Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, For Use of the Commission Only (as permitted by
Rule14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Under Rule 14a-12
Park Electrochemical Corp.
(Name of Registrant as Specified in Its Charter)
(Name of Person(s) Filing Proxy Statement, If Other than
Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-
6(i)(1) and 0-11.
(1) Title of each class of securities to which transactions
applies:
________________________________________________________________
(2) Aggregate number of securities to which transaction applies:
________________________________________________________________
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11 (set forth the
amount on which the filing fee is calculated and state how it
was determined):
________________________________________________________________
(4) Proposed maximum aggregate value of transaction:
________________________________________________________________
(5) Total fee paid:
________________________________________________________________
[ ] Fee paid previously with preliminary materials:
________________________________________________________________
[ ] Check box if any part of the fee is offset as provided by
Exchange Act Rule 0-11(a)(2) and identify the filing for
which the offsetting fee was paid previously. Identify the
previous filing by registration statement number, or the Form
or Schedule and the date of its filing.
(1) Amount previously paid:
_
(2) Form, Schedule or Registration Statement No.:
_
(3) Filing Party:
_
(4) Date Filed:
APPENDIX to electronically filed Proxy Statement dated June 16,
2004 of Park Electrochemical Corp. listing all graphic
information included in such Proxy Statement:
1. Stock Performance Graph appearing on page 11 of Proxy
Statement dated June 16, 2004 comparing the yearly percentage
change in the cumulative total shareholder return on the
Registrant's Common Stock with the cumulative total return of
the New York Stock Exchange Market Index and a Media General
Financial Services Index for electronic components and
accessories manufacturers comprised of the Company and 254
other companies for the period of the Company's five fiscal
years commencing March 1, 1999 and ending February 29, 2004,
assuming that $100 had been invested in the Company's Common
Stock and each index on February 26, 1999 and that all divi
dends on the Company's Common Stock and on each stock
included in each index were reinvested.
Such graph shows that such $100 invested in the Company's
Common Stock would have had a value of $84.43 on February 27,
2000, $188.96 on February 25, 2001, $147.25 on March 3, 2002,
$88.09 on March 2, 2003 and $155.27 on February 29, 2004,
that such $100 invested in the Media General Financial
Services Index would have had values of $295.25, $129.24,
$111.95, $62.30 and $114.67, respectively, on such dates and
that such $100 invested in the New York Stock Exchange Market
Index would have had values of $101.26, $108.67, $102.04,
$80.55 and $114.87, respectively, on such dates.
PARK ELECTROCHEMICAL CORP.
5 Dakota Drive
Lake Success, New York 11042
Notice of Annual Meeting of Shareholders
July 14, 2004
___
The Annual Meeting of Shareholders of PARK ELECTROCHEMICAL
CORP. (the "Company") will be held at The Bank of New York, One
Wall Street - 47th Floor, New York, New York (attendees must use
the 80 Broadway entrance) on July 14, 2004 at 10:00 o'clock A.M.,
New York time, for the purpose of considering and acting upon the
following:
1. The election of six (6) directors to serve
until the next annual meeting of shareholders
and until their successors are elected and
qualified.
2. The approval of the matching contribution feature of the
Company's Employee Stock Purchase Plan.
3. The transaction of such other business as may properly come
before the meeting.
Only holders of record of Common Stock at the close of
business on May 19, 2004 will be entitled to notice of, and to
vote at, the meeting or any adjournment or postponement thereof.
By Order of the Board of Directors,
Stephen E. Gilhuley
Senior Vice President,
Secretary and General Counsel
Dated: June 16, 2004
ALL SHAREHOLDERS ARE CORDIALLY INVITED TO ATTEND THE MEETING. IF
YOU DO NOT EXPECT TO BE PRESENT, PLEASE DATE AND SIGN THE
ENCLOSED FORM OF PROXY AND RETURN IT PROMPTLY TO THE COMPANY IN
THE ENCLOSED ENVELOPE WHICH REQUIRES NO POSTAGE IF MAILED IN THE
UNITED STATES.
PARK ELECTROCHEMICAL CORP.
5 Dakota Drive
Lake Success, New York 11042
P R O X Y S T A T E M E N T
Annual Meeting of Shareholders
July 14, 2004
This Proxy Statement is furnished in connection with the
solicitation by the Board of Directors (the "Board") of Park
Electrochemical Corp. (the "Company") of proxies with respect to
the Annual Meeting of Shareholders of the Company to be held on
July 14, 2004, and any adjournment or postponement thereof (the
"Meeting"). Any shareholder giving such a proxy (the form for
which is enclosed with this Proxy Statement) has the power to
revoke the same at any time before it is voted by (i) delivering
written notice of such revocation bearing a later date than the
proxy to the Secretary of the Company, (ii) submitting a later-
dated proxy, or (iii) attending the Meeting and voting in person.
This Proxy Statement and the accompanying form of proxy are
first being mailed on or about June 16, 2004 to all shareholders
of record as of the close of business on May 19, 2004.
VOTING SECURITIES
As of May 19, 2004, the outstanding voting securities of the
Company consisted of 19,872,550 shares of Common Stock, par value
$.10 per share, of the Company (the "Common Stock"), each share
of which, held of record at the close of business on May 19,
2004, is entitled to one vote. Presence in person or by proxy of
holders of a majority of the outstanding shares of Common Stock
will constitute a quorum for the transaction of business at the
Meeting. Abstentions and broker non-votes, if any, will be
included for purposes of determining a quorum. With respect to
the election of directors and the proposed approval of the
matching contribution feature of the Company's Employee Stock
Purchase Plan, abstentions and broker non-votes, if any, will not
be counted as having been voted and will have no effect on the
outcome of the votes, except in the case of the matching
contribution feature of the Company's Employee Stock Purchase
Plan, as described below under the caption "Approval of the
Matching Feature of the Company's Employee Stock Purchase Plan -
Vote Required".
As of May 19, 2004, all executive officers and directors of
the Company and nominees as a group (13 persons) beneficially
owned an aggregate of 2,637,277 shares of Common Stock (including
options to purchase an aggregate of 628,342 shares), constituting
approximately 12.9% of the outstanding shares of Common Stock
(giving effect to the exercise of such options).
STOCK OWNERSHIP
Principal Shareholders
The following table sets forth information as of May 19,
2004 with respect to each person (including any "group" of
persons as that term is used in Section 13(d)(3) of the
Securities Exchange Act of 1934, as amended (the "Exchange
Act")), who is known to the Company to be the beneficial owner
(for purposes of the rules of the Securities and Exchange
Commission) of more than 5% of the outstanding shares of Common
Stock as of that date.
Amount and
Nature of Percent
Name and Address Beneficial of
of Beneficial Owner Ownership Class
DePrince, Race & Zollo, 1,979,850(a) 10.0%
Inc.
201 S. Orange Avenue
Suite 850
Orlando, FL 32801
Jerry Shore 1,719,343(b) 8.7%
5 Dakota Drive
Lake Success, NY 11042
Wachovia Corporation 1,157,745(c) 5.8%
One Wachovia Center
Charlotte, NC 28288
(a) Deprince, Race & Zollo, Inc., a registered investment
adviser, holds sole investment power and sole voting power over
all of such shares, based on an amendment, dated January 28,
2004, to its Schedule 13G, filed under the Exchange Act, which
represented approximately 10.0% of the outstanding shares of the
Company's Common Stock as of May 19, 2004.
(b) Includes 168,615 shares owned by a member of Jerry Shore's
family, of which he disclaims beneficial ownership, and 45,129
shares owned by a foundation, of which he disclaims beneficial
ownership.
(c) Wachovia Corporation, a parent holding company, holds sole
investment power over 1,143,312 of such shares and sole voting
power over 939,030 of such shares, based on an amendment, dated
January 28, 2004, to its Schedule 13G, filed under the Exchange
Act, which represented approximately 5.8% of the outstanding
shares of the Company's Common Stock as of May 19, 2004.
Ownership of Directors and Executive Officers
The following table sets forth information as of May 19,
2004 with respect to shares of Common Stock beneficially owned
(for purposes of the rules of the Securities and Exchange
Commission) by each director and nominee, by each executive
officer of the Company who is identified in the Summary
Compensation table elsewhere in this Proxy Statement and by all
directors, nominees and executive officers of the Company as a
group.
Amount and
Nature of Percent
Beneficial of
Name of Beneficial Owner Ownership Class
Mark S. Ain 24,000(a) *
Dale Blanchfield 0 *
Anthony Chiesa 121,500(b) *
Lloyd Frank 28,125(c) *
Brian E. Shore 545,972(d) 2.7%
Jerry Shore 1,719,343(e) 8.7%
Steven T. Warshaw 0 *
Emily J. Groehl 39,205(f) *
John Jongebloed 32,825(g) *
Steven P. Schaefer 3,500(h) *
Gary M. Watson 35,750(i) *
All directors, nominees and
executive 2,637,277(j) 12.9%
officers as a group (13
persons)
* Less than 1%
(a) Consists of shares which Mark S. Ain may acquire pursuant to
options.
