert Annual Compensation Table
<TABLE>
<CAPTION> Long Term
Compensation
Annual Compensation Awards
Name and Other Annual Securities All Other
Principal Year Compensation Underlying Compensation
Position (1) Salary Bonus (2) Options/SARs(#) (3)
<S> <C> <C> <C> <C> <C> <C>
Jerry Shore (4) 1995 $350,000 $150,000 $34,850 10,000 $50,000
Chairman of the Board, 1994 250,000 49,800 34,850 20,000 29,980
President and Chief 1993 250,000 -0- 34,850 10,000 12,193
Executive Officer
E. Philip Smoot 1995 _______ _______ -0- 10,000 ______
Executive Vice President 1994 251,390 150,000 -0- 10,000 23,584
1993 231,000 34,000 -0- 6,509 11,136
Brian E. Shore 1995 _______ ______ -0- 10,000 ______
Executive Vice President 1994 158,550 30,000 -0- 3,500 18,855
1993 151,000 10,000 -0- 3,000 7,834
Allen Levine (5) 1995 _______ ______ -0- 2,000 ______
Secretary, Treasurer, 1994 152,250 25,000 -0- 3,500 17,725
Vice President and 1993 145,000 12,500 -0- 2,000 7,664
Chief Financial Officer
_________________
<FN>
(1) Data are provided for the Company's fiscal years ended February 26,
1995, February 27, 1994 and February 28, 1993, respectively.
(2) Amounts shown for Jerry Shore are the costs for the purchase of
certain term life insurance policies for Jerry Shore, the
beneficiaries of which are certain members of Jerry Shore's family.
(3) Reflects the amount of Company contributions to the Profit Sharing
Plan which were accrued for the fiscal years shown pursuant to such
Plan for the accounts of the named executive officers. These amounts
vest in accordance with a graduated scale based on years of service of
the employee with the Company. The amounts shown for Jerry Shore also
include $35,000, $6,396 and $1,057 for 1995, 1994 and 1993,
respectively, credited by the Company to a separate account maintained
by the Company in accordance with Jerry Shore's employment agreement.
The amount shown for E. Philip Smoot for 1995 includes $______
credited by the Company to a separate account maintained by the
Company in accordance with an agreement with E. Philip Smoot. These
amounts are determined as the amounts the Company would have
contributed to the Profit Sharing Plan for Jerry Shore and E. Philip
Smoot for such years but for the limitations imposed by the Internal
Revenue Code of 1986, as amended (the "Code").
(4) In accordance with the provisions of an amended and restated
employment agreement between Jerry Shore and the Company, as amended,
pursuant to which he has agreed to serve as chairman of the board,
chief executive officer or president of the Company for an initial
term ending on February 28, 1999, Jerry Shore receives a base salary
of $350,000 per annum (subject to annual review by the CEO
Compensation Committee of the Board) and an incentive bonus equal to
4% of the amount by which consolidated net earnings, after taxes, of
the Company and its subsidiaries for each fiscal year, exceed
$7,500,000. The bonus is limited to a maximum of $350,000 per year.
Although under the incentive bonus formula Jerry Shore would have been
entitled to a bonus of $350,000 for the last fiscal year, he decided
to limit his bonus to $150,000. The agreement also provides that the
initial term will be automatically extended for additional successive
one year periods unless the Board of Directors of the Company elects
to terminate the agreement by notification to Jerry Shore at least
five years prior to the commencement of each such one-year period, in
which event the agreement will terminate five years from the 1st day
of March following such notification. No such notification has been
given to date and, therefore, Jerry Shore's employment term under the
agreement will continue until February 29, 2000. Pursuant to the
agreement, Jerry Shore has the right to retire from full-time
employment and serve as a consultant to the Company for a period of
five years. In such event, he will be paid an annual consulting fee
equal to 60% of his base salary in effect under the employment
agreement at the time of his retirement, subject to an indexed cost of
living increase. Pursuant to the agreement, Jerry Shore has deferred
receipt of certain amounts payable to him under the agreement and his
prior employment agreement with the Company until his retirement, and
the Company has agreed to pay Jerry Shore interest on the amounts
deferred at the prime rate.
(5) At May 23, 1995, Allen Levine beneficially owned _______ shares of
Common Stock, including _____ shares of Common Stock which he may
acquire pursuant to options.
</TABLE>
Stock Options
The Company's 1982 Stock Option Plan and 1992 Stock Option Plan (the
"Plans") provide for the grant to key employees of the Company of both
options which qualify as incentive stock options under the Internal Revenue
Code of 1986 and non-qualified stock options. The Plans are each
administered by a committee appointed by the Board. The following table
sets forth certain information for the Company's last fiscal year with
respect to options to purchase shares of Common Stock granted pursuant to
the Plans:
Insert Option/SAR Grants Table
<TABLE>
<CAPTION>
Option/SAR Grants in Last Fiscal Year
Number of Potential Realizable Value
Securities % of Total at Assumed
Underlying Options/SARs Exercise Annual Rates of Stock Price
Options/SARs Granted to or Base Appreciation for Option
Granted (#) Employees in Price Term (2)
Name (1) Fiscal Year ($/sh.) Expiration Date 0% ($) 5% ($) 10% ($)
<S> <C> <C> <C> <C> <C> <C> <C>
Jerry Shore 10,000 14.3% $26.25 May 18, 2004 $0 165,100 $418,400
E. Philip Smoot 10,000 14.3% 26.25 May 18, 2004 0 165,100 418,400
Brian E. Shore 10,000 14.3% 26.25 May 18, 2004 0 165,100 418,400
Allen Levine 2,000 2.9% 26.25 May 18, 2004 0 33,000 83,700
_____________________
<FN>
(1) Options become exercisable 25% one year from the date of grant with an
additional 25% exercisable each succeeding year. The Company has not
granted stock appreciation rights.
(2) The potential realizable value portion of the foregoing table illustrates
value that might be realized upon exercise of the options at the
expiration of their term, assuming the specified compounded rates of
appreciation on the Company's Common Stock over the life of the options.
This schedule does not take into account provisions of the options
providing for termination of the option following termination of
employment, nontransferability or vesting over periods of four years. The
dollar amounts under these columns are the result of calculations at the
5% and 10% rates set by the Securities and Exchange Commission and
therefore are not intended to forecast possible future appreciation, if
any, of the Company's stock price. The Company did not use an alternative
formula for a grant date valuation, as the Company is not aware of any
formula which will determine with reasonable accuracy a present value
based on future unknown or volatile factors. The column indicating 0%
appreciation is included to reflect the fact that a zero percent gain in
stock price appreciation will result in zero dollars for the optionee. No
gain to the optionees is possible without an increase in stock price
appreciation, which will benefit all shareholders commensurately.
</TABLE>
Aggregated Option Exercises in the Last Fiscal Year and Fiscal Year End
Option Values
The following table provides details regarding the pre-tax value
realized from the exercise of stock options during the Company's last fiscal
year and the value of unexercised options held by the named individuals as
of the end of such fiscal year.
Insert Aggregated Options Table
<TABLE>
<CAPTION>
Number of Securities Value of Unexercised
Shares Acquired Value Underlying Unexercised In-the-Money Options/SARs
On Exercise (#) Realized Options/SARs at FY-End (#) at FY-End ($) (3)
Name (1) (2) Exercisable Unexercisable Exercisable Unexercisable
<S> <C> <C> <C> <C> <C> <C>
Jerry Shore 50,000 $818,750 20,000 30,000 $437,250 $494,500
E. Philip Smoot -0- -0- 14,379 27,505 316,211 459,982
Brian E. Shore -0- -0- 7,125 15,375 157,922 196,391
Allen Levine 10,125 192,573 -0- 6,875 -0- 119,078
<FN>
(1) The Company has not granted stock appreciation rights.
(2) Value realized equals market value on the date of exercise, less the
exercise price, times the number of shares acquired, without deducting any
taxes paid by employee.
(3) Value of unexercised options equals market value of the share underlying
"in-the-money" options at February 26, 1995 ($34.625), less exercise
price, times the number of options outstanding.
</TABLE>
During the last fiscal year, 56 employees of the Company and its
subsidiaries as a group (including all executive officers and directors of
the Company) were granted options to purchase an aggregate of 69,800 shares
of Common Stock under the Plans. At May 23, 1995, __ employees of the
Company and its subsidiaries were participants in the Plans and
approximately 100 employees were eligible to participate in the Plans. As
of such date, an aggregate of _______ shares of Common Stock were subject to
options under the Plans at prices ranging between $11.00 and $_____ per
share and expiring between _________________ and May __, 2005.
Compensation Report
Compensation of the Company's executive officers is composed of
salary, annual cash bonuses, stock options and the Company's Profit Sharing
Plan. The Board has a CEO Compensation Committee which considers and takes
any necessary action regarding the compensation of the Company's Chief
Executive Officer, other than the grant of stock options or compensation
pursuant to plans administered by the Board. The Board does not have any
other compensation committee. Jerry Shore, Chairman of the Board, President
and Chief Executive Officer of the Company, determines the annual salary and
cash bonus for each executive officer other than himself. A committee of
the Board administers the Plans, including decisions as to the number of
options to grant to each executive officer. The amount of discretionary
contributions to the Profit Sharing Plan for each fiscal year is determined
by the Board of Directors.
Salaries of executive officers are determined based on the
significance of the position to the Company, individual experience and
expertise, individual performance and information gathered informally as to
compensation levels of comparable companies in the same geographic location
as the Company. Jerry Shore reviews the salary of each key employee,
including executive officers, annually and makes adjustments as appropriate.
Decisions as to the award of annual cash bonuses to executive officers
other than Jerry Shore with respect to each fiscal year are made after the
close of the fiscal year. The amount awarded to each executive officer is
based on the Company's overall performance, individual performance, base
salary level, bonuses paid in prior years and overall equity and fairness.
The Company typically grants stock options under the Plans once each
year. The stock option committee bases its decisions on individual
performance, base salary and bonus levels, recommendations from senior
management and overall equity and fairness.
The Board decides annually the amount of the Company's contribution to
the Profit Sharing Plan. The amount of such contribution is discretionary,
but may not exceed 15% of the total remuneration paid to eligible employees
or such larger amount as is allowed under the Code. Subject to this limit,
the Board determines the amount to be contributed for each year based on the
Company's overall performance, the amount contributed in prior years and the
amounts of prior contributions recently forfeited by eligible employees due
to termination of employment prior to vesting. The Profit Sharing Plan is
a broad-based plan in which numerous employees as well as executive officers
are eligible to participate. Once the Company contribution is made, amounts
are allocated to eligible employees in accordance with a formula based on
their remuneration.
During the last fiscal year, Jerry Shore received an annual salary of
$350,000 and an incentive compensation bonus in the amount of $150,000
pursuant to his employment agreement (the "employment agreement"). See Note
4 to the table set forth under "Executive Compensation -- Summary
Compensation" elsewhere herein. During the last fiscal year, the CEO
Compensation Committee approved an amendment to the employment agreement
pursuant to which the incentive bonus compensation formula was modified.
Although under the modified incentive bonus formula Jerry Shore would have
been entitled to a bonus of $350,000 for the last fiscal year, subsequent to
the modification of the employment agreement he decided to limit his bonus
to $150,000 for the last fiscal year. Prior to the amendment, the incentive
bonus formula was based on the excess of net earnings over a portion of
shareholders' equity at the beginning of the fiscal year, subject to an
annual limitation of $250,000. The CEO Compensation Committee modified the
formula so that the amount of the incentive bonus compensation would not
fluctuate based on extraordinary or non-recurring events (such as the call
for redemption in the most recent fiscal year of the Company's 7 1/4%
Convertible Subordinated Debentures due June 15, 2006) which change
stockholders equity but which are not related to the Company's financial
performance. In approving the increase in the amount of the annual
limitation for the incentive bonus compensation, the CEO Compensation
Committee considered the following principal factors: informal data relating
to the salary compensation of chief executive officers of comparable
companies in the same geographical area as the Company's headquarters; Jerry
Shore's contribution to the long-term success and vitality of the Company
and the Company's operating and financial performance during the prior
eleven years. The CEO Compensation Committee did not assign any particular
numerical weight to these factors. The stock option grant to Jerry Shore
during the Company's last fiscal year was made by the stock option committee
on the basis of the committee's evaluation of the Company's performance
during the prior fiscal year.
The Board, the CEO Compensation Committee, the stock option committee
and Jerry Shore use no set formulas in making their determinations and may
afford different weight to different factors for each executive officer.
Such weighing may vary from year to year.
The Board and the CEO Compensation Committee have reviewed the impact
of recently enacted Section 162(m) of the Code which, beginning in fiscal
1995, limits the deductibility of certain otherwise deductible compensation
in excess of $1 million paid to the Chief Executive Officer and the other
executive officers named in the summary compensation table appearing above.
