SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_______________
FORM 10-K
FOR ANNUAL AND TRANSITION REPORTS
PURSUANT TO SECTIONS 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended March 1, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from ________ to________
Commission file number 1-4415
Park Electrochemical Corp.
(Exact Name of Registrant as Specified in Its Charter)
New York 11-1734643
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
5 Dakota Drive, Lake Success, New York 11042
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (516) 354-4100
Securities registered pursuant to Section 12(b) of the Act:
Name of Each Exchange
Title of Each Class on Which Registered
Common Stock, $.10 par value New York Stock Exchange
Preferred Stock Purchase Rights New York Stock Exchange
5.5% Convertible Subordinated Notes New York Stock Exchange
due 2006
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such
shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past 90
days. Yes [X] No [ ]
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein, and
will not be contained, to the best of registrant's knowledge, in
definitive proxy or information statements incorporated by reference
in Part III of this Form 10-K or any amendment to this Form 10-K. [ ]
[cover page 1 of 2 pages]
State the aggregate market value of the voting and non-voting
common equity held by non-affiliates of the registrant. The aggregate
market value shall be computed by reference to the price at which the
common equity was sold, or the average bid and asked prices of such
common equity, as of a specified date within 60 days prior to the date
of filing.
As of Close
Title of Class Aggregate Market Value of Business On
Common Stock, $295,682,676* May 1, 1998
$.10 par value
Indicate the number of shares outstanding of each of the
registrant's classes of common stock, as of the latest practicable
date.
Shares As of Close
Title of Class Outstanding of Business On
Common Stock, 11,399,814 May 1, 1998
$.10 par value
DOCUMENTS INCORPORATED BY REFERENCE
Proxy Statement for Annual Meeting of Shareholders to be held July
15, 1998 incorporated by reference into Part III of this Report.
=====================================================================
*Included in such amount are 1,015,032 shares of common stock valued
at $25.9375 per share and held by Jerry Shore, the Registrant's
Chairman of the Board and a member of the Registrant's Board of
Directors.
[cover page 2 of 2 pages]
PART I
Item 1. Business.
General
Park Electrochemical Corp. ("Park"), through its subsidiaries
(unless the context otherwise requires, Park and its subsidiaries are
hereinafter called the "Company"), is primarily engaged in the design,
production and marketing of advanced electronic materials used to fabricate
complex multilayer printed circuit boards, semiconductor packages and other
electronic interconnection systems. The Company's electronic materials
business is operated by its "Nelco" group of companies. The Company is also
engaged in the design, production and marketing of specialty adhesive tapes
and films, advanced composite materials and microwave circuitry materials
for the electronics, aerospace and industrial markets and plumbing hardware.
Park was founded in 1954 by Jerry Shore, the Company's Chairman of the Board
and largest shareholder.
In October 1997, the Company acquired Dielektra GmbH, located in
Cologne, Germany. Dielektra manufactures advanced electronic materials,
including continuously produced copper-clad laminates and mass-laminated
multilayer panels, used to produce sophisticated multilayer printed circuit
boards. Dielektra, with total sales in the 1997 calendar year of approxi-
mately $50 million, became part of Park's Nelco group of companies. See
Note 14 of the Notes to Consolidated Financial Statements in Item 8 of this
Report.
The Company's business is divided into two industry segments: (1)
electronic materials and (2) engineered materials and plumbing hardware.
See Note 12 of the Notes to Consolidated Financial Statements in Item 8 of
this Report for information concerning the sales to unaffiliated customers,
operating profit, identifiable assets, depreciation and amortization, and
capital expenditures attributable to each of the Company's industry segments
during its last three fiscal years.
The sales, operating profit and identifiable assets of the Company's
operations by geographic area for the last three fiscal years are also set
forth in Note 12 of the Notes to Consolidated Financial Statements in Item
8 of this Report. The Company's foreign operations are conducted principal-
ly by the Company's subsidiaries in the United Kingdom, France, Germany and
Singapore. The Company's foreign operations are subject to the impact of
foreign currency fluctuations. See Note 1 of the Notes to Consolidated
Financial Statements in Item 8 of this Report.
Electronic Materials Operations
The Company is a leading global designer and producer of advanced
electronic materials used to fabricate complex multilayer printed circuit
boards and other electronic interconnect systems, such as backplanes, PC
cards and semiconductor packaging systems. The Company's multilayer printed
circuit materials include copper-clad laminates, prepregs and semi-finished
multilayer printed circuit board panels. The Company has long-term
relationships with its major customers, which include leading independent
printed circuit board fabricators and major electronic equipment manufac-
turers. Multilayer printed circuit boards and interconnect systems are used
in virtually all advanced electronic equipment to direct, sequence and
control electronic signals between semiconductor devices (such as micropro-
cessors and memory and logic devices) and passive components (such as
resistors and capacitors). Examples of end uses of the Company's printed
circuit materials range from supercomputers to laptops and from satellite
switching equipment to cellular telephones. The Company has developed long-
term relationships with major customers as a result of its leading edge
products, extensive technical and engineering service support and responsive
manufacturing capabilities.
Park founded the modern day printed circuit industry in 1957 by
inventing a composite material consisting of an epoxy resin substrate
reinforced with fiberglass cloth which was laminated together with sheets of
thin copper foil. This epoxy-glass copper-clad laminate system is still
used to construct the large majority of today's advanced printed circuit
products. In 1962, the Company invented the first multilayer printed
circuit materials system used to construct multilayer printed circuit
boards. The Company also pioneered vacuum lamination and many other
manufacturing technologies used in the industry today. In addition, the
Company's recently acquired subsidiary, Dielektra GmbH, owns a patented
process for continuously producing thin copper-clad laminates for printed
circuit board applications. The Company believes it is one of the
industry's technological leaders.
As a result of its leading edge products, extensive technical and
engineering service support and responsive manufacturing capabilities, the
Company expects to continue to take advantage of several industry trends.
These trends include the increasing global demand for electronic products
and technology, the increasing complexity of electronic products, the
increasingly advanced electronic materials required for interconnect
performance and manufacturability, the consolidation of the printed circuit
board fabrication industry and the time-to-market and time-to-volume
pressures requiring closer collaboration with materials suppliers.
The Company believes that it is one of the world's largest
manufacturers of multilayer printed circuit materials and the market leader
in North America and Southeast Asia. It also believes that it is the only
significant independent manufacturer of multilayer printed circuit materials
in the world. The Company was the first manufacturer in the printed circuit
materials industry to establish manufacturing presences in the three major
global markets of North America, Europe and Asia, with facilities estab-
lished in Europe in 1969 and Asia in 1986.
Industry Background
The electronic materials manufactured by the Company and its
competitors are used to construct and fabricate complex multilayer printed
circuit boards and other advanced electronic interconnect systems.
Multilayer printed circuit materials consist of prepregs and copper-clad
laminates, as well as semi-finished multilayer printed circuit board panels.
Prepregs are chemically and electrically engineered plastic resin systems
which are impregnated into and reinforced by a specially manufactured
fiberglass cloth product or other woven or non-woven reinforcing fiber.
This insulating dielectric substrate is .030 inch to .002 inch in thickness
or less in some cases. These resin systems are usually based upon an epoxy
chemistry. One or more plies of prepreg are laminated together to form an
insulating dielectric substrate to support the copper circuitry patterns of
a multilayer printed circuit board. Copper-clad laminates consist of one or
more plies of prepreg laminated together with specialty thin copper foil
laminated on the top and bottom. Copper foil is specially formed in thin
sheets which may vary from .0030 inch to .0002 inch in thickness and
normally have a thickness of .0014 inch or .0007 inch. The Company supplies
both copper-clad laminates and prepregs to its customers, which use these
products as a system to construct multilayer printed circuit boards.
The printed circuit board fabricator processes copper-clad laminates
to form the inner layers of a multilayer printed circuit board. The
fabricator photoimages these laminates with a dry film or liquid photo-
resist. After development of the photoresist, the copper surfaces of the
laminate are etched to form the circuit pattern. The fabricator then
assembles these etched laminates by inserting one or more plies of
dielectric prepreg between each of the inner layer etched laminates and also
between an inner layer etched laminate and the outer layer copper plane, and
then laminating the entire assembly in a press. Prepreg serves as the
insulator between the multiple layers of copper circuitry patterns found in
the multilayer circuit board. When the multilayer configuration is
laminated, these plies of prepreg form an insulating dielectric substrate
supporting and separating the multiple inner and outer planes of copper
circuitry. The fabricator drills vertical through-holes or vias in the
multilayer assembly and then plates the through-holes or vias to form
vertical conductors between the multiple layers of circuitry patterns.
These through holes or vias combine with the conductor paths on the
horizontal circuitry planes to create a three-dimensional electronic
interconnect system. The outer two layers of copper foil are then imaged
and etched to form the finished multilayer printed circuit board. The
completed multilayer board is a three-dimensional interconnect system with
electronic signals traveling in the horizontal planes of multiple layers of
copper circuitry patterns, as well as the vertical plane through the plated
holes or vias.
The global market for advanced electronic products is growing as a
result of technological change and frequent new product introductions. This
growth is principally attributable to increased sales and more complex
electronic content of newer products, such as cellular phones, pagers,
personal computers and portable computing devices, and greater use of
electronics in other products, such as automobiles. Further, large, almost
completely untapped markets for advanced electronic equipment have emerged
in such areas as India and China and other areas of the Pacific Rim.
Semiconductor manufacturers have introduced successive generations
of more powerful microprocessors and memory and logic devices. Electronic
equipment manufacturers have designed these advanced semiconductors into
more compact and often portable products. High performance computing
devices in these smaller portable platforms require greater reliability,
closer tolerances, higher component and circuit density and increased
overall complexity. As a result, the interconnect industry has developed
smaller, lighter, faster and more cost-effective interconnect systems,
including advanced multilayer printed circuit boards and new types of
semiconductor packaging systems such as ball-grid arrays and multi-chip
modules.
Advanced interconnect systems require higher technology printed
circuit materials to insure the performance of the electronic system and to
improve the manufacturability of the interconnect platform. The growth of
the market for more advanced printed circuit materials has outpaced the
market growth for standard printed circuit materials in recent years.
Printed circuit board fabricators and electronic equipment manufacturers
require advanced printed circuit materials that have increasingly higher
temperature tolerances and more advanced electrical properties in order to
support high speed computing in a miniaturized and often portable environ-
ment.
With the very high density circuit demands of miniaturized high
performance interconnect systems, the uniformity, purity, consistency,
performance predictability, dimensional stability and production tolerances
of printed circuit materials have become successively more critical. High
density printed circuit boards and interconnect systems often involve higher
layer count multilayer circuit boards where the multiple planes of circuitry
and dielectric insulating substrates are very thin (dielectric insulating
substrate layers may be .002 inch or less) and the circuit line and space
geometries in the circuitry plane are very narrow (.003 inch or less). In
addition, advanced surface mount interconnect systems are typically designed
with very small pad sizes and very narrow plated through holes or vias which
electrically connect the multiple layers of circuitry planes. High density
interconnect systems must utilize printed circuit materials whose dimension-
al characteristics and purity are consistently manufactured to very high
tolerance levels in order for the printed circuit board fabricator to attain
and sustain acceptable production yields.
Shorter product life cycles and competitive pressures have induced
electronic equipment manufacturers to bring new products to market and
increase production volume to commercial levels more quickly. These trends
have highlighted the importance of front-end engineering of electronic
products and have increased the level of collaboration among system
designers, fabricators and printed circuit materials suppliers. As the
complexity of electronic products increases, materials suppliers must
provide greater technical support to interconnect systems fabricators on a
timely basis regarding manufacturability and performance of new materials
systems.
Products and Services
The Company produces a broad line of advanced printed circuit
materials used to fabricate complex multilayer printed circuit boards and
other electronic interconnect systems, including backplanes, PC cards and
semiconductor packaging systems. The Company also manufactures semi-
finished multilayer printed circuit board panels for a select group of
customers. The Company's diverse advanced printed circuit materials product
line is designed to address a wide array of end-use applications and
performance requirements.
The Company's product line has been developed internally and through
long-term development projects with its principal suppliers. The Company
focuses its research and development efforts on developing industry leading
product technology to meet the most demanding product requirements and has
designed its product line with a focus on the higher performance, higher
technology end of the materials spectrum. All of the Company's existing
electronic materials products have been introduced since 1990.
Most of the Company's research and development expenditures are
attributable to the efforts of its electronic materials operations. In
response to the rapid technological changes in the electronic materials
business, these expenditures on research and product development have
increased over the past several years.
The Company's products include high-temperature modified epoxies,
bismaleimide triazine epoxies ("BT epoxy"), non-MDA polyimides, enhanced
polyimides, high performance epoxy Thermount(R) materials ("Thermount" is a
registered trademark of E.I. duPont de Nemours & Co.), cyanate esters and
polytetrafluoroethylene ("PTFE") materials.
In addition to prepreg and copper-clad laminate printed circuit
materials products, the Company also manufactures semi-finished multilayer
printed circuit board panels as a value-added service for certain of its
customers. Production of the Company's semi-finished multilayer product
involves several additional manufacturing steps beginning with the
photoimaging and etching of the copper-clad laminate product into the
circuitry patterns specified by the customer. These etched laminates form
the inner layers of the multilayer circuit board. The etched inner layers
are then laminated into a multilayer assembly with insulating dielectric
prepreg inserted between the multiple etched inner layers and outer layer
copper planes. The outer planes of copper foil are left in unprocessed
"blank" form and the product is delivered to the customer at this stage in
the process. The fabricator customer then drills and plates the through
holes or vias and finishes the outer layers of circuitry patterns to
complete the product.
The Company has developed long-term relationships with select
customers through broad-based technical support and service, as well as
manufacturing proximity and responsiveness at multiple levels of the
customer's organization. The Company focuses on developing a thorough
understanding of its customer's business, product lines, processes and
technological challenges. The Company seeks customers which are industry
leaders committed to maintaining and improving their industry leadership
positions and which are committed to long-term relationships with their
suppliers. The Company also seeks business opportunities with the more
advanced printed circuit fabricators and electronic equipment manufacturers
which are interested in the full value of products and services provided by
their suppliers. The Company believes its proactive and timely support in
assisting its customers with the integration of advanced materials
technology into new product designs further strengthens its relationships
with its customers.
The Company's emphasis on service and close relationship with its
customers is reflected in its relatively short lead times. The Company has
designed its manufacturing processes and service organizations to provide
the customer with its printed circuit materials products on a just-in-time
basis.
The Company has located its advanced printed circuit materials
manufacturing operations in strategic locations intended to serve specific
regional markets. By situating its facilities in close geographical
proximity to its customers, the Company is able to rapidly adjust its
manufacturing processes to meet customers' new requirements and respond
quickly to customers' technical needs. The Company has full technical
staffs based at each of its manufacturing locations, which allows the rapid
dispatch of technical personnel to a customer's facility to assist the
customer in quickly solving design, process, production or manufacturing
problems.
Customers and End Markets
The Company's customers for its advanced electronic materials
include the leading independent printed circuit board fabricators and major
electronic equipment manufacturers in the computer, telecommunications,
transportation, aerospace and instrumentation industries located throughout
North America, Europe and Asia. The Company seeks to align itself with the
larger, more technologically-advanced and better capitalized independent
printed circuit board fabricators and major electronic equipment manufactur-
ers which are industry leaders committed to maintaining and improving their
industry leadership positions and to building long-term relationships with
their suppliers. The Company's selling effort typically involves several
stages and relies on the talents of Company personnel at different levels,
from management to sales personnel and quality engineers. The Company's
strategy emphasizes the use of multiple facilities established in market
areas in close proximity to its customers.
During the Company's 1998 fiscal year, more than 10% of the
Company's sales were to Delco Electronics Corporation, a subsidiary of
General Motors Corp. Delco Electronics has purchased a significant amount
of product from the Company for more than three years. However, in March
1998 the Company was informed by Delco that Delco planned to close its
printed circuit board fabrication plant and exit the printed circuit board
manufacturing business. After the plant closure, Delco will purchase all of
its printed circuit boards from outside suppliers and Delco will no longer
be a customer of Park's. During the 1998, 1997 and 1996 fiscal years, sales
to Delco Electronics represented 15.8%, 17.3% and 17.1%, respectively, of
the Company's total worldwide sales. The Company plans to aggressively
market its unique high technology semi-finished multilayer circuit board
material manufacturing capability to leading printed circuit board
fabricators, contract assemblers and electronic original equipment
manufacturers in North America. The Company has not previously been able to
aggressively market this capability as its semi-finished multilayer capacity
has been largely committed to supplying Delco Electronics. Although the
Company's electronic materials segment is not dependent on this single
customer, the loss of this customer may have a material adverse effect on
the business of this segment in the fiscal year ending February 28, 1999 and
in subsequent fiscal years. Although no other single customer accounted for
10% or more of total sales of the Company for the 1998 fiscal year and the
electronic materials segment is not dependent on any other single customer,
the loss of a major customer or of a group of this segment's customers could
have a material adverse effect on the business of this segment.
The Company's electronic materials segment's products are marketed
by sales personnel in industrial centers in North America, Europe and Asia.
Such personnel include both salaried employees and independent sales
representatives who work on a commission basis.
Manufacturing
The process for manufacturing multilayer printed circuit materials
is capital intensive and requires sophisticated equipment as well as clean-
room environments. The key steps in the Company's manufacturing process
include: the impregnation of specially designed fiberglass cloth with a
resin system and the partial curing of that resin system; the assembling of
laminates consisting of single or multiple plies of prepreg and copper foil
in a clean-room environment; the vacuum lamination of the copper-clad
assemblies under simultaneous exposure to heat, pressure and vacuum; and the
finishing of the laminates to customer specifications.
Prepreg is manufactured in a treater. A treater is a roll-to-roll
continuous machine which sequences specially designed fiberglass cloth or
other reinforcement fabric into a resin tank and then sequences the resin-
coated cloth through a series of ovens which partially cure the resin system
into the cloth. This partially cured product or prepreg is then sheeted or
paneled and packaged by the Company for sale to customers, or used by the
Company to construct its copper-clad laminates.
The Company manufactures copper-clad laminates by first setting up
in a clean room an assembly of one or more plies of prepreg stacked together
with a sheet of specially manufactured copper foil on the top and bottom of
the assembly. This assembly, together with a large quantity of other
laminate assemblies, is then inserted into a large, multiple opening vacuum
lamination press. The laminate assemblies are then laminated under
simultaneous exposure to heat, pressure and vacuum. After the press cycle
is complete, the laminates are removed from the press and sheeted, paneled
and finished to customer specifications. The product is then inspected and
packaged for shipment to the customer. In addition, the Company manufactur-
es very thin copper-clad laminates utilizing Dielektra's unique, patented
continuous lamination technology.
The Company manufactures multilayer printed circuit materials at
nine fully integrated facilities located in the United States, Europe and
Southeast Asia. The Company opened its California facility in 1965, its
United Kingdom facility in 1969, its first Arizona and France facilities in
1984, its Singapore facility in 1986 and its second Arizona and France
facilities in 1992, and in October 1997, the Company acquired Dielektra GmbH
with a fully integrated facility in Cologne, Germany. The Company services
the North American market principally through its United States manufactur-
ing facilities, the European market principally through its manufacturing
facilities in the United Kingdom, France and Germany, and the Asian market
principally through its Singapore manufacturing facility. The Company has
located its manufacturing facilities in its important markets. By
maintaining full technical and engineering staffs at each of its manufactur-
ing facilities, the Company is able to deliver fully-integrated products and
services on a timely basis.
During the 1996 fiscal year, the Company expanded its New York State
operations to increase its production capacity for advanced printed circuit
materials principally for the North American market and expanded its Tempe,
Arizona operations to provide enhanced capability and capacity to produce
high density, semi-finished multilayer panels and interconnect systems. It
commenced commercial operations at these expanded facilities during the
early part of its 1997 fiscal year. The Company added to the manufacturing
capacity of its facilities in Arizona and Singapore during the latter part
of its 1997 fiscal year and further expanded the manufacturing capacity of
its facilities in California and Singapore during its 1998 fiscal year. The
Company is planning further expansions of its electronic materials
operations during the 1999 fiscal year in the United States, Europe and
Asia.
All of the Company's multilayer printed circuit materials manufac-
turing facilities are used for manufacturing, engineering and product
development. All of the Company's Nelco and Dielektra printed circuit
materials manufacturing facilities are ISO 9002 certified.
Materials and Sources of Supply
The principal materials used in the manufacture of the Company's
electronic products are specially manufactured copper foil, fiberglass cloth
and synthetic reinforcements, and specially formulated resins and chemicals.
The Company attempts to develop and maintain close working relationships
with suppliers of those materials who have dedicated themselves to complying
with the Company's stringent specifications and technical requirements.
While the Company's philosophy is to work with a limited number of
suppliers, the Company has identified alternate sources of supply for each
of these materials. However, there are a limited number of qualified
suppliers of these materials, substitutes for these materials are not
readily available, and, in the recent past, the industry has experienced
shortages in the market for certain of these materials. While the Company
has not experienced significant problems in the delivery of these materials
and considers its relationships with its suppliers to be strong, a
disruption of the supply of material from one of the Company's principal
suppliers or an inability to obtain essential materials could materially
adversely affect the business, financial condition and results of operations
of the Company. Significant increases in the cost of materials purchased by
the Company could also have a material adverse effect on the Company's
business, financial condition and results of operations if the Company were
unable to pass such price increases through to its customers.
Competition
The multilayer printed circuit materials industry is characterized
by intense competition and ongoing consolidation. The Company's competitors
are primarily divisions or subsidiaries of very large, diversified
multinational manufacturers which are substantially larger and have greater
financial resources than the Company and, to a lesser degree, smaller
regional producers. Because the Company focuses on the higher technology
segment of the electronic materials market, technological innovation,
quality and service, as well as price, are significant competitive factors.
The Company believes that there are approximately ten significant
multilayer printed circuit materials manufacturers in the world and many of
these competitors have or are developing significant presences in the three
major global markets of North America, Europe and Asia. The Company
believes that the multilayer printed circuit materials industry is rapidly
becoming more global and that the remaining smaller regional manufacturers
will find it increasingly difficult to remain competitive. The Company
believes that it is currently one of the world's largest multilayer printed
circuit materials manufacturers. The Company further believes it is the
only significant independent manufacturer of multilayer printed circuit
materials in the world today.
The markets in which the Company's electronic materials operations
compete are characterized by rapid technological advances, and the Company's
position in these markets depends largely on its continued ability to
develop technologically advanced and highly specialized products. Although
the Company believes it is an industry technology leader and directs a
significant amount of its time and resources toward maintaining its
technological competitive advantage, there is no assurance that the Company
will be technologically competitive in the future, or that the Company will
continue to develop new products that are technologically competitive.
Engineered Materials and Plumbing Hardware
The Company's engineered materials and plumbing hardware segment is
comprised of its specialty adhesive tape and film, advanced composite
materials and plumbing hardware businesses. Dielectric Polymers, Inc., the
Company's specialty adhesive tape and film business, produces tapes and
bonding films for a variety of applications including joining industrial
components together. FiberCote Industries, Inc., the Company's composites
business, designs and produces engineered advanced composite materials for
the electronics, aerospace and industrial markets. Zin-Plas Corporation
markets plumbing hardware products, which it designs and manufactures
typically from chrome and brass plated zinc and plastic, and markets brass
cast and plastic plumbing hardware products and components.
Marketing and Customers
The Company's engineered materials and plumbing hardware customers,
substantially all of which are located in the United States, include
manufacturers in the electronics, aerospace and industrial industries and
original equipment manufacturers, hardware and plumbing wholesalers and home
improvement centers. All of such products are marketed by sales personnel
including both salaried employees and independent sales representatives who
work on a commission basis.
While no single engineered materials and plumbing hardware customer
accounted for 10% or more of the Company's total sales during the last
fiscal year, the loss of a major customer or of a group of some of the
largest customers of the engineered materials and plumbing hardware segment
could have a material adverse effect upon this segment.
Manufacturing and Sources of Supply
The Company's advanced composite materials manufacturing facility is
located in Waterbury, Connecticut. Holyoke, Massachusetts is the site of
the Company's specialty adhesive tape and film business. Zinc and plastic
plumbing hardware products are manufactured and assembled at the Company's
facilities in Grand Rapids and Comstock Park, Michigan.
The Company designs and manufactures its advanced composite
materials and industrial tapes and films to its own specifications and to
the specifications of its customers. Product development efforts are
devoted toward the conforming of the Company's advanced composites to the
specifications of, and the obtaining of approvals from, the Company's
customers. The materials used in the manufacture of these engineered
materials include chemicals, films, resins, fiberglass, plastics, and other
fabricated materials and adhesives. The Company purchases these materials
from several suppliers. Although satisfactory substitutes for many of these
materials are not readily available, the Company has experienced no
difficulties in obtaining such materials.
The Company designs and manufactures its plumbing hardware to its
own specifications and to the specifications of original equipment
manufacturers, using combinations of materials and product designs that are
developed by its personnel. The Company's product development efforts
relating to its plumbing hardware business operations are directed toward
the development of new decorative plumbing hardware product designs and new
materials to be used in the manufacture of plumbing products. This requires
market research, industrial design, engineering and testing for ease of
installation and durability. The Company usually combines chrome-plated
zinc and plastic moldings for its products.
The principal materials used in the manufacture of the Company's
plumbing hardware products consist of zinc castings, plastics, plating
materials, and other component parts. The Company purchases these materials
from several suppliers. Although satisfactory substitutes for these
materials are not readily available, the Company has experienced no
difficulties in obtaining such materials.
Competition
The Company has many competitors in the engineered materials and
plumbing hardware segment, including some major corporations which have
substantially greater financial resources than the Company. The Company
competes for business on the basis of product performance and development,
product qualification and approval, the ability to manufacture and deliver
products in accordance with customers' needs and requirements, and price.
The Company's plumbing hardware business can be affected by fluctuations in
the housing industry.
Backlog
The Company records an item as backlog when it receives a purchase
order specifying the number of units to be purchased, the purchase price,
specifications and other customary terms and conditions. At May 1, 1998,
the unfilled portion of all purchase orders believed to be firm was
approximately $18,918,000, compared to $21,524,000 at May 2, 1997. Backlog
of the Company's two industry segments at May 1, 1998, compared to May 2,
1997, was as follows:
May 1, 1998 May 2, 1997
Electronic Materials $10,436,000 $13,784,000
Engineered Materials and
Plumbing Hardware 8,482,000 7,740,000
Total $18,918,000 $21,524,000
Various factors contribute to the size of the Company's backlog.
Accordingly, the foregoing information may not be indicative of the
Company's results of operations for any period subsequent to the fiscal year
ended March 1, 1998.
Patents and Trademarks
The Company holds several patents and trademarks or licenses thereto.
In the Company's opinion, some of these patents and trademarks are important
to its products. Generally, however, the Company does not believe that an
inability to obtain new, or to defend existing, patents and trademarks would
have a material adverse effect on the Company.
Employees
At March 1, 1998, the Company had approximately 2,600 employees. Of
these employees, 2,360 were engaged in the Company's electronic materials
operations, 220 in its engineered materials and plumbing hardware operations
and 20 consisted of executive personnel and general administrative staff.
Approximately 2% of the Company's employees, all of whom are engaged in the
plumbing hardware operations, are subject to a collective bargaining
agreement. Management considers its labor relations to be satisfactory.
Environmental Matters
The Company is subject to stringent environmental regulation of its
use, storage, treatment and disposal of hazardous materials and the release
of emissions into the environment. The Company believes that it currently
is in substantial compliance with the applicable federal, state and local
environmental laws and regulations to which it is subject and that
continuing compliance therewith will not have a material effect on its
capital expenditures, earnings or competitive position. The Company does
not currently anticipate making material capital expenditures for environ-
mental control facilities for its existing manufacturing operations during
the remainder of its current fiscal year or its succeeding fiscal year.
However, developments, such as the enactment or adoption of even more
stringent environmental laws and regulations, could conceivably result in
substantial additional costs to the Company.
The Company and certain of its subsidiaries have been named by the
Environmental Protection Agency (the "EPA") or a comparable state agency
under the Comprehensive Environmental Response, Compensation and Liability
Act (the "Superfund Act") or similar state law as potentially responsible
parties in connection with alleged releases of hazardous substances at nine
sites. In addition, a subsidiary of the Company has received cost recovery
claims under the Superfund Act from other private parties involving three
other sites and has received requests from the EPA under the Superfund Act
for information with respect to its involvement at two other sites. Under
the Superfund Act and similar state laws, all parties who may have
contributed any waste to a hazardous waste disposal site or contaminated
area identified by the EPA or comparable state agency may be jointly and
severally liable for the cost of cleanup. Generally, these sites are
locations at which numerous persons disposed of hazardous waste. In the
case of the Company's subsidiaries, generally the waste was removed from
their manufacturing facilities and disposed at the waste sites by various
companies which contracted with the subsidiaries to provide waste disposal
services. Neither the Company nor any of its subsidiaries have been accused
of or charged with any wrongdoing or illegal acts in connection with any
such sites. The Company believes it maintains an effective and comprehen-
sive environmental compliance program. Management believes the ultimate
disposition of known environmental matters will not have a material adverse
effect upon the Company.
See "Management's Discussion and Analysis of Financial Condition and
Results of Operations - Environmental Matters" included in Item 7 of this
Report and Note 11 of the Notes to Consolidated Financial Statements
included in Item 8 of this Report.
Item 2. Properties.
The following chart indicates the significant properties owned and
leased by the Company, the industry segment which uses the properties, and
the location and size of each such property. All of such properties, except
for the Lake Success, New York property, are used principally as manufactur-
ing, warehouse and assembly facilities.
<TABLE>
<CAPTION> Size
Owned or (Square
Location Leased Use Footage)
<S> <C> <C> <C>
Lake Success, NY Leased Executive Offices 7,000
Walden, NY Owned Electronic Materials 51,000
Newburgh, NY Leased Electronic Materials 57,000
Fullerton, CA Leased Electronic Materials 95,000
Anaheim, CA Leased Electronic Materials 26,000
Tempe, AZ Leased Electronic Materials 86,000
Tempe, AZ Leased Electronic Materials 38,000
Tempe, AZ Leased Electronic Materials 15,000
Mirebeau, France Owned Electronic Materials 81,000
Lannemezan, France Owned Electronic Materials 29,000
Cologne, Germany Owned Electronic Materials 193,000
Sindelfingen, Germany Leased Electronic Materials 14,000
Skelmersdale, England Owned Electronic Materials 54,000
Singapore Leased Electronic Materials 48,000
Singapore Leased Electronic Materials 10,000
Grand Rapids, MI Owned Plumbing Hardware 165,000
Comstock Park, MI Leased Plumbing Hardware 39,000
Holyoke, MA Leased Engineered Materials- 34,000
Specialty Adhesive
Tapes and Films
Waterbury, CT Leased Engineered Materials- 100,000
Advanced Composites
</TABLE>
The Company believes its facilities and equipment to be in good
condition and reasonably suited and adequate for its current needs.
Item 3. Legal Proceedings.
In May 1998, the Company and its subsidiary, Nelco Technology, Inc.,
filed a complaint against Delco Electronics Corporation and Delphi
Automotive Systems, Inc. in the United States District Court for the
District of Arizona. The complaint alleges, among other things, that Delco
breached its contract to purchase semi-finished multilayer printed circuit
boards from Nelco and that Delphi interfered with Nelco's contract with
Delco and seeks compensatory and punitive damages of not less than $170
million.
Park announced in March 1998 that it had been informed by Delco
Electronics that Delco planned to close its printed circuit board fabrica-
tion plant and exit the printed circuit board manufacturing business. After
the plant closure, Delco will purchase all of its printed circuit boards
from outside suppliers and Delco will no longer be a customer of Park's.
The Company had been Delco's principal supplier of semi-finished multilayer
printed circuit board materials for more than ten years. These materials
were used by Delco to produce finished multilayer printed circuit boards.
Sales to Delco Electronics represented 15.8%, 17.3% and 17.1% of the
Company's total worldwide sales for the 1998, 1997 and 1996 fiscal years,
respectively. See "Business-Electronic Materials Operations-Customers and
End Markets" in Item 1 of this Report, "Management's Discussion and Analysis
of Financial Condition and Results of Operations" in Item 7 of this Report,
"Factors That May Affect Future Results" after Item 7 of this Report and
Note 13 of the Notes to Consolidated Financial Statements in Item 8 of this
Report.
Item 4. Submission of Matters to a Vote of Security Holders.
None.
Executive Officers of the Registrant.
Name Title Age
Brian E. Shore Chief Executive Officer, President 46
and a Director
E. Phillip Smoot Executive Vice President and a 60
Director
Brian Shore has served as a Director of the Company for more than the
past five years. Brian Shore was elected a Vice President of the Company in
January 1993, Executive Vice President in May 1994, President effective
March 4, 1996, the first day of the Company's 1997 fiscal year, and Chief
Executive Officer in November 1996. Brian Shore also served as General
Counsel of the Company from April 1988 until April 1994.
Mr. Smoot has served the Company in the capacities stated above for more
than the past five years.
There are no family relationships between the directors or executive
officers of the Company, except that Brian Shore is the son of Jerry Shore,
who is the Chairman of the Board and a Director of the Company and who also
served as President of the Company for more than five years until March 4,
1996 and as Chief Executive Officer of the Company for more than five years
until November 19, 1996.
The term of office of each executive officer of the Company expires upon
the election and qualification of his successor.
PART II
Item 5. Market for the Registrant's Common
Stock and Related Stockholder Matters.
The Company's Common Stock is listed and trades on the New York
Stock Exchange (trading symbol PKE). (The Common Stock also trades on the
Midwest Stock Exchange.) The following table sets forth, for each of the
quarterly periods indicated, the high and low sales prices for the Common
Stock as reported on the New York Stock Exchange Composite Tape and
dividends declared on the Common Stock.
For the Fiscal Year Stock Price Dividends
Ended March 1, 1998 High Low Declared
First Quarter $25 3/4 $21 1/4 $.08
Second Quarter 31 3/4 24 7/8 $.08
Third Quarter 31 3/4 25 1/8 $.08
Fourth Quarter 32 1/2 26 $.08
For the Fiscal Year Stock Price Dividends
Ended March 2, 1997 High Low Declared
First Quarter $33 3/8 $21 3/4 $.08
Second Quarter 24 5/8 16 3/4 $.08
Third Quarter 24 17 1/2 $.08
Fourth Quarter 26 1/2 20 7/8 $.08
As of May 1, 1998, there were 2,318 holders of record of Common
Stock.
The Company expects, for the immediate future, to continue to pay
regular cash dividends.
Item 6. Selected Financial Data.
The following selected consolidated financial data of Park and its
subsidiaries is qualified by reference to, and should be read in conjunction
with, the consolidated financial statements, related notes, and Management's
Discussion and Analysis of Financial Condition and Results of Operations
contained elsewhere herein. Insofar as such consolidated financial
information relates to the five fiscal years ended March 1, 1998 and is as
of the end of such periods, it is derived from the consolidated financial
statements for such periods and as of such dates audited by Ernst & Young
LLP, independent Certified Public Accountants. The consolidated financial
statements as of March 1, 1998 and March 2, 1997 and for the three years
ended March 1, 1998, together with the auditors' reports for the three years
ended March 1, 1998, appear elsewhere in this Report.
<TABLE>
<CAPTION>
Fiscal Year Ended
Mar. 1, Mar. 2, Mar. 3, Feb. 26, Feb. 27,
1998 1997 1996 1995 1994
(In thousands, except per share amounts)
<S> <C> <C> <C> <C> <C>
STATEMENT OF EARNINGS INFORMATION:
Net sales $376,158 $334,490 $312,966 $253,022 $208,410
Cost of sales 301,968 275,372 242,655 196,917 168,175
Gross profit 74,190 59,118 70,311 56,105 40,235
Selling, general and administrative
expenses 39,418 34,366 35,236 29,995 25,930
Profit from operations 34,772 24,752 35,075 26,110 14,305
Other income (expense):
Interest and other income, net 8,382 7,653 2,285 1,822 947
Interest expense (5,468) (5,508) (96) (431) (2,407)
Total other income 2,914 2,145 2,189 1,391 (1,460)
Earnings before income taxes 37,686 26,897 37,264 27,501 12,845
Income tax provision 12,436 8,338 12,366 10,156 4,783
Net earnings $ 25,250 $ 18,559 $ 24,898 $ 17,345 $ 8,062
Earnings per share:
Basic $ 2.22 $ 1.64 $ 2.17 $ 1.60 $ 1.01
Diluted $ 2.07 $ 1.58 $ 2.11 $ 1.51 $ .85
Weighted average number of common
shares outstanding:
Basic 11,353 11,349 11,500 10,858 7,986
Diluted 13,948 13,932 11,843 11,630 11,342
Cash dividends per common share $ .32 $ .32 $ .28 $ .20 $ .16
BALANCE SHEET INFORMATION:
Working capital $176,553 $165,004 $160,965 $ 55,035 $ 45,867
Total assets 359,329 307,862 298,975 162,051 140,750
Long-term debt 100,000 100,000 100,000 23 32,861
Stockholders' equity 166,404 143,355 134,427 112,048 61,454
</TABLE>
Item 7. Management's Discussion and Analysis of
Financial Condition and Results of Operations.
Park is a leading global designer and producer of advanced
electronic materials used to fabricate complex multilayer printed circuit
boards, semiconductor packages and other electronic interconnection systems.
In October 1997, the Company acquired Dielektra GmbH, a manufacturer of
advanced electronic materials, including continuously produced copper-clad
laminates and mass-laminated multilayer panels, located in Cologne, Germany.
The Company's customers for its advanced printed circuit materials include
leading independent circuit board fabricators and large electronic equipment
manufacturers in the computer, telecommunications, transportation, aerospace
and instrumentation industries. The Company's electronic materials
operations accounted for approximately 89% of the Company's total net sales
worldwide in the 1998 fiscal year and approximately 87% of net sales
worldwide in each of the preceding two fiscal years. The Company's foreign
electronic materials operations accounted for approximately 31% of the
Company's total net sales worldwide in the 1998 fiscal year and approximate-
ly 29% of net sales worldwide in each of the preceding two fiscal years.
Park is also engaged in the engineered materials business, which
consists of the Company's specialty adhesive tape business and advanced
composite business, both of which operate as independent business units. In
addition, Park operates a plumbing hardware business. The Company's
engineered material and plumbing hardware businesses accounted for
approximately 11% of the Company's total net sales worldwide in the 1998
fiscal year and approximately 13% of net sales worldwide in each of the
preceding two fiscal years.
The Company's sales growth during the last three fiscal years has
been led by strong growth in sales by its North American and Asian
electronic materials operations. During the 1998 fiscal year, the sales of
Dielektra contributed to this growth; and during the 1997 and 1996 fiscal
years, increased sales by the Company's European operations also contributed
to this growth. The Company's ongoing efforts to expand its higher
technology, higher margin product lines have been significant factors in the
growth of the Company's sales of electronic materials during this period.
The Company introduced several new electronic materials products during the
past three fiscal years.
Sales volume of the Company's electronic materials segment has
increased during each of the last three fiscal years. However, growth of
the Company's electronic materials business was constrained during these
fiscal years by the Company's available manufacturing capacity. The Company
has significantly expanded the manufacturing capacity of its New York,
California, Arizona and Singapore facilities during the last three fiscal
years and is planning additional expansions of its electronic materials
operations in California, New York, Arizona, Europe and Singapore during the
1999 fiscal year.
During the Company's 1998 fiscal year and for several years prior
thereto, more than 10% of the Company's total sales were to Delco Electron-
ics Corporation, a subsidiary of General Motors Corp. Sales to Delco
Electronics represented 15.8%, 17.3% and 17.1% of the Company's total sales
worldwide for the 1998, 1997 and 1996 fiscal years, respectively.
In March of 1998 the Company was informed by Delco that Delco
planned to close its printed circuit board fabrication plant and completely
exit the printed circuit board manufacturing business. After the plant
closure, which is expected to occur during the first half of the Company's
1999 fiscal year, Delco will no longer be a customer of the Company. In May
1998, the Company and its subsidiary, Nelco Technology, Inc., filed a
complaint against Delco Electronics Corporation and Delphi Automotive
Systems, Inc. (also a subsidiary of General Motors Corp.) in the United
States District Court for the District of Arizona. The complaint alleges,
among other things, that Delco breached its contract to purchase semi-
finished multilayer printed circuit boards from Nelco and that Delphi
interfered with Nelco's contract with Delco and seeks compensatory and
punitive damages of not less than $170 million.
The Company plans to aggressively market its high technology semi-
finished multilayer circuit board material manufacturing capability to
leading printed circuit board fabricators, contract assemblers and
electronic original equipment manufacturers in North America. The Company
has not previously been able to aggressively market this capability as it
has been largely committed to supplying Delco Electronics. Although the
Company's electronic materials segment is not dependent on this single
customer, the loss of this customer may have a material adverse effect on
the business of this segment in the fiscal year ending February 28, 1999 and
in subsequent fiscal years.
Fiscal Year 1998 Compared with Fiscal Year 1997:
The Company's electronic materials business was largely responsible
for the improvement in the Company's results of operations for the fiscal
year ended March 1, 1998. The North American and Asian markets for
sophisticated printed circuit materials were strong during the 1998 fiscal
year, and the Company's electronic materials operations located in these
regions performed well as a result. The market in Europe for sophisticated
printed circuit materials was not as strong as in North America or Asia,
although the Company's European operations benefited from the acquisition of
Dielektra, resulting in higher sales and improved profitability.
During most of the 1998 fiscal year, the Company's electronic
materials business experienced improved efficiencies resulting from the
operation of its facilities at levels close to their designed manufacturing
capacity, which favorably impacted the Company's margins.
Operating results of the Company's engineered materials businesses
and plumbing hardware business improved during the 1998 fiscal year.
Results of Operations
Sales for the fiscal year ended March 1, 1998 increased 12% to
$376.2 million from $334.5 million for the fiscal year ended March 2, 1997.
Sales of the electronic materials business for the 1998 fiscal year were
$335.2 million, or 89% of total sales worldwide, compared with $291.1
million, or 87% of total sales worldwide, for the 1997 fiscal year. This
15% increase in sales of electronic materials was principally the result of
higher volume of electronic materials shipped, an increase in sales of
higher technology products and the inclusion of Dielektra in the Company's
sales since the date of acquisition. Sales of the engineered materials
businesses continued to grow during the 1998 fiscal year as the result of
increased volume of materials shipped and the addition of new products. The
sales increase by the engineered materials business was overshadowed by the
reduced sales of the plumbing hardware business, which resulted in an
overall decline of 6% in the engineered materials and plumbing hardware
segment to $40.9 million in the 1998 fiscal year from $43.3 million in the
1997 fiscal year.
The Company's foreign operations accounted for $116.6 million of
sales, or 31% of the Company's total sales worldwide, during the 1998 fiscal
year compared with $99.5 million of sales, or 30% of total sales worldwide,
during the 1997 fiscal year. Sales by the Company's foreign operations
during the 1998 fiscal year increased 17% from the 1997 fiscal year. The
increase in sales by the Company's foreign operations in the 1998 fiscal
year was principally due to the inclusion of Dielektra in the Company's
sales and an increase in sales by the Company's Asian electronic materials
operations. An expansion of the Company's Singapore manufacturing facility
was completed at the end of the Company's 1997 fiscal year, and the Company
further expanded the manufacturing capacity of its facility in Singapore
during the 1998 fiscal year.
The gross margin for the Company's worldwide operations was 19.7%
during the 1998 fiscal year compared with 17.7% for the 1997 fiscal year.
The improvement in the gross margin was attributable to the increase in
sales volume over the prior fiscal year, the continuing growth in sales of
higher technology, higher margin products and efficiencies resulting from
operating the Company's facilities at levels close to their designed
capacity. This improvement was partially offset by a $1.4 million pre-tax
charge included in the cost of sales in the fourth quarter of the 1998
fiscal year to write down certain fixed assets that will no longer be
utilized in the Company's plumbing hardware business and in the Company's
semi-finished multilayer printed circuit board business.
Selling, general and administrative expenses, measured as a
percentage of sales, were 10.5% during the 1998 fiscal year compared with
10.3% during the 1997 fiscal year. This increase was a function of
increased general and administrative expenses, resulting, in part, from
higher employee bonus and profit sharing expenses due to higher operating
profits.
For the reasons set forth above, profit from operations for the 1998
fiscal year increased 40% to $34.8 million from $24.8 million for the 1997
fiscal year.
Interest and other income, principally investment income, increased
9% to $8.4 million for the 1998 fiscal year from $7.7 million for the 1997
fiscal year. The increase in investment income was attributable to the
increase in cash available for investment and an increase in the prevailing
interest rates during the current year. The Company's investments were
primarily short-term taxable instruments and government securities.
Interest expense for the 1998 fiscal year was $5.5 million compared with the
same amount during the 1997 fiscal year.
The Company's effective income tax rate for the 1998 fiscal year was
33.0% compared with 31.0% for the 1997 fiscal year. This increase in the
effective tax rate was primarily the result of less favorable foreign tax
rate differentials and a change in the domestic sales mix into states with
higher tax rates.
Net earnings for the 1998 fiscal year increased 36% to $25.3 million
from $18.6 million for the 1997 fiscal year. Basic and diluted earnings per
share increased to $2.22 and $2.07, respectively, for the 1998 fiscal year
from $1.64 and $1.58, respectively, for the 1997 fiscal year. This increase
in net earnings and earnings per share was primarily attributable to the
increase in the profit from operations offset, in part, by the higher
effective tax rate.
Fiscal Year 1997 Compared with Fiscal Year 1996:
The Company's electronic materials business was responsible for the
decline in the Company's results of operations for the fiscal year ended
March 2, 1997. The North American, European and Asian markets for sophisti-
cated printed circuit materials experienced weakness during the first half
of the 1997 fiscal year which continued into the third quarter in the North
American and European markets. The Company believes this weakness was
principally attributable to an industry-wide inventory correction that began
in the first quarter.
During the 1997 fiscal year, the Company's electronic materials
business experienced inefficiencies caused by operating its facilities at
levels significantly lower than their designed manufacturing capacity in the
first three quarters and faced price pressure from its customers resulting
in an inability to pass along raw material cost increases which it received
earlier in the 1997 fiscal year. These factors adversely affected the
Company's margins. The Company's performance during the 1997 fiscal year
was also adversely affected by significant disruptions of the Company's
business with its largest customer, Delco Electronics Corporation, caused by
the Canadian Auto Workers' and United Auto Workers' strikes against General
Motors in the first and third quarters of the fiscal year. The improvement
in the Company's margins in the second quarter over the first quarter was
achieved from internal operating adjustments in response to the industry
downturn that occurred in the first quarter and the return of Delco
Electronics to more normal business levels after the aforementioned strikes.
The improvement in the Company's margins in the fourth quarter over the
third quarter resulted from the return of Delco Electronics to more normal
business levels after the aforementioned strikes and the strengthening of
the market for the Company's products in the fourth quarter.
Operating results of the Company's engineered materials and plumbing
hardware business improved considerably during the 1997 fiscal year and
accounted for approximately 11% of the Company's total operating profit.
Results of Operations
Sales for the fiscal year ended March 2, 1997 increased 7% to $334.5
million from $313.0 million for the fiscal year ended March 3, 1996. Sales
of the electronic materials business for the 1997 fiscal year were $291.1
million, or 87% of total sales worldwide, compared with $274.9 million, or
88% of total sales worldwide, for the 1996 fiscal year. This 6% increase in
sales of electronic materials was principally the result of higher volume of
electronic materials shipped and an increase in sales of higher technology
products. Sales of the engineered materials and plumbing hardware business
for the 1997 fiscal year increased 14% to $43.3 million from $38.1 million
for the 1996 fiscal year due primarily to increased sales in the specialty
adhesive tape and advanced composite materials businesses resulting from new
products and higher volumes in both businesses.
The Company's foreign operations accounted for $99.5 million of
sales, or 30% of the Company's total sales worldwide, during the 1997 fiscal
year compared with $91.7 million of sales, or 29% of total sales worldwide,
during the 1996 fiscal year. Sales by the Company's foreign operations
during the 1997 fiscal year increased 9% from the 1996 fiscal year. While
sales by each of the Company's foreign operations were higher in the 1997
fiscal year compared with the 1996 fiscal year, the increase in sales by
foreign operations was principally due to an increase in sales by the
Company's Asian operations.
The gross margin for the Company's worldwide operations was 17.7%
during the 1997 fiscal year compared with 22.5% for the 1996 fiscal year.
The decline in the gross margin was attributable to inefficiencies resulting
from dramatic volume fluctuations during the year, the impact of disruptions
to the Company's business with its largest customer, Delco Electronics
Corporation, due to strikes against General Motors, selling price pressure
and operating certain facilities at levels lower than their designed
capacity, which were partially offset by the continuing growth in sales of
higher technology, higher margin products.
Selling, general and administrative expenses, measured as a
percentage of sales, were 10.3% during the 1997 fiscal year compared with
11.3% during the 1996 fiscal year. This reduction was a function of the
partially fixed nature of the selling, general and administrative expenses
relative to the increase in sales and lower incentive payments due to lower
operating profits.
For the reasons set forth above, profit from operations for the 1997
fiscal year decreased 29% to $24.8 million from $35.1 million for the 1996
fiscal year.
Interest and other income, principally investment income, increased
235% to $7.7 million for the 1997 fiscal year from $2.3 million for the 1996
fiscal year. Interest expense for the 1997 fiscal year was $5.5 million
compared with $0.1 million during the 1996 fiscal year. The increases in
investment income and interest expense were attributable to the increase in
cash available for investment and the additional interest expense resulting
from the Company's issuance of $100 million principal amount of 5.5%
Convertible Subordinated Notes due 2006 at the end of the 1996 fiscal year.
The Company's investments were primarily short-term taxable instruments and
government securities.
The Company's effective income tax rate for the 1997 fiscal year was
31.0% compared with 33.2% for the 1996 fiscal year. This decrease in the
effective tax rate was primarily the result of favorable foreign tax rate
differentials.
Net earnings for the 1997 fiscal year were $18.6 million compared
to $24.9 million for the 1996 fiscal year. Basic and diluted earnings per
share decreased to $1.64 and $1.58, respectively, for the 1997 fiscal year
from $2.17 and $2.11, respectively, for the 1996 fiscal year. This decrease
in net earnings and earnings per share was primarily attributable to the
decrease in the profit from operations.
Liquidity and Capital Resources:
At March 1, 1998, the Company's cash and temporary investments were
$158.5 million compared with $144.6 million at March 2, 1997, the end of the
Company's 1997 fiscal year. The increase in the Company's cash and
investment position at March 1, 1998 was attributable to cash provided from
operating activities in excess of investments in property, plant and
equipment, as discussed below. The Company's working capital was $176.6
million at March 1, 1998 compared with $165.0 million at March 2, 1997. The
increase at March 1, 1998 compared with March 2, 1997 was due principally to
the increases in cash and inventories, offset in part by higher accrued
liabilities and accounts payable. The increase in inventories at March 1,
1998 compared with March 2, 1997 was due principally to increased raw
material and finished goods levels in support of higher sales and the
inclusion of Dielektra's inventory in 1998. The Company's current ratio
(the ratio of current assets to current liabilities) was 3.5 to 1 at March
1, 1998 compared with 4.0 to 1 at March 2, 1997.
During the 1998 fiscal year, the Company generated funds from
operations of $40.5 million and expended $18.3 million for the net purchase
of property, plant and equipment. Cash provided by net earnings before
depreciation and amortization of $38.5 million combined with a net decrease
in non-cash working capital items resulted in $40.5 million of cash provided
from operating activities. A significant portion of the 1998 fiscal year's
capital expenditures related to installation of additional capacity at the
Company's electronic materials facilities in California and Singapore.
These expansions will increase the Company's capacity and capability for the
production of sophisticated printed circuit materials. Net expenditures for
property, plant and equipment were $18.3 million, $18.7 million and $24.5
million in the 1998, 1997 and 1996 fiscal years, respectively. The Company
expects the level of capital expenditures in the 1999 fiscal year to be in
excess of the expenditures in the 1998 fiscal year. The Company is planning
further expansions of its electronic materials operations in the United
States, Asia and Europe.
At March 1, 1998, the Company's only long-term debt was the 5.5%
Convertible Subordinated Notes due 2006 (the "Notes") issued at the end of
the 1996 fiscal year. The Company believes its financial resources will be
sufficient, for the foreseeable future, to provide for continued investment
in property, plant and equipment and for general corporate purposes. Such
resources, including the proceeds from the Notes, would also be available
for appropriate acquisitions and other expansions of the Company's business.
The Company has reviewed its worldwide computer systems for year
2000 readiness and is in the process of implementing a plan to resolve
existing issues. As part of ongoing system development programs, the
Company is modifying or replacing existing computer programs so that they
will function properly with respect to dates in the year 2000 and beyond.
The Company anticipates all critical systems will be modified for year 2000
compliance by mid-1999 and believes that after such modifications have been
completed year 2000 issues will not pose significant operational problems.
Management does not expect that the cost of year 2000 modifications will
have a material adverse effect on the liquidity, capital resources, business
or consolidated financial position of the Company.
Environmental Matters:
The Company is subject to various federal, state and local
government requirements relating to the protection of the environment. The
Company believes that, as a general matter, its policies, practices and
procedures are properly designed to prevent unreasonable risk of environmen-
tal damage and that its handling, manufacture, use and disposal of hazardous
or toxic substances are in accord with environmental laws and regulations.
However, mainly because of past operations and operations of predecessor
companies, which were generally in compliance with applicable laws at the
time of the operations in question, the Company, like other companies
engaged in similar businesses, is a party to claims by government agencies
and third parties and has incurred remedial response and voluntary cleanup
costs associated with environmental matters. Additional claims and costs
involving past environmental matters may continue to arise in the future.
It is the Company's policy to record appropriate liabilities for such
matters when remedial efforts are probable and the costs can be reasonably
estimated.
In the 1998, 1997 and 1996 fiscal years, the Company charged
approximately $0.4 million, $0.2 million and $0.2 million, respectively,
against pretax income for remedial response and voluntary cleanup costs
(including legal fees). While annual expenditures have generally been
constant from year to year, and may increase over time, the Company expects
it will be able to fund such expenditures from cash flow from operations.
The timing of expenditures depends on a number of factors, including
regulatory approval of cleanup projects, remedial techniques to be utilized
and agreements with other parties. At March 1, 1998, the recorded liability
in accrued liabilities for environmental matters was $3.5 million compared
with $1.2 million at March 2, 1997. The increase in this liability at March
1, 1998 was due to accrued liabilities for environmental matters at
Dielektra GmbH, which the Company acquired in October 1997. Dielektra's
environmental liability is for various compliance and remediation costs
expected to be incurred at its facility in Cologne, Germany over the next
several years.
Management does not expect that environmental matters will have a
material adverse effect on the liquidity, capital resources, business or
consolidated financial position of the Company. See Note 11 of the Notes to
Consolidated Financial Statements included in Item 8 of this Report for a
discussion of the Company's commitments and contingencies, including those
related to environmental matters.
Factors That May Affect Future Results.
The Private Securities Litigation Reform Act of 1995 provides a
"safe harbor" for forward-looking statements to encourage companies to
provide prospective information about their companies without fear of
litigation so long as those statements are identified as forward-looking and
are accompanied by meaningful cautionary statements identifying important
factors that could cause actual results to differ materially from those
projected in the statement. Accordingly, the Company hereby identifies the
following important factors which could cause the Company's actual results
to differ materially from any such results which might be projected,
forecast, estimated or budgeted by the Company in forward-looking state-
ments.
. The Company's customer base is concentrated, in part, because the
Company's business strategy has been to develop long-term relation-
ships with a select group of customers. During the Company's
fiscal year ended March 1, 1998, the Company's ten largest
customers accounted for approximately 52% of net sales. The
Company expects that sales to a relatively small number of
customers will continue to account for a significant portion of its
net sales for the foreseeable future. A loss of one or more of
such key customers could affect the Company's profitability. See
"Business-Electronic Materials Operations-Customers and End
Markets" in Item 1 of this Report, "Legal Proceedings" in item 3 of
this Report, "Management's Discussion and Analysis of Financial
Condition and Results of Operations" in Item 7 of this Report and
Note 13 of the Notes to Consolidated Financial Statements in Item
8 of this Report for discussions of the loss of a key customer
early in the 1999 fiscal year.
. The Company's business is dependent on certain aspects of the
electronics industry, which is a cyclical industry and which has
experienced recurring downturns. The downturns, such as occurred
in the first quarter of the Company's fiscal year ended March 2,
1997, can be unexpected and have often reduced demand for, and
prices of, electronic materials.
. The Company's operating results are affected by a number of
factors, including various factors beyond the Company's control.
Such factors include economic conditions in the electronics
industry, the timing of customer orders, product prices, process
yields, the mix of products sold and maintenance-related shutdowns
of facilities. Operating results also can be influenced by
development and introduction of new products and the costs
associated with the start-up of new facilities.
. Rapid technological advances in semiconductors and electronic
equipment have placed rigorous demands on the electronic materials
manufactured by the Company and used in printed circuit board
production. The Company's operating results will be affected by
the Company's ability to maintain and increase its technological
and manufacturing capability and expertise in this rapidly changing
industry.
. The electronic materials industry is intensely competitive and the
Company competes worldwide in the market for materials used in the
production of complex multilayer printed circuit boards. The
Company's competitors are substantially larger and have greater
financial resources than the Company, and the Company's operating
results will be affected by its ability to maintain its competitive
position in the industry.
. There are a limited number of qualified suppliers of the principal
materials used by the Company in its manufacture of electronic
materials products. Substitutes for these products are not readily
available, and in the recent past there have been shortages in the
market for certain of these materials.
. The Company typically does not obtain long-term purchase orders or
commitments. Instead, it relies primarily on continual communica-
tion with its customers to anticipate the future volume of purchase
orders. A variety of conditions, both specific to the individual
customer and generally affecting the customer's industry, can cause
a customer to reduce or delay orders previously anticipated by the
Company.
. The Company, from time to time, is engaged in the expansion of
certain of its manufacturing facilities for electronic materials.
The anticipated costs of such expansions cannot be determined with
precision and may vary materially from those budgeted. In
addition, such expansions will increase the Company's fixed costs.
The Company's future profitability depends upon its ability to
utilize its manufacturing capacity in an effective manner.
. The Company's business is capital intensive and, in addition, the
introduction of new technologies could substantially increase the
Company's capital expenditures. In order to remain competitive the
Company must continue to make significant investments in capital
equipment and expansion of operations. This may require that the
Company continue to be able to access capital on terms acceptable
to the Company.
. The Company may acquire businesses, product lines or technologies
that expand or complement those of the Company. The integration
and management of an acquired company or business may strain the
Company's management resources and technical, financial and
operating systems. In addition, implementation of acquisitions can
result in large one-time charges and costs. A given acquisition,
if consummated, may materially affect the Company's business,
financial condition and results of operations.
. The Company's international operations are subject to risks,
including unexpected changes in regulatory requirements, exchange
rates, tariffs and other barriers, political and economic instabil-
ity and potentially adverse tax consequences.
. A portion of the sales and costs of the Company's international
operations are denominated in currencies other than the U.S. dollar
and may be affected by fluctuations in currency exchange rates.
. The Company's success is dependent upon its relationship with key
management and technical personnel.
. The Company's future success depends in part upon its intellectual
property which the Company seeks to protect through a combination
of contract provisions, trade secret protections, copyrights and
patents.
. The Company's production processes require the use, storage,
treatment and disposal of certain materials which are considered
hazardous under applicable environmental laws and the Company is
subject to a variety of regulatory requirements relating to the
handling of such materials and the release of emissions and
effluents into the environment. Other possible developments, such
as the enactment or adoption of additional environmental laws,
could result in substantial costs to the Company.
. The market price of the Company's securities can be subject to
fluctuations in response to quarter to quarter variations in
operating results, changes in analysts' earnings estimates, market
conditions in the electronic materials industry, as well as general
economic conditions and other factors external to the Company.
. The Company's results could be affected by changes in the Company's
accounting policies and practices or changes in the Company's
organization, compensation and benefit plans, or changes in the
Company's material agreements or understandings with third parties.
Item 8. Financial Statements and Supplementary Data.
The Company's Financial Statements begin on the next page.
<PAGE>
REPORT OF INDEPENDENT AUDITORS
To the Board of Directors and Stockholders of
Park Electrochemical Corp.
Lake Success, New York
We have audited the accompanying consolidated balance sheets of Park
Electrochemical Corp. and subsidiaries as of March 1, 1998 and March 2, 1997
and the related consolidated statements of earnings, stockholders' equity,
and cash flows for each of the three years in the period ended March 1,
1998. Our audits also included the financial statement schedule listed in
the Index at Item 14(a)(2). These financial statements and financial
statement schedule are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements and
financial statement schedule based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the consolidated financial
position of Park Electrochemical Corp. and subsidiaries as of March 1, 1998
and March 2, 1997 and the consolidated results of their operations and their
cash flows for each of the three years in the period ended March 1, 1998, in
conformity with generally accepted accounting principles. Also, in our
opinion, the related financial statement schedule, when considered in
relation to the basic consolidated financial statements taken as a whole,
presents fairly in all material respects the information set forth therein.
ERNST & YOUNG LLP
New York, New York
April 22, 1998
<TABLE>
PARK ELECTROCHEMICAL CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except shares and per share amounts)
<CAPTION>
March 1, March 2,
1998 1997
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 45,102 $ 42,321
Marketable securities (Note 2) 113,358 102,232
Accounts receivable, less allowance for
doubtful accounts of $1,858 and $1,746,
respectively 53,511 50,314
Inventories (Note 3) 26,953 20,458
Prepaid expenses and other current
assets (Note 7) 8,456 5,089
Total current assets 247,380 220,414
Property, plant and equipment, at cost, less
accumulated depreciation and amortization
(Note 4) 108,116 83,391
Other assets (Notes 7 and 10) 3,833 4,057
Total $359,329 $307,862
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 37,426 $ 32,892
Accrued liabilities (Note 5) 25,261 18,565
Income taxes payable 8,140 3,953
Total current liabilities 70,827 55,410
Long-term debt (Note 6) 100,000 100,000
Deferred income taxes (Note 7) 8,781 7,963
Deferred pension liability and other (Note 10) 13,317 1,134
Commitments and contingencies (Notes 10 and 11)
Stockholders' equity (Notes 6, 8, 9 and 10):
Preferred stock, $1 par value per share--
authorized, 500,000 shares; issued, none - -
Common stock, $.10 par value per share--
authorized, 30,000,000; issued, 13,580,018
shares 1,358 1,358
Additional paid-in capital 52,990 51,290
Retained earnings 130,435 108,804
Currency translation adjustments (291) 831
Pension liability adjustment (1,039) (850)
Unrealized gains (losses) on investments 64 (11)
183,517 161,422
Less treasury stock, at cost, 2,181,247 and
2,307,765 shares, respectively (17,113) (18,067)
Total stockholders' equity 166,404 143,355
Total $359,329 $307,862
<FN>
See notes to consolidated financial statements.
</TABLE>
<TABLE>
PARK ELECTROCHEMICAL CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(In thousands, except per share amounts)
<CAPTION>
52 Weeks 53 Weeks
Ended Ended
March 1, March 2, March 3,
1998 1997 1996
<S> <C> <C> <C>
Net sales $376,158 $334,490 $312,966
Cost of sales 301,968 275,372 242,655
Gross profit 74,190 59,118 70,311
Selling, general and administrative
expenses 39,418 34,366 35,236
Profit from operations 34,772 24,752 35,075
Other income (expense):
Interest and other income, net 8,382 7,653 2,285
Interest expense (Note 6) (5,468) (5,508) (96)
Total other income 2,914 2,145 2,189
Earnings before income taxes 37,686 26,897 37,264
Income tax provision (Note 7) 12,436 8,338 12,366
Net earnings $ 25,250 $ 18,559 $ 24,898
Earnings per share (Note 9):
Basic $2.22 $1.64 $2.17
Diluted $2.07 $1.58 $2.11
<FN>
See notes to consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
PARK ELECTROCHEMICAL CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(In thousands, except shares and per share amounts)
<CAPTION> Additional Currency Pension Unrealized
Common Stock Paid-in Retained Translation Liability Losses on Treasury Stock
Shares Amount Capital Earnings Adjustments Adjustment Investments Shares Amount
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Balance, February 26, 1995 13,580,018 $1,358 $50,728 $ 72,216 $1,545 $ (972) $(139) 2,136,416 $(12,688)
Net earnings 24,898
Exchange rate changes (217)
Change in pension
liability adjustment (29)
Market revaluation 109
Stock options exercised 230 (102,726) 610
Cash dividends ($.28 per
share) (3,222)
Purchase of treasury stock 14 -
Balance, March 3, 1996 13,580,018 1,358 50,958 93,892 1,328 (1,001) (30) 2,033,704 (12,078)
Net earnings 18,559
Exchange rate changes (497)
Change in pension
liability adjustment 151
Market revaluation 19
Stock options exercised 332 (84,868) 547
Cash dividends ($.32 per
share) (3,647)
Purchase of treasury stock 358,929 (6,536)
Balance, March 2, 1997 13,580,018 1,358 51,290 108,804 831 (850) (11) 2,307,765 (18,067)
Net earnings 25,250
Exchange rate changes (1,122)
Change in pension
liability adjustment (189)
Market revaluation 75
Stock options exercised 228 (49,529) 352
Cash dividends ($.32 per
share) (3,619)
Purchase of treasury stock 11 -
Shares issued in business
acquisition 1,472 (77,000) 602
Balance, March 1, 1998 13,580,018 $1,358 $52,990 $130,435 $ (291) $(1,039) $ 64 2,181,247 $(17,113)
<FN>
See notes to consolidated financial statements.
/TABLE
<PAGE>
<TABLE>
PARK ELECTROCHEMICAL CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
<CAPTION>
52 Weeks 53 Weeks
Ended Ended
March 1, March 2, March 3,
1998 1997 1996
<S> <C> <C> <C>
Cash flows from operating activities:
Net earnings $ 25,250 $ 18,559 $ 24,898
Adjustments to reconcile net earnings
to net cash provided by operating
activities:
Depreciation and amortization 13,207 11,584 9,849
Provision for write-down of fixed assets 1,400 - -
Provision for doubtful accounts receivable 75 (306) (495)
(Gain) on sale of marketable securities - (16) (38)
(Benefit) provision for deferred income taxes (301) 1,596 1,425
Other, net (11) 65 64
Changes in operating assets and liabilities:
Decrease (increase) in accounts receivable 1,273 (7,612) (9,277)
(Increase) decrease in inventories (3,138) 7,202 (11,671)
(Increase) in prepaid expenses and
other current assets (1,950) (1,456) (1,057)
(Increase) decrease in other assets (544) 122 (42)
Increase (decrease) in accounts payable 1,235 (2,528) 11,409
(Decrease) increase in accrued liabilities (250) 1,700 1,108
Increase in income taxes payable 4,204 286 1,260
Net cash provided by operating activities 40,450 29,196 27,433
Cash flows from investing activities:
Purchases of property, plant and equipment, net (18,274) (18,735) (24,510)
Purchases of marketable securities (135,390) (137,897) (74,881)
Proceeds from sales of marketable securities 124,264 103,330 22,952
Business acquisition net of cash acquired (Note 14) (4,585) - -
Net cash used in investing activities (33,985) (53,302) (76,439)
Cash flows from financing activities:
Convertible notes offering - - 100,000
Convertible notes issuance costs - - (3,250)
Dividends paid (3,619) (3,647) (3,222)
Proceeds from exercise of stock options 228 604 697
Purchase of treasury stock - (6,535) -
Other - - 4
Net cash (used in) provided by
financing activities (3,391) (9,578) 94,229
Increase (decrease) in cash and cash equivalents
before effect of exchange rate changes 3,074 (33,684) 45,223
Effect of exchange rate changes on
cash and cash equivalents (293) 35 (56)
Increase (decrease) in cash and cash equivalents 2,781 (33,649) 45,167
Cash and cash equivalents, beginning of year 42,321 75,970 30,803
Cash and cash equivalents, end of year $ 45,102 $ 42,321 $ 75,970
<FN>
See notes to consolidated financial statements.
</TABLE>
PARK ELECTROCHEMICAL CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Three years ended March 1, 1998
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Park Electrochemical Corp. ("Park"), through its subsidiaries
(collectively, the "Company"), is a leading global designer and producer
of advanced electronic materials used to fabricate complex multilayer
printed circuit boards, semiconductor packages and other electronic
interconnection systems. The Company's multilayer printed circuit board
materials include copper-clad laminates, prepregs and semi-finished
multilayer printed circuit board panels. Multilayer printed circuit
boards and interconnection systems are used in virtually all advanced
electronic equipment to direct, sequence and control electronic signals
between semiconductor devices and passive components. The Company also
designs and manufactures specialty adhesive tapes, advanced composite
materials, microwave circuitry materials and plumbing hardware for the
electronics, aerospace, industrial and plumbing markets.
a. Principles of Consolidation - The consolidated financial statements
include the accounts of Park and its subsidiaries. All significant
intercompany balances and transactions have been eliminated.
b. Use of Estimates - The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the amounts
reported in the financial statements and accompanying notes. Actual
results could differ from those estimates.
c. Accounting Period - The Company's fiscal year is the 52 or 53 week
period ending the Sunday nearest to the last day of February. The
1998, 1997 and 1996 fiscal years ended on March 1, 1998, March 2, 1997
and March 3, 1996, respectively. Fiscal 1998 and 1997 each included
52 weeks; fiscal 1996 included 53 weeks.
d. Marketable Securities - All marketable securities are classified as
available-for-sale and are carried at fair value, with the unrealized
gains and losses, net of tax, reported as a separate component of
stockholders' equity. Realized gains and losses, amortization of
premiums and discounts, and interest and dividend income are included
in other income. The cost of securities sold is based on the specific
identification method.
e. Inventories - Inventories are stated at the lower of cost (first-in,
first-out method) or market.
f. Revenue Recognition - Revenues are recognized at the time product is
shipped to the customer.
g. Depreciation and Amortization - Depreciation and amortization are
computed principally by the straight-line method over the estimated
useful lives of the related assets or, with respect to leasehold
improvements, the term of the lease, if shorter.
h. Deferred Charges - Costs incurred in connection with the issuance of
debt financing are deferred and included in other assets and
amortized, using the effective interest method, over the respective
debt repayment period.
i. Income Taxes - Deferred income taxes are provided for temporary
differences in the reporting of certain items, primarily depreciation,
for income tax purposes as compared with financial accounting
purposes.
United States ("U.S.") Federal income taxes have not been provided on
the undistributed earnings (approximately $36,100,000 at March 1,
1998) of the Company's foreign subsidiaries, since it is management's
practice and intent to reinvest such earnings in the operations of
these subsidiaries.
j. Foreign Currency Translation - Assets and liabilities of foreign
subsidiaries using currencies other than the U.S. dollar as their
functional currency are translated into U.S. dollars at year-end
exchange rates and income and expense items are translated at average
exchange rates for the period. Gains and losses resulting from
translation are recorded as currency translation adjustments in
stockholders' equity.
k. Consolidated Statements of Cash Flows - The Company considers all
money market securities and investments with maturities at the date of
purchase of 90 days or less to be cash equivalents.
Supplemental cash flow information:
<TABLE>
<CAPTION> Fiscal Year
1998 1997 1996
<S> <C> <C> <C>
Cash paid during the year for:
Interest $5,519,000 $2,792,000 $ -
Income taxes 8,289,000 6,570,000 9,701,000
</TABLE>
l. Recently Issued Accounting Pronouncements - In June 1997, the
Financial Accounting Standards Board issued Statement of Financial
Accounting Standards No. 130 (SFAS 130), "Reporting Comprehensive
Income", and No. 131 (SFAS 131), "Disclosures about Segments of an
Enterprise and Related Information" and in February 1998, issued
Statement of Financial Accounting Standards No. 132 (SFAS 132),
"Employers' Disclosures about Pensions and other Postretirement
Benefits". SFAS 130 establishes standards for reporting and
displaying comprehensive income and its components in the financial
statements. SFAS 131 establishes new guidelines for reporting
information about operating segments. SFAS 132 addresses disclosure
issues relating to pensions and postretirement benefits and does not
change the measurement or recognition provisions of the current
statements. All three statements are effective for fiscal years
beginning after December 15, 1997 and will be adopted in the fiscal
year ended February 28, 1999. Management is evaluating the effect, if
any, of adopting these accounting standards.
2. MARKETABLE SECURITIES
<TABLE>
The following is a summary of available-for-sale securities:
<CAPTION>
Gross Gross Estimated
Unrealized Unrealized Fair
Cost Gains Losses Value
<S> <C> <C> <C> <C>
March 1, 1998:
U.S. Treasury and other
government securities $ 6,177,000 $44,000 $ - $ 6,221,000
U.S. corporate debt
securities 107,077,000 51,000 47,000 107,081,000
Total debt securities 113,254,000 95,000 47,000 113,302,000
Equity securities 4,000 52,000 - 56,000
$113,258,000 $147,000 $47,000 $113,358,000
March 2, 1997:
U.S. Treasury and other
government securities $ 35,423,000 $19,000 $47,000 $ 35,395,000
U.S. corporate debt
securities 66,822,000 20,000 40,000 66,802,000
Total debt securities 102,245,000 39,000 87,000 102,197,000
Equity securities 4,000 31,000 - 35,000
$102,249,000 $70,000 $87,000 $102,232,000
</TABLE>
The gross realized gains on sales of available-for-sale securities
totalled $18,000, $39,000 and $50,000 for 1998, 1997 and 1996,
respectively, and the gross realized losses totalled $6,000, $23,000 and
$12,000 for 1998, 1997 and 1996, respectively.
The amortized cost and estimated fair value of the debt and marketable
equity securities at March 1, 1998, by contractual maturity, are shown
below:
<TABLE>
<CAPTION> Estimated
Fair
Cost Value
<S> <C> <C>
Due in one year or less $ 82,230,000 $ 82,253,000
Due after one year through five years 31,024,000 31,049,000
113,254,000 113,302,000
Equity securities 4,000 56,000
$113,258,000 $113,358,000
</TABLE>
<TABLE>
3. INVENTORIES
<CAPTION>
March 1, March 2,
1998 1997
<S> <C> <C>
Raw materials $10,686,000 $ 8,459,000
Work-in-process 5,740,000 4,037,000
Finished goods 9,806,000 7,173,000
Manufacturing supplies 721,000 789,000
$26,953,000 $20,458,000
</TABLE>
<TABLE>
4. PROPERTY, PLANT AND EQUIPMENT
<CAPTION>
March 1, March 2,
1998 1997
<S> <C> <C>
Land, buildings and improvements $ 41,598,000 $ 30,983,000
Machinery, equipment, furniture
and fixtures 160,888,000 134,774,000
202,486,000 165,757,000
Less accumulated depreciation
and amortization 94,370,000 82,366,000
$108,116,000 $ 83,391,000
</TABLE>
Depreciation and amortization expense relating to property, plant and
equipment amounted to $12,884,000, $11,146,000 and $9,382,000 for fiscal
1998, 1997 and 1996, respectively. A pretax charge of $1,400,000 was
recorded in fiscal 1998, for the write-down of operating equipment that
will no longer be utilized, to its estimated net realizable value.
Interest expense capitalized to property, plant and equipment amounted
to $294,000 and $260,000 for fiscal 1998 and 1997, respectively.
<TABLE>
5. ACCRUED LIABILITIES
<CAPTION> March 1, March 2,
1998 1997
<S> <C> <C>
Payroll and commissions $ 6,091,000 $ 4,239,000
Taxes, other than income taxes 1,130,000 899,000
Interest 2,765,000 2,781,000
Other 15,275,000 10,646,000
$25,261,000 $18,565,000
</TABLE>
6. LONG-TERM DEBT
On February 28, 1996, the Company issued $100,000,000 principal amount
of 5.5% Convertible Subordinated Notes due 2006 (the "Notes") with
interest payable semiannually on March 1 and September 1 of each year,
commencing September 1, 1996. The Notes are unsecured and subordinated
to other long-term debt and are convertible at the option of the holder
at any time prior to maturity, unless previously redeemed or
repurchased, into shares of the Company's common stock at $42.188 per
share, subject to adjustment under certain conditions. The Notes are
not redeemable at the option of the Company prior to March 1, 1999; at
any time on or after such date, the Notes will be redeemable at the
option of the Company, in whole or in part, initially at 102.75% of the
principal amount of such Notes redeemed and thereafter at prices
declining to 100% on March 1, 2001, together with accrued interest. At
March 1, 1998 and March 2, 1997, the fair value of the Notes
approximated $99,000,000 and $90,625,000, respectively.
Foreign lines of credit totalled $5,300,000 at March 1, 1998, all of
which remains available to the subsidiaries.
7. INCOME TAXES
<TABLE>
The income tax provision includes the following:
<CAPTION>
Fiscal Year
1998 1997 1996
<S> <C> <C> <C>
Current:
Federal $10,181,000 $6,150,000 $ 9,980,000
State and local 1,332,000 592,000 961,000
Foreign 1,224,000 - -
12,737,000 6,742,000 10,941,000
Deferred:
Federal (680,000) 863,000 655,000
State and local 94,000 150,000 60,000
Foreign 285,000 583,000 710,000
(301,000) 1,596,000 1,425,000
$12,436,000 $8,338,000 $12,366,000
</TABLE>
The Company's effective income tax rate differs from the statutory U.S.
Federal income tax rate as a result of the following:
Fiscal Year
1998 1997 1996
Statutory U.S. Federal tax rate 35.0% 35.0% 35.0%
State and local taxes, net of
Federal benefit 2.5 1.8 1.8
Foreign tax rate differentials (7.4) (7.8) (4.6)
Other, net 2.9 2.0 1.0
33.0% 31.0% 33.2%
The Company had foreign net operating loss carryforwards of
approximately $37,500,000 and $14,400,000 in fiscal 1998 and 1997,
respectively. Nearly all of the net operating loss carryforwards were
acquired as the result of acquisitions, including $25,700,000 which was
acquired in fiscal 1998 when the Company purchased the capital stock of
Dielektra GmbH ("Dielektra"), a German corporation located in Cologne,
Germany. Long-term deferred tax assets arising from these net operating
loss carryforwards were valued at $0 at both March 1, 1998 and March 2,
1997, net of valuation reserves of approximately $19,500,000 and
$5,000,000, respectively. None of the acquired net operating loss
carryforwards relate to goodwill or other intangible assets.
Approximately $1,300,000 of the foreign net operating loss carryforwards
expire in varying amounts from fiscal 1999 through fiscal 2002; the
remainder have an indefinite expiration.
At March 1, 1998 and March 2, 1997, current deferred tax assets of
$2,254,000 and $1,135,000, respectively, which were primarily
attributable to expenses not currently deductible were included in other
current assets. The long-term deferred tax liabilities consisted
primarily of timing differences relating to depreciation.
8. STOCKHOLDERS' EQUITY
a. Stock Options - Under the 1992 Stock Option Plan (the "Plan")
approved by the Company's stockholders, key employees may be granted
options to purchase shares of common stock of the Company
exercisable at prices not less than the fair market value at the
date of grant. Options become exercisable 25% one year from the
date of grant, with an additional 25% exercisable each succeeding
year. The options expire 10 years from the date of grant. Options
to purchase a total of 1,150,000 shares of common stock are
authorized for grant under such Plan. The Plan will expire in
March, 2002.
The Company has elected the disclosure provision of Statement of
Financial Standards No. 123, "Accounting for Stock-Based
Compensation", and continues to apply Accounting Principles Board
Opinion No. 25, "Accounting for Stock Issued to Employees" (APB 25)
and related interpretations in accounting for the option plans.
Under APB 25, because the exercise price of the granted options is
not less than the market price at the date of the grant, no
compensation expense is recognized.
The weighted average fair value for options was estimated at the
date of grant using the Black-Scholes option pricing model to be
$7.17 for fiscal 1998, $7.78 for fiscal 1997 and $5.40 for fiscal
1996, with the following weighted average assumptions for fiscal
1998, 1997 and 1996, respectively: risk free interest rate of 6%;
expected volatility factors of 33%, 34% and 31%; expected dividend
yield of 2%; and estimated option lives of 4.6 years. For the
purpose of pro forma disclosures, the effect of applying SFAS 123 on
net income and earnings per share for fiscal 1998, 1997 and 1996
would approximate the amounts shown below (in thousands, except EPS
data):
<TABLE>
<CAPTION>
1998 1997 1996
As Pro As Pro As Pro
Reported forma Reported forma Reported forma
<S> <C> <C> <C> <C> <C> <C>
Net income $25,250 $24,810 $18,559 $18,330 $24,898 $24,805
EPS-basic $2.22 $2.19 $1.64 $1.62 $2.17 $2.16
EPS-diluted $2.07 $2.04 $1.58 $1.57 $2.11 $2.11
</TABLE>
<TABLE>
Information with respect to the Company's stock option plans follows:
<CAPTION>
Weighted
Average
Range of Outstanding Exercise
Exercise Prices Options Price
<S> <C> <C> <C>
Balance, March 3, 1996 $ 5.50 - $27.19 519,618 $11.43
Granted 23.75 - 24.63 111,675 24.55
Exercised 5.50 - 18.31 (84,868) 7.11
Cancelled 7.38 - 27.19 (26,450) 20.68
Balance, March 2, 1997 5.50 - 24.63 519,975 14.48
Granted 23.75 - 28.00 211,700 25.01
Exercised 5.50 - 24.63 (51,041) 8.80
Cancelled 6.00 - 28.00 (55,909) 26.59
Balance, March 1, 1998 $ 5.50 - $27.63 624,725 $17.43
Exercisable, March 1, 1998 $ 5.50 - $24.63 301,588 $12.58
</TABLE>
<TABLE>
The following table summarizes information concerning currently outstanding
and exercisable options.
<CAPTION>
Options Outstanding Options Exercisable
Weighted
Average Weighted Weighted
Remaining Average Average
Range of Number Contractual Exercise Number Exercise
Exercise Prices Outstanding Life(Years) Price Exercisable Price
<S> <C> <C> <C> <C> <C>
$ 5.50 - $ 9.99 148,150 4.67 $ 7.07 148,150 $ 7.07
10.00 - 19.99 211,900 6.75 15.92 130,375 15.50
20.00 - 28.00 264,675 8.92 24.43 23,063 24.63
624,725 301,588
</TABLE>
Stock options available for future grant under the 1992 Plan at March 1,
1998 and March 2, 1997 were 447,890 and 603,881, respectively.
b. Stockholders' Rights Plan - On February 2, 1989, the Company adopted
a stockholders' rights plan designed to protect stockholder interests
in the event the Company is confronted with coercive or unfair
takeover tactics. Under the terms of the plan, as amended on July
12, 1995, each share of the Company's common stock held of record on
February 15, 1989 or issued thereafter received one right. In the
event that a person has acquired, or has the right to acquire, 15%
(25% in certain cases) or more of the then outstanding common stock
of the Company (an "Acquiring Person") or tenders for 15% or more of
the then outstanding common stock of the Company, such rights will
become exercisable, unless the Board of Directors otherwise
determines. Upon becoming exercisable as aforesaid, each right will
entitle the holder thereof to purchase one one-hundredth of a share
of Series A Preferred Stock for $75, subject to adjustment (the
"Purchase Price"). In the event that any person becomes an Acquiring
Person, each holder of an unexercised exercisable right, other than
an Acquiring Person, shall have the right to purchase, at a price
equal to the then current Purchase Price, such number of shares of
the Company's common stock as shall equal the then current Purchase
Price divided by 50% of the then market price per share of the
Company's common stock. In addition, if after a person becomes an
Acquiring Person, the Company engages in any of certain business
combination transactions as specified in the plan, the Company will
take all action to ensure that, and will not consummate any such
business combination unless, each holder of an unexercised
exercisable right, other than an Acquiring Person, shall have the
right to purchase, at a price equal to the then current Purchase
Price, such number of shares of common stock of the other party to
the transaction for each right held by such holder as shall equal the
then current Purchase Price divided by 50% of the then market price
per share of such other party's common stock. The Company may redeem
the rights for a nominal consideration at any time, and after any
person becomes an Acquiring Person, but before any person becomes the
beneficial owner of 50% or more of the outstanding common stock of
the Company, the Company may exchange all or part of the rights for
shares of the Company's common stock at a one-for-one exchange ratio.
Unless redeemed, exchanged or exercised earlier, all rights expire on
July 12, 2005.
c. Reserved Common Shares - At March 1, 1998, 2,370,342 shares of common
stock were reserved for issuance upon conversion of the Notes and
1,072,615 shares were reserved for issuance upon exercise of stock
options.
9. EARNINGS PER SHARE
The following table sets forth the calculation of basic and diluted
earnings per share for the fiscal years:
<TABLE>
<CAPTION> 1998 1997 1996
<S> <C> <C> <C>
Net income for basic EPS $25,250,000 $18,559,000 $24,898,000
Add interest on 5.5% convertible
subordinated notes, net of taxes 3,554,000 3,523,000 53,000
Net income for diluted EPS $28,804,000 $22,082,000 $24,951,000
Weighted average common shares
outstanding for basic EPS 11,353,000 11,349,000 11,500,000
Net effect of dilutive options 225,000 213,000 313,000
Assumed conversion of 5.5%
convertible subordinated notes 2,370,000 2,370,000 30,000
Weighted average shares
outstanding for diluted EPS 13,948,000 13,932,000 11,843,000
EPS-Basic $2.22 $1.64 $2.17
EPS-Diluted $2.07 $1.58 $2.11
</TABLE>
10. EMPLOYEE BENEFIT PLANS
a. Profit Sharing Plan - Park and certain of its subsidiaries have a
noncontributory profit sharing retirement plan covering their regular
full-time employees. The plan may be modified or terminated at any
time, but in no event may any portion of the contributions revert to
the Company. The Company's contributions under the plan amounted to
$2,179,000, $1,775,000 and $2,329,000 for fiscal 1998, 1997 and 1996,
respectively. Contributions are discretionary and may not exceed the
amount allowable as a tax deduction under the Internal Revenue Code.
In addition, the Company sponsors a 401(k) savings plan; commencing
in fiscal 1996, the contributions of employees of certain
subsidiaries were partially matched by the Company, amounting to
$692,000, $554,000 and $499,000 in fiscal 1998, 1997 and 1996,
respectively.
b. Pension Plans - A domestic subsidiary of the Company has two pension
plans, one of which is active, covering its union employees. The
pension plans are noncontributory defined benefit plans. The
Company's funding policy is to contribute annually the amounts
necessary to satisfy applicable funding standards. On October 29,
1997, the Company acquired Dielektra GmbH, ("Dielektra"), including
its pension plan liability of $9,627,000. Dielektra has a
noncontributory defined benefit plan which covers certain employees.
Under the terms of the Dielektra plan, participants may not accrue
additional service time after December 31, 1987. The Company's
policy with respect to this plan is to contribute annually the
amounts necessary to fund current payment obligations of the plan.
In accordance with SFAS No. 87, the Company records its deferred
pension liability related to its three defined benefit pension plans,
which amounted to $10,543,000 and $1,134,000 at March 1, 1998 and
March 2, 1997, respectively. The effect on the Company's
consolidated financial statements in recording the liability was to
recognize an asset (included in other assets) of $230,000 and
$284,000 at March 1, 1998 and March 2, 1997, respectively, and to
record a corresponding reduction of stockholders' equity of
$1,039,000 and $850,000 at those same dates.
Net pension cost includes the following components:
<TABLE>
<CAPTION>
Fiscal Year
1998 1997 1996
<S> <C> <C> <C>
Service cost--benefits earned
during the period $ 54,000 $ 50,000 $ 51,000
Interest cost on projected
benefit obligation 494,000 289,000 299,000
Return on plan assets--actual (144,000) (155,000) (400,000)
Net amortization and deferral (10,000) 35,000 354,000
Effect of curtailment - 75,000 -
Net periodic pension cost $394,000 $294,000 $304,000
</TABLE>
<TABLE>
The funded status of the pension plans follows:
<CAPTION>
March 1, March 2,
1998 1997
<S> <C> <C>
Accumulated benefit obligation
(including vested benefit
obligation of $12,882,000
and $3,893,000, respectively) $13,025,000 $3,931,000
Projected benefit obligation $13,336,000 $3,931,000
Plan assets at fair value 3,164,000 2,937,000
Excess of projected benefit obligation
over plan assets 10,172,000 994,000
Unrecognized net loss (1,039,000) (850,000)
Unrecognized prior service cost ( 109,000) (135,000)
Unrecognized initial net obligation
being amortized over 15 years (119,000) (149,000)
Accrued pension (asset) liability $ 8,905,000 $ (140,000)
</TABLE>
The projected benefit obligation for the domestic plans was determined
using an assumed discount rate of 7.25% and 7.75% for fiscal 1998 and
1997, respectively, and the assumed long-term rate of return on plan
assets was 8% for both fiscal years. Projected wage increases are not
applicable as benefits pursuant to the plans are based upon years of
service without regard to levels of compensation.
At March 1, 1998, domestic plan assets were invested in U.S.
government securities, corporate debt securities, mutual funds and
money market funds.
The projected benefit obligation for the foreign plan was determined
using an assumed discount rate of 7.00% for fiscal 1998. Projected
wage increases of 2.50% were also assumed. As previously stated, the
Company's funding policy with respect to this plan is to contribute
annually the amounts necessary to meet current payment obligations of
the plan.
11. COMMITMENTS AND CONTINGENCIES
a. Lease Commitments - The Company conducts certain of its operations
from leased facilities, which include several manufacturing plants,
warehouses and offices, and land leases. The leases on facilities are
for terms of up to 10 years, the latest of which expires in 2005.
Many of the leases contain renewal options for periods ranging from
one to ten years and require the Company to pay real estate taxes and
other operating costs. The latest land lease expiration is 2013 and
this land lease contains renewal options of up to 35 years.
These noncancelable operating leases have the following payment
schedule:
Fiscal Year Amount
1999 $2,224,000
2000 2,100,000
2001 1,661,000
2002 1,379,000
2003 1,169,000
Thereafter 2,119,000
$10,652,000
Rental expense, inclusive of real estate taxes and other costs,
amounted to $2,781,000, $2,620,000 and $2,259,000 for fiscal 1998,
1997 and 1996, respectively.
b. Environmental Contingencies - The Company and certain of its subsid-
iaries have been named by the Environmental Protection Agency (the
"EPA") or a comparable state agency under the Comprehensive Environ-
mental Response, Compensation and Liability Act (the "Superfund Act")
or similar state law as potentially responsible parties in connection
with alleged releases of hazardous substances at nine sites. In
addition, a subsidiary of the Company has received cost recovery
claims under the Superfund Act from other private parties involving
three other sites, and has received requests from the EPA under the
Superfund Act for information with respect to its involvement at two
other sites.
Under the Superfund Act and similar state laws, all parties who may
have contributed any waste to a hazardous waste disposal site or
contaminated area identified by the EPA or comparable state agency may
be jointly and severally liable for the cost of cleanup. Generally,
these sites are locations at which numerous persons disposed of
hazardous waste. In the case of the Company's subsidiaries, generally
the waste was removed from their manufacturing facilities and disposed
at waste sites by various companies which contracted with the
subsidiaries to provide waste disposal services. Neither the Company
nor any of its subsidiaries have been accused of or charged with any
wrongdoing or illegal acts in connection with any such sites. The
Company believes it maintains an effective and comprehensive
environmental compliance program.
The insurance carriers that provided general liability insurance
coverage to the Company and its subsidiaries for the years during
which the Company's subsidiaries' waste was disposed at these sites
have agreed to pay, or reimburse the Company and its subsidiaries for,
100% of their legal defense and remediation costs associated with
three of these sites, 35% of such costs associated with one of these
sites and 25% of such costs associated with another three of these
sites.
The total costs incurred by the Company and its subsidiaries in
connection with these sites, including legal fees incurred by the
Company and its subsidiaries and their assessed share of remediation
costs and excluding amounts paid or reimbursed by insurance carriers,
were approximately $0.4 million during the 1998 fiscal year and
approximately $0.2 million during each of the 1997 and 1996 fiscal
years. The recorded liabilities in other liabilities for environmental
matters were $3.5 million and $1.2 million at March 1, 1998 and March
2, 1997, respectively. The environmental liability at March 1, 1998,
included an accrual of $2.3 million which was acquired when the
Company purchased Dielektra in October, 1997. Dielektra's liability
is for various compliance and remediation costs expected to be
incurred at its facility in Cologne, Germany over the next several
years.
Included in cost of sales are charges for actual expenditures and
accruals, based on estimates, for certain environmental matters
described above. The Company accrues estimated costs associated with
known environmental matters, when such costs can be reasonably
estimated and when the outcome appears probable. Management believes
the ultimate disposition of known environmental matters will not have
a material adverse effect on the liquidity, capital resources,
business or consolidated financial position of the Company. However,
one or more of such environmental matters could have a significant
negative impact on the Company's consolidated financial results for a
particular reporting period.
12. BUSINESS SEGMENTS
The Company has two major business segments: electronic materials and
engineered materials and plumbing hardware. The Company's electronic
materials products are marketed primarily to major independent printed
circuit board fabricators and to large electronic original equipment
manufacturers ("OEMs") that are located throughout North America, Europe
and Asia. The Company's engineered materials and plumbing hardware
customers, the majority of which are located in the United States, include
OEMs, independent firms and distributors in the electronics, aerospace,
industrial and plumbing industries.
Financial information concerning the Company's business segments follows
(in thousands):
<TABLE>
<CAPTION> Fiscal Year
1998 1997 1996
<S> <C> <C> <C>
Sales to unaffiliated customers:
Electronic materials $335,227 $291,146 $274,903
Engineered materials and
plumbing hardware 40,931 43,344 38,063
Net sales $376,158 $334,490 $312,966
Operating profit(1):
Electronic materials $ 35,132 $ 25,298 $ 37,699
Engineered materials and
plumbing hardware 3,928 3,026 1,466
Total operating profit 39,060 28,324 39,165
General corporate expense (4,288) (3,572) (4,090)
Interest and other income, net 8,382 7,653 2,285
Interest expense (5,468) (5,508) (96)
Total other income 2,914 2,145 2,189
Earnings before income taxes $ 37,686 $ 26,897 $ 37,264
Identifiable assets(2):
Electronic materials $210,714 $153,653 $146,549
Engineered materials and
plumbing hardware 13,884 14,111 13,260
224,598 167,764 159,809
Corporate assets 134,731 140,098 139,166
Total assets $359,329 $307,862 $298,975
Depreciation and amortization:
Electronic materials $ 12,403 $ 10,789 $ 9,013
Engineered materials and
plumbing hardware 785 774 813
13,188 11,563 9,826
Corporate depreciation 19 21 23
Total depreciation and
amortization $ 13,207 $ 11,584 $ 9,849
Capital expenditures:
Electronic materials $ 18,161 $ 18,030 $ 23,852
Engineered materials and
plumbing hardware 868 795 689
19,029 18,825 24,541
Corporate capital expenditures 11 26 21
Total capital expenditures $ 19,040 $ 18,851 $ 24,562
<FN>
(1) Operating profit is comprised of total operating revenues, less
costs and expenses other than interest expense, general corporate
expense and income taxes.
(2) Identifiable assets consist of those assets which are used by the
segments. Corporate identifiable assets consist primarily of cash,
cash equivalents and marketable securities.
</TABLE>
Intersegment sales and sales between geographic areas were not
significant.
Financial information regarding the Company's operations by geographic
area follows (in thousands):
<TABLE>
Fiscal Year
1998 1997 1996
<S> <C> <C> <C>
Sales:
North America $260,498 $235,773 $221,975
Europe 59,134 48,421 47,368
Asia 56,526 50,296 43,623
$376,158 $334,490 $312,966
Operating profit:
North America $ 26,242 $ 21,550 $ 33,206
Rest of World 12,818 6,774 5,959
$ 39,060 $ 28,324 $ 39,165
Identifiable assets:
North America $248,443 $245,596 $241,191
Europe 66,952 33,751 31,291
Asia 43,934 28,515 26,493
$359,329 $307,862 $298,975
</TABLE>
13. CUSTOMER AND SUPPLIER CONCENTRATIONS
a. Customers - Sales to Delco Electronics Corporation, a subsidiary of
General Motors Corp., were 15.8%, 17.3% and 17.1% of the Company's
total sales worldwide for fiscal 1998, 1997 and 1996, respectively.
The Company has been informed by Delco Electronics that Delco plans
to close its printed circuit board fabrication plant and exit the
printed circuit board manufacturing business in the 1998 calendar
year. After the plant closure Delco will no longer be a customer of
the Company.
While no other customer accounts for 10% or more of the total sales
of the Company in fiscal 1998 and the Company is not dependent on any
other single customer, the loss of a major customer or of a group of
customers within each significant business segment could have a
material adverse effect on the Company's business.
b. Sources of Supply - The principal materials used in the manufacture
of the Company's electronic materials products are specially
manufactured copper foil, fiberglass cloth and synthetic
reinforcements, and specially formulated resins and chemicals.
Although there are a limited number of qualified suppliers of these
materials, the Company has nevertheless identified alternate sources
of supply for each of the aforementioned materials. While the
Company has not experienced significant problems in the delivery of
these materials and considers its relationships with its suppliers to
be strong, a disruption of the supply of material from a principal
supplier could adversely affect the electronic materials segment's
business. Furthermore, substitutes for the aforesaid materials are
not readily available and an inability to obtain essential materials,
if prolonged, could materially adversely affect the business of the
electronic materials segment.
14. ACQUISITION
On October 29, 1997, the Company acquired Dielektra GmbH ("Dielektra").
Dielektra, located in Cologne, Germany, is a manufacturer of advanced
electronic materials used to produce sophisticated multilayer printed
circuit boards. Dielektra's advanced circuit materials product line
includes very high layer count semi-finished multilayer printed circuit
boards and very thin continuously produced copper-clad laminates. The
purchase price was comprised of $8.8 million in cash, 77,000 shares of
Park common stock having a fair market value of $2.1 million and an
additional 103,000 shares of Park common stock, having a fair market
value of $2.7 million, due five years after the purchase date. The
acquisition of Dielektra is being accounted for as a purchase. The
purchase price of the acquisition has been allocated on the basis of
the estimated fair value of the assets acquired and liabilities
assumed. There was no goodwill recognized as a result of this
acquisition. Dielektra's operating results are included in the
Company's consolidated statements of earnings from the date of
acquisition. Pro forma operating results are not presented because the
impact of including Dielektra on the Company's consolidated operating
income is immaterial for fiscal 1998 and 1997.
15. SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)
[CAPTION]
<TABLE>
Quarter
First Second Third Fourth
(In thousands, except per share amounts)
<S> <C> <C> <C> <C>
Fiscal 1998:
Net sales $91,633 $83,086 $97,625 $103,814
Gross profit 18,041 14,940 19,851 21,358
Net earnings 6,165 4,852 6,996 7,237
Earnings per share:
Basic $.55 $.43 $.62 $.63
Diluted $.51 $.41 $.56 $.58
Weighted average common shares
outstanding:
Basic 11,273 11,283 11,366 11,492
Diluted 13,847 13,915 13,993 14,118
Fiscal 1997:
Net sales $75,406 $81,974 $88,972 $88,138
Gross profit 11,832 14,854 15,385 17,047
Net earnings 3,125 4,681 4,888 5,865
Earnings per share:
Basic $.27 $.41 $.43 $.52
Diluted $.26 $.40 $.42 $.49
Weighted average common shares
outstanding:
Basic 11,555 11,412 11,256 11,266
Diluted 11,829 13,960 13,814 13,848
</TABLE>
Earnings per share is computed separately for each quarter. Therefore,
the sum of such quarterly per share amounts may differ from the total
for the years.
*******
Item 9. Changes in and Disagreements with Accountants on Accounting
and Financial Disclosure.
Not applicable.
PART III
Item 10. Directors and Executive Officers of the Registrant.
The information called for by this Item (except for information as
to the Company's executive officers, which information appears elsewhere in
this Report) is incorporated by reference to the Company's definitive proxy
statement for the 1998 Annual Meeting of Shareholders to be filed pursuant
to Regulation 14A.
Item 11. Executive Compensation.
The information called for by this Item is incorporated by
reference to the Company's definitive proxy statement for the 1998 Annual
Meeting of Shareholders to be filed pursuant to Regulation 14A.
Item 12. Security Ownership of Certain Beneficial Owners and Management.
The information called for by this Item is incorporated by
reference to the Company's definitive proxy statement for the 1998 Annual
Meeting of Shareholders to be filed pursuant to Regulation 14A.
Item 13. Certain Relationships and Related Transactions.
The information called for by this Item is incorporated by
reference to the Company's definitive proxy statement for the 1998 Annual
Meeting of Shareholders to be filed pursuant to Regulation 14A.
PART IV
Item 14. Exhibits, Financial Statement Page
Schedules, and Reports on Form 8-K.
(a) Documents filed as a part of this report
(1) Financial Statements:
The following Consolidated Financial
Statements of the Company are
included in Part II, Item 8:
Report of Ernst & Young LLP,
independent auditors 25
Balance sheets 26
Statements of earnings 27
Statements of stockholders' equity 28
Statements of cash flows 29
Notes to consolidated financial
statements (1-15) 30
(2) Financial Statement Schedules:
Schedule II - Valuation and qualifying
accounts 54
All other schedules have been omitted because
they are inapplicable or not required, or the
information is included elsewhere in the
financial statements or notes thereto.
<PAGE>
(3)Exhibits:
Exhibit
Number Description
3.01 Restated Certificate of Incorporation, as amended (Reference is
made to Exhibit 3.01 of the Company's Quarterly Report on Form
10-Q for the fiscal quarter ended August 27, 1995, Commission
File No. 1-4415, which is incorporated herein by reference.)
3.02 By-Laws, as amended July 16, 1997.
4.01 Amended and Restated Rights Agreement, dated as of July 12,
1995, between the Company and Registrar and Transfer Company, as
Rights Agent, relating to the Company's Preferred Stock Purchase
Rights. (Reference is made to Exhibit 1 to Amendment No. 1 on
Form 8-A/A to the Company's Registration Statement on Form 8-A
filed on August 10, 1995, Commission File No. 1-4415, which is
incorporated herein by reference.)
4.02 Form of Indenture, dated as of February 1, 1996, between the
Company and The Chase Manhattan Bank, N.A., as Trustee, relating
to the Company's 5.5% Convertible Subordinated Notes due 2006
(Reference is made to Exhibit 1.02 to Amendment No. 1 to the
Company's Form S-3 Registration Statement, Registration No. 333-
00213, as filed with the Securities and Exchange Commission on
February 1, 1996, which is incorporated herein by reference.)
Information concerning Registrant's long-term debt is set forth
in Note 6 of the Notes to Consolidated Financial Statements
included in Item 8 of this Report. Other than the Indenture
filed as Exhibit 4.02 hereto, no instrument defining the rights
of holders of such long-term debt relates to securities having
an aggregate principal amount in excess of 10% of the consoli-
dated total assets of Registrant and its subsidiaries;
therefore, in accordance with paragraph (iii) of Item 4 of Item
601(b) of Regulation S-K, the other instruments defining the
rights of holders of long-term debt are not filed herewith.
Registrant hereby agrees to furnish a copy of any such other
instruments to the Securities and Exchange Commission upon
request.
10.01 Lease dated December 12, 1989 between Nelco Products, Inc. and
James Emmi regarding real property located at 1100 East Kimberly
Avenue, Anaheim, California and letter dated December 29, 1994
from Nelco Products, Inc. to James Emmi exercising its option to
extend such Lease. (Reference is made to Exhibit 10.01 of the
Company's Annual Report on Form 10-K for the fiscal year ended
March 3, 1996, Commission File No. 1-4415, which is incorporated
herein by reference.)
10.02 Lease dated December 12, 1989 between Nelco Products, Inc. and
James Emmi regarding real property located at 1107 East Kimberly
Avenue, Anaheim, California and letter dated December 29, 1994
from Nelco Products, Inc. to James Emmi exercising its option to
extend such Lease. (Reference is made to Exhibit 10.02 of the
Company's Annual Report on Form 10-K for the fiscal year ended
March 3, 1996, Commission File No. 1-4415, which is incorporated
herein by reference.)
Exhibit
Number Description
10.03 Lease Agreement dated August 16, 1983 and Exhibit C, First
Addendum to Lease, between Nelco Products, Inc. and
TCLW/Fullerton regarding real property located at 1411 E.
Orangethorpe Avenue, Fullerton, California. (Reference is made
to Exhibit 10.03 of the Company's Annual Report on Form 10-K for
the fiscal year ended March 3, 1996, Commission File No. 1-4415,
which is incorporated herein by reference.)
10.03(a) Second Addendum to Lease dated January 26, 1987 to Lease
Agreement dated August 16, 1983 (see Exhibit 10.03 hereto)
between Nelco Products, Inc. and TCLW/Fullerton regarding real
property located at 1421 E. Orangethorpe Avenue, Fullerton,
California. (Reference is made to Exhibit 10.03(a) of the
Company's Annual Report on Form 10-K for the fiscal year ended
February 26, 1995, Commission File No. 1-4415, which is incorpo-
rated herein by reference.)
10.03(b) Third Addendum to Lease dated January 7, 1991 and Fourth
Addendum to Lease dated January 7, 1991 to Lease Agreement dated
August 16, 1983 (see Exhibit 10.03 hereto) between Nelco
Products, Inc. and TCLW/Fullerton regarding real property
located at 1411, 1421 and 1431 E. Orangethorpe Avenue,
Fullerton, California. (Reference is made to Exhibit 10.03(b) of
the Company's Annual Report on Form 10-K for the fiscal year
ended March 2, 1997, Commission File No. 1-4415, which is
incorporated herein by reference.)
10.03(c) Fifth Addendum to Lease dated July 5, 1995 to Lease Agreement
dated August 16, 1983 (See Exhibit 10.03 hereto) between Nelco
Products, Inc. and TCLW/Fullerton regarding real property
located at 1411 E. Orangethorpe Avenue, Fullerton, California.
(Reference is made to Exhibit 10.03(c) of the Company's Annual
Report on Form 10-K for the fiscal year ended March 3, 1996,
Commission File No. 1-4415, which is incorporated herein by
reference.)
10.04 Lease dated February 15, 1983 between Nelco Products, Inc. and
CMD Southwest, Inc. regarding real property located at 1130 West
Geneva Drive, Tempe, Arizona. (Reference is made to Exhibit
10.04 of the Company's Annual Report on Form 10-K for the fiscal
year ended March 3, 1996, Commission File No. 1-4415, which is
incorporated herein by reference.)
10.04(a) First Amendment to Lease dated December 10, 1992 to Lease dated
February 15, 1983 (see Exhibit 10.04 hereto) between Nelco
Technology, Inc. and CMD Southwest Inc., and novation
substituting Nelco Technology, Inc. for Nelco Products, Inc.,
regarding real property located at 1130 West Geneva Drive,
Tempe, Arizona. (Reference is made to Exhibit 10.04(a) of the
Company's Annual Report on Form 10-K for the fiscal year ended
February 28, 1993, Commission File No. 1-4415, which is
incorporated herein by reference.)
10.04(b) Letter dated August 28, 1997 from Nelco Technology, Inc. to SPT
Real Estate Corp. E extending the Lease dated February 15, 1983
(see Exhibit 10.04 hereto) and Second Amendment to Lease dated
February 2, 1998 to Lease dated February 15, 1993 (see Exhibit
10.04 hereto) between Nelco Technology, Inc. and SPT Real Estate
Corp. E regarding real property located at 1130 West Geneva
Drive, Tempe, Arizona.
Exhibit
Number Description
10.05 Lease Agreement dated May 26, 1982 between Nelco Products Pte.
Ltd. (lease was originally entered into by Kiln Technique (Pri-
vate) Limited, which subsequently assigned this lease to Nelco
Products Pte. Ltd.) and the Jurong Town Corporation regarding
real property located at 4 Gul Crescent, Jurong, Singapore.
(Reference is made to Exhibit 10.05 of the Company's Annual
Report on Form 10-K for the fiscal year ended February 28, 1993,
Commission File No. 1-4415, which is incorporated herein by
reference.)
10.05(a) Deed of Assignment, dated April 17, 1986 between Nelco Products
Pte. Ltd., Kiln Technique (Private) Limited and Paul Ma, Richard
Law, and Michael Ng, all of Peat Marwick & Co., of the Lease
Agreement dated May 26, 1982 (see Exhibit 10.05 hereto) between
Kiln Technique (Private) Limited and the Jurong Town Corporation
regarding real property located at 4 Gul Crescent, Jurong,
Singapore. (Reference is made to Exhibit 10.05(a) of the Com-
pany's Annual Report on Form 10-K for the fiscal year ended
February 28, 1993, Commission File No. 1-4415, which is incorpo-
rated herein by reference.)
10.06(a) Amended and Restated 1982 Stock Option Plan of the Company.
(Reference is made to Exhibit 10.06(a) of the Company's Annual
Report on Form 10-K for the fiscal year ended March 1, 1992,
Commission File No. 1-4415, which exhibit is incorporated herein
by reference. This exhibit is a management contract or
compensatory plan or arrangement.)
10.06(b) 1992 Stock Option Plan of the Company, as amended by First
Amendment thereto. (This exhibit is a management contract or
compensatory plan or arrangement.)
10.07 Amended and Restated Employment Agreement dated February 28,
1994 between the Company and Jerry Shore. (Reference is made to
Exhibit 10.07(c) of the Company's Annual Report on Form 10-K for
the fiscal year ended February 27, 1994, Commission File No. 1-
4415, which is incorporated herein by reference. This exhibit
is a management contract or compensatory plan or arrangement.)
10.07(a) Amendment No. 1 dated March 1, 1995 to the Amended and Restated
Employment Agreement dated February 28, 1994 (see Exhibit 10.07
hereto) between the Company and Jerry Shore. (Reference is made
to Exhibit 10.07(c) of the Company's Annual Report on Form 10-K
for the fiscal year ended February 26, 1995, Commission File No.
1-4415, which is incorporated herein by reference. This exhibit
is a management contract or compensatory plan or arrangement.)
10.07(b) Amendment No. 2 dated December 5, 1996 to the Amended and
Restated Employment Agreement dated February 28, 1994 (see
Exhibit 10.07 hereto) between the Company and Jerry Shore.
(Reference is made to Exhibit 10.07(b) of the Company's Annual
Report on Form 10-K for the fiscal year ended March 2, 1997,
Commission File No. 1-4415, which is incorporated herein by
reference. This exhibit is a management contract or
compensatory plan or arrangement.)