(b) Includes 9,000 shares which Anthony Chiesa may acquire
pursuant to options.
(c) Includes 22,125 shares which Lloyd Frank may acquire
pursuant to options and 3,000 shares owned by a member of Lloyd
Frank's family, of which he disclaims beneficial ownership.
(d) Includes 407,500 shares which Brian E. Shore may acquire
pursuant to options.
(e) See note (b) to the table under "Stock Ownership - Principal
Shareholders" for information with respect to these shares.
(f) Includes 39,196 shares which Emily J. Groehl may acquire
pursuant to options.
(g) Includes 31,025 shares which John Jongebloed may acquire
pursuant to options.
(h) Consists of shares which Steven P. Schaefer may acquire
pursuant to options.
(i) Includes 35,000 shares which Gary M. Watson may acquire
pursuant to options.
(j) Consists of 2,008,935 shares owned by directors and
executive officers and 628,342 shares issuable to directors and
executive officers upon exercise of options that are exercisable
as of May 19, 2004 or become exercisable within 60 days
thereafter.
ELECTION OF DIRECTORS
The Board to be elected at the Meeting consists of six
members. Proxies will be voted in accordance with their terms
and, in the absence of contrary instructions, for the election as
directors of the nominees whose names appear in the following
table, to serve for the ensuing year and until their successors
are elected and qualified. One current director, Jerry Shore, who
has been a member of the Board since the founding of the Company
in 1954, is retiring as a director and will not be standing for
re-election at the Meeting. Should any of the nominees not remain
a candidate at the time of the Meeting (a situation which is not
now anticipated), proxies solicited hereunder will be voted in
favor of those nominees who do remain as candidates and may be
voted for substituted nominees. The six nominees who receive a
plurality of the votes cast at the Meeting in person or by proxy
shall be elected. Each of the nominees, other than Messrs.
Blanchfield and Warshaw, is presently a member of the Board.
Principal Occupation; Positions
and Offices with the Company; Directo
Name Other Directorships Age r
Since
Mark S. Ain Chief Executive Officer and 61 1998
Chairman of the Board of Kronos
Incorporated, a manufacturer of
computerized systems for time and
labor management, Chelmsford,
Massachusetts; and a director of
KVH Industries, Inc. and LTX
Corporation
Dale Former President of Electronics 66 -
Blanchfield Division of The Bureau of
Engraving Inc., a manufacturer of
specialized, high-volume, high
layer count printed circuit
boards, Minneapolis, Minnesota,
from 1990 to June 2003; and a
director of The Bureau of
Engraving Inc.
Anthony Chiesa Former Vice President of the 83 1954
Company
Lloyd Frank Of Counsel since January 2004 and 78 1985
a Partner for many years prior
thereto, Jenkins & Gilchrist
Parker Chapin LLP, a law firm,
New York City; and a director of
DryClean, USA Inc. and Volt
Information Sciences, Inc.
Brian E. Shore President and Chief Executive 52 1983
Officer of the Company
Steven T. President, Chief Executive 55 -
Warshaw Officer and Chairman of the
Board, M Cubed Technologies,
Inc., a manufacturer of advanced
ceramic materials for semi-
conductor equipment and armor
applications, Monroe,
Connecticut, since July 2002;
President, Hexcel Schwebel
Division, Hexcel Corporation, a
supplier of specialized fabrics
for reinforcement of laminates
used in printed circuit boards
and in commercial aerospace,
recreation and other industrial
applications, Anderson, South
Carolina, April 2000 to November
2001; Senior Vice President,
World Wide Sales and Marketing,
Photronics, Inc., a manufacturer
of photomasks used to transfer
circuit patterns onto semi-
conductor wafers, Brookfield,
Connecticut, February 1999 to
April 2000; and President, Olin
Microelectronic Materials, a
supplier of advanced chemicals
and related products, Norwalk,
Connecticut, January 1996 to
January 1999; and a director of
NN, Inc.
Messrs. Ain, Chiesa and Shore have had the principal
occupation set forth opposite their respective names for at least
the past five years.
There are no family relationships among any of the persons
named in the above table or among any of such persons and any of
the other executive officers of the Company. Jerry Shore, who is
not standing for re-election as a director, is the father of
Brian E. Shore.
The Board has determined that the following nominees and
directors have no material relationships with the Company and are
"independent" as required by and as defined in the director
independence standards of the New York Stock Exchange: Mark S.
Ain, Dale Blanchfield, Anthony Chiesa, Lloyd Frank and Steven T.