It is the Company's policy to attempt to design its executive compensation
plans and arrangements to be treated as tax deductible compensation
wherever, in the judgment of the Board or the CEO Compensation Committee, as
the case may be, to do so would be consistent with the objectives of that
compensation plan or arrangement. Accordingly, the Board and the CEO
Compensation Committee from time to time may consider whether changes in the
Company's compensation plans and arrangements, particularly the Plans, may
be appropriate to continue to fulfill the requirements for treatment as tax
deductible compensation under the Code.
The Board of Directors CEO Compensation Committee
Anthony Chiesa Lloyd Frank, Chairman
Lloyd Frank Anthony Chiesa
Norman M. Schneider Norman M. Schneider
Brian E. Shore
Jerry Shore
E. Philip Smoot
Compensation Committee Interlocks and Insider Participation
Anthony Chiesa, a member of the committee of the Board which
administers the Plans, is a former Vice President of the Company who retired
in 1977. Mr. Lloyd Frank, also a member of such committee, is a partner of
the law firm Parker Chapin Flattau & Klimpl, which firm was retained to
provide counsel to the Company during its last fiscal year and which the
Company has retained during its present fiscal year. Jerry Shore, Brian
Shore and E. Philip Smoot, directors of the Company who are also executive
officers of the Company, participated in deliberations of the Board relating
to the amount of the Company's contribution to the Profit Sharing Plan
during the Company's last fiscal year.
STOCK PERFORMANCE GRAPH
The graph set forth below compares the annual cumulative total return
for the Company's five fiscal years ended February 26, 1995 among the
Company, the New York Stock Exchange Market Index and a peer group index
comprised of the Company and 192 other companies. The peer group companies
are classified in the same three-digit industry group in the Standard
Industrial Classification Code system. These companies are described as
companies primarily engaged in the manufacture of electronic components and
accessories. The returns of each company in the peer group have been
weighted according to the company's stock market capitalization. The graph
has been prepared based on an assumed investment of $100 on February 25,
1990 and the reinvestment of dividends (where applicable).
[Chart to come]
SHAREHOLDER PROPOSALS
Shareholder proposals intended to be presented at the 1996 Annual
Meeting of Shareholders must be received by the Company at the Company's
principal executive offices for inclusion in the Proxy Statement and form of
Proxy relating to that meeting by January 26, 1996.
OTHER MATTERS
The Board of the Company has selected Ernst & Young, the Company's
auditors for the past fiscal year, as the auditors of the Company for the
present fiscal year. A representative of Ernst & Young is expected to be
present at the Annual Meeting. He will have the opportunity to make a
statement if he so desires and will be available to respond to appropriate
questions.
On January 18, 1994, the Company engaged Ernst & Young ("E&Y"),
independent auditors, as its accountants to audit the financial statements
of the Company and certain subsidiaries for the year ended February 27, 1994
and dismissed Deloitte & Touche ("D&T") as independent accountants for the
Company and such subsidiaries. The engagement of E&Y and the dismissal of
D&T was approved by the Board. The Audit Committee of the Board did not
separately recommend or approve the change in the Company's independent
accountants.
In connection with the audit of the Company's financial statements for
the fiscal year ended February 28, 1993, and in the subsequent interim
period up to the date of dismissal of D&T, there did not exist any
disagreement (within the meaning of Rule 304(a)(1)(iv) of Regulation S-K of
the Securities and Exchange Commission ("Regulation S-K")) between the
Company and D&T on any matter of accounting principles or practices,
financial statement disclosure, or auditing scope or procedure which, if not
resolved to the satisfaction of D&T, would have caused D&T to have referred
to the subject matter of the disagreement in connection with its report on
the Company's financial statements. D&T's report on the Company's financial
statements for the fiscal year ended February 28, 1993 contained no adverse
opinion or disclaimer of opinion, and was not qualified or modified as to
uncertainty, audit scope or accounting principles. During the Company's two
fiscal years preceding the date of dismissal of D&T and the subsequent
interim period up to the date of dismissal of D&T there were no "reportable
events", as that term is defined in Rule 304(a)(1)(v) of Regulation S-K.