10.07(c) Amendment No. 3 dated October 14, 1997 to the Amended and
Restated Employment Agreement dated February 28, 1994 (see
Exhibit 10.07 hereto) between the Company and Jerry Shore. (This
exhibit is a management contract or compensatory plan or
arrangement.)
Exhibit
Number Description
10.08 Lease dated April 15, 1988 between FiberCote Industries, Inc.
(lease was initially entered into by USP Composites, Inc., which
subsequently changed its name to FiberCote Industries, Inc.) and
Geoffrey Etherington, II regarding real property located at 172
East Aurora Street, Waterbury, Connecticut. (Reference is made
to Exhibit 10.08 of the Company's Annual Report on form 10-K for
the fiscal year ended February 26, 1995, Commission File No. 1-
4415, which is incorporated herein by reference.)
10.08(a) Amendment to Lease dated December 21, 1992 to Lease dated April
15, 1988 (see Exhibit 10.08 hereto) between FiberCote Indus-
tries, Inc. and Geoffrey Etherington II regarding real property
located at 172 East Aurora Street, Waterbury, Connecticut.
(Reference is made to Exhibit 10.08(a) of the Company's Annual
Report on Form 10-K for the fiscal year ended February 28, 1993,
Commission File No. 1-4415, which is incorporated herein by
reference.)
10.08(b) Letter dated June 30, 1997 from FiberCote Industries, Inc. to
Geoffrey Etherington II extending the Lease dated April 15, 1988
(see Exhibit 10.08 hereto) between FiberCote Industries, Inc.
and Geoffrey Etherington II regarding real property located at
172 East Aurora Street, Waterbury, Connecticut.
10.09 Lease dated March 14, 1988 between Nelco Products, Inc. and CMD
Southwest One regarding real property located at 1117 West
Fairmont, Tempe, Arizona. (Reference is made to Exhibit 10.09
of the Company's Annual Report on Form 10-K for the fiscal year
ended February 26, 1995, Commission File No. 1-4415, which is
incorporated herein by reference.)
10.09(a) First Amendment to Lease dated December 10, 1992 to Lease dated
March 14, 1988 (see Exhibit 10.09 hereto) between Nelco
Technology, Inc. and CMD Southwest One regarding real property
located at 1117 West Fairmont, Tempe, Arizona, and novation
substituting Nelco Technology, Inc. for Nelco Products, Inc.
(Reference is made to Exhibit 10.09(a) of the Company's Annual
Report on Form 10-K for the fiscal year ended February 28, 1993,
Commission File No. 1-4415, which is incorporated herein by
reference.)
10.09(b) Second Amendment to Lease dated March 24, 1995 to Lease dated
March 14, 1988 (see Exhibit 10.09 hereto) between Nelco
Technology, Inc. and CMD Southwest One regarding real property
located at 1117 West Fairmont, Tempe, Arizona. (Reference is
made to Exhibit 10.09(b) of the Company's Annual Report on Form
10-K for the fiscal year ended March 3, 1996, Commission File
No. 1-4415, which is incorporated herein by reference.)
10.09(c) Third Amendment to Lease dated January 18, 1996 to Lease dated
March 14, 1988 (see Exhibit 10.09 hereto) between Nelco
Technology, Inc. and CMD Southwest One regarding real property
located at 1117 West Fairmont, Tempe, Arizona. (Reference is
made to Exhibit 10.09(c) of the Company's Annual Report on Form
10-K for the fiscal year ended March 3, 1996, Commission File
No. 1-4415, which is incorporated herein by reference.)
10.10 Lease dated October 1, 1991 between Zin-Plas Corporation and
Philip L. Johnson d/b/a Johnson Development Company regarding
real property located at 25 North Park, N.E., Comstock Park,
Michigan. (Reference is made to Exhibit 10.10 of the Company's
Annual Report on Form 10-K for the fiscal year ended February
28, 1993, Commission File No. 1-4415, which is incorporated
herein by reference.)
Exhibit
Number Description
10.10(a) Letter dated October 17, 1996 from Zin-Plas Corporation to
Philip L. Johnson extending the Lease dated October 1, 1991 (see
Exhibit 10.10 hereto) between Zin-Plas Corporation and Philip L.
Johnson d/b/a Johnson Development Company regarding real
property located at 25 North Park, N.E., Comstock Park,
Michigan. (Reference is made to Exhibit 10.10(a) of the
Company's Annual Report on Form 10-K for the fiscal year ended
March 2, 1997, Commission File No. 1-4415, which is incorporated
herein by reference.)
10.11 Lease dated August 31, 1989 between Nelco Technology, Inc. and
Cemanudi Associates regarding real property located at 1104 West
Geneva Drive, Tempe, Arizona. (Reference is made to Exhibit
10.11 of the Company's Annual Report on Form 10-K for the fiscal
year ended March 3, 1996, Commission File No. 1-4415, which is
incorporated herein by reference.)
10.11(a) First Amendment to Lease dated October 21, 1994 to Lease dated
August 31, 1989 (see Exhibit 10.11 hereto) between Nelco
Technology, Inc. and Cemanudi Associates regarding real property
located at 1104 West Geneva Drive, Tempe, Arizona. (Reference
is made to Exhibit 10.11(a) of the Company's Annual Report on
Form 10-K for the fiscal year ended February 26, 1995,
Commission File No. 1-4415, which is incorporated herein by
reference.)
10.12 Lease dated March 24, 1995 between Nelco Technology, Inc. and
CMD Southwest Inc. regarding real property located at 1131 West
Fairmont, Tempe, Arizona. (Reference is made to Exhibit 10.12
of the Company's Annual Report on Form 10-K for the fiscal year
ended March 3, 1996, Commission File No. 1-4415, which is
incorporated herein by reference.)
10.12(a) First Amendment to Lease dated January 18, 1996 to Lease dated
March 24, 1995 (see Exhibit 10.12 hereto) between Nelco
Technology, Inc. and CMD Southwest Inc. regarding real property
located at 1131 West Fairmont, Tempe, Arizona. (Reference is
made to Exhibit 10.12(a) of the Company's Annual Report on Form
10-K for the fiscal year ended March 3, 1996, Commission File
No. 1-4415, which is incorporated herein by reference.)
10.13 Lease dated December 12, 1990 between Neltec, Inc. and NZ
Properties, Inc. regarding real property located at 1420 W. 12th
Place, Tempe, Arizona. (Reference is made to Exhibit 10.13 of
the Company's Annual Report on Form 10-K for the fiscal year
ended March 2, 1997, Commission File No. 1-4415, which is
incorporated herein by reference.)
10.13(a) Letter dated January 8, 1996 from Neltec, Inc. to NZ Properties,
Inc. exercising its option to extend the Lease dated December
12, 1990 (see Exhibit 10.13 hereto) between Neltec, Inc. and NZ
Properties, Inc. regarding real property located at 1420 W. 12th
Place, Tempe, Arizona. (Reference is made to Exhibit 10.13(a) of
the Company's Annual Report on Form 10-K for the fiscal year
ended March 2, 1997, Commission File No. 1-4415, which is
incorporated herein by reference.)
10.14 Indenture of Lease dated November 1, 1984 between Dielectric
Polymers, Inc. and Holyoke Supply Company, Inc. regarding real
property located at 218 Race Street, Holyoke, Massachusetts.
(Reference is made to Exhibit 10.14 of the Company's Annual
Report on Form 10-K for the fiscal year ended February 28, 1993,
Commission File No. 1-4415, which is incorporated herein by
reference.)
Exhibit
Number Description
10.14(a) Extension of Lease dated May 30, 1986 to Indenture of Lease
dated November 1, 1984 (see Exhibit 10.14 hereto) between
Dielectric Polymers, Inc. and Holyoke Supply Company, Inc.
regarding real property located at 218 Race Street, Holyoke,
Massachusetts. (Reference is made to Exhibit 10.14(a) of the
Company's Annual Report on Form 10-K for the fiscal year ended
February 28, 1993, Commission File No. 1-4415, which is
incorporated herein by reference.)
10.14(b) Second Extension of Lease dated May 30, 1991 to Indenture of
Lease dated November 1, 1984 (see Exhibit 10.14 hereto) between
Dielectric Polymers, Inc. and Holyoke Supply Company, Inc.
regarding real property located at 218 Race Street, Holyoke,
Massachusetts. (Reference is made to Exhibit 10.14(b) of the
Company's Annual Report on Form 10-K for the fiscal year ended
February 28, 1993, Commission File No. 1-4415, which is
incorporated herein by reference.)
10.14(c) Amendment to Second Extension of Lease dated May 19, 1994 to
Indenture of Lease dated November 1, 1984 (see Exhibit 10.14
hereto) between Dielectric Polymers, Inc. and Holyoke Supply
Company, Inc. regarding real property located at 218 Race
Street, Holyoke, Massachusetts. (Reference is made to Exhibit
10.14(c) of the Company's Annual Report on Form 10-K for the
fiscal year ended February 27, 1994, Commission File No. 1-4415,
which is incorporated herein by reference.)
10.14(d) 1995 Extension to Amendment to Second Extension of Lease dated
October 19, 1995 to Indenture of Lease dated November 1, 1984
(see Exhibit 10.14 hereto) between Dielectric Polymers, Inc. and
Holyoke Supply Company, Inc. regarding real property located at
218 Race Street, Holyoke, Massachusetts. (Reference is made to
Exhibit 10.14(d) of the Company's Annual Report on Form 10-K for
the fiscal year ended March 3, 1996, Commission File No. 1-4415,
which is incorporated herein by reference.)
10.14(e) Letter dated July 31, 1996 from Dielectric Polymers, Inc. to
Holyoke Supply Company, Inc. exercising its option to extend the
Indenture of Lease dated November 1, 1984 (see Exhibit 10.14
hereto) between Dielectric Polymers, Inc. and Holyoke Supply
Company, Inc. regarding real property located at 218 Race
Street, Holyoke, Massachusetts. (Reference is made to Exhibit
10.14(e) of the Company's Annual Report on Form 10-K for the
fiscal year ended March 2, 1997, Commission File No. 1-4415,
which is incorporated herein by reference.)
10.14(f) 1997 Extension to Amendment to Second Extension of Lease dated
March 26, 1997 to Indenture of Lease dated November 1, 1984 (see
Exhibit 10.14 hereto) between Dielectric Polymers, Inc. and
Holyoke Supply Company, Inc. regarding real property located at
218 Race Street, Holyoke, Massachusetts. (Reference is made to
Exhibit 10.14(f) of the Company's Annual Report on Form 10-K for
the fiscal year ended March 2, 1997, Commission File No. 1-4415,
which is incorporated herein by reference.)
10.14(g) Letter dated August 27, 1997 from Dielectric Polymers, Inc. to
Holyoke Supply Company, Inc. extending the Indenture of Lease
(see Exhibit 10.14 hereto) between Dielectric Polymers, Inc. and
Holyoke Supply Company, Inc. regarding real property located at
218 Race Street, Holyoke, Massachusetts.
Exhibit
Number Description
10.15 Lease dated January 8, 1992 between Nelco Technology, Inc. and
CMD Southwest, Inc. regarding real property located at 1135 West
Geneva Drive, Tempe, Arizona. (Reference is made to Exhibit
10.15 of the Company's Annual Report on Form 10-K for the fiscal
year ended March 1, 1992, Commission File No. 1-4415, which is
incorporated herein by reference.)
10.15(a) First Amendment dated July 8, 1996 to Lease dated January 8,
1992 (see Exhibit 10.15 hereto) between Nelco Technology, Inc.
and CMD Southwest, Inc. regarding real property located at 1135
West Geneva Drive, Tempe, Arizona. (Reference is made to Exhibit
10.15(a) of the Company's Annual Report on Form 10-K for the
fiscal year ended March 2, 1997, Commission File No. 1-4415,
which is incorporated herein by reference.)
10.16 Tenancy Agreement dated October 8, 1992 between Nelco Products
Pte. Ltd. and Jurong Town Corporation regarding real property
located at 36 Gul Lane, Jurong Town, Singapore. (Reference is
made to Exhibit 10.18 of the Company's Annual Report on Form 10-
K for the fiscal year ended February 28, 1993, Commission File
No. 1-4415, which is incorporated herein by reference.)
10.16(a) Tenancy Agreement dated November 3, 1995 between Nelco Products
Pte. Ltd. and Jurong Town Corporation regarding real property
located at 36 Gul Lane, Jurong Town, Singapore. (Reference is
made to Exhibit 10.16(a) of the Company's Annual Report on Form
10-K for the fiscal year ended March 2, 1997, Commission File
No. 1-4415, which is incorporated herein by reference.)
10.17 Lease Contract dated February 26, 1988 between the New York
State Department of Transportation and the Edgewater Stewart
Company regarding real property located at 15 Governor Drive in
the Stewart International Airport Industrial Park, New Windsor,
New York. (Reference is made to Exhibit 10.19 of the Company's
Annual Report on Form 10-K for the fiscal year ended February
26, 1995, Commission File No. 1-4415, which is incorporated
herein by reference.)
10.17(a) Assignment and Assumption of Lease dated February 16, 1995
between New England Laminates Co., Inc. and The Edgewater
Stewart Company regarding the assignment of the Lease Contract
(see Exhibit 10.17 hereto) for the real property located at 15
Governor Drive in the Stewart International Airport Industrial
Park, New Windsor, New York. (Reference is made to Exhibit
10.19(a) of the Company's Annual Report on Form 10-K for the
fiscal year ended February 26, 1995, Commission File No. 1-4415,
which is incorporated herein by reference.)
10.17(b) Lease Amendment No. 1 dated February 17, 1995 between New
England Laminates Co., Inc. and the New York State Department of
Transportation to Lease Contract dated February 26, 1988 (see
Exhibit 10.17 hereto) regarding the real property located at 15
Governor Drive in the Stewart International Airport Industrial
Park, New Windsor, New York. (Reference is made to Exhibit
10.19(b) of the Company's Annual Report on Form 10-K for the
fiscal year ended February 26, 1995, Commission File No. 1-4415,
which is incorporated herein by reference.)
Exhibit
Number Description
10.18 Employment Agreement, dated March 18, 1996, between the Company
and E. Phillip Smoot. (Reference is made to Exhibit 10.20 of
the Company's Annual Report on Form 10-K for the fiscal year
ended March 3, 1996, Commission File No. 1-4415, which is
incorporated herein by reference. This exhibit is a management
contract or compensatory plan or arrangement.)
10.19 Sale and Purchase Agreement dated 29 October 1997 between Dieter
G. Weiss, Lothar Hubert Reinartz, Nelco International
Corporation and Park Electrochemical Corp. relating to the sale
and purchase of shares of capital in Dielektra GmbH. (Reference
is made to Exhibit 10.01 of the Company's Quarterly Report on
Form 10-Q for the fiscal quarter ended November 30, 1997,
Commission File No. 1-4415, which is incorporated herein by
reference.)
21.01 Subsidiaries of the Company.
23.01 Consent of Ernst & Young LLP.
27.01(a) Financial Data Schedule - Annual information restated for impact
of SFAS 128 Change to Earnings Per Share Calculations.
27.01(b) Financial Data Schedule - First quarter information restated for
impact of SFAS 128 Change to Earnings Per Share Calculations.
27.01(c) Financial Data Schedule - Second quarter information restated
for impact of SFAS 128 Change to Earnings Per Share
Calculations.
27.01(d) Financial Data Schedule - Third quarter information restated for
impact of SFAS 128 Change to Earnings Per Share Calculations.
(b) No reports on Form 8-K have been filed during the fiscal quarter
ended March 1, 1998.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
Date: May 27, 1998 PARK ELECTROCHEMICAL CORP.
By:/s/Brian E. Shore
Brian E. Shore,
Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
Signature Title Date
/s/Brian E. Shore Chief Executive Officer,
Brian E. Shore President and Director
(principal executive and May 27, 1998
financial officer)
/s/Murray O. Stamer Corporate Controller
Murray O. Stamer (principal accounting
officer) May 27, 1998
/s/E. Phillip Smoot Director
E. Phillip Smoot May 27, 1998
/s/Jerry Shore Chairman of the Board and
Jerry Shore Director May 27, 1998
/s/Anthony Chiesa Director
Anthony Chiesa May 27, 1998
/s/Lloyd Frank Director
Lloyd Frank May 27, 1998
<TABLE>
Schedule II
PARK ELECTROCHEMICAL CORP. AND SUBSIDIARIES
<CAPTION>
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
Column A Column B Column C Column D Column E
Balance at Charged to Other Balance at
Beginning Cost and Accounts Translation End
Description of Period Expenses Written Off Adjustment of Period
(A)
ALLOWANCE FOR DOUBTFUL ACCOUNTS:
<S> <C> <C> <C> <C> <C>
52 weeks ended March 1, 1998 $1,746,000 $ 75,000 $ 46,000 (B) $ (9,000) $1,858,000
52 weeks ended March 2, 1997 $1,857,000 $(306,000) $ 204,000 $ (9,000) $1,746,000
53 weeks ended March 3, 1996 $2,490,000 $(495,000) $(128,000) $(10,000) $1,857,000
<FN>
(A) Uncollectible accounts, net of recoveries.
(B) Includes $169,000 acquired in business acquisition.
</TABLE>
=================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________
EXHIBITS
filed with
FORM 10-K
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended March 1, 1998
___________________
PARK ELECTROCHEMICAL CORP.
=================================================
Exhibit
Number Description
3.01 Restated Certificate of Incorporation, as amended (Reference is
made to Exhibit 3.01 of the Company's Quarterly Report on Form
10-Q for the fiscal quarter ended August 27, 1995, Commission
File No. 1-4415, which is incorporated herein by reference.)
3.02 By-Laws, as amended July 16, 1997.
4.01 Amended and Restated Rights Agreement, dated as of July 12,
1995, between the Company and Registrar and Transfer Company, as
Rights Agent, relating to the Company's Preferred Stock Purchase
Rights. (Reference is made to Exhibit 1 to Amendment No. 1 on
Form 8-A/A to the Company's Registration Statement on Form 8-A
filed on August 10, 1995, Commission File No. 1-4415, which is
incorporated herein by reference.)
4.02 Form of Indenture, dated as of February 1, 1996, between the
Company and The Chase Manhattan Bank, N.A., as Trustee, relating
to the Company's 5.5% Convertible Subordinated Notes due 2006
(Reference is made to Exhibit 1.02 to Amendment No. 1 to the
Company's Form S-3 Registration Statement, Registration No. 333-
00213, as filed with the Securities and Exchange Commission on
February 1, 1996, which is incorporated herein by reference.)
Information concerning Registrant's long-term debt is set forth
in Note 6 of the Notes to Consolidated Financial Statements
included in Item 8 of this Report. Other than the Indenture
filed as Exhibit 4.02 hereto, no instrument defining the rights
of holders of such long-term debt relates to securities having
an aggregate principal amount in excess of 10% of the consoli-
dated total assets of Registrant and its subsidiaries;
therefore, in accordance with paragraph (iii) of Item 4 of Item
601(b) of Regulation S-K, the other instruments defining the
rights of holders of long-term debt are not filed herewith.
Registrant hereby agrees to furnish a copy of any such other
instruments to the Securities and Exchange Commission upon
request.
10.01 Lease dated December 12, 1989 between Nelco Products, Inc. and
James Emmi regarding real property located at 1100 East Kimberly
Avenue, Anaheim, California and letter dated December 29, 1994
from Nelco Products, Inc. to James Emmi exercising its option to
extend such Lease. (Reference is made to Exhibit 10.01 of the
Company's Annual Report on Form 10-K for the fiscal year ended
March 3, 1996, Commission File No. 1-4415, which is incorporated
herein by reference.)
10.02 Lease dated December 12, 1989 between Nelco Products, Inc. and
James Emmi regarding real property located at 1107 East Kimberly
Avenue, Anaheim, California and letter dated December 29, 1994
from Nelco Products, Inc. to James Emmi exercising its option to
extend such Lease. (Reference is made to Exhibit 10.02 of the
Company's Annual Report on Form 10-K for the fiscal year ended
March 3, 1996, Commission File No. 1-4415, which is incorporated
herein by reference.)
Exhibit
Number Description
10.03 Lease Agreement dated August 16, 1983 and Exhibit C, First
Addendum to Lease, between Nelco Products, Inc. and
TCLW/Fullerton regarding real property located at 1411 E.
Orangethorpe Avenue, Fullerton, California. (Reference is made
to Exhibit 10.03 of the Company's Annual Report on Form 10-K for
the fiscal year ended March 3, 1996, Commission File No. 1-4415,
which is incorporated herein by reference.)
10.03(a) Second Addendum to Lease dated January 26, 1987 to Lease
Agreement dated August 16, 1983 (see Exhibit 10.03 hereto)
between Nelco Products, Inc. and TCLW/Fullerton regarding real
property located at 1421 E. Orangethorpe Avenue, Fullerton,
California. (Reference is made to Exhibit 10.03(a) of the
Company's Annual Report on Form 10-K for the fiscal year ended
February 26, 1995, Commission File No. 1-4415, which is incorpo-
rated herein by reference.)
10.03(b) Third Addendum to Lease dated January 7, 1991 and Fourth
Addendum to Lease dated January 7, 1991 to Lease Agreement dated
August 16, 1983 (see Exhibit 10.03 hereto) between Nelco
Products, Inc. and TCLW/Fullerton regarding real property
located at 1411, 1421 and 1431 E. Orangethorpe Avenue,
Fullerton, California. (Reference is made to Exhibit 10.03(b) of
the Company's Annual Report on Form 10-K for the fiscal year
ended March 2, 1997, Commission File No. 1-4415, which is
incorporated herein by reference.)
10.03(c) Fifth Addendum to Lease dated July 5, 1995 to Lease Agreement
dated August 16, 1983 (See Exhibit 10.03 hereto) between Nelco
Products, Inc. and TCLW/Fullerton regarding real property
located at 1411 E. Orangethorpe Avenue, Fullerton, California.
(Reference is made to Exhibit 10.03(c) of the Company's Annual
Report on Form 10-K for the fiscal year ended March 3, 1996,
Commission File No. 1-4415, which is incorporated herein by
reference.)
10.04 Lease dated February 15, 1983 between Nelco Products, Inc. and
CMD Southwest, Inc. regarding real property located at 1130 West
Geneva Drive, Tempe, Arizona. (Reference is made to Exhibit
10.04 of the Company's Annual Report on Form 10-K for the fiscal
year ended March 3, 1996, Commission File No. 1-4415, which is
incorporated herein by reference.)
10.04(a) First Amendment to Lease dated December 10, 1992 to Lease dated
February 15, 1983 (see Exhibit 10.04 hereto) between Nelco
Technology, Inc. and CMD Southwest Inc., and novation
substituting Nelco Technology, Inc. for Nelco Products, Inc.,
regarding real property located at 1130 West Geneva Drive,
Tempe, Arizona. (Reference is made to Exhibit 10.04(a) of the
Company's Annual Report on Form 10-K for the fiscal year ended
February 28, 1993, Commission File No. 1-4415, which is
incorporated herein by reference.)
10.04(b) Letter dated August 28, 1997 from Nelco Technology, Inc. to SPT
Real Estate Corp. E extending the Lease dated February 15, 1983
(see Exhibit 10.04 hereto) and Second Amendment to Lease dated
February 2, 1998 to Lease dated February 15, 1993 (see Exhibit
10.04 hereto) between Nelco Technology, Inc. and SPT Real Estate
Corp. E regarding real property located at 1130 West Geneva
Drive, Tempe, Arizona.
Exhibit
Number Description
10.05 Lease Agreement dated May 26, 1982 between Nelco Products Pte.
Ltd. (lease was originally entered into by Kiln Technique (Pri-
vate) Limited, which subsequently assigned this lease to Nelco
Products Pte. Ltd.) and the Jurong Town Corporation regarding
real property located at 4 Gul Crescent, Jurong, Singapore.
(Reference is made to Exhibit 10.05 of the Company's Annual
Report on Form 10-K for the fiscal year ended February 28, 1993,
Commission File No. 1-4415, which is incorporated herein by
reference.)
10.05(a) Deed of Assignment, dated April 17, 1986 between Nelco Products
Pte. Ltd., Kiln Technique (Private) Limited and Paul Ma, Richard
Law, and Michael Ng, all of Peat Marwick & Co., of the Lease
Agreement dated May 26, 1982 (see Exhibit 10.05 hereto) between
Kiln Technique (Private) Limited and the Jurong Town Corporation
regarding real property located at 4 Gul Crescent, Jurong,
Singapore. (Reference is made to Exhibit 10.05(a) of the Com-
pany's Annual Report on Form 10-K for the fiscal year ended
February 28, 1993, Commission File No. 1-4415, which is incorpo-
rated herein by reference.)
10.06(a) Amended and Restated 1982 Stock Option Plan of the Company.
(Reference is made to Exhibit 10.06(a) of the Company's Annual
Report on Form 10-K for the fiscal year ended March 1, 1992,
Commission File No. 1-4415, which exhibit is incorporated herein
by reference. This exhibit is a management contract or
compensatory plan or arrangement.)
10.06(b) 1992 Stock Option Plan of the Company, as amended by First
Amendment thereto. (This exhibit is a management contract or
compensatory plan or arrangement.)
10.07 Amended and Restated Employment Agreement dated February 28,
1994 between the Company and Jerry Shore. (Reference is made to
Exhibit 10.07(c) of the Company's Annual Report on Form 10-K for
the fiscal year ended February 27, 1994, Commission File No. 1-
4415, which is incorporated herein by reference. This exhibit
is a management contract or compensatory plan or arrangement.)
10.07(a) Amendment No. 1 dated March 1, 1995 to the Amended and Restated
Employment Agreement dated February 28, 1994 (see Exhibit 10.07
hereto) between the Company and Jerry Shore. (Reference is made
to Exhibit 10.07(c) of the Company's Annual Report on Form 10-K
for the fiscal year ended February 26, 1995, Commission File No.
1-4415, which is incorporated herein by reference. This exhibit
is a management contract or compensatory plan or arrangement.)
10.07(b) Amendment No. 2 dated December 5, 1996 to the Amended and
Restated Employment Agreement dated February 28, 1994 (see
Exhibit 10.07 hereto) between the Company and Jerry Shore.
(Reference is made to Exhibit 10.07(b) of the Company's Annual
Report on Form 10-K for the fiscal year ended March 2, 1997,
Commission File No. 1-4415, which is incorporated herein by
reference. This exhibit is a management contract or
compensatory plan or arrangement.)
10.07(c) Amendment No. 3 dated October 14, 1997 to the Amended and
Restated Employment Agreement dated February 28, 1994 (see
Exhibit 10.07 hereto) between the Company and Jerry Shore. (This
exhibit is a management contract or compensatory plan or
arrangement.)
Exhibit
Number Description
10.08 Lease dated April 15, 1988 between FiberCote Industries, Inc.
(lease was initially entered into by USP Composites, Inc., which
subsequently changed its name to FiberCote Industries, Inc.) and
Geoffrey Etherington, II regarding real property located at 172
East Aurora Street, Waterbury, Connecticut. (Reference is made
to Exhibit 10.08 of the Company's Annual Report on form 10-K for
the fiscal year ended February 26, 1995, Commission File No. 1-
4415, which is incorporated herein by reference.)
10.08(a) Amendment to Lease dated December 21, 1992 to Lease dated April
15, 1988 (see Exhibit 10.08 hereto) between FiberCote Indus-
tries, Inc. and Geoffrey Etherington II regarding real property
located at 172 East Aurora Street, Waterbury, Connecticut.
(Reference is made to Exhibit 10.08(a) of the Company's Annual
Report on Form 10-K for the fiscal year ended February 28, 1993,
Commission File No. 1-4415, which is incorporated herein by
reference.)