Warshaw. In making this determination, the Board considered that
Jenkins & Gilchrist Parker Chapin LLP, a law firm of which Lloyd
Frank is of counsel and was a partner for many years prior to
2004, was retained to provide counsel to the Company during its
fiscal year ended March 2, 2003 but not during its fiscal year
ended February 29, 2004. Brian E. Shore does not satisfy such
independence standards because he is an employee of the Company,
and Jerry Shore does not satisfy such standards because he is the
father of Brian Shore.
The Company's Audit Committee currently consists of Mark S.
Ain, Anthony Chiesa and Lloyd Frank. Following the Meeting, it is
the intention of the Board of Directors to appoint Mark S. Ain,
Anthony Chiesa, Lloyd Frank and Steven T. Warshaw as members of
the Audit Committee. The Board of Directors has determined that
Mr. Warshaw is an "audit committee financial expert" as required
by and as defined in rules of the Securities and Exchange
Commission and that each of Messrs. Ain, Chiesa, Frank and
Warshaw is "independent" as required by and as defined in the
audit committee independence standards of the Securities and
Exchange Commission and of the New York Stock Exchange. The
duties and responsibilities of the Audit Committee are set forth
in a written charter of such Committee, first adopted by the
Board in July 2000 and subsequently amended and restated in May
2004, a copy of which is attached as Appendix A to this Proxy
Statement as required by rules of the Securities and Exchange
Commission, and are described elsewhere in this Proxy Statement
under the caption "Other Matters - Audit Committee Report". The
Audit Committee also issues the Audit Committee Report required
to be included in the Company's Proxy Statement by rules of the
Securities and Exchange Commission. The Audit Committee Report
for the Company's 2004 fiscal year is set forth under the caption
"Other Matters - Audit Committee Report" elsewhere in this Proxy
Statement.
The Company has a Compensation Committee and a Stock Option
Committee, each consisting of Anthony Chiesa, Lloyd Frank and
Jerry Shore. Following the Meeting, it is the intention of the
Board of Directors to appoint Dale Blanchfield, Anthony Chiesa
and Steven T. Warshaw as members of the Compensation Committee
and Anthony Chiesa, Lloyd Frank and Steven T. Warshaw as members
of the Stock Option Committee. The functions of the Compensation
and Stock Option Committees are set forth in written charters of
such Committees adopted by the Board, and such functions are
described elsewhere in this Proxy Statement under the caption
"Executive Compensation - Board and Compensation Committee Report
on Executive Compensation".
The Company has a Nominating Committee consisting of Anthony
Chiesa, Lloyd Frank and Jerry Shore. Following the Meeting, it is
the intention of the Board of Directors to appoint Dale
Blanchfield, Anthony Chiesa and Lloyd Frank as members of the
Nominating Committee. The functions of the Nominating Committee,
which are to identify and recommend to the Board of Directors
individuals qualified to serve as directors of the Company and on
committees of the Board and to oversee the evaluation of the
Board and the Company's management, are set forth in a written
charter of such Committee adopted by the Board. The Nominating
Committee recommended to the Board of Directors, and the Board
nominated, Mark S. Ain, Dale Blanchfield, Anthony Chiesa, Lloyd
Frank, Brian Shore and Steven T. Warshaw as nominees for election
as directors at the Meeting.
The Company has a Corporate Governance Committee consisting
of Anthony Chiesa, Lloyd Frank and Jerry Shore. Following the
Meeting, it is the intention of the Board of Directors to appoint
Anthony Chiesa, Lloyd Frank and Steven T. Warshaw as members of
the Corporate Governance Committee. The functions of the
Corporate Governance Committee, which are to advise the Board of
Directors with respect to Board composition, procedures and
committees and to develop and recommend to the Board a set of
corporate governance principles applicable to the Company, are
set forth in a written charter of such Committee adopted by the
Board.
Copies of the charters of the Audit, Compensation, Stock
Option, Nominating and Corporate Governance Committees are
available on the Company's web site at www.parkelectro.com under
the caption "Charters and Codes" as required by rules of the New
York Stock Exchange.
During the Company's last fiscal year, the Board of
Directors met six times and authorized action by unanimous
written consent on five occasions, the Audit Committee met twice
and authorized action by unanimous written consent on one
occasion, the Compensation Committee met once, and the Stock
Option Committee met twice. Each of the directors attended all of
the meetings held by the Board and each committee thereof of
which he was a member during the Company's last fiscal year. The
Company did not have a Corporate Governance Committee or a
Nominating Committee during the last fiscal year.
