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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report: September 26, 1996
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Lowrance Electronics, Inc.
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(Exact name of Registrant as specified in its charter)
Delaware 0-15240 440624411
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(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification No.)
12000 East Skelly Drive
Tulsa, Oklahoma 74128
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (918) 437-6881
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LOWRANCE ELECTRONICS, INC.
F O R M 8 - K
CURRENT REPORT
For the Event Occurring on
August 30, 1996
Item 1. Changes in Control of Registrant.
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Not applicable.
Item 2. Acquisition or Disposition of Assets.
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Not applicable.
Item 3. Bankruptcy or Receivership.
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Not applicable.
Item 4. Changes in Registrant's Certifying Accountant.
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Not applicable.
Item 5. Other Events - Lease of Mexican Manufacturing Facility.
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For several years, the Company's manufacturing facility in Tulsa,
Oklahoma has been fully utilized. As a result, in 1993, due to
continuing sales growth, the Company expanded its capacity by leasing
a 25,000 square foot manufacturing plant in Ensenada, Mexico. In 1995,
the Company again expanded its manufacturing operations by increasing
its leased space in Tulsa, Oklahoma from 30,000 square feet to 79,000
square feet, which the Company uses for warehousing, shipping and
manufacturing. The Company expects its unit sales to continue to grow
as the Company expands its Global Positioning System (GPS) product
offerings into the marine marketplace as well as into new aviation and
land-based recreational markets. To accommodate the expected growth,
on August 30, 1996 the Company entered into a new long-term lease for
a newly completed 88,000 square foot manufacturing facility in
Ensenada, Mexico
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which the Company expects to have operational by October, 1996. The
Company will surrender its existing 25,000 sq. ft. lease in Ensenada
in January 1997 and integrate its existing employees, approximately
150, and manufacturing production with expanded sonar and GPS
manufacturing operations into the new plant where employment is
expected to reach 400 full-time employees during 1997. In addition,
the Company expects to continue to employ approximately 170 full-time
manufacturing workers during 1997 in its Tulsa facilities where it
will continue to utilize 52,000 square feet of manufacturing space.
The Company executed two lease agreements for the new facility on
August 30, 1996. The first lease is for the 88,000 square foot
building which was built to the Company's specifications and the
second lease is for approximately 4.5 acres of land on which the
building is located. Both leases commence on October 1, 1996, and run
for a term of ten years, ending on September 30, 2006. In addition,
the Company has the right to renew the leases under the same
conditions for up to 20 additional years. The total payments under the
leases are $46,500 per month for the first 24 months and thereafter,
increased by a fixed inflationary factor of 3% per year. The Company
also has a one year option to lease all or part of the adjoining 6.2
acre tract of undeveloped land. The initial lease land rental payment
is approximately $1,700 per acre per month. Additionally, the Company
has the option any time after October 1, 1999, to purchase the
building and the 4.5 acres it is located on, along with any part of
the undeveloped land the Company elects to lease until the lease
agreements terminate, including renewal options. The fixed purchase
price for the building and the 4.5 acres is $4,142,000 and the price
of the undeveloped land is approximately $200,000 per acre during the
period from October 1, 1999, to September 30, 2000; thereafter, the
option purchase price for the building and land is escalated by 3% per
year.
Item 6. Resignations of Registrant's Directors.
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Not applicable.
Item 7. Financial Statements and Exhibits.
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Not applicable.
Item 8. Change in Fiscal Year.
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Not applicable.
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SIGNATURES
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
LOWRANCE ELECTRONICS, INC.
By: /s/ Darrell J. Lowrance
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Date: September 26, 1996 President and Chief
Executive Officer
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