10.08(b) Letter dated June 30, 1997 from FiberCote Industries, Inc. to
Geoffrey Etherington II extending the Lease dated April 15, 1988
(see Exhibit 10.08 hereto) between FiberCote Industries, Inc.
and Geoffrey Etherington II regarding real property located at
172 East Aurora Street, Waterbury, Connecticut.
10.09 Lease dated March 14, 1988 between Nelco Products, Inc. and CMD
Southwest One regarding real property located at 1117 West
Fairmont, Tempe, Arizona. (Reference is made to Exhibit 10.09
of the Company's Annual Report on Form 10-K for the fiscal year
ended February 26, 1995, Commission File No. 1-4415, which is
incorporated herein by reference.)
10.09(a) First Amendment to Lease dated December 10, 1992 to Lease dated
March 14, 1988 (see Exhibit 10.09 hereto) between Nelco
Technology, Inc. and CMD Southwest One regarding real property
located at 1117 West Fairmont, Tempe, Arizona, and novation
substituting Nelco Technology, Inc. for Nelco Products, Inc.
(Reference is made to Exhibit 10.09(a) of the Company's Annual
Report on Form 10-K for the fiscal year ended February 28, 1993,
Commission File No. 1-4415, which is incorporated herein by
reference.)
10.09(b) Second Amendment to Lease dated March 24, 1995 to Lease dated
March 14, 1988 (see Exhibit 10.09 hereto) between Nelco
Technology, Inc. and CMD Southwest One regarding real property
located at 1117 West Fairmont, Tempe, Arizona. (Reference is
made to Exhibit 10.09(b) of the Company's Annual Report on Form
10-K for the fiscal year ended March 3, 1996, Commission File
No. 1-4415, which is incorporated herein by reference.)
10.09(c) Third Amendment to Lease dated January 18, 1996 to Lease dated
March 14, 1988 (see Exhibit 10.09 hereto) between Nelco
Technology, Inc. and CMD Southwest One regarding real property
located at 1117 West Fairmont, Tempe, Arizona. (Reference is
made to Exhibit 10.09(c) of the Company's Annual Report on Form
10-K for the fiscal year ended March 3, 1996, Commission File
No. 1-4415, which is incorporated herein by reference.)
10.10 Lease dated October 1, 1991 between Zin-Plas Corporation and
Philip L. Johnson d/b/a Johnson Development Company regarding
real property located at 25 North Park, N.E., Comstock Park,
Michigan. (Reference is made to Exhibit 10.10 of the Company's
Annual Report on Form 10-K for the fiscal year ended February
28, 1993, Commission File No. 1-4415, which is incorporated
herein by reference.)
Exhibit
Number Description
10.10(a) Letter dated October 17, 1996 from Zin-Plas Corporation to
Philip L. Johnson extending the Lease dated October 1, 1991 (see
Exhibit 10.10 hereto) between Zin-Plas Corporation and Philip L.
Johnson d/b/a Johnson Development Company regarding real
property located at 25 North Park, N.E., Comstock Park,
Michigan. (Reference is made to Exhibit 10.10(a) of the
Company's Annual Report on Form 10-K for the fiscal year ended
March 2, 1997, Commission File No. 1-4415, which is incorporated
herein by reference.)
10.11 Lease dated August 31, 1989 between Nelco Technology, Inc. and
Cemanudi Associates regarding real property located at 1104 West
Geneva Drive, Tempe, Arizona. (Reference is made to Exhibit
10.11 of the Company's Annual Report on Form 10-K for the fiscal
year ended March 3, 1996, Commission File No. 1-4415, which is
incorporated herein by reference.)
10.11(a) First Amendment to Lease dated October 21, 1994 to Lease dated
August 31, 1989 (see Exhibit 10.11 hereto) between Nelco
Technology, Inc. and Cemanudi Associates regarding real property
located at 1104 West Geneva Drive, Tempe, Arizona. (Reference
is made to Exhibit 10.11(a) of the Company's Annual Report on
Form 10-K for the fiscal year ended February 26, 1995,
Commission File No. 1-4415, which is incorporated herein by
reference.)
10.12 Lease dated March 24, 1995 between Nelco Technology, Inc. and
CMD Southwest Inc. regarding real property located at 1131 West
Fairmont, Tempe, Arizona. (Reference is made to Exhibit 10.12
of the Company's Annual Report on Form 10-K for the fiscal year
ended March 3, 1996, Commission File No. 1-4415, which is
incorporated herein by reference.)
10.12(a) First Amendment to Lease dated January 18, 1996 to Lease dated
March 24, 1995 (see Exhibit 10.12 hereto) between Nelco
Technology, Inc. and CMD Southwest Inc. regarding real property
located at 1131 West Fairmont, Tempe, Arizona. (Reference is
made to Exhibit 10.12(a) of the Company's Annual Report on Form
10-K for the fiscal year ended March 3, 1996, Commission File
No. 1-4415, which is incorporated herein by reference.)
10.13 Lease dated December 12, 1990 between Neltec, Inc. and NZ
Properties, Inc. regarding real property located at 1420 W. 12th
Place, Tempe, Arizona. (Reference is made to Exhibit 10.13 of
the Company's Annual Report on Form 10-K for the fiscal year
ended March 2, 1997, Commission File No. 1-4415, which is
incorporated herein by reference.)
10.13(a) Letter dated January 8, 1996 from Neltec, Inc. to NZ Properties,
Inc. exercising its option to extend the Lease dated December
12, 1990 (see Exhibit 10.13 hereto) between Neltec, Inc. and NZ
Properties, Inc. regarding real property located at 1420 W. 12th
Place, Tempe, Arizona. (Reference is made to Exhibit 10.13(a) of
the Company's Annual Report on Form 10-K for the fiscal year
ended March 2, 1997, Commission File No. 1-4415, which is
incorporated herein by reference.)
10.14 Indenture of Lease dated November 1, 1984 between Dielectric
Polymers, Inc. and Holyoke Supply Company, Inc. regarding real
property located at 218 Race Street, Holyoke, Massachusetts.
(Reference is made to Exhibit 10.14 of the Company's Annual
Report on Form 10-K for the fiscal year ended February 28, 1993,
Commission File No. 1-4415, which is incorporated herein by
reference.)
Exhibit
Number Description
10.14(a) Extension of Lease dated May 30, 1986 to Indenture of Lease
dated November 1, 1984 (see Exhibit 10.14 hereto) between
Dielectric Polymers, Inc. and Holyoke Supply Company, Inc.
regarding real property located at 218 Race Street, Holyoke,
Massachusetts. (Reference is made to Exhibit 10.14(a) of the
Company's Annual Report on Form 10-K for the fiscal year ended
February 28, 1993, Commission File No. 1-4415, which is
incorporated herein by reference.)
10.14(b) Second Extension of Lease dated May 30, 1991 to Indenture of
Lease dated November 1, 1984 (see Exhibit 10.14 hereto) between
Dielectric Polymers, Inc. and Holyoke Supply Company, Inc.
regarding real property located at 218 Race Street, Holyoke,
Massachusetts. (Reference is made to Exhibit 10.14(b) of the
Company's Annual Report on Form 10-K for the fiscal year ended
February 28, 1993, Commission File No. 1-4415, which is
incorporated herein by reference.)
10.14(c) Amendment to Second Extension of Lease dated May 19, 1994 to
Indenture of Lease dated November 1, 1984 (see Exhibit 10.14
hereto) between Dielectric Polymers, Inc. and Holyoke Supply
Company, Inc. regarding real property located at 218 Race
Street, Holyoke, Massachusetts. (Reference is made to Exhibit
10.14(c) of the Company's Annual Report on Form 10-K for the
fiscal year ended February 27, 1994, Commission File No. 1-4415,
which is incorporated herein by reference.)
10.14(d) 1995 Extension to Amendment to Second Extension of Lease dated
October 19, 1995 to Indenture of Lease dated November 1, 1984
(see Exhibit 10.14 hereto) between Dielectric Polymers, Inc. and
Holyoke Supply Company, Inc. regarding real property located at
218 Race Street, Holyoke, Massachusetts. (Reference is made to
Exhibit 10.14(d) of the Company's Annual Report on Form 10-K for
the fiscal year ended March 3, 1996, Commission File No. 1-4415,
which is incorporated herein by reference.)
10.14(e) Letter dated July 31, 1996 from Dielectric Polymers, Inc. to
Holyoke Supply Company, Inc. exercising its option to extend the
Indenture of Lease dated November 1, 1984 (see Exhibit 10.14
hereto) between Dielectric Polymers, Inc. and Holyoke Supply
Company, Inc. regarding real property located at 218 Race
Street, Holyoke, Massachusetts. (Reference is made to Exhibit
10.14(e) of the Company's Annual Report on Form 10-K for the
fiscal year ended March 2, 1997, Commission File No. 1-4415,
which is incorporated herein by reference.)
10.14(f) 1997 Extension to Amendment to Second Extension of Lease dated
March 26, 1997 to Indenture of Lease dated November 1, 1984 (see
Exhibit 10.14 hereto) between Dielectric Polymers, Inc. and
Holyoke Supply Company, Inc. regarding real property located at
218 Race Street, Holyoke, Massachusetts. (Reference is made to
Exhibit 10.14(f) of the Company's Annual Report on Form 10-K for
the fiscal year ended March 2, 1997, Commission File No. 1-4415,
which is incorporated herein by reference.)
10.14(g) Letter dated August 27, 1997 from Dielectric Polymers, Inc. to
Holyoke Supply Company, Inc. extending the Indenture of Lease
(see Exhibit 10.14 hereto) between Dielectric Polymers, Inc. and
Holyoke Supply Company, Inc. regarding real property located at
218 Race Street, Holyoke, Massachusetts.
Exhibit
Number Description
10.15 Lease dated January 8, 1992 between Nelco Technology, Inc. and
CMD Southwest, Inc. regarding real property located at 1135 West
Geneva Drive, Tempe, Arizona. (Reference is made to Exhibit
10.15 of the Company's Annual Report on Form 10-K for the fiscal
year ended March 1, 1992, Commission File No. 1-4415, which is
incorporated herein by reference.)
10.15(a) First Amendment dated July 8, 1996 to Lease dated January 8,
1992 (see Exhibit 10.15 hereto) between Nelco Technology, Inc.
and CMD Southwest, Inc. regarding real property located at 1135
West Geneva Drive, Tempe, Arizona. (Reference is made to Exhibit
10.15(a) of the Company's Annual Report on Form 10-K for the
fiscal year ended March 2, 1997, Commission File No. 1-4415,
which is incorporated herein by reference.)
10.16 Tenancy Agreement dated October 8, 1992 between Nelco Products
Pte. Ltd. and Jurong Town Corporation regarding real property
located at 36 Gul Lane, Jurong Town, Singapore. (Reference is
made to Exhibit 10.18 of the Company's Annual Report on Form 10-
K for the fiscal year ended February 28, 1993, Commission File
No. 1-4415, which is incorporated herein by reference.)
10.16(a) Tenancy Agreement dated November 3, 1995 between Nelco Products
Pte. Ltd. and Jurong Town Corporation regarding real property
located at 36 Gul Lane, Jurong Town, Singapore. (Reference is
made to Exhibit 10.16(a) of the Company's Annual Report on Form
10-K for the fiscal year ended March 2, 1997, Commission File
No. 1-4415, which is incorporated herein by reference.)
10.17 Lease Contract dated February 26, 1988 between the New York
State Department of Transportation and the Edgewater Stewart
Company regarding real property located at 15 Governor Drive in
the Stewart International Airport Industrial Park, New Windsor,
New York. (Reference is made to Exhibit 10.19 of the Company's
Annual Report on Form 10-K for the fiscal year ended February
26, 1995, Commission File No. 1-4415, which is incorporated
herein by reference.)
10.17(a) Assignment and Assumption of Lease dated February 16, 1995
between New England Laminates Co., Inc. and The Edgewater
Stewart Company regarding the assignment of the Lease Contract
(see Exhibit 10.17 hereto) for the real property located at 15
Governor Drive in the Stewart International Airport Industrial
Park, New Windsor, New York. (Reference is made to Exhibit
10.19(a) of the Company's Annual Report on Form 10-K for the
fiscal year ended February 26, 1995, Commission File No. 1-4415,
which is incorporated herein by reference.)
10.17(b) Lease Amendment No. 1 dated February 17, 1995 between New
England Laminates Co., Inc. and the New York State Department of
Transportation to Lease Contract dated February 26, 1988 (see
Exhibit 10.17 hereto) regarding the real property located at 15
Governor Drive in the Stewart International Airport Industrial
Park, New Windsor, New York. (Reference is made to Exhibit
10.19(b) of the Company's Annual Report on Form 10-K for the
fiscal year ended February 26, 1995, Commission File No. 1-4415,
which is incorporated herein by reference.)
Exhibit
Number Description
10.18 Employment Agreement, dated March 18, 1996, between the Company
and E. Phillip Smoot. (Reference is made to Exhibit 10.20 of
the Company's Annual Report on Form 10-K for the fiscal year
ended March 3, 1996, Commission File No. 1-4415, which is
incorporated herein by reference. This exhibit is a management
contract or compensatory plan or arrangement.)
10.19 Sale and Purchase Agreement dated 29 October 1997 between Dieter
G. Weiss, Lothar Hubert Reinartz, Nelco International
Corporation and Park Electrochemical Corp. relating to the sale
and purchase of shares of capital in Dielektra GmbH. (Reference
is made to Exhibit 10.01 of the Company's Quarterly Report on
Form 10-Q for the fiscal quarter ended November 30, 1997,
Commission File No. 1-4415, which is incorporated herein by
reference.)
21.01 Subsidiaries of the Company.
23.01 Consent of Ernst & Young LLP.
27.01(a) Financial Data Schedule - Annual information restated for impact
of SFAS 128 Change to Earnings Per Share Calculations.
27.01(b) Financial Data Schedule - First quarter information restated for
impact of SFAS 128 Change to Earnings Per Share Calculations.
27.01(c) Financial Data Schedule - Second quarter information restated
for impact of SFAS 128 Change to Earnings Per Share
Calculations.
27.01 (d) Financial Data Schedule - Third quarter information restated for
impact of SFAS 128 Change to Earnings Per Share Calculations.
EXHIBIT 3.02
BY-LAWS
OF
PARK ELECTROCHEMICAL CORP.
ARTICLE I
OFFICES
Section 1. Principal Office. The principal office of
the Corporation shall be in the City and State of New York.
Section 2. Other Offices. The Corporation may also
have offices at such other place or places within and without
the State of New York as the Board of Directors may from time
to time determine or the business of the Corporation may re-
quire.
ARTICLE II
STOCKHOLDERS' MEETINGS
Section 1. Annual Meetings. The annual meeting of
shareholders of the Corporation shall be held on the fourth
Wednesday in June of each year (or if said day be a legal holi-
day, then on the next succeeding day not a legal holiday), at
ten o'clock A.M., at the principal office of the Corporation in
the State of New York, or at such other place within or without
the State of New York and at such other time and on such other
date as may be determined by the Board of Directors and as
shall be designated in the notice of said meeting, for the
purpose of electing directors and for the transaction of such
other business as may properly be brought before the meeting.
Section 2. Special-Meetings. Special Meetings of the
stockholders shall be held at the principal office of the
Corporation in the State of New York, or at such other place
within the State of New York as may be designated in the notice
of said meeting, by resolution of the Board of Directors, and
shall be called by the Chairman of the Board, the President or
the Secretary at the request in writing of stockholders owning
of record at least eighty percent (80%) of the issued and
outstanding shares of stock of the Corporation entitled to vote
thereat.
Section 3. Notice of Purpose of Meetings. Written
notice of the purpose or purposes and of the time and place of
every meeting of shareholders shall be given by the Chairman of
the Board, the President, the Secretary or an Assistant Secre-
tary either personally or by mail or by any other lawful means
of communication not less than ten nor more than fifty days
before the meeting to each shareholder of record entitled to
vote at such meeting. If mailed, such notice shall be directed
to each shareholder at his address as it appears on the stock
book unless he shall have filed with the Secretary of the
Corporation a written request that notices intended for him be
mailed to some other address, in which case it shall be mailed
or transmitted to the address designated in such request.
Except where otherwise required by law, notice of any adjourned
meeting of the shareholders of the Corporation shall not be
required to be given.
Section 4. Quorum. A quorum at all meetings of stock-
holders shall consist of the holders of record of a majority of
the shares of stock of the Corporation, issued and outstanding,
entitled to vote at the meeting, present in person or by proxy,
except as otherwise provided by law or by the Certificate of
Incorporation. In the absence of a quorum at any meeting or
any adjournment thereof, a majority of those present in person
or by proxy and entitled to vote may adjourn such meeting from
time to time. At any such adjourned meeting at which a quorum
is present any business may be transacted which might have been
transacted at the meeting as originally called.
Section 5. Organization. Meetings of the stockholders
shall be presided over by the Chairman of the Board, or if he
is not present, by the President, or if neither the Chairman of
the Board nor the President is present, by any Vice President,
or in the absence of such officers, by a chairman to be chosen
by a majority of the stockholders entitled to vote who are
present in person or by proxy at the meeting. The Secretary of
the Corporation, or in his absence, an Assistant Secretary,
shall act as secretary of every meeting, but if neither the
Secretary nor an Assistant Secretary is present, the meeting
shall choose any person present to act as secretary of the
meeting.
Section 6. Voting. Except as otherwise provided in the
Certificate of Incorporation or by law, at every meeting of the
stockholders each stockholder of record entitled to vote at
such meeting shall have one vote in person or by proxy for each
share-of stock having voting rights held by him and registered
in his name on the books of the Corporation. Any vote on
shares of stock of the Corporation may be given by the stock-
holder entitled thereto in person or by his proxy appointed by
an instrument in, writing, subscribed by such stockholder or by
his attorney thereunto authorized and delivered to the secre-
tary of the meeting. Except as otherwise required by law, by
the Certificate of Incorporation or these By-Laws, all matters
coming before any meeting of the stockholders shall be decided
by the vote of the holders of a majority of the shares of stock
present in person or by proxy at such meeting, a quorum being
present. At all elections of directors the voting may but need
not be by ballot.
Section 7. Inspectors of Election. At all elections of
directors, or in any other case in which inspectors may act,
two inspectors of election shall be appointed by the chairman
of the meeting, except as otherwise provided by law. The
inspectors of election shall take and subscribe an oath
faithfully to execute the duties of inspectors at such meeting
with strict impartiality, and according to the best of their
ability, and shall take charge of the polls and after the vote
shall have been taken shall make a certificate of the result
thereof, but no director or candidate for the office of
director shall be appointed as such inspector. If there be a
failure to appoint inspectors or if any inspector appointed be
absent or refuse to act, or if his office become vacant, the
stockholders present at the meeting may choose the required
number of temporary inspectors.
Section 8. Fixing Record Date. For the purpose of
determining the shareholders entitled to notice of or to vote
at any meeting of shareholders or any adjournment thereof, or
to express consent to or dissent from any proposal without a
meeting, or for the purpose of determining the shareholders
entitled to receive payment of any dividend or the allotment of
any rights, or for the purpose of any other action, the Board
of Directors may fix, in advance, a date as the record date for
any such determination of shareholders. Such date shall not be
more than fifty nor less than ten days before the date of such
meeting, nor more than fifty days prior to any other action.
Section 9. Notice of Stockholder Nominees. Only per-
sons who are nominated in accordance with the following proce-
dures set forth in these By-Laws shall be eligible for election
as directors of the Corporation. Nominations of persons for
election to the Board of Directors may be made at any annual
meeting of stockholders (a) by or at the direction of the Board
of Directors (or any duly authorized committee thereof) or (b)
by any stockholder of the Corporation (i) who is a stockholder
of record on the date of the giving of the notice provided for
in this Section 9 and on the record date for the determination
of stockholders entitled to vote at such annual meeting and
(ii) who complies with the notice procedures set forth in this
Section 9.
In addition to any other applicable requirements, for
a nomination to be made by a stockholder, such stockholder must
have given timely notice thereof in proper written form to the
Secretary of the Corporation.
To be timely, a stockholder's notice to the Secretary
must be delivered to or mailed and received at the principal
executive offices of the Corporation not less than sixty (60)
days nor more than ninety (90) days prior to the anniversary
date of the immediately preceding annual meeting of stockhold-
ers; provided, however, that in the event that the annual
meeting is called for a date that is not within thirty (30)
days before or after such anniversary date, notice by the
stockholder in order to be timely must be so received not later
than the close of business on the tenth (10th) day following
the day on which notice of the date of the annual meeting was
mailed or public disclosure of the date of the annual meeting
was made, whichever first occurs.
To be in proper written form, a stockholder's notice to
the Secretary must set forth (a) as to each person whom the
stockholder proposes to nominate for election as a director (i)
the name, age, business address and residence address of the
person, (ii) the principal occupation or employment of the per-
son, (iii) the class or series and number of shares of capital
stock of the Corporation which are owned beneficially or of
record by the person and (iv) any other information relating to
the person that would be required to be disclosed in a proxy
statement or other filings required to be made in connection
with solicitations of proxies for election of directors
pursuant to Section 14 of the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), and the rules and regulations
promulgated thereunder; and (b) as to the stockholder giving
the notice (i) the name and record address of such stockholder,
(ii) the class or series and number of shares of capital stock
of the Corporation which are owned beneficially or of record by
such stockholder, (iii) a description of all arrangements or
understandings between such stockholder and each proposed
nominee and any other person or persons (including their names)
pursuant to which the nomination(s) are to be made by such
stockholder, (iv) a representation that such stockholder
intends to appear in person or by proxy at the annual meeting
to nominate the persons named in its notice and (v) any other
information relating to such stockholder that would be required
to be disclosed in a proxy statement or other filings required
to be made in connection with solicitations of proxies for
election of directors pursuant to Section 14 of the Exchange
Act and the rules and regulations promulgated thereunder. Such
notice must be accompanied by a written consent of each pro-
posed nominee to be named as a nominee and to serve as a direc-
tor if elected.
No person shall be eligible for election as a director
of the Corporation unless nominated in accordance with the
procedures set forth in this Section 9. If the Chairman of the
annual meeting determines that a nomination was not made in
accordance with the foregoing procedures, the Chairman shall
declare to the meeting that the nomination was defective and
such defective nomination shall be disregarded.
Section 10. Notice of Stockholder Business. No busi-
ness may be transacted at an annual meeting of stockholders,
other than business that is either (a) specified in the notice
of meeting (or any supplement thereto) given by or at the
direction of the Board of Directors (or any duly authorized
committee thereof), (b) otherwise properly brought before the
annual meeting by or at the direction of the Board of Directors
(or any duly authorized committee thereof) or (c) otherwise
properly brought before the annual meeting by any stockholder
of the Corporation (i) who is a stockholder of record on the
date of the giving of the notice provided for in this Section
10 and on the record date for the determination of stockholders
entitled to vote at such annual meeting and (ii) who complies
with the notice procedures set forth in this Section 10.
In addition to any other applicable requirement, for
business to be properly brought before an annual meeting by a
stockholder, such stockholder must have given timely notice
thereof in proper written form to the Secretary of the Corpora-
tion.
To be timely, a stockholder's notice to the Secretary
must be delivered to or mailed and received at the principal
executive offices of the Corporation not less than sixty (60)
days nor more than ninety (90) days prior to the anniversary
date of the immediately preceding annual meeting of stockhold-
ers; provided, however, that in the event that the annual
meeting is called for a date that is not within thirty (30)
days before or after such anniversary date, notice by the
stockholder in order to be timely must be so received not later
than the close of business on the tenth (10th) day following
the day on which notice of the date of the annual meeting was
mailed or public disclosure of the date of the annual meeting
was made, whichever first occurs.
To be in proper written form, a stockholder's notice to
the Secretary must set forth as to each matter such stockholder
proposes to bring before the annual meeting (i) a brief
description of the business desired to be brought before the
annual meeting and the reasons for conducting such business at
the annual meeting, (ii) the name and record address of such
stockholder, (iii) the class or series and number of shares of
capital stock of the Corporation which are owned beneficially
or of record by such stockholder, (iv) a description of all
arrangements or understandings between such stockholder and any
other person or persons (including their names) in connection
with the proposal of such business by such stockholder and any
material interest of such stockholder in such business and (v)
a representation that such stockholder intends to appear in
person or by proxy at the annual meeting to bring such business
before the meeting.
No business shall be conducted at the annual meeting of
stockholders except business brought before the annual meeting
in accordance with the procedures set forth in this Section 10,
provided, however, that, once business has been properly
brought before the annual meeting in accordance with such
procedures, nothing in this Section 10 shall be deemed to
preclude discussion by any stockholder of any such business.
If the Chairman of an annual meeting determines that business
was not properly brought before the annual meeting in accor-
dance with the foregoing procedures, the Chairman shall declare
to the meeting that the business was not properly brought
before the meeting and such business shall not be transacted.
ARTICLE III
DIRECTORS
Section 1. Powers, Number, Qualification, Term, Quorum,
Vacancies. The property, affairs and business of the Corpo-
ration shall be managed by its Board of Directors, consisting
of not less than five nor more than fifteen persons. The exact
number of directors within the maximum and minimum limitations
specified shall be fixed from time to time by resolution of the
Board of Directors. Directors need not be stockholders of the
Corporation. All directors shall be of full age and at least
one shall be a citizen of the United States and a resident of
the State of New York. Directors shall be elected at the
annual meeting and until their successors, shall be elected and
shall qualify.
Section 2. Quorum. A majority of the members of the
Board of Directors then in office, acting at a meeting duly
assembled, shall constitute a quorum for the transaction of
business, but if at any meeting of the Board of Directors there
shall be less than a quorum present, a majority of those
present may adjourn the meeting without further notice from
time to time until a quorum shall have been obtained. Any act
of a majority of directors present at a meeting at which there
is a quorum shall be the act of the Board of Directors, except
as otherwise specifically provided in the By-Laws.
Section 3. Vacancies. In case one or more vacancies
shall occur on the Board of Directors by reason of death,
resignation, increase in the number of directors or otherwise,
except insofar as otherwise provided in these By-Laws, the
remaining directors, although less than a quorum, may, by a
majority vote, elect successor or additional directors. A
person so elected shall serve only until the next annual
meeting of stockholders and until his successor shall be
elected and shall qualify.
Section 4. Meetings. Meetings of the Board of Direc-
tors shall be held at the principal office of the Corporation
or at such other place or places within or outside the State of
New York as may be specified in the notice of the meeting.
Regular meetings of the Board of Directors shall be held at
such times as may from time to time be fixed by resolution of
the Board of Directors, and special meetings may be held at any
time upon the call of the Chairman of the Board or the Presi-
dent or any two directors by oral, telegraphic or written
notice duly served on or sent or mailed to each director not
less than two days before such meeting. A meeting of the Board
of Directors may be held without notice immediately after the
annual meeting of stockholders. Notice need not be given of
regular meetings of the Board of Directors when fixed by
resolution as above set forth. Meetings may be held at any
time without notice if all the directors are present, or if at
any time before or after the meeting those not present waive
notice of the meeting in writing.
Section 5. Removal of Directors. At any special meet-
ing of the stockholders, duly called as provided in these By-
Laws, any director or directors may, by the affirmative vote of
the holders of a majority of the shares of stock issued and
outstanding and entitled to vote for the election of directors,
be removed from office for cause, and his successor or their
successors may be elected at such meeting; or the remaining
directors may, to the extent vacancies are not filled by such
election, fill any vacancy or vacancies created by such
removal. Stockholders may not remove directors without cause.
Section 6. Executive Committee. An Executive Committee
of three or more directors may be designated by resolution
passed by a majority of the whole Board of Directors. The act
of a majority of the members of said Committee shall be the act
of the Committee, and said Committee may meet at stated times
or on notice. Whenever the Board of Directors is not in
session or whenever a quorum of the Board of Directors fails to
attend any regular or special meeting of the Board, said
Committee shall advise with and aid the officers of the
Corporation in all matters concerning its interests and the
management of its business and affairs, and generally perform
such duties and exercise such powers as may be performed and
exercised by the Board of Directors from time to time, and the
Executive Committee shall have the power to authorize the seal
of the Corporation to be affixed to all papers which may
require it and, insofar as may be permitted by law, exercise
the powers and perform the obligations of the Board of Direc-
tors. The Board of Directors may also designate one or more
committees in addition to the Executive Committee by resolution
or resolutions passed by a majority of the whole Board of
Directors; such committee or committees to consist of three or
more directors of the Corporation, and, to the extent provided
in the resolution or resolutions designating them, shall have
or may exercise the specific powers of the Board of Directors
in the management of the business and affairs of the Corpo-
ration. Such committee or committees shall have such name or
names as may be determined from time to time by resolution
adopted by the Board of Directors.