It is the Company's policy that all directors are invited to
and encouraged to attend Annual Meetings of Shareholders, and all
members of the Board of Directors attended the Annual Meeting of
Shareholders held on July 17, 2003.
Each director who is not an employee of the Company or any
of its subsidiaries receives a fee of $12,000 per annum for his
services as a director, each member of the Audit Committee, other
than the Chairman of the Committee, receives a fee of $2,000 per
annum for his services as a member of such Committee, and the
Chairman of the Audit Committee receives a fee of $4,000 per
annum for his services as Chairman of such Committee, each member
of the Compensation Committee of the Board of Directors receives
a fee of $2,000 per annum for his services as a member of such
Committee, and each Director and each Committee member is
reimbursed for travel expenses incurred in attending meetings of
the Board of Directors of the Company and of Committees of the
Board of Directors of the Company.
On July 24, 2003, Messrs. Ain, Chiesa, Frank and Jerry Shore
each received a non-qualified stock option for 3,000 shares of
Common Stock at an exercise price of $19.95 per share under the
Company's 2002 Stock Option Plan. Each of these options expires
on July 24, 2013, and each is exercisable 25 percent after one
year from date of grant, 50 percent after two years from date of
grant, 75 percent after three years from date of grant and 100
percent after four years from date of grant.
EXECUTIVE COMPENSATION
Summary Compensation
The following table shows the compensation for each of the
three most recent fiscal years for the Company's Chief Executive
Officer and the four other most highly compensated executive
officers who were serving in such capacities at the end of the
Company's most recent fiscal year.
Long-Term
Compensation
Annual Compensation Awards
----------------------- ------------
Other Securities All Other
Annual Underlying Compen-
Name and Year Compen- Options sation
Principal Position (a) Salary Bonus sation SARs(#) (b)
Brian E. Shore(c) 2004 $357,760 $ -0- $ -0- 20,000 $7,000
President and Chief 2003 357,760 -0- -0- 25,000 4,000
Executive Officer 2002 364,640 -0- -0- 40,000 8,500
Emily J. Groehl 2004 210,912 -0- -0- 7,500 7,000
Senior Vice President, 2003 210,912 -0- -0- 15,000 4,000
Sales and Marketing 2002 214,968 -0- -0- 15,000 8,500
John Jongebloed(d) 2004 165,000 15,000 -0- 5,000 5,775
Senior Vice President, 2003 165,000 -0- -0- 10,000 3,300
Global Logistics 2002 168.173 -0- -0- 15,000 8,409
Steven P. Schaefer(e) 2004 155,577 25,000 -0- 15,000 5,445
Senior Vice President,
Technology
Gary M. Watson(f) 2004 240,000 25,000 74,576 10,000 7,000
Senior Vice President, 2003 223,047 -0- 71,964 15,000 4,000
Engineering and Senior 2002 203,846 -0- -0- 10,000 8,500
Vice President, Asian
Business Unit
---------
The salary amounts for Messrs. Shore and Jongebloed and Ms.
Groehl for the 2002 fiscal year are more than the salary amounts
for the 2003 fiscal year not because of any salary decreases, but
because the 2002 fiscal year consisted of 53 weeks while the 2003
fiscal year consisted of 52 weeks. None of the named executive
officers has received any salary increase during the Company's
last four fiscal years, other than Mr. Schaefer and other than
Mr. Watson (see note (f) below):
(a) Information is provided for the Company's fiscal years ended
February 29, 2004, March 2, 2003 and March 3, 2002, respectively.
(b) Includes the amounts of the Company's annual profit sharing
contributions to the Company's Employees' Profit Sharing and
401(k) Retirement Savings Plan ("the Plan") which were accrued
for the accounts of the named executive officers for the fiscal
years shown. These amounts vest in accordance with a graduated
scale based on years of service of the employee with the Company.
Substantially all full-time employees of the Company and its
subsidiaries in the United States participate in the profit
sharing portion of the Plan, which is intended to provide
retirement benefits to such employees and which is subject to the
provisions of the Employee Retirement Income Security Act of 1974
("ERISA"). The amounts of profit sharing contributions, if any,
by the Company and its subsidiaries to the accounts of
participating employees are percentages of the eligible
compensation of the participating employees up to a maximum
amount of compensation for each employee established under the
Internal Revenue Code of 1986, which was $200,000 for each of the
Company's two most recent fiscal years and $170,000 for the
Company's fiscal year ended March 3, 2002. The percentages of
compensation contributed to the Plan, which are determined each
year by the Board of Directors of the Company, may vary between
the Company and each subsidiary, but the percentage must be the
same for each participating employee of the Company or the
subsidiary, as the case may be.
