UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 30, 1997
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OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
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Commission File Number 1-4184
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MATEC Corporation
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(Exact name of registrant as specified in its charter)
Delaware 06-0737363
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(State or other jurisdiction of (I.R.S Employer
incorporation or organization) Identification Number)
75 South St., Hopkinton, Massachusetts 01748
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(Address of principal executive offices) (Zip Code)
(508) 435-9039
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(Registrant's telephone number, including area code)
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
--- ---
As of May 6, 1997, the number of shares outstanding of Registrant's
Common Stock, par value $.05 was 2,735,191.
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MATEC Corporation
Index
Page
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PART I. FINANCIAL INFORMATION
Consolidated Condensed Balance Sheets -
March 30, 1997 and December 31, 1996 .................... 3
Consolidated Statements of Operations -
Three Months Ended March 30, 1997 and March 31, 1996 .... 4
Consolidated Condensed Statements of Cash Flows -
Three Months Ended March 30, 1997 and March 31, 1996 .... 5
Notes to Consolidated Condensed Financial Statements ..... 6
Management's Discussion and Analysis of Financial
Condition and Results of Operations ..................... 7-9
PART II. OTHER INFORMATION
Item 4 - Submission of Matters to a Vote of
Security Holders ................................ 10
Item 6 - Exhibits and Reports on Form 8-K ................ 10
Signatures ..................................................... 11
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PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
MATEC Corporation and Subsidiaries
Consolidated Condensed Balance Sheets
(In thousands, except share data) (Unaudited)
3/30/97 12/31/96
-------- --------
ASSETS
Current assets:
Cash and cash equivalents ............................ $ 834 $ 884
Receivables, less allowances of $132 and $145 ........ 5,794 5,764
Inventories .......................................... 5,309 5,464
Deferred income taxes and other current assets ....... 1,124 1,037
------- -------
Total current assets ............................... 13,061 13,149
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Property, plant and equipment, at cost ................. 18,972 18,894
Less accumulated depreciation ........................ 12,618 12,480
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6,354 6,414
------- -------
Marketable equity securities ........................... 2,652 2,782
Other assets ........................................... 120 109
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$22,187 $22,454
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable ........................................ $ 1,140 $ 1,190
Current portion of long-term debt .................... 200 200
Accounts payable ..................................... 2,212 2,035
Accrued liabilities .................................. 1,220 1,399
Income taxes ......................................... 115 119
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Total current liabilities .......................... 4,887 4,943
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Deferred income taxes .................................. 1,611 1,652
Long-term debt ......................................... 1,985 1,984
Stockholders' equity:
Preferred stock, $1.00 par value-
Authorized 1,000,000 shares; issued none ............ - -
Common stock, $.05 par value-
Authorized 10,000,000 shares; Issued 3,804,195 shares 190 190
Capital surplus ...................................... 6,443 6,443
Retained earnings .................................... 10,936 10,955
Net unrealized gain on marketable equity securities .. 1,492 1,570
Treasury stock at cost, 1,068,979 and 1,049,467 shares (5,357) (5,283)
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Total stockholders' equity ...................... 13,704 13,875
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$22,187 $22,454
======= =======
See notes to consolidated condensed financial statements.
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MATEC Corporation and Subsidiaries
Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
Three Months Ended
3/30/97 3/31/96
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Net sales ............................ $ 7,445 $ 8,652
Cost of sales ........................ 5,933 6,263
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Gross profit ....................... 1,512 2,389
Operating expenses:
Selling and administrative ......... 1,397 1,762
Research and development ........... 51 134
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1,448 1,896
Operating profit ..................... 64 493
Other income (expense):
Interest expense .................... (83) (116)
Other, net .......................... (13) (13)
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(96) (129)
Earnings (loss) before income taxes .. (32) 364
Income tax (expense) credit .......... 13 (146)
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Net earnings (loss) .................. $ (19) $ 218
======= =======
Earnings (loss) per share ............ $ (.01) $ .08
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Average shares outstanding ........... 2,748 2,764
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Cash dividends per share ............. $ - $ -
===== =====
See notes to consolidated condensed financial statements.
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MATEC Corporation and Subsidiaries
Consolidated Condensed Statements of Cash Flows
(In thousands)
(Unaudited)
Three Months Ended
3/30/97 3/31/96
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Cash flows from operating activities:
Net earnings (loss) .............................. $ (19) $ 218
Adjustments to reconcile net earnings (loss) to
net cash provided (used) by operating activities:
Non-cash items ................................. 333 285
Changes in operating assets and liabilities .... 52 (12)
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Net cash provided by operating activities 366 491
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Cash flows from investing activities:
Capital expenditures, net ........................ (277) (262)
Other, net........................................ (16) (10)
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Net cash (used) by investing activities (293) (272)
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Cash flows from financing activities:
Net (repayments) under lines of credit ........... (50) (200)
Purchases of common stock ........................ (73) -
Payments on long-term debt ....................... - (24)
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Net cash (used) by financing activities (123) (224)
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Net (decrease) in cash and cash equivalents ......... (50) (5)
Cash and cash equivalents:
Beginning of period .............................. 884 830
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End of period .................................... $ 834 $ 825
======= =======
See notes to consolidated condensed financial statements.
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MATEC Corporation and Subsidiaries
Notes to Consolidated Condensed Financial Statements
1. Financial Presentation:
The interim financial statements are unaudited but, in the
opinion of management, reflect all adjustments necessary for fair
presentation of results for such periods. The results of operations
for any interim period are not necessarily indicative of results for
the full year.
The accounting policies followed by the Company are set forth
in Note 1 to the Company's financial statements in the 1996 MATEC
Corporation and Subsidiaries Annual Report which is incorporated by
reference in Form 10-KSB for the year ended December 31, 1996.
2. Inventories:
Inventories consist of the following (in thousands):
3/30/97 12/31/96
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Raw materials ....................... $ 2,657 $ 2,586
Work in process ..................... 940 849
Finished goods ...................... 1,712 2,029
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$ 5,309 $ 5,464
======= =======
Inventories of $2,455,000 in 1997 and $2,575,000 in 1996 are
determined by the LIFO method.
3. New Accounting Standards:
The Company will adopt Statement of Financial Accounting
Standards ("SFAS") No. 128, "Earnings Per Share" in the fourth
quarter of 1997, as required. The Company will continue to apply APB
Opinion No. 15, "Earnings Per Share" until the adoption of SFAS 128.
The standard specifies the computation, presentation and disclosure
requirements for earnings per share.
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Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Financial Condition
- -------------------
Cash and cash equivalents decreased $50,000 during the three months
ended March 30, 1997. The Company's operations generated $366,000 in
cash during this period, while investing and financing activities used
cash of $293,000 and $123,000, respectively.
The sources of cash from operations were the net noncash items,
mainly depreciation, of $333,000 and $52,000 from the favorable change in
operating assets and liabilities, partially offset by the $19,000 loss.
The decrease in inventory and the increase in accounts payable, offset in
part by a decrease in accrued liabilities were the primary reasons for
the decrease in net operating assets. The decrease in inventory was
mainly due to lower levels in the steel cable and electronics segments
due to a combination of shorter lead times for certain products, the
Company's effort to reduce certain inventory levels and the increased
shipments in the steel cable segment. The increase in accounts payable
is mainly attributable to the timing of inventory purchases. The
decrease in accrued liabilities resulted mainly from the payments of the
401(k) match and restructuring expenses.
The Company's principal investing activity during the three months
ended March 30, 1997 was the purchase of $277,000 of capital equipment.
Machinery and equipment additions geared toward adding new and upgrading
existing production capabilities and processes in the steel cable segment
accounted for the majority of these expenditures.
During the quarter ended March 30, 1997, the Company reduced its
lines of credit borrowings by $50,000. At March 30, 1997, the Company's
unused portion of these lines of credit was $1,710,000.
Management believes that based on its current debt arrangements,
its current working capital, and the expected cash flows from operations
the Company's resources are sufficient to meet its financial needs in
1997 including a remaining capital expenditures budget of approximately
$1,000,000.
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Results of Operations -- Overview --
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Net sales for the quarter ended March 30, 1997 decreased $1,207,000
(14%) from the comparable period in 1996, as lower sales in the
electronics and instruments segments were partially offset by increased
sales in the steel cable segment.
The overall gross profit percentage decreased 26% from 1996 as lower
margins in the electronics and steel cable segments were partially offset
by higher margins in the instruments segment.
Total selling and administrative expenses decreased $365,000 (21%)
from 1996. Selling expenses decreased $303,000 (27%) from 1996 as all
segments reported lower expenses. Overall general and administrative
expenses decreased $62,000 (10%) mainly as a result of the lower
provision for Company-wide profit sharing and incentive bonus expense.
Research and development expenses decreased $83,000 (62%) from 1996
as a result of lower expenses in the instruments segment.
Interest expense decreased $33,000 from 1996 due to the lower levels
of short and long-term debt. Other income (expense), net remained level
with 1996.
The estimated effective income tax rate for both 1997 and 1996 is
40%.
Based on the lower sales level and the lower gross margin, offset in
part by a decrease in operating expenses, operating profit decreased from
$493,000 in 1996 to $64,000 during the quarter ended March 30, 1997.
Nonoperating expenses decreased $33,000 from 1996 mainly as a result of
lower interest expense. As a result, the Company reported a pre-tax loss
of $32,000 during the quarter ended March 30, 1997 versus a pre-tax
profit of $364,000 in 1996. The net loss amounted to $19,000 in 1997
compared to net earnings of $218,000 in 1996.
Business Segment Results
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Sales in the steel cable segment increased $760,000 (26%) over 1996
mainly due to increased sales to the automotive market. The overall
gross profit percentage decreased 30% from last year mainly as a result
of increased operating costs, primarily labor and freight, in its Mexican
facility. Based on the increased sales volume and delivery requirements
of the Mexican facility, the Company experienced an increase in the
number of and turnover of direct labor people, resulting in significant
labor inefficiencies and higher than anticipated labor costs. In
addition, in order to meet customer delivery schedules, the Company
incurred higher than expected freight expenses. Operating expenses
decreased $50,000 from 1996 mainly due to a lower bad debt expense
provision. As a result of the lower gross margin, partially offset by a
decrease in operating expenses, the steel cable segment reported a
$39,000 decrease in operating profit from 1996.
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Sales in the electronics segment decreased $1,409,000 (32%) from 1996
as this segment continues to experience softness from both the OEM and
contract manufacturers in the telecommunications market. The segment
first began to see this softness in the latter part of the second quarter
of 1996. The gross profit percentage decreased 28% from 1996 as a result
of the negative effect of allocating the fixed overhead expenses over the
lower sales level and changes in product mix. Total operating expenses
decreased 14% from 1996 mainly as a result of lower sales commission
expense. Based on the decreased sales and gross profit, offset in part
by lower operating expenses, the electronics segment reported a decrease
in operating profit of $527,000 from 1996.
Total sales in the instruments segment decreased $557,000 (41%) from
1996 as lower sales to both the NDT/NDE and medical research markets were
partially offset by increased unit sales of instruments to the colloidal
markets. The overall gross profit percentage increased 15% from 1996
mainly as a result of decreased personnel expense due to the phasing out
of the AcoustoSizer(TM) in 1996, reduced operating expenses and operating
efficiencies achieved by the consolidation of this segment in one
location, and changes in sales mix. Total operating expenses declined
43% from 1996 mainly due to decreases in selling and research and
development expenses. The selling expense decrease was mainly due to
lower personnel, travel and advertising expenses. Decreased personnel
expense and operating supplies were the primary reasons for the decrease
in research and development expense. While sales decreased, based on an
increase in the gross profit percentage and lower operating expenses, the
instruments segment reported a $103,000 reduction in its operating loss
incurred in 1996.
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PART II - OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
The Annual Meeting of Stockholders was held on April 28, 1997
to consider and vote on the election of seven directors.
Stockholders cast votes for the election of directors as
follows:
Nominee "For" "Withheld"
------------------ --------- ----------
Eli Fleisher 2,256,395 5,582
Robert B. Gill 2,104,183 157,794
Lawrence Holsborg 2,256,495 5,482
John J. McArdle III 2,256,445 5,532
Robert W. Muir, Jr. 2,256,495 5,482
Joseph W. Tiberio 2,256,395 5,582
Ted Valpey, Jr. 2,256,345 5,632
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
3. (b) Amendment to Article III, Section 1 of the By-Laws
effective April 28, 1997. Filed herein.
3 (c) By-Laws. Filed herein.
11. Statement re Computation of Per Share Earnings
(Loss). Filed herein.
27. Financial Data Schedule. Filed for electronic
purposes only.
(b) Reports on Form 8-K - None
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
MATEC Corporation
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Date: May 7, 1997 By /s/ Ted Valpey, Jr.
---------------------------------
Ted Valpey, Jr.
Chairman of the Board and
President
Date: May 7, 1997 By /s/ Michael J. Kroll
---------------------------------
Michael J. Kroll,
Vice President and Treasurer
(Principal Financial and
Accounting Officer)
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Exhibit 3.(b)
ARTICLE III
DIRECTORS
Section 1. Number, Qualification and Term. The property and
business of the Corporation shall be managed by its Board of
Directors consisting of not less than Five (5) nor more than Thirteen
(13) persons. The number of directors constituting the entire Board
shall be Seven (7); provided, however, that from time to time, such
number may be decreased to not less than Five (5) or increased to not
more than Thirteen (13) persons by amendment of this section of the
By-laws by a majority of the entire Board of Directors. Directors
need not be stockholders. They shall be elected at the Annual
Meeting of Stockholders and each director shall be elected to serve
until his successor shall be elected and shall qualify.
<PAGE>
Exhibit 3.(c)
MATEC Corporation
By-Laws
ARTICLE I
OFFICES
Section 1. Offices. The Corporation shall maintain a registered
office in Delaware. The Corporation may maintain such other offices
and keep its books, documents and records at such other places both
within and without the State of Delaware as the Board of Directors
may from time to time determine or the business of the Corporation
may require.
ARTICLE II
STOCKHOLDERS
Section 1. Place of Meetings. Meetings of stockholders for all
purposes shall be held at such place within or without the State of
Delaware as shall be determined by the Board of Directors.
Section 2. Annual Meetings. Annual meetings of stockholders shall
be held on the last Wednesday in April, in each year, if not a legal
holiday, and if a legal holiday, then on the next secular day
following, or on such other day as shall be fixed by the Board of
Directors and stated in the notice of the meeting, when stockholders
shall elect by a plurality vote a Board of Directors, and transact
such other business as may properly be brought before the meeting.
The annual meeting shall be held at a time determined by the Board of
Directors and stated in the notice of the meeting.
Section 3. Notice of Annual Meeting. Written or printed notice of
the annual meeting stating the place, date and hour of the meeting
shall be delivered not less than ten nor more than sixty days before
the date of the meeting, by mail, by or at the direction of the chief
executive officer, the Secretary, or the officer or persons calling
the meeting, to each stockholder of record entitled to vote at such
meeting.
Section 4. Special Meetings. Special meetings of the stockholders,
for any purpose or purposes, unless otherwise prescribed by statute
or by the Certificate of Incorporation, may be called by the chief
executive officer or the Board of Directors. The business transacted
at any special meeting of stockholders shall be limited to the
purposes stated in the notice of the meeting.
<PAGE>
Section 5. Notice of Special Meetings. Written or printed notice of
a special meeting stating the place, date and hour of the meeting and
the purpose or purposes for which the meeting is called, shall be
delivered not less than ten nor more than sixty days before the date
of the meeting, by mail, by or at the direction of the chief
executive officer, the Secretary, or the officer or persons calling
the meeting, to each stockholder of record entitled to vote at such
meeting. The notice shall also indicate that it is being issued by,
or at the direction of, the person calling the meeting.
Section 6. Quorum. The holders of a majority of the shares issued
and outstanding and entitled to vote, represented in person or by
proxy, shall constitute a quorum at all meetings of the stockholders
for the transaction of business except as otherwise provided by
statute or by the Certificate of Incorporation. If, however, such
quorum shall not be present or represented at any meeting of the
stockholders, the stockholders present in person or represented by
proxy shall have power to adjourn the meeting from time to time,
without notice other than announcement at the meeting, until a quorum
shall be present or represented. At such adjourned meeting at which
a quorum shall be present or represented any business may be
transacted which might have been transacted at the meeting as
originally noticed.
Section 7. Voting. At any meeting of stockholders each outstanding
share having voting power shall be entitled to one vote on each
matter submitted to a vote. A stockholder may vote either in person
or by proxy executed in writing by the stockholder or by his duly
authorized attorney-in-fact. All elections shall be determined by
plurality vote, and except as otherwise provided by statute or in the
Certificate of Incorporation, all other matters shall be determined
by vote of a majority of the shares present or represented at such
meeting and voting on such matters.
Section 8. Inspectors of Election. The Board of Directors in
advance of any meeting of stockholders may appoint one or more
inspectors to act at the meeting or any adjournment thereof. If
inspectors are not so appointed, the person presiding at a meeting of
stockholders may, and, on the request of any stockholder entitled to
vote thereat, shall appoint one or more inspectors. In case any
person appointed as inspector fails to appear or act, the vacancy may
be filled by the Board of Directors in advance of the meeting or at
the meeting by the person presiding thereat. Each inspector, before
entering upon the discharge of his duties shall take and sign an oath
faithfully to execute the duties of inspector at such meeting with
strict impartiality and according to the best of his ability.
Section 9. List of Stockholders. A list of stockholders as of the
record date, certified by the officer of the Corporation responsible
for its preparation or by the transfer agent, shall be produced at
any meeting of stockholders upon the request thereat or prior thereto
of any stockholder. If the right to vote at any meeting is
challenged, the inspectors of election, or person presiding thereat
shall require such list of stockholders to be produced as evidence of
the right of the persons challenged to vote at such meeting, and all
persons who appear from such list to be stockholders entitled to vote
thereat may vote at such meeting.
<PAGE>
ARTICLE III
DIRECTORS
Section 1. Number, Qualification and Term. The property and
business of the Corporation shall be managed by its Board of
Directors consisting of not less than Five (5) nor more than Thirteen
(13) persons. The number of directors constituting the entire Board
shall be Seven (7); provided, however, that from time to time, such
number may be decreased to not less than Five (5) or increased to not
more than Thirteen (13) persons by amendment of this section of the
By-laws by a majority of the entire Board of Directors. Directors
need not be stockholders. They shall be elected at the Annual
Meeting of Stockholders and each director shall be elected to serve
until his successor shall be elected and shall qualify.
Section 2. Removal. Any or all of the directors may be removed for
cause at any time by the vote of the stockholders.
Section 3. Vacancies. Newly created directorships resulting from an
increase in the Board of Directors and all vacancies occurring in the
Board of Directors, except vacancies caused by removal without cause,
may be filled by a majority vote of the directors then in office,
though less than a quorum exists. A director elected to fill a
vacancy shall be elected for the unexpired portion of the term of his
predecessor in office. A director elected to fill a newly created
directorship shall serve until the next succeeding annual meeting of
stockholders and until his successor shall have been elected and
qualified.
Section 4. Additional Powers. In addition to the powers and
authorities by these By-Laws expressly conferred upon it, the Board
of Directors may exercise all such powers of the Corporation and do
all such lawful acts and things as are not by statute or by the
Certificate of Incorporation or by these By-Laws directed or required
to be exercised or done by the stockholders.
ARTICLE IV
MEETINGS OF THE BOARD OF DIRECTORS
Section 1. Place. Meetings of the Board of Directors, regular or
special, may be held either within or without the State of Delaware.
Section 2. First Meeting. The first meeting of each newly elected
Board of Directors shall be held immediately after the annual meeting
of stockholders at the same place as such meeting is held and no
notice of such meeting to the newly elected directors shall be
necessary in order legally to constitute the meeting provided a
quorum shall be present, or it may convene at such place and time as
shall be specified in a notice given as hereinafter provided for
special meetings of the Board of Directors, or as shall be specified
in a duly executed waiver of notice thereof.
Section 3. Regular Meetings. Regular meetings of the Board of
Directors may be held upon such notice, or without notice, and at
such time and at such place as shall from time to time be determined
by the Board.
<PAGE>
Section 4. Special Meetings. Special meetings of the Board of
Directors may be called by the chief executive officer on written
notice to each director, deposited in the United States mail no later
than the third calendar day preceding the meeting date or delivered
by hand or to the telegraph company no later than the first calendar
day preceding the meeting date; special meetings shall be called by
the chief executive officer or Secretary in like manner and on like
notice on the written request of two directors.
Section 5. Quorum. A majority of the entire Board of Directors
shall constitute a quorum for the transaction of business unless a
greater or lesser number is required by law or by the Certificate of
Incorporation. The vote of a majority of the directors present at
any meeting at which a quorum is present shall be the act of the
Board of Directors, unless the vote of a greater number is required
by law or by the Certificate of Incorporation. If a quorum shall not
be present at any meeting of directors, the directors present may
adjourn the meeting from time to time. Notice of any such
adjournment shall be given to any director who was not present at the
time of such adjournment and unless announced at the meeting to the
other directors.
Section 6. Consent in Lieu of Meeting. Any action required or
permitted to be taken by the Board of Directors or any committee
thereof may be taken without a meeting if all members of the Board or
the committee consent in writing to the adoption of a resolution
authorizing the action. The resolution and the written consents
thereto by the members of the Board or committee shall be filed with
the minutes of the proceedings of the Board or committee.
Section 7. Telephone Participation at Meetings. Any one or more of
the Board of Directors or any committee thereof may participate in a
meeting of the Board of Directors or of such committee by means of
conference telephone or similar communications equipment allowing all
persons participating in the meeting to hear each other at the same
time. Participation in a meeting by such means shall constitute
presence in person at a meeting.
ARTICLE V
COMMITTEES
Section 1. Committees. The Board of Directors, by resolution
adopted by a majority of the entire board, may designate, from among
its members, an executive committee and other committees consisting
of three or more directors, which, to the extent provided in the
resolution, shall have all the authority of the Board, except as
otherwise required by law. Vacancies in the membership of such
committees shall be filled by the Board of Directors at a regular or
special meeting. Such committees shall keep regular minutes of its
proceedings and report the same to the Board when required.
Subject to the provisions of these By-Laws, the executive
committee and each other committee shall fix its own rules of
procedure and shall meet as provided by such rules or by resolution
of the Board of Directors and it shall also meet at the call of the
Chairman of the Board or President of the Corporation or any two
members of such committee. A majority of the executive committee and
of each other committee shall constitute a quorum for the transaction
of business and the vote of a majority of the members of such
committee present at any meeting at which there is a quorum shall be
the act of such committee.
<PAGE>
ARTICLE VI
NOTICES
Section 1. Form; Delivery. Whenever, under the provisions of the
statutes or of the Certificate of Incorporation or of these By-Laws,
notice is required to be given to any director or stockholder, such
notice may be given in writing, by mail, addressed to such director or
stockholder, at his address as it appears on the records of the
Corporation, with postage thereon prepaid, and such notice shall be
deemed to be given at the time when the same shall be deposited in the
United States mail. Notice to directors may also be given by
hand delivery, effective upon such delivery, or by telegram which notice
shall be deemed to have been given when delivered to the telegraph
company. Neither the business to be transacted at, nor the purpose of,
any regular or special meeting of the Board of Directors need be
specified in the notice or waiver of notice of such meeting.
Section 2. Waiver of Notice. Whenever any notice is required to be
given under the provisions of any statute or under the provisions of the
Certificate of Incorporation or these By-Laws, a waiver thereof in
writing signed by the person or persons entitled to such notice, whether
before or after the time stated therein, shall be deemed equivalent to
the giving of such notice. In addition, any stockholder attending a
meeting of stockholders in person or by proxy without protesting prior
to the conclusion of the meeting, the lack of notice thereof to him, and
any director attending a meeting of the Board of Directors without
protesting prior to the meeting or at its commencement such lack of
notice shall be conclusively deemed to have waived notice of such
meeting.
ARTICLE VII
OFFICERS AND AGENTS
Section 1. Officers. The officers of the Corporation shall be chosen
by the Board of Directors and shall be a Chairman of the Board, a
President, a Vice-President, a Secretary and a Treasurer. The Board of
Directors may also choose additional Vice-Presidents, and one or more
Assistant Secretaries and Assistant Treasurers.
Section 2. Election. The Board of Directors at its first meeting after
each annual meeting of stockholders shall choose a Chairman of the
Board, a President, one or more Vice-Presidents, a Secretary and a
Treasurer. Any two or more offices may be held by the same person.
Section 3. Additional Officers and Agents. The Board of Directors may
appoint such other officers and agents as it shall deem necessary who
shall hold their offices for such terms and shall exercise such powers
and perform such duties as shall be determined from time to time by the
Board of Directors.
Section 4. Compensation. The salaries of all officers of the
Corporation shall be fixed by the Board of Directors and the
compensation of employees and agents shall be so fixed or shall be fixed
by officers thereunto duly authorized.
<PAGE>
Section 5. Term of Office; Removal. The officers of the Corporation
shall hold office until their successors are chosen and qualify. Any
officer or agent elected or appointed by the Board of Directors may be
removed at any time with or without cause by the Board. Any vacancy
occurring in any office of the Corporation may be filled by the Board of
Directors.
Section 6. Powers and Duties of the Chairman of the Board. The
Chairman of the Board of Directors shall preside at all meetings of the
Board and all meetings of the stockholders at which he shall be present
and shall have such other powers and duties as may from time to time be
assigned to him by the Board of Directors.
Section 7. Powers and Duties of the President. The President shall be
the Chief Executive Officer of the Corporation, and shall have the
general management and superintendence of the affairs of the
Corporation, subject, however, to the control of the Board of Directors;
and in all cases where, and to the extent that, the duties of the other
officers of the Corporation are not specifically prescribed by By-Laws
or rules or regulations of the Board of Directors, the President may
prescribe such duties. He shall have general and active supervision
over the property, business and affairs of the Corporation and may sign,
execute, and deliver in the name of the Corporation deeds, mortgages,
bonds, contracts, powers of attorney, and other instruments, except in
cases where the signing and execution thereof shall be expressly
delegated by the Board of Directors or these By-Laws to some other
officer or agent of the Corporation or shall be required by law or
otherwise to be signed or executed, and may exercise any and all powers
and perform any and all duties relating to such supervision, or which
are imposed upon him by the By-Laws, or by the Board of Directors.
Subject to such limitations as the Board of Directors may from time to
time prescribe, the Chief Executive Officer shall have power to appoint
and to dismiss all such agents and employees of the Corporation who are
not officers thereof (including any appointed by the Board) as he may
deem proper, and to prescribe their duties, and subject to like
limitations, delegate to other officers of the Corporation any other of
the powers and duties conferred upon him by the By-Laws or by the Board
of Directors.
Section 8. Powers and Duties of the Vice-President. The Vice-President
shall perform the duties as may be prescribed by the Board of Directors
and subject to the chief executive officer.
Section 9. Powers and Duties of the Secretary. The Secretary shall
attend all sessions of the Board and all meetings of the stockholders
and record all votes and the minutes of all proceedings in a book to be
kept for that purpose, and shall perform like duties for any committee
of the Board when required. He shall cause to be given notice of all
meetings of stockholders and directors and shall perform such other
duties as pertain to his office. He shall keep in safe custody the seal
of the Corporation and when authorized by the Board of Directors, affix
it when required to any instrument.
<PAGE>
Section 10. Powers and Duties of the Treasurer. The Treasurer shall
have the custody of all the corporate funds and securities and shall
keep full and accurate accounts of receipts and disbursements in books
belonging to the Corporation and shall deposit all moneys and other
valuable effects in the name and to the credit of the Corporation in
such depositories as may be designated by the Board of Directors. He
shall disburse the funds of the Corporation as may be ordered by the
Board, taking proper vouchers for such disbursements, and shall render
to the chief executive officer and directors at the regular meetings of
the Board, or whenever they may require it, an account of all his
transactions as treasurer and of the financial condition of the
Corporation.
Section 11. Powers and Duties of Other Officers. All other officers
shall have such duties and exercise such powers as generally pertain to
their respective offices and all officers shall have such other duties
and exercise such other powers as from time to time may be prescribed by
the chief executive officer or the Board of Directors.
ARTICLE VIII
SHARES
Section 1. Form; Signature. The shares of the Corporation shall be
represented by certificates signed by the President or a Vice-President
and the Secretary or an Assistant Secretary or the Treasurer or an
Assistant Treasurer of the Corporation and may be sealed with the seal
of the Corporation or a facsimile thereof. The signatures of the
officers of the Corporation upon a certificate may be facsimiles if the
certificate is countersigned by a transfer agent or registered by a
registrar other than the Corporation itself or an employee of the
Corporation. In case any officer who has signed or whose facsimile
signature has been placed upon a certificate shall have ceased to be
such officer before such certificate is issued, it may be issued by the
Corporation with the same effect as if he were such officer at the date
of issue.
Section 2. Lost Certificates. The Board of Directors may authorize the
officers or agents of the Corporation to issue a new certificate in
place of any certificate theretofore issued by the Corporation alleged
to have been lost or destroyed and as a condition precedent to the
issuance thereof, may prescribe such terms and conditions as it deems
expedient, and may require such indemnities as it deems adequate to
protect the Corporation from any claim that may be made against it with
respect to any such certificate alleged to have been lost or destroyed.
Section 3. Transfer of Shares. Upon surrender to the Corporation or
the transfer agent of the Corporation of a certificate representing
shares duly endorsed or accompanied by proper evidence of succession,
assignment or authority to transfer, a new certificate shall be issued
to the person entitled thereto, and the old certificate cancelled and
the transaction recorded upon the books of the Corporation.
<PAGE>
Section 4. Fixing Record Date. For the purpose of determining
stockholders entitled to notice of or to vote at any meeting of
stockholders or any adjournment thereof, or to express consent to or
dissent from any proposal without a meeting, or for the purpose of
determining stockholders 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 stockholders. Such date
shall not be more than sixty nor less than ten days before the date
of any meeting nor more than sixty days prior to any other action.
When a determination of stockholders of record entitled to notice of
or to vote at any meeting of stockholders has been made as provided
in this section, such determination shall apply to any adjournment
thereof, unless the Board fixes a new record date for the adjourned
meeting.
Section 5. Registered Stockholders. The Corporation shall be
entitled to recognize the exclusive right of a person registered on
its books as the owner of shares to receive dividends, and to vote as
such owner, and to hold liable for calls and assessments a person
registered on its books as the owner of shares, and shall not be
bound to recognize any equitable or other claim to or interest in
such share or shares on the part of any other person, whether or not
it shall have express or other notice thereof, except as otherwise
provided by the laws of Delaware.
ARTICLE IX
GENERAL PROVISIONS
Section 1. Dividends. Subject to the provisions of law and of the
Certificate of Incorporation relating thereto, dividends may be
declared by the Board of Directors at any regular or special meeting,
pursuant to law. Dividends may be paid in cash, the Corporation's
bonds or its property, including the shares or bonds of other
corporations, subject to any provisions of law and of the Certificate
of Incorporation.
Section 2. Reserves. Before payment of any dividend, there may be
set aside out of any funds of the Corporation available for dividends
such sum or sums as the directors from time to time, in their
absolute discretion, think proper as a reserve fund to meet
contingencies, or for equalizing dividends, or for repairing or
maintaining any property of the Corporation, or for such other
purposes as the directors shall think conducive to the interest of
the Corporation, and the directors may modify or abolish any such
reserve in the manner in which it was created.
Section 3. Checks. All checks or demands for money and notes of the
Corporation shall be signed by such officer or officers or such other
person or persons as the Board of Directors may from time to time
designate.
Section 4. Fiscal Year. The fiscal year of the Corporation shall
begin on January 1st and end on December 31st of each year, unless
otherwise provided by the Board of Directors.
<PAGE>
Section 5. Seal. The corporate seal shall have inscribed thereon
the name of the Corporation, the year of its organization and the
words "CORPORATE SEAL, DELAWARE". This seal may be used by causing
it or a facsimile thereof to be impressed or affixed or in any manner
reproduced.
ARTICLE X
AMENDMENTS
Section 1. Amendments. These By-Laws may be amended or added to or
any part thereof repealed by the affirmative vote of a majority of
the votes cast by the holders of shares entitled to vote thereon at
any meeting of stockholders, the notice of which meeting includes
notice of the proposed amendment, addition or repeal; or the
affirmative vote of a majority of the directors present at the time
of the vote, if a quorum is present at such time, at any meeting of
the Board of Directors, the notice of which meeting includes notice
of the proposed amendment, addition or repeal, unless all members of
the Board of Directors are present at such meeting or unless such
notice be waived, in a writing, setting forth the proposed amendment,
addition or repeal and signed by the director entitled to such
notice.
<PAGE>
MATEC Corporation and Subsidiaries Exhibit 11
Calculation of Earnings (Loss) Per Share
(amounts in thousands, except per share data)
Three Months Ended
3/30/97 3/31/96
------ ------
Net earnings (loss) ............................... $ (19) $ 218
====== ======
Calculation of primary earnings (loss) per share:
- -------------------------------------------------
Weighted average common shares outstanding ....... 2,748 2,764
Increase from assumed exercise of stock options
and investment of proceeds in treasury stock,
based upon average market prices (D) ............ - 23
------ -------
Average common stock and common equivalent
shares outstanding (B) .......................... 2,748 2,787
====== =======
Net earnings (loss) per common and common
equivalent share (A) ............................ $ (.01) $ .08
====== =======
Calculation of fully diluted earnings (loss) per share:
- -------------------------------------------------------
Weighted average common shares outstanding ....... 2,748 2,764
Increase from assumed exercise of stock options
and investment of proceeds in treasury stock,
based upon the higher of average or quarter-end
market prices ................................... 25 23
------ -------
Average common stock and common equivalent
shares used to calculate fully diluted earnings
per share (B) ................................... 2,773 2,787
====== =======
Net earnings (loss) per common and common equivalent
share assuming full dilution (C) ................ $ (.01) $ .08
====== =======
(A) Dilution from stock options is less than 3%, therefore primary
earnings per share is based on the weighted average number of shares
outstanding.
(B) The effect of the outstanding warrants is excluded since they do not
meet either test of paragraph 37 of APB Opinion No. 15.
(C) Dilution is less than 3%, therefore the primary basis was used for
per share calculations.
(D) In loss periods, dilutive common equivalent shares are excluded as
the effect would be anti-dilutive.
<PAGE>
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<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-30-1997
<CASH> 834
<SECURITIES> 0
<RECEIVABLES> 5,926
<ALLOWANCES> 132
<INVENTORY> 5,309
<CURRENT-ASSETS> 13,061
<PP&E> 18,972
<DEPRECIATION> 12,618
<TOTAL-ASSETS> 22,187
<CURRENT-LIABILITIES> 4,887
<BONDS> 1,985
0
0
<COMMON> 190
<OTHER-SE> 13,514
<TOTAL-LIABILITY-AND-EQUITY> 22,187
<SALES> 7,445
<TOTAL-REVENUES> 7,445
<CGS> 5,933
<TOTAL-COSTS> 5,933
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 83
<INCOME-PRETAX> (32)
<INCOME-TAX> (13)
<INCOME-CONTINUING> (19)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (19)
<EPS-PRIMARY> (.01)
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</TABLE>