D&T has furnished the Company with a letter, dated January 25, 1994,
addressed to the Securities and Exchange Commission relating to the
Company's disclosure set forth in this paragraph. A copy of D&T's letter is
an exhibit to Amendment No. 1 on Form 8-K/A to the Company's Current Report
on Form 8-K dated January 18, 1994.
Prior to the engagement of E&Y, no member of that firm was consulted
by the Company (1) for the purpose of obtaining a written report or oral
advice with regard to the application of accounting principles to a
specified transaction of the Company or any of its subsidiaries, (2)
regarding the type of audit opinion that might be rendered on the Company's
financial statements or (3) regarding any matter that was the subject of a
disagreement (within the meaning of Rule 304(a)(1)(iv) of Regulation S-K)
between the Company and D&T or which constituted a reportable event (as
defined in Rule 304(a)(1)(iv) of Regulation S-K).
In May 1995, the Company purchased from Reliance Insurance Company
insurance covering the directors and officers of the Company and its
subsidiaries against certain claims arising out of their service to the
Company and subsidiaries. The insurance policy runs for a period of one
year at a total cost of $______.
If a proxy or ballot indicates that a stockholder, including a broker
or nominee, abstains from voting or does not vote shares on a particular
proposal, the shares will be counted as in attendance at the meeting for
purposes of a quorum but will not be counted as having been voted on the
particular proposal. Abstentions will not be included in the final tally of
votes cast for the election of directors under New York law and the
Company's By-laws. Abstentions and shares not voted will have the effect of
negative votes in determining whether the proposed amendment to the
Certificate of Incorporation is authorized under New York law and the
Company's By-laws, because such authorization requires the affirmative vote
of the holders of a majority of the shares entitled to vote at the Meeting.
The Board does not know of any other matters to be brought before the
meeting. If any other matters not mentioned in the Proxy Statement are
properly brought before the meeting, including matters incident to the
conduct of the meeting or relating to the adjournment thereof, the persons
named in the enclosed proxy intend to vote such proxy in accordance with
their best judgment on such matters.
By Order of the Board of Directors,
Jerry Shore,
Chairman of the Board
Dated: May 26, 1995
[PROXY CARD]
[SIDE 1]
Preliminary Proxy
PARK ELECTROCHEMICAL CORP.
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS July 12, 1995
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby constitutes and appoints BRIAN E.
SHORE, ANTHONY CHIESA and NORMAN M. SCHNEIDER, and each of them,
the attorneys and proxies of the undersigned, with full power
of substitution, to attend the Annual Meeting of Shareholders
of PARK ELECTROCHEMICAL CORP. to be held at The Chase Manhattan
Bank, One Chase Manhattan Plaza, New York, New York on July 12,
1995 at 10:00 o'clock A.M., New York time, and any adjournments
thereof, to vote all the shares of Common Stock of the Company
which the undersigned would be entitled to vote if personally
present and to vote upon the following matters:
(1) ELECTION OF DIRECTORS
[ ] FOR all nominees listed below (except as marked to
the contrary below).
[ ] WITHHOLD AUTHORITY to vote for all nominees listed
below.
ANTHONY CHIESA, LLOYD FRANK, NORMAN M. SCHNEIDER,
BRIAN E. SHORE, JERRY SHORE and E. PHILIP SMOOT
(INSTRUCTION: To withhold authority to vote for any individual
nominee, write the nominee's name in the space provided below.)
____________________________________________________________
(2) INCREASE IN Common Stock
[ ] FOR proposed increase in the number of authorized
shares of Common Stock.
[ ] AGAINST proposed increase in the number of authorized
shares of Common Stock.
[ ] ABSTAIN from voting on proposed increase in the number
of authorized shares of Common Stock.
(3) The transaction of such other business as may properly come
before the meeting.
If no specification is made, the shares represented by this
Proxy will be voted "FOR" the nominees, "FOR" the proposed
increase in Common Stock, and in the discretion of the Proxies
on any other business.
(continued and to be SIGNED on the reverse side)
[SIDE 2]
The undersigned hereby acknowledges receipt of the
Company's 1995 Annual Report and the accompanying Notice of
Meeting and Proxy Statement and hereby revokes any proxy or
proxies heretofore given.
Dated:____________________, 1995
________________________________
________________________________
(Signature(s) of Shareholder(s))
Please date and sign exactly as name appears
hereon. Executors, Administrators, Trustees,
etc. should so indicate when signing. If shares
are held jointly, both owners should sign.