Substantially all full-time employees of the Company's
subsidiaries in the United States are eligible to receive
contributions by the subsidiaries to match the contributions
of the employees to the 401(k) retirement savings portion of
the Plan, with the maximum matching contribution being 3% of
the compensation of the employees. However, employees of the
Company are not eligible to receive such matching
contributions, but it has been the Company's practice to
determine a gross annual profit sharing percentage of
eligible compensation to be contributed by each subsidiary to
the profit sharing portion of the Plan and to reduce such
percentage by the average percentage of the compensation of
such subsidiary's employees that was contributed by such
subsidiary as 401(k) retirement savings matching
contributions. Consistent with this practice, to compensate
employees of the Company for their ineligibility for matching
contributions to the 401(k) retirement savings portion of the
Plan, the Company approved profit sharing contributions for
the named executive officers and for the other employees of
the Company in amounts equal to 2% of the eligible
compensation of such employees, since the Company's
subsidiaries' matching contributions under the 401(k)
retirement savings portion of the Plan for the 2003 fiscal
year approximated 2% of the eligible compensation of the such
subsidiaries' employees. Accordingly, the amounts shown for
2003 are contributions that were made by the Company for the
named executive officers to compensate them for the fact that
they were not eligible for matching contributions under the
401(k) retirement savings portion of the Plan.
(c) As he has in the past, Mr. Shore rejected the Compensation
Committee's offer of a bonus for the fiscal year ended February
29, 2004 and a salary increase for the fiscal year ending
February 27, 2005.
(d) Mr. Jongebloed became an executive officer on July 18, 2001,
but the salary shown for him is the salary paid to him by the
Company for the entire 2002 fiscal year.
(e) Mr. Schaefer became an executive officer on July 17, 2003,
but the salary shown for him is the salary paid to him by the
Company for the entire 2003 fiscal year. Under the Securities and
Exchange Commission's rules regarding the disclosure of executive
compensation, no information is required to be provided for Mr.
Schaefer for prior years during which he was not an executive
officer.
(f) Mr. Watson's title was Senior Vice President, Engineering
until May 2001, when he became Senior Vice President, Engineering
and Technology, and he also became Senior Vice President, Asian
Business Unit in August 2002. Mr. Watson's title was changed to
Senior Vice President, Engineering in July 2003. The salary
amount for Mr. Watson for the 2003 fiscal year is more than the
salary amount for the 2002 fiscal year because of a salary
increase granted to Mr. Watson in connection with his becoming
Senior Vice President, Asian Business Unit and his relocation to
Singapore in August 2002 to manage the Company's Asian Business
Unit; and the amounts shown for Mr. Watson under "Other Annual
Compensation" consist of certain expenses paid on his behalf by
the Company in connection with his relocation to Singapore and
certain living expenses incurred by him in Singapore but paid by
the Company pursuant to an agreement between Mr. Watson and the
Company relating to his relocation to Singapore.
Stock Options
The Company's 2002 Stock Option Plan provides for the grant
to key employees of the Company of both options which qualify as
incentive stock options under the Internal Revenue Code of 1986
and non-qualified stock options. The 2002 Stock Option Plan is
administered by the Stock Option Committee.
The following table provides information with respect to
options to purchase shares of Common Stock granted pursuant to
the 2002 Stock Option Plan to the named executive officers during
the Company's last fiscal year.
Part 1 of 2
Option/SAR Grants in Last Fiscal Year
-------------------------------------
Number of
Securities % of Total
Underlying Options/SARs Exercise
Options/SARs Granted to or Base
Granted(#) Employees in Price
Name (a) Fiscal Year ($/sh.) Expiration Date
Brian E. Shore 20,000 11.0% $19.95 July 24, 2013
Emily J. Groehl 7,500 4.1% 19.95 July 24, 2013
John Jongebloed 5,000 2.7% 19.95 July 24, 2013
Steven P. Schaefer 15,000 8.2% 19.95 July 24, 2013
Gary M. Watson 10,000 5.5% 19.95 July 24, 2013
Part 2 of 2
Option/SAR Grants in Last Fiscal Year
-------------------------------------
Potential Realizable Value
at Assumed Annual Rates of
Stock Price Appreciation
for Option Term (b)
Name 0%($) 5%($) 10%($)
Brian E. Shore $-0- $250,929 $635,903
Emily J. Groehl -0- 94,098 238,464
John Jongebloed -0- 62,732 158,976
Steven P. Schaefer -0- 188,197 476,927
Gary M. Watson -0- 125,464 317,952
(a) Options become exercisable 25% one year from the date of
grant with an additional 25% exercisable each succeeding
anniversary of the date of grant. The Company has not granted
stock appreciation rights.