Section 7. Compensation of Directors. Directors may by
resolution-of the Board of Directors, be allowed a fixed sum
and expenses for attendance at regular or special meetings of
the Board of Directors; provided that nothing herein contained
shall be construed to preclude any director from serving the
Corporation in any other capacity and receiving compensation
therefor. Members of special or standing committees, and
others who attend pursuant to direction, may, by vote of the
Board of Directors be allowed a like fixed sum and expenses for
attending committee meetings.
Section 8. Action by Written Consent in lieu of
Meeting. Any action required or permitted to be taken by the
Board of Directors of the Corporation or of any committee
thereof may be taken without a meeting if all members of the
Board of Directors or of any committee thereof consent in
writing to the adoption of a resolution authorizing the action.
Section 9. Action by Conference Call. Any one or more
members of the Board of Directors of the Corporation or of any
committee thereof may participate in a meeting of said Board or
of any such committee by means of a conference telephone or
similar communications equipment allowing all persons partici-
pating in the meeting to hear each other at the same time.
ARTICLE IV
OFFICERS
Section 1. Election. The Board of Directors at its
meeting held immediately after the annual meeting of stock-
holders shall elect a Chairman of the Board, a President, one
or more Vice Presidents, a Secretary and a Treasurer. From
time to time the Board of Directors may appoint such Assistant
Vice Presidents, Assistant Secretaries, Assistant Treasurers
and such other officers, agents and employees as it may deem
proper. Any two offices may be held by the same person. The
Chairman of the Board and the President shall be chosen from
among the directors.
Section 2. Term and Removal. The term of office of all
officers shall be one year and until their respective suc-
cessors are elected and qualify but any officer may be removed
from office either with or without cause at any time by the
affirmative vote of a majority of the members of the Board of
Directors then in office. A vacancy in any office arising from
any cause may be filled by the Board of Directors.
Section 3. Chairman of the Board. The Chairman of the
Board shall preside at all meetings of the Board of Directors
and stockholders.
Section 4. President. The President shall, in the
absence of the Chairman of the Board, preside at all meetings
of the Board of Directors and stockholders. He shall have such
other duties and powers as may be assigned to him from time to
time by the Board of Directors.
Section 5. Vice Presidents. The Vice Presidents shall
have such powers and discharge such duties as may be assigned
to them from time to time by the Board of Directors.
Section 6. Treasurer. The Treasurer shall have the
custody of all the funds and securities of the Corporation.
When necessary or proper he shall endorse on behalf of the Cor-
poration, for collection, checks, notes and other obligations
and shall deposit the same to the credit of the Corporation in
such bank or banks, or depositories as may be designated by the
Board of Directors, or by any officer acting under authority
conferred by the Board of Directors. Whenever required by the
Board of Directors, he shall render an account of all his
transactions as Treasurer and of the financial condition of the
Corporation. He shall give bond for the faithful discharge of
his duties if the Board of Directors so requires. He shall do
and perform such other duties as may be assigned to him from
time to time by the Board of Directors.
Section 7. Secretary. The Secretary shall attend all
meetings of the stockholders and all meetings of the Board of
Directors, and record all votes and the minutes of all proceed-
ings in a book to be kept for that purpose; and shall perform
like duties for other committees when so required. He shall
give, or cause to be given, notice of all meetings of stock-
holders and of the Board of Directors and of committees and
shall perform such other duties as may be prescribed by the
Board of Directors. He shall keep in safe custody the seal of
the Corporation and affix the same to any instrument whose
execution has been authorized. He shall do and perform such
other duties as may be assigned to him from time to time by the
Board of Directors.
Section 8. Assistant Officers. The Assistant Vice
Presidents, the Assistant Secretaries and the Assistant Trea-
surers shall, in the order of their respective seniorities, in
the absence or disability of the Vice Presidents, Secretary or
Treasurer, respectively, perform the duties of such officer and
shall perform such other duties as the Board of Directors may
from time to time prescribe.
ARTICLE V
CERTIFICATES OF STOCK
Section 1. Form and Transfers. The interest of each
stockholder of the Corporation shall be evidenced by certifi-
cates for shares of stock certifying the number of shares
represented thereby and in such form, not inconsistent with the
Certificate of Incorporation, as the Board of Directors may
from time to time prescribe.
The certificates of stock shall be signed by the
Chairman of the Board or the President or a Vice President and
by the Secretary or an Assistant Secretary or the Treasurer or
an Assistant Treasurer, and sealed with the seal of the
Corporation. Such seal may be a facsimile, engraved or
printed. Where any such certificate is signed by a transfer
agent, or by a transfer clerk and registrar, the signature of
the Chairman of the Board, President, Vice President, Secre-
tary, Assistant Secretary, Treasurer or Assistant Treasurer
upon such certificate may be facsimiles, engraved or printed.
In case any such officer who has signed or whose facsimile
signature has been placed upon such certificate shall have
ceased to be such before such certificate is issued, it may be
issued by the Corporation with the same effect as if such
officer had not ceased to be such at the time of its issue.
Transfers of shares of stock of the Corporation shall
be made only on the books of the Corporation by the registered
holder thereof, or by his attorney thereunto authorized by
power of attorney duly executed and filed with the Secretary of
the Corporation, or with a transfer clerk or a transfer agent
appointed as in section 4 of this Article provided, and on sur-
render of the certificate or certificates for such shares prop-
erly endorsed and the payment of all taxes thereon. The person
in whose name shares of stock stand on the books of the
Corporation shall be deemed the owner thereof for all purposes
as regards the Corporation. The Board of Directors may, from
time to time, make such additional rules and regulations as it
may deem expedient, not inconsistent with these By-Laws,
concerning the issue, transfer and registration of certificates
for shares of stock of the Corporation.
Section 2. Lost, Stolen, Destroyed, or Mutilated
Certificates. No certificate for shares of stock of the Corpo-
ration shall be issued in place of any certificate alleged to
have been lost, destroyed or stolen, except on production of
such evidence of such loss, destruction or theft as the Board
of Directors may require and on delivery to the Corporation, if
the Board of Directors shall so require, of a bond of indemnity
in such amount, containing such terms and secured by such
surety as the Board of Directors may in its discretion require.
The Board of Directors shall have the right from time to time
to prescribe such rules and procedures as it shall deem
advisable with regard to lost, stolen, destroyed or mutilated
certificates and the issuance of new shares of this Corporation
in place thereof.
Section 3. Transfer Agent and Registrar. The Board of
Directors may appoint one or more registrars, and may require
all certificates for shares of stock to bear the signature or
signatures of any of them.
ARTICLE VI
CORPORATE SEAL
The corporate seal of the Corporation shall consist of
two concentric circles, between which shall be the name of the
Corporation, and in the center shall be inscribed the year of
its incorporation and the words, "Corporate Seal, New York."
ARTICLE VII
AMENDMENTS
These By-Laws may be amended, altered or repealed or
additional By-Laws adopted at any meeting of the Board of
Directors by the vote of a majority of the directors then in
office. These By-Laws, and any amendments thereto and new By-
Laws added by the directors may be amended, altered or repealed
by the stockholders at any annual or special meeting of the
stockholders provided notice of such action shall have been
contained in the notice of meeting.
ARTICLE VIII
INDEMNIFICATION
Section 1. Definitions. "Action"' shall mean any
threatened, pending or completed legal action, lawsuit or pro-
ceeding, whether civil, criminal, administrative or inves-
tigative, including without limitation any action by or in the
right of the Corporation to procure a judgment in its favor.
"Indemnitee" shall mean a person who was or is a party,
or is threatened to be made a party, to an Action by reason of
the fact that such person (or such person's testator or
intestate, in which case both such person and his testator or
intestate shall be deemed the Indemnitee) is or was or has
agreed to become a director or officer of the Corporation, or
is or was serving or has agreed to serve at the request of the
Corporation as a director, officer or trustee of or in a
similar capacity with another corporation, partnership, joint
venture, trust, plan or other enterprise, or by reason of any
action alleged to have been taken or omitted in such capacity.
"Costs" shall mean all amounts actually paid by or on
behalf of an Indemnitee (i) on account of judgments, fines and
penalties incurred in connection with an Action, or (ii) in
settlement of an Action.
"Expenses" shall mean all expenses actually and
reasonably incurred by or on behalf of an Indemnitee in
connection with an Action, whether or not the Indemnitee is
successful on the merits, including without limitation,
expenses of investigation, judicial or administrative pro-
ceedings and appeals, attorneys' fees and disbursements, and
expenses of establishing or defending a right to indemnifica-
tion under this Article.
"Act" shall mean Sections 721 through 726 of the
Business Corporation Law of the State of New York or any
comparable provisions of New York law hereafter enacted
applicable to the Corporation.
Section 2. Indemnification and Advances of Expenses.
The Corporation shall indemnify each Indemnitee against all
Costs and Expenses of each Action, unless such indemnification
shall be expressly prohibited by Section 721 of the Act, or
unless the Action (other than an Action instituted pursuant to
Section 3 of this Article VIII) shall have been initiated by
the Indemnitee without the authorization of the Board of
Directors of the Corporation. Expenses for which indemni-
fication is sought under this Article shall be paid by the
Corporation in advance of any final disposition of the Action
at the written request of an Indemnitee, provided that the
Indemnitee shall undertake to repay amounts advanced to the
extent that a court of competent jurisdiction ultimately
determines that the Indemnitee was not entitled to such
indemnification. Except to the extent prohibited by law,
advances of Expenses shall be paid without reference to the
Indemnitee's financial ability to make repayment, no security
shall be required therefor, and such advances shall not under
any circumstances be claimable against the Indemnitee's spouse,
children, estate, heirs, executors or administrators. The
Board of Directors may, by a majority vote of a quorum consist-
ing of directors who are not parties to an Action, and upon
approval of an Indemnitee, authorize the Corporation's counsel
to represent the Indemnitee in an Action.
Section 3. Procedure for Indemnification. Any indem-
nification or advance of Expenses under Section 2 of this Arti-
cle shall be made promptly, and in any event within 45 days
following the written request of the Indemnitee, unless a
determination that the Indemnitee is not entitled to indemnifi-
cation because he has not met the applicable standard of
conduct expressly required by Section 721 of the Act is made
(1) by the Board of Directors by a majority vote of a quorum
consisting of directors who are not parties to such Action, or
(2) if such a quorum is not obtainable, or, even if obtainable,
if a quorum of disinterested directors so directs, by indepen-
dent legal counsel in a written opinion, or (3) by the share-
holders. The right to indemnification and advances of Expenses
under this Article shall be enforceable by the Indemnitee in
any court of competent jurisdiction if the Corporation denies
such request, in whole or in part, or if no disposition thereof
is made within 45 days. It shall be a defense to any such
action (other than an action brought to enforce a claim for the
advance of Expenses where the required undertaking, if any, has
been received by the Corporation) that the Indemnitee has not
met the applicable standard of conduct expressly required by
the Act, but the burden of proving such defense shall be on the
Corporation and neither (i) the termination of any Action by
judgment, order, settlement, conviction, or upon a plea of nolo
contendere or its equivalent, nor (ii) any determination
pursuant to the first sentence of this Section 2, shall, of
itself, create a presumption that the Indemnitee did not act in
accordance with such standard of conduct.
Section 4. Other Rights and Continuation of Right to
Indemnification. The indemnification provided by this Article
shall not be exclusive of all other rights to which an Indemni-
tee seeking indemnification is entitled under any law (common
or statutory), agreement, resolution of shareholders or
directors or otherwise, and nothing contained in this Article
shall limit the right to indemnification or advancement of
expenses to which any person would be entitled from the
Corporation in lieu of, in addition to or in the absence of
this Article. The Corporation is hereby expressly authorized
to grant other rights of indemnification or advancement of
expenses by resolution of shareholders or directors, agreement
or otherwise. The indemnification provided by this Article
shall continue as to an Indemnitee who has ceased to be a
director, officer, trustee, committee member, employee or
agent, and shall inure to the benefit of the estate, heirs,
executors and administrators of each Indemnitee.
Section 5. Insurance. The Corporation shall purchase
and maintain insurance on behalf of any person who is or was or
has agreed to become a director or officer of the Corporation,
or is or was serving at the request of the Corporation as a
director, officer or trustee of or in a similar capacity with
another corporation, partnership, joint venture, trust, plan or
other enterprise against any liability asserted against such
person and incurred by such person or on such person's behalf
in any such capacity, or arising out of such persons's status
as such, whether or not the Corporation would have the power to
indemnify such person under the provisions of this Article
VIII, provided that such insurance is available on terms
acceptable to a majority of the entire Board of Directors of
the Corporation.
Section 6. Contractual Rights; Conflicts. The provi-
sions of this Article VIII shall constitute a contract between
the Corporation and each Indemnitee, pursuant to which the
Corporation and each such Indemnitee intend to be legally
bound. No repeal or modification of this Article VIII shall
affect any rights or obligations then existing or thereafter
arising with respect to any state of facts then or theretofore
existing. In the event any rights under this Article VIII are
expressly prohibited by any provision of Article XIV of the
Corporation's Certificate of Incorporation as in effect on the
date this Article VIII is adopted, such provision of the
Corporation's Certificate of Incorporation shall be controlling
unless subsequently amended to eliminate such prohibition.
Section 7. Severability. If this Article VIII or any
portion hereof shall be invalidated on any ground by any court
of competent jurisdiction, then the Corporation shall neverthe-
less indemnify each Indemnitee as to Costs and Expenses and
make advancements thereof to the fullest extent permitted by
any applicable portion of this Article VIII that shall not have
been invalidated and to the fullest extent permitted by the
Act.
[bylaws]
7/16/97
EXHIBIT 10.04(b)
NELCO TECHNOLOGY, INC.
Subsidiary of Nelco International Corp.
August 28, 1997
SPT Real Estate Corp. E
c/o Ms. Kathleen Bloemker
District Manager
RREEF Management Company
2201 E. Camelback Road
Suite 230B
Phoenix, AZ 85016
Ladies and Gentlemen:
Pursuant to Schedule 4 to the Indenture of Lease dated February 15,
1983, as amended by a First Amendment to Lease dated December 10,
1992, between SPT Real Estate Corp. E, successor to Presidio
Associates, L.P., Shidler Equities, L.P., James C. Reynolds, Marc R.
Brutten and Patricia M. Brutten, successors to CMD Southwest, Inc.
(as Lessor) and Nelco Technology, Inc. (as Lessee) for the premises
commonly known as 1130 West Geneva Drive, Tempe, Arizona, 85282,
Nelco Technology, Inc. hereby notifies SPT Real Estate Corp. E that
it is exercising its option to extend the Lease for a period of five
(5) years commencing on March 1, 1998 and ending on February 28,
2003.
Please advise us of the amount of the rental adjustment applicable
to the extended period once you are able to make that determination
following the availability of the appropriate information. Until we
receive such notification, we will continue to pay monthly rental in
the same amount as presently in effect.
Please contact the undersigned to discuss any questions pertaining
to this lease extension.
Sincerely,
Mac Smith Smith
Vice President/General Manager
MS/rfb
cc/Steve G11huley, Park Electrochemical Corp.
Phil Smoot, Nelco International Corporation
SECOND AMENDMENT TO LEASE
THIS AMENDMENT, dated this 2nd day of February, 1998 between SPT Real Estate
Corp. E, a Delaware corporation ("Landlord") and Nelco Technology, Inc., an
Arizona corporation ("Tenant"), is for the premises located in the City of
Tempe, County of Maricopa, State of Arizona, commonly known as 1130 West
Geneva Drive (Renewal Premises").
WITNESSETH:
WHEREAS, Landlord's predecessor CMD Southwest, Inc., an Arizona
corporation and Tenant's predecessor Nelco Products, Inc. entered into that
certain Lease dated February 15, 1983 and amended by the First Amendment to
Lease dated December 10, 1992 (hereinafter collectively referred to as the
"Lease"); and
WHEREAS, Landlord and Tenant desire to amend the Lease as more fully set
forth below.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
contained herein and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties agree as follows:
1. DEFINITIONS. Unless otherwise specifically set forth herein, all
capitalized terms herein shall have the same meaning as set forth in the
Lease.
2. AMENDMENTS.
A. Effective March 1, 1998 The Renewal Term of the Lease shall
hereby be March 1, 1998 thru February 28. 2003.
B. Effective March 1, 1998 the Annual Net Basic Rent for a
period of five (5) years shall hereby be amended to be the
greater of the following:
a. The Market Rental; or
b. An amount equal to the product of the Market Rental
multiplied by a fraction which has as its
denominator the All Item Revised Consumer Price
Index for All Urban Consumers-United States City
Average (1967-100), issued by the Bureau of Labor
Statistics, U.S. Department of Labor, published
for the month of March 1993 and as its numerator,
said index published for the month of March 1998.
3. TENANT'S AUTHORITY.
If Tenant is a corporation, Tenant represents and warrants that this
Amendment and the undersigned's execution of this Amendment has been
duly authorized and approved by the corporation's Board of Directors.
The undersigned officers and representatives of the corporation
executing this Amendment on behalf of the corporation represent and
warrant that they are officers of the corporation with authority to
execute this Amendment on behalf of the corporation.
4. INCORPORATION.
Except as modified herein, all other terms and conditions of the Lease
between the parties above described, as attached hereto, shall continue
in full force and effect.
5. LIMITATION OF LANDLORD'S LIABILITY.
Redress for any claims against Landlord under this Amendment or under
the Lease shall only be made against Landlord to, the extent of
Landlord's interest in the property to which the Premises are a part.
The obligations of Landlord under this Amendment and the Lease shall not
be personally binding on, nor shall any resort be had to the private
properties of, any of its trustees or board of directors and officers,
as the case may be, the general partners thereof or any beneficiaries,
stockholders, employees or agents of Landlord, or the investment
manager.
IN WITNESS WHEREOF Landlord and Tenant have executed this Second Amendment
to Lease as of
the day and year first written above.
LANDLORD: TENANT:
SPT REAL ESTATE CORP. E., NELCO TECHNOLOGY, INC.
a Delaware corporation an Arizona corporation
By: RREEF MANAGEMENT COMPANY,
a California corporation
By: By:
Kathleen Graham Malcolm E. Smith
District Manager Vice President and General Manager
Date: 3/5/98 Date: 3/4/98
EXHIBIT 10.06(b)
PARK ELECTROCHEMICAL CORP.
STOCK OPTION PLAN
1. Purpose of the Plan. This Plan (herein called the "Plan") is
designed to provide an incentive to key employees, including officers and
directors who are employees, of PARK ELECTROCHEMICAL CORP., a New York
corporation (the "Company"), and its subsidiaries, and to offer an
additional inducement in obtaining the services of key personnel. The Plan
provides for the grant of (i) incentive stock options ("Incentive Stock
Options") , as contemplated by Section 422 of the Internal Revenue Code of
1986, as now in effect or later amended (the "Code"), which options shall be
subject to to the tax treatment described in Section 421 of the Code, and
(ii) non-qualified stock options ("Non-Qualified Stock Options").
2. Stock Subject to the Plan. Options may be granted under the Plan
to purchase in the aggregate not more than 300,000 shares of Common Stock,
par value $.10 per share, of the Company ("Common Stock"), which shares may,
in the discretion of the Board of Directors, consist either in whole or in
part of authorized but unissued shares of Common Stock or shares of Common
Stock held in the treasury of the Company. Subject to the provisions of
Paragraph 7, any shares subject to an option which for any reason expires or
is terminated unexercised as to such shares shall again become available for
option under the Plan.
3. Administration of the Plan. The Plan shall be administered by a
Stock Option Committee (the "Committee") consisting of three persons. The
Committee shall be appointed by, and shall serve at the pleasure of, the
Board of Directors. A majority of the members shall constitute a quorum,
and the acts of a majority of the members present at any meeting at which a
quorum is present, and any acts approved in writing by a majority of the
members without a meeting, shall be the acts of the Committee. The members
of the Committee shall be "disinterested" to the extent required in order
for options granted under the Plan to benefit from the exemption pursuant to
Rule 16b-3 (or any successor exemption) promulgated under the Securities
Exchange Act of 1934, as amended (the "Exchange Act").
Subject to the express provisions of the Plan, the Committee shall have
the authority, in its discretion, to determine the individuals to receive
options, the times when they shall receive them, the number of shares to be
subject to each option (except that no grants of options may be made "in
tandem", i.e., where an exercise of one option, in whole or in part,
automatically results in the lapse of termination of another option, in
whole or in part), whether and to what extent options shall be designated
Incentive Stock options or Non-Qualified Stock Options, the amount of any
required federal income tax or other withholding amount, the term of each
option, the date each option shall become exercisable, whether an option
shall be exercisable in whole, in part or in installments, and if in
installments, the number of shares subject to each installment, the date
each installment shall become exercisable and the term of each installment,
to accelerate the date of exercise of any installment, to construe the
respective option agreements and the Plan, and to make all other
determinations necessary or advisable for administering the Plan. The
determinations of the Committee on the matters referred to in this paragraph
shall be conclusive.
4. Eligibility. The Committee may, consistent with the purposes of
the Plan, grant options from time to time within ten (10) years from the date
of adoption of the Plan by the Board of Directors of the Company, to key
employees, including officers and directors who are employees, of the
Company or any of its present or future subsidiary corporations
("Subsidiaries"), and covering such number of shares of Common Stock as the
Committee may determine. The aggregate fair market value (determined at the
time the stock option is granted) of the shares with respect to which
Incentive Stock options may be granted under this Plan and any other
incentive stock options satisfying the requirements of Section 422 of the
Code granted under any other plan of the Company or any of its subsidiaries
(as defined in Section 424(f) of the Code) or of its parent (as defined in
Section 424(e) of the Code) which are exercisable for the first time by any
particular optionee during any calendar year shall not exceed $100,000. In
addition, no Incentive Stock Option may be granted under the Plan if such
grant, together with any other applicable grant of Incentive Stock options
under the Plan and any other incentive stock options satisfying the other
plan of the requirements of the Code granted under any Company or any of its
subsidiaries (as defined in Section 424(f) of the Code) or of its parent (as
defined in Section 424(e) of the Code) would exceed any other applicable
maximum established under the Code for incentive stock options. Employees,
including those who have been granted options under the Company's 1964 and
1968 Qualified Stock Option Plans and the Company's 1974 Amended Stock
Option Plan and 1982 Amended and Restated Stock option Plan, may receive
more than one option under the Plan. If an option granted under the Plan
exceeds the foregoing limitations, such option shall be deemed a Non-
Qualified Stock Option to the extent it exceeds such limitations.
5. Option Price. The purchase price of the Common Stock under each
option shall be determined by the Committee, but shall in no event be less
than the fair market value of the Common Stock at the time of grant;
provided, however, that if at the time an Incentive Stock Option is granted,
the individual owns stock possessing more than 10% of the total combined
voting power of all classes of the capital stock of the Company, of its
present and future subsidiaries (as defined in Section 424(f) of the Code)
or of a parent (as defined in Section 424(e) of the Code), the purchase
price shall not be less than 110% of the fair market value of the Common
Stock at the time of grant. Such fair market value shall be taken by the
Committee as the reported closing price of the Common Stock on the New York
Stock Exchange (or, if the Common Stock is not then listed on the New York
Stock Exchange, on such other securities exchange on which the Common Stock
may then be listed), on the date the option is granted, or if there is no
sale of the Common Stock on that date, then on the last previous day on
which such sale was reported, provided that, if the foregoing clause is
inapplicable, fair market value shall be determined by the Committee and
provided that, with respect to Incentive Stock options, if such method is
inconsistent with any regulations applicable to such options adopted by the
Treasury Department, then the fair market value shall be determined by the
Committee consistent with such regulations. For the purposes of this Plan,
an employee shall be deemed to own shares which he may purchase under
outstanding options and shares attributed to him under Section 424(d) of the
Code or any comparable provision thereafter enacted.
6. Term of option. The term of each Incentive Stock Option granted
pursuant to the Plan shall be for a period not exceeding ten (10) years from
the date of granting thereof; provided, however, that if, at the time an
Incentive stock option is granted, the individual to whom such option is
granted owns stock possessing more than 10% of the total combined voting
power of all classes of the capital stock of the Company, of any of its
present or future subsidiaries (as defined in Section 424(f) of the Code) or
of a parent (as defined in Section 424(e) of the Code), the term of the
Incentive Stock Option granted to such individual shall be for a period not
exceeding five (5) years from the date of grant thereof. The term of each
Non-Qualified Stock option granted pursuant to the Plan shall be for a
period not exceeding ten (10) years and one (1) month from the date of grant
thereof. Options shall be subject to earlier termination as hereinafter
provided.
7. Exercise or Surrender of option. (a) General. An option (or any
part or installment thereof) shall be exercised by giving written notice to
the Company at its principal office (at the time of adoption of this Plan,
located at 5 Dakota Drive, Lake Success, New York 11042), identifying the
option being exercised, specifying the number of shares as to which such
option is being exercised and accompanied by payment in full in cash, Common
Stock or any combination thereof, of the aggregate purchase price therefor
plus any required federal income tax or other withholding amount.
Certificates representing the shares purchased shall be issued as promptly
as practicable thereafter. The holder of an option shall not have the right
of a shareholder with respect to the shares covered by his option until the
date of issuance of a stock certificate to him or her for such shares. In
no case may a fraction of share be purchased or issued under the Plan.
(b) Surrender. (1) General Rule. The Committee acting in its absolute
discretion may incorporate a provision in the terms of an option to allow a
holder of an option granted under this Plan to surrender his or her option
in whole or in part in lieu of the exercise in whole or in part of that
option on any date that:
(a) the fair market value of the Common Stock subject to such
option (determined in accordance with Paragraph 5) exceeds the
option price (determined pursuant to Paragraph 5) for such
Common Stock; and
(b) the option to purchase such Common Stock is otherwise
exercisable.
(2) Procedure. The surrender of an option in whole or in part
shall be effected by the delivery of the Stock Option Contract provided for
in Paragraph 10 to the Committee or to its delegate together with a
statement signed by the holder of an option granted under this Plan which
specifies the number of shares of Common Stock as to which the holder of an
option granted under this Plan surrenders his or her option and how he or
she desires payment be made for such Common Shares surrendered in accordance
with this Paragraph.
(3) Payment. In exchange for his or her shares surrendered in
accordance with this Paragraph a holder of an option granted under this Plan
shall receive a payment in cash or in Common Stock, or in a combination of
cash and Common Stock, equal in amount on the date such surrender is
effected to the excess of the fair market value determined in accordance
with Paragraph 5 of the shares surrendered in accordance with this Paragraph
on such date over the option price determined pursuant to Paragraph 5 for
the Shares surrendered in accordance with this Paragraph (reduced by any
applicable federal income tax or other withholding amount). The Committee
acting in its absolute discretion may approve or disapprove the request for
payment by the holder of an option granted under this Plan in whole or in
part in cash and may cause such payment to be made in cash or in such
combination of cash and Common Stock as the Committee deems appropriate. A
request for payment only in Common Stock shall be approved and made in
Common Stock to the extent payment can be made in whole shares of Common
Stock and, at the Committee's discretion, in cash in lieu of any fractional
share of Common Stock.
(4) Restrictions. Any option which incorporates a provision to
allow a holder thereof to surrender his or her option in whole or in part
shall also incorporate such additional restrictions, if any, on the exercise
or surrender of such option as the Committee deems necessary or appropriate,
including restrictions to satisfy the conditions to the exemption related to
such surrender rights set forth in Rule 16b-3 (or any successor exemption)
promulgated under Section 16(b) of the Exchange Act.