(b) The potential realizable value portion of the foregoing table
illustrates value that might be realized upon exercise of the
options at the expiration of their term, assuming the
specified compounded rates of appreciation on the Company's
Common Stock over the life of the options. This schedule does
not take into account provisions of the options providing for
termination of the option following termination of
employment, nontransferability or vesting over periods of
four years. The dollar amounts under these columns are the
result of calculations at the 5% and 10% rates set by the
Securities and Exchange Commission and therefore are not
intended to forecast possible future appreciation, if any, of
the Company's stock price. The column indicating 0%
appreciation is included to reflect the fact that a zero
percent gain in stock price will result in zero dollars for
the optionee. No gain to the optionees is possible without an
increase in stock price, which will benefit all shareholders
commensurately.
Aggregated Option Exercises in the Last Fiscal Year and Fiscal
Year-End Option Values
The following table provides information regarding the pre-
tax value realized from the exercise of stock options by the
named executive officers during the Company's last fiscal year
and the value of unexercised options held by such executive
officers as of the end of such fiscal year.
part 1 of 2
Number of Securities
Shares Underlying Unexercised
Acquired Value Options/SARs at FY-End(#)
Name On Exercise Realized
(#)(a) $(b) Exercisable Unexercisable
Brian E. Shore 10,500 $124,880 412,500 77,500
Emily J. Groehl -0- -0- 35,446 29,063
John Jongebloed -0- -0- 24,775 23,750
Steven P. Schaefer -0- -0- 2,250 19,750
Gary M. Watson -0- -0- 25,625 31,875
part 2 of 2
Value of Unexercised
In-the-Money
Options/SARs
at FY-End ($)(c)
Name Exercisable Unexercisable
Brian E. Shore $4,531,752 $402,124
Emily J. Groehl 185,560 74,625
John Jongebloed 182,387 98,250
Steven P. Schaefer 4,130 106,130
Gary M. Watson 21,375 85,625
(a) The Company has not granted stock appreciation rights.
(b) Value realized equals market value of the underlying shares
on the date of exercise, less the exercise price, times the
number of shares acquired, without deducting any taxes paid
by the employee.
(c) Value of unexercised options equals market value of the
shares underlying "in-the-money" options at February 29, 2004
($26.75 per share), less exercise price, times the number of
options outstanding
Equity Compensation Plan Information
The following table provides information as of the end of
the Company's most recent fiscal year with respect to
compensation plans (including individual compensation
arrangements) under which equity securities of the Company are
authorized for issuance.
Number of securites
Number of remaining available
securities Weighted-average for future issuance
to be issued upon exercise price under equity
exercise of of outstanding compensation plans
outstanding options, (excluding securites
options,warrants warrants and reflected in
Plan category and rights rights column (A))
(A) (B) (C)
Equity compensation
plans approved by
security holders(a) 1,396,653 $19.91 705,725
Equity compensation
plans not approved
by security holders(a) -0- -0- -0-
Total 1,396,653 $19.91 705,725
---------------
(a)The Company's only equity compensation plans are its 2002 Stock
Option Plan, which was approved by the Company's shareholders in
July 2002, and its 1992 Stock Option Plan, which was approved by the
Company's shareholders in July 1992. Authority to grant additional
options under the 1992 Plan expired on March 24, 2002, and all
options granted under the 1992 Plan will expire in March 2012 or
earlier; and authority to grant additional options under the 2002
Plan will expire on May 21, 2012, and all options granted to date
under the 2002 Plan will expire in January 2014 or earlier.
Employment and Consulting Agreements
Jerry Shore, Chairman of the Board, was President of the
Company until March 4, 1996 and Chief Executive Officer of the
Company until November 19, 1996. In accordance with the
provisions of an amended and restated employment agreement
between Jerry Shore and the Company, as amended, Jerry Shore is
serving as Chairman of the Board, and effective as of March 3,
1997, the first day of the Company's 1998 fiscal year, he retired
from full-time employment with the Company and commenced serving
as a consultant for a term of five years. In accordance with the
employment agreement, he was being paid an annual consulting fee
equal to 60% of his base salary in effect under the agreement at
the time of his retirement, subject to an indexed cost of living
increase. In October 1997, in connection with the Company's
agreement to participate in a split dollar life insurance
agreement for Jerry Shore's benefit as discussed below, Jerry
Shore agreed to extend his consulting term for an additional year
and agreed not to compete with the Company during the consulting
term. Jerry Shore's consulting term expired on March 2, 2003.
In October 1997, the Company entered into a split-dollar
life insurance agreement with a trust established by Jerry Shore
for the benefit of his descendants, of which Jerry Shore's
children, including Brian E. Shore, are the trustees. Pursuant to
this agreement, the Company pays to Jerry Shore an amount equal
to the portion of the annual premiums on two life insurance
policies held in the trust that represents the "economic benefit"
to Jerry Shore calculated in accordance with United States
Treasury Department rules then in effect ($6,703 in the 2004
fiscal year), and the Company pays the balance of the annual
premiums on the policies to the insurers. In light of certain
provisions of the Sarbanes-Oxley Act of 2002, the Company made no
payment for the balance of the annual premiums in the 2004 fiscal
year. Both policies are joint life policies payable on the death
of the survivor of Jerry Shore and his spouse, with an aggregate
face value of $5 million. The aggregate amount of the premiums on
the policies paid by the Company constitutes indebtedness from
the trust to the Company and is secured by collateral assignments
of the policies. Upon the termination of the split-dollar life
insurance agreement, whether by the death of the survivor of the
insureds or the earlier termination of the agreement, the Company
is entitled to be repaid by the trust the amount of such indebted
ness.
Board and Compensation Committee Report on Executive Compensation
Compensation of the Company's executive officers is composed
of salary, annual cash bonuses, stock options and the Company's
Profit Sharing Plan. The Board has a Compensation Committee which
considers and takes any necessary action regarding the
compensation of the Company's Chief Executive Officer, other than
the grant of stock options or compensation pursuant to plans
administered by the Board. Brian E. Shore, President and Chief
Executive Officer of the Company, determines the annual salary
and cash bonus for each executive officer other than himself. The
Board also has a Stock Option Committee which administers the
Company's Stock Option Plans, including decisions as to the
number of options to grant to each executive officer. The amount
of discretionary contributions to the Profit Sharing Plan for
each fiscal year is determined by the Board of Directors.
Salaries of executive officers are determined based on the
significance of the position to the Company, individual
experience and expertise, individual performance and information
gathered informally as to compensation levels of comparable
companies in the same geographic location as the Company. Brian
E. Shore reviews the salary of each key employee, including
executive officers, annually and makes adjustments as
appropriate.
Decisions as to the award of annual cash bonuses to
executive officers with respect to each fiscal year are made
after the close of the fiscal year. The amount awarded to each
executive officer is based on the Company's overall performance,
individual performance, base salary level, bonuses paid in prior
years and overall equity and fairness.
The Company typically grants stock options under the
Company's Stock Option Plan once each year. The Stock Option
Committee bases its decisions on individual performance, base
salary and bonus levels, recommendations from senior management
and overall equity and fairness.
The Board decides annually the amount of the Company's
contribution to the Profit Sharing Plan. The amount of such
contribution is discretionary, but may not exceed 15% of the
total remuneration paid to eligible employees or such other
amount as is allowed under the Internal Revenue Code of 1986, as
amended (the "Code"). Subject to this limit, the Board determines
the amount to be contributed for each year based on the Company's
overall performance, the amount contributed in prior years and
the amounts of prior contributions recently forfeited by eligible
employees due to termination of employment prior to vesting. The
Profit Sharing Plan is a broad-based plan in which numerous
employees as well as executive officers are eligible to par
ticipate. Once the Company contribution is made, amounts are
allocated to eligible employees in accordance with a formula
based on their remuneration.
The Board, the Compensation Committee, the Stock Option
Committee and Brian E. Shore use no set formulas in making their
determinations and may afford different weight to different
factors for each executive officer. Such weighting may vary from
year to year.
The Board and the Compensation Committee have reviewed the
impact of Section 162(m) of the Code which limits the
deductibility of certain otherwise deductible compensation in
excess of $1 million paid to the Chief Executive Officer and the
other executive officers named in the table set forth under the
caption "Executive Compensation - Summary Compensation" elsewhere
in this Proxy Statement. It is the Company's policy to attempt to
design its executive compensation plans and arrangements to be
treated as tax deductible compensation wherever, in the judgment
of the Board or the Compensation Committee, as the case may be,
to do so would be consistent with the objectives of that
compensation plan or arrangement. Accordingly, the Board and the
Compensation Committee from time to time may consider whether
changes in the Company's compensation plans and arrangements may
be appropriate to continue to fulfill the requirements for
treatment as tax deductible compensation under the Code.
The Board of Directors Compensation Committee and
Stock Option Committee
Mark S. Ain Jerry Shore, Chairman