8. Termination of Employment. Unless otherwise provided in connection
with the grant of any particular option or in the applicable Stock Option
Contract, any option holder whose employment has terminated for any reason
other than death may exercise his option, to the extent exercisable upon the
effective date of such termination, at any time within three (3) months
after the date of termination, but in no event after the expiration of the
term of the option, provided, however, that if his employment shall be
terminated either (i) for cause, or (ii) without the consent of the Company,
said option shall (to the extent not previously exercised) terminate
immediately. Options granted under the Plan shall not be affected by any
change of employment so long as the holder continues to be an employee of
the Company or of any of the Subsidiaries or of a corporation or its parent
or subsidiary issuing or assuming a stock option in a transaction to which
Section 424 (a) of the Code applies. Notwithstanding the foregoing, any
holder of an option whose employment has terminated by reason of disability
(as defined in Section 22(e)(3) of the Code) may exercise his option to the
extent exercisable upon the effective date of such termination, at any time
within one (1) year after the date of termination, but in no event after the
expiration of the term of the option. In connection with the termination of
employment of any particular holder of an option, the Committee may, in its
discretion, determine to permit a longer period than that specified in this
Paragraph or the applicable Stock Option Contract for the exercise of all or
any part of such option after such termination or to permit such option to
be exercisable in whole or in part with respect to the shares as to which
such option would not otherwise be exercisable at the time of such
termination; provided, however, that the period for exercise of any
Incentive Stock Option after termination of employment shall not exceed the
maximum period provided by the Code.
9. Death of an Employee. If an option holder dies while he is
employed by the Company or any of the Subsidiaries, or within three months
after termination of his employment (unless such termination was either
(i) for cause, or (ii) without the consent of the Company), unless otherwise
provided in connection with the grant of such option or in the applicable
Stock Option Contract, the option may be exercised, to the extent
exercisable on the date of his or her death, by his or her executor,
administrator or other person at the time entitled by law to his rights
under the option, at any time within six (6) months after death, but in no
event after the expiration of the term of the option. In connection with
the death of any particular holder of an option, the Committee may, in its
discretion, determine to permit a longer period than that specified in this
Paragraph or the applicable Stock Option Contract for the exercise of such
option after such death or to permit such option to be exercisable in whole
or in part with respect to the shares as to which option would not otherwise
be exercisable at the time of such death; provided, however, that the period
for exercise of any Incentive Stock Option after death shall not exceed the
maximum period provided by the Code.
10. Stock Option Contracts. Each option shall be evidenced by an
appropriate Stock Option Contract which shall provide, among other things,
(a) that the employee agrees that he or she will remain in the employ of the
Company or the Subsidiaries, at the election of the Company, for a period of
at least (i) one (1) year from the date the option is granted to him or her,
or (ii) such later date to which he or she is then contractually obligated
to remain in the employ of the Company, (b) that in the event of the
exercise of such option, unless the shares received upon exercise shall have
been registered pursuant to an effective registration statement under the
Securities Act of 1933, as amended, the employee acknowledges that such
shares may be "restricted securities" as defined in Rule 144 under such Act
and agrees that such shares may not be sold except in compliance with
applicable provisions of such Act, and (c) that in the event of any
disposition of the shares of Common Stock acquired upon the exercise of an
Incentive Stock Option within two (2) years from the date of grant of the
option or one (1) year from the date of issuance of such shares to him or
her, the employee will notify the Company thereof in writing within thirty
(30) days after such disposition and will pay to the Company an amount
necessary to satisfy any obligations the Company may have to withhold any
taxes by reason of such disqualifying disposition. Nothing in the Plan or
in any Stock Option Contract entered into pursuant hereto shall confer upon
any employee any right to continue in the employ of the Company or the
Subsidiaries, or interfere in any way with the right of the Company or the
Subsidiaries (subject to the terms of any written employment contract) to
terminate his or her employment at any time without liability to the Company
or the Subsidiaries.
11. Adjustments Upon changes in Common Stock; Certain other Changes.
(a) Notwithstanding any other provision of the Plan, in the
event of any change in the outstanding Common Stock by reason of a stock
dividend, recapitalization, merger, consolidation, split-up, combination or
exchange of shares or the like, the aggregate number and kind of shares
available under the Plan, the aggregate number and kind of shares subject to
each outstanding option and the option prices provided therein shall be
appropriately adjusted by the Board of Directors, whose determination shall
be conclusive.
(b) If a transaction occurs which is not approved,
recommended or supported by a majority of the Board of Directors of the
Company in actions taken prior to, and with respect to, such transaction
in which any of the following occurs: (i) the Company merges or
consolidates with any other corporation (other than one of the Company's
wholly owned subsidiaries) and is not the surviving corporation (or
survives only as the subsidiary of another corporation), (ii) the Company
sells all or substantially all of its assets to any other person or entity,
or (iii) the Company is dissolved, or if (iv) any third person or entity,
(other than the trustee or committee of any qualified employee benefit plan
of the Company) together with its affiliates and associates (as such terms
are defined in the rules under the Exchange Act shall be directly or
indirectly, the beneficial owner (as such term is defined for purposes of
Regulation 13D-G under the Exchange Act) of at least thirty percent (30%)
of the voting stock of the Company, or (v) the individuals who constitute
the members of Company's Board of Directors on the date hereof (the
"Incumbent Board") cease for any reason to constitute at least a majority
thereof, provided that any person becoming a Director subsequent to the
date of adoption of this Plan by the Board of Directors whose election or
nomination for election by the Company's shareholders was approved by a
vote of at least eighty percent (80%) of the Directors comprising the
Incumbent Board (either by a specific vote or by approval of the proxy
statement of the Company in which such person is named as a nominee for
Director, without objection to such nomination) shall be, for purposes of
this clause (v), considered as though such person were a member of - the
Incumbent Board, then within (a) ten days after the approval by the
shareholders of the Company of such merger, consolidation, sale of assets
or dissolution as described in clause (i), (ii) or (iii) of this
Paragraph 11(b) or (b) thirty days after the occurrence of such, change of
beneficial ownership (as so defined) or Directors as described in clause
(iv) or (v) of this Paragraph 11(b) with respect to all such outstanding
options, irrespective of whether such options are then exercisable, shall
be surrendered to the Company by each grantee of such options and such
options shall thereupon be cancelled by the Company, and the grantee shall
receive a cash payment by the Company in an amount equal to the number of
shares of Common Stock subject to the option held by such grantee
multiplied by the amount by which (x) exceeds (y) where (y) equals the
purchase price per share of Common Stock covered by the option and
(x) equals (1) the per share price offered to shareholders of the
Company in any such merger, consolidation, sale or assets or dissolution
transaction, (2) the price offered to shareholders of the Company in any
tender offer or exchange offer whereby any such change of beneficial
ownership (as so defined) or Directors takes place, or (3) the "fair market
value" of the Common Stock on the date determined by the Committee (as
constituted prior to any change described in clause (iv) or (v) to be the
date of cancellation and surrender of such options if any such change of
beneficial ownership or Directors occurs other than pursuant to a tender or
exchange offer, whichever is appropriate. In the event that the
consideration offered to shareholders of the Company in any transaction
described in this Paragraph 11(b) consists of anything other than cash, the
Committee (as constituted prior to such transaction) shall determine the
fair cash equivalent of the portion of the consideration offered which is
other than cash.
(c) Any adjustment provided for in Paragraph 11(b)
above shall be subject to any required shareholder action. Notwithstanding
anything to the contrary herein, no adjustment provided for in Paragraph
11(b) shall be made if such adjustment would result in a modification of
any Incentive Stock Option (within the meaning of Section 424 of the Code),
or cause such Incentive Stock Option to fail to continue to qualify as an
incentive stock option under section 422 of the Code.
12. Amendments and Termination of the Plan. The Board of Directors,
without further approval of the shareholders, may at any time suspend or
terminate the Plan, in whole or in part, or amend it f rom time to time in
such respects as it may deem advisable in order that Incentive Stock Options
granted hereunder meet the requirements. for "incentive stock options" under
the Code or any comparable provisions thereafter enacted and conform to any
change in applicable law or to regulations or rulings of administrative
agencies or may so amend it in any other respect not involving a substantial
departure from the principles herein set forth, provided, however, that no
amendment shall be effective without the approval, within twelve (12) months
thereafter, of holders of a majority of the issued and outstanding shares of
Common Stock of the Company which would (a) except as specified in Paragraph
11(a), change the maximum number of shares for which options may be granted
under the Plan, or (b) change the eligibility requirements for individuals
entitled to receive options hereunder. No termination, suspension or
amendment of the Plan shall, without the consent of the holder of an
existing option.affected thereby, adversely affect his or her rights under
such option.
13. Non-Transferability of Options. No option granted under the
Plan shall be transferable otherwise than by will or the laws of descent
and distribution, and options may be exercised, during the lifetime of the
holder thereof, only by him or her.
14. Conditions of Exercise or Surrender. Each option shall be
subject to the requirement that if at any time the Board of Directors or
the Committee shal@ determine, in its discretion, that the listing,
registration or qualification of the shares subject to such option upon
any securities exchange or under any state or federal law, or the consent
or approval of any governmental regulatory body, is necessary or desirable,
as a condition of, or in connection with, the granting of such option or
the issue or purchase of shares thereunder, no such option may be exercised in
whole or in part unless such listing, registration, qualification, consent
or approval shall have been effected or obtained free of any conditions not
acceptable to the Board of Directors or the Committee.
15. Sale or Merger of the Company. If the Company agrees to sell all
or substantially all of its assets for cash or property or for a combination
of cash and property or agrees to any merger, consolidation, reorganization,
division or other corporate transaction in which Common Stock is converted
into another security or into the right to receive securities or property
and such agreement does not provide for the assumption or substitution of
the options granted under this Plan, each then outstanding option at the
direction and discretion of the Board of Directions may be cancelled
unilaterally by the Company as of the effective date of such transaction in
exchange for the same net consideration which each holder of an option
granted under this Plan would have received if each such option had been
exercisable in full on such date and each holder of an option granted under
this Plan had exercised each such option for Common Stock under Paragraph 7
on such date and then sold such Common Stock on such date.
16. Shareholder's Approval. This Plan shall become effective when
adopted by the Board of Directors, subject to approval by a majority of the
outstanding shares of stock of the Company at the annual meeting of its
shareholders next succeeding such adoption, and any Non-Qualified Stock
options or Incentive Stock options granted hereunder prior to such
shareholder approval shall be conditioned thereon; provided that the date of
grant of any options so granted under this Plan shall be determined as if
such options had not been subject to such approval.
17. Miscellaneous. (a) No Shareholder Rights. No holder of an option
granted under this Plan shall have any rights as a shareholder of the
Company as a result of the grant of an option to him or to her under this
Plan or his or her exercise or surrender of such option pending the actual
delivery of shares of Common Stock subject to such option to such holder.
(b) Withholding. The exercise or surrender of any option granted
under this Plan shall constitute the holder's full and complete consent to
whatever action the Committee elects to satisfy the federal and state tax
withholding requiremnemts, it any, which the Committee in its discretion
deems applicable to such exercise or surrender.
FIRST AMENDMENT TO
PARK ELECTROCHEMICAL CORP.
1992 STOCK OPTION PLAN
The Park Electrochemical Corp. 1992 Stock Option Plan (the "Plan") is
hereby amended as follows:
1. The first sentence of Paragraph 2 of the Plan is. hereby amended and
restated in its entirety to read as follows:
"Options may be granted under the Plan to purchase in the aggregate
not more than 1,150,000 shares of Common Stock, par value $.10 per
share, of the Company ("Common Stock"), which shares may, in the
discretion of the Board of Directors, consist either in whole or in
part of authorized but unissued shares of Common Stock or shares of
Common Stock held in the treasury of the Company."
2. Paragraph 4 is hereby amended by adding to the end thereof the
sentence to read as ID follows:
"Commencing in the Company's fiscal year ending March 2, 1997, no
Participant may, in any such fiscal year, receive Options relating
to Shares which in the aggregate exceed the greater of (i) 50% of
the total number of Shares granted pursuant to the Plan in any such
year or (ii) 100,000 Shares."
3. Ratification. Except as expressly set forth in this First Amendment
to the Plan, the Plan is hereby ratified and confirmed without
modification.
4. Effective Date. The effective date of this Amendment to the Plan
shall be May 14, 1996.
EXHIBIT 10.07 (c)
THIS AMENDMENT NO. 2, is made and entered into this 144A day of
October, 1997, by and between PARK ELECTROCHEMICAL CORP., a New York
corporation (the "Company"), having an office at S Dakota Drive, Lake
Success, New York 11042, and JERRY SHORE (hereinafter called "Shore"),
residing at Lighthouse Road, Sands Point, New York.
WITNESSETH:
WHEREAS, the Company and Shore have previously executed and
delivered an Amended and Restated Employment Agreement, dated as of February
28, 1994, as thereafter amended (as so amended, the Amended and Restated
Employment Agreement is hereinafter referred to as the "Employment
Agreement"); and
WHEREAS, in accordance with Section 5 of the Employment Agreement,
effective March 3, 1997 Shore retired from full-time employment with the
Company and commenced serving as a consultant for a term of five years; and
WHEREAS, the Company believes it is desirable and in the best
interests of the Company and its shareholders that (i) the five-year
consulting period be extended and (ii) the Company obtain from Shore certain
non-competition covenants to remain in effect throughout the extended
consulting period, in consideration for which the Company is agreeing to
provide certain additional life insurance benefits to Shore.
NOW, THEREFORE, IT IS AGREED AS FOLLOWS:
1. Amendment to Section 5 of Employment Agreement. Section 5 of
the Employment Agreement shall be amended by replacing the second sentence
thereof with the following:
"Upon the effective date of such retirement and for a
period of six (6) years thereafter (the "consulting
period"), Shore shall make himself available to advise and
consult with officers and other employees of the Company
so that the Company may continue to have the benefit of
his experience and knowledge of the affairs of the Company
and of his reputation and contacts in the industries in
which the Company is engaged in business."
2. Amendment to Section 11 of Emplovment Agreement. Section 11
of the Employment Agreement shall be amended in its entirety to read as
follows:
"11. Non-Competition. (a) Shore shall not, during the
consulting period, directly or indirectly: (i) induce any
person connected with or employed by the Company or any
subsidiary of the Company to leave the employ of the
Company or any such subsidiary; or (ii) solicit the
employment of any such person on his own behalf or on
behalf of any other person, firm, corporation, association
or any other entity.
"(b) Shore shall not, during the consulting period,
without the prior approval of the Board of Directors of
the Company, directly or indirectly engage in competition
("Competition") with the Company. For purposes of this
Agreement, Competition by Shore shall mean Shore's
engaging in, or otherwise directly or indirectly being
employed by or acting as a consultant or lender to, or
being a director, officer, employee, principal, licensor,
trustee, broker, agent, stockholder, member, owner, joint
venturer or partner of, or permitting his name to be used
in connection with the activities of any other business or
organization anywhere which competes, directly or
indirectly, with the business of the Company; provided,
however, that Shore shall not be deemed to have engaged in
Competition merely by owning not more than 5% of the
outstanding securities of a corporation if such securities
are traded on a national stock exchange or in the over-
the-counter market."
3. Full Force and Effect. This Amendment No. 2 constitutes an
amendment to the Employment Agreement as contemplated by Section 12 thereof.
The Employment Agreement, as modified by this Amendment No. 2, shall remain
in full force and effect.
IN WITNESS WHEREOF, the parties have executed this Amendment on the
date first above written.
PARK ELECTROCHEMICAL CORP.
By: /s/Brian E. Shore
Title: President
/s/Jerry Shore
Jerry Shore
EXHIBIT 10.08(b)
FIBERCOTE INDUSTRIES, INC.
June 30, 1997
Mr. Geoffrey Etherington, 11
Ethcrington Industries, Inc.
2 Clark St.
Old Saybrook, CT 06475
Dear Mr. Etherington;
On June 27, Ray Miranda had written to you requesting a two week extension
on today's deadline for exercising the option to extend our lease on the 172
East Aurora Street facility. While we pursue the previously discussed
amendments to the extension, I feel that it is in the best interest of all
concerned that we at least exercise the five (5) year extension as provided
for in the current lease.
Therefore, pursuant to Section I of the Amendment dated December 21, 1992 to
the Indenture of Lease dated April 15, 1998 between Geoffrey Etherington,
II, (as landlord) and FiberCote industries, Inc. (formerly known as USP
Composites, Inc.) (as Tenant) for the premises commonly known as 172 East
Aurora Street, Waterbury, Connecticut 06708, FiberCote Industries, Inc.
hereby notifies Geoffrey Etherington that it is exercising its option to
extend the Lease for a period of five (5) years commencing on January 1,
1998 and ending on December 31, 2002.
Please keep in mind that we will continue to work toward an amended
extension that is both acceptable to you and our corporate management at
Park Electrochemical Corporation. We hope that a mutually satisfactory
lease extension can be approved within the requested two week time frame.
In the meantime, you may indicate acknowledgment of the above by signing in
the space provided and returning it to the undersigned.
Sincerely.
John W. Brooks, Jr.
President/CEO
Accepted and agreed
Geoffrey Etherington II
Etherington Industries, Inc.
By:
Name:
Title:
172 EAST AURORA ST WATERBURY, CT 06708-2024 (203) 755-1344
SUBSIDIARY OF PARK ELECTROCHEMICAL CORPORATION
[ex1008b]
EXHIBIT 10.14(g)
DIELECTRIC POLYMERS, INC.
218 RACE STREET, HOLYOKE, MASSACHUSETTS 01040
413-532-3288 FAX 413-533-9316
- ------------------------------------------------
August 27, 1997
Mr. Daniel C. Moriarity
President
Holyoke Supply Company, lm;.
P.O. Box 789
218 Race Street
Holyoke, MA 01040
Dear Dan,
Pursuant to Article H, Section 2 of the Indenture of Lease dated November 1,
1984, as extended by an Extension of Lease dated May 30, 1986, a Second
Extension of Lease dated as of May 30, 199 1, an Amendment to Second
Extension of Lease dated May 19, 1994, a 1995 Extension to Amendment to
Second Extension of Lease effective May 19, 1995, and a 1997 Extension to
Amendment to Second Extension of Lease effective March 26, 1997, between
Holyoke Supply Company, Inc. ("Landlord") and Dielectric Polymers, Inc.
("Tenant"), the Tenant hereby notifies the Landlord that the Tenant is
exercising its right and option to extend said lease Indenture for a term of
six (6) months expiring May 31, 1998.
Please acknowledge your receipt of this notice by signing the enclosed copy
of this letter and returning it to the undersigned.
Very truly yours,
DIELECTRIC POLYMERS, INC.
/s/Lawrence G. Kuntz
Lawrence G. Kuntz
President
Receipt of notice acknowledged
HOLYOKE SUPPLY COMPANY, INC.
/s/Daniel C. Moriarity
Daniel C. Moriarity
President
[ex1014g]bd
EXHIBIT 21.01
SUBSIDIARIES OF PARK ELECTROCHEMICAL CORP.
The following table lists Park's subsidiaries and the jurisdiction in
which each such subsidiary is organized.
Jurisdiction of
Name Incorporation
Dielectric Polymers, Inc. Massachusetts
Dielektra GmbH Germany
Dielektra (H.K.) Limited Hong Kong
Dielektra UK Limited England
FiberCote Industries, Inc. Connecticut
Grand Rapids Die Casting Corp. Michigan
Metclad S.A. France
Nelco International Corporation Delaware
Nelco GmbH West Germany
Nelco Products, Inc. Delaware
Nelco Products Pte. Ltd. Singapore
Nelco S.A. France
Nelco STS, Inc. Delaware
Nelco Technology, Inc. Arizona
Neltec, Inc. Delaware
Neluk, Inc. Delaware
New England Laminates Co., Inc. New York
New England Laminates (U.K.) Ltd. England
Park Advanced Product Development Corp.Delaware
Technocharge Limited England
Zin-Plas Corporation Michigan
Zin-Plas of Canada, Inc. Canada
Zin-Plas Marketing and Business
Development Corporation Michigan
[ex2101]
EXHIBIT 23.01
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in the Registration
Statements Nos. 33-3777, 33-16650, 33-55383, 33-63956 and 333-12463 of our
report, dated April 22, 1998, with respect to the consolidated financial
statements and schedule of Park Electrochemical Corp. included in the
Annual Report on Form 10-K of Park Electrochemical Corp. for the fiscal
year ended March 1, 1998.
ERNST & YOUNG LLP
New York, New York
May 28, 1998
[ex2301]
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
financial statements of Park Electrochemical Corp. and is qualified in its
entirety by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1000
<S> <C> <C> <C>
<PERIOD-TYPE> YEAR YEAR YEAR
<FISCAL-YEAR-END> MAR-01-1998 MAR-02-1997 MAR-03-1996
<PERIOD-END> MAR-01-1998 MAR-02-1997 MAR-03-1996
<CASH> 45,102 42,321 75,970
<SECURITIES> 113,358 102,232 67,243
<RECEIVABLES> 55,369 52,060 44,678
<ALLOWANCES> 1,858 1,746 1,857
<INVENTORY> 26,953 20,458 27,712
<CURRENT-ASSETS> 247,380 220,414 217,772
<PP&E> 202,486 165,757 148,715
<DEPRECIATION> 94,370 82,366 72,276
<TOTAL-ASSETS> 359,329 307,862 298,975
<CURRENT-LIABILITIES> 70,827 55,410 56,807
<BONDS> 100,000 100,000 100,000
0 0 0
0 0 0
<COMMON> 1,358 1,358 1,358
<OTHER-SE> 165,046 141,997 133,069
<TOTAL-LIABILITY-AND-EQUITY> 166,404 307,862 298,975
<SALES> 376,158 334,490 312,966
<TOTAL-REVENUES> 384,540 342,143 315,251
<CGS> 301,968 275,372 242,655
<TOTAL-COSTS> 341,386 309,738 277,891
<OTHER-EXPENSES> 0 0 0
<LOSS-PROVISION> 0 0 0
<INTEREST-EXPENSE> 5,468 5,508 96
<INCOME-PRETAX> 37,686 26,897 37,264
<INCOME-TAX> 12,436 8,338 12,366
<INCOME-CONTINUING> 25,250 18,559 24,898
<DISCONTINUED> 0 0 0
<EXTRAORDINARY> 0 0 0
<CHANGES> 0 0 0
<NET-INCOME> 25,250 18,559 24,898
<EPS-PRIMARY> 2.22 1.64<F1> 2.17<F1>
<EPS-DILUTED> 2.07 1.58<F2> 2.11<F2>
<FN>
<F1>Restated to Basic EPS for adoption of SFAS No. 128
<F2>Restated to Diluted EPS for adoption of SFAS No. 128
</FN>
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
financial statements of Park Electrochemical Corp. and is qualified in its
entirety by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1000
<S> <C> <C>
<PERIOD-TYPE> 9-MOS 9-MOS
<FISCAL-YEAR-END> MAR-01-1998 MAR-02-1997
<PERIOD-END> NOV-30-1997 DEC-01-1996
<CASH> 27,203 62,631
<SECURITIES> 125,035 80,677
<RECEIVABLES> 53,242 48,222
<ALLOWANCES> 0 0
<INVENTORY> 30,432 21,826
<CURRENT-ASSETS> 244,203 217,828
<PP&E> 191,581 163,040
<DEPRECIATION> 91,111 80,839
<TOTAL-ASSETS> 348,593 304,435
<CURRENT-LIABILITIES> 67,071 56,759
<BONDS> 100,000 100,000
0 0
0 0
<COMMON> 1,358 1,358
<OTHER-SE> 159,487 137,743
<TOTAL-LIABILITY-AND-EQUITY> 348,593 304,435
<SALES> 272,344 246,352
<TOTAL-REVENUES> 278,594 251,726
<CGS> 219,512 204,281
<TOTAL-COSTS> 247,618 229,267
<OTHER-EXPENSES> 0 0
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 4,084 4,062
<INCOME-PRETAX> 26,892 18,397
<INCOME-TAX> 8,879 5,703
<INCOME-CONTINUING> 18,013 12,694
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 18,013 12,694
<EPS-PRIMARY> 1.59<F1> 1.11<F1>
<EPS-DILUTED> 1.48<F2> 1.09<F2>
<FN>
<F1>Restated to Basic EPS for adoption of SFAS No. 128
<F2>Restated to Diluted EPS for adoption of SFAS No. 128
</FN>
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
financial statements of Park Electrochemical Corp. and is qualified in its
entirety by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1000
<S> <C> <C>
<PERIOD-TYPE> 6-MOS 6-MOS
<FISCAL-YEAR-END> MAR-01-1998 MAR-02-1997
<PERIOD-END> AUG-31-1997 SEP-01-1996
<CASH> 39,295 82,121
<SECURITIES> 114,960 52,304
<RECEIVABLES> 41,634 44,304
<ALLOWANCES> 0 0
<INVENTORY> 25,426 25,969
<CURRENT-ASSETS> 228,451 209,204
<PP&E> 171,378 157,518
<DEPRECIATION> 87,463 77,760
<TOTAL-ASSETS> 316,661 293,448
<CURRENT-LIABILITIES> 55,134 50,666
<BONDS> 100,000 100,000
0 0
0 0
<COMMON> 1,358 1,358
<OTHER-SE> 150,405 133,175
<TOTAL-LIABILITY-AND-EQUITY> 316,661 293,448
<SALES> 174,719 157,380
<TOTAL-REVENUES> 178,883 160,908
<CGS> 141,738 130,694
<TOTAL-COSTS> 159,729 146,870
<OTHER-EXPENSES> 0 0
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 2,710 2,725
<INCOME-PRETAX> 16,444 11,313
<INCOME-TAX> 5,427 3,507
<INCOME-CONTINUING> 11,017 7,806
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 11,017 7,806
<EPS-PRIMARY> 0.98<F1> 0.68<F1>
<EPS-DILUTED> 0.92<F2> 0.67<F2>
<FN>
<F1>Restated to Basic EPS for adoption of SFAS No. 128
<F2>Restated to Diluted EPS for adoption of SFAS No. 128
</FN>
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
financial schedule of Park Electrochemical Corp. and is qualified in its
entirety by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1000
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 3-MOS
<FISCAL-YEAR-END> MAR-01-1998 MAR-02-1997
<PERIOD-END> JUN-01-1997 JUN-02-1996
<CASH> 44,754 87,398
<SECURITIES> 111,969 53,929
<RECEIVABLES> 46,589 40,058
<ALLOWANCES> 0 0
<INVENTORY> 23,425 31,269
<CURRENT-ASSETS> 232,492 217,387
<PP&E> 168,953 152,190
<DEPRECIATION> 85,153 74,849
<TOTAL-ASSETS> 320,660 299,390
<CURRENT-LIABILITIES> 62,625 55,241
<BONDS> 100,000 100,000
0 0
0 0
<COMMON> 1,358 1,358
<OTHER-SE> 147,180 135,185
<TOTAL-LIABILITY-AND-EQUITY> 320,660 299,390
<SALES> 91,633 75,406
<TOTAL-REVENUES> 93,623 77,259
<CGS> 73,592 63,574
<TOTAL-COSTS> 83,065 71,375
<OTHER-EXPENSES> 0 0
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 1,356 1,355
<INCOME-PRETAX> 9,202 4,529
<INCOME-TAX> 3,037 1,404
<INCOME-CONTINUING> 6,165 3,125
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 6,165 3,125
<EPS-PRIMARY> 0.55<F1> 0.27<F1>
<EPS-DILUTED> 0.51<F1><F2> 0.26<F2>
<FN>
<F1>Restated to Basic EPS for adoption of SFAS No. 128
<F2>Restated to Diluted EPS for adoption of SFAS No. 128
</FN>
</TABLE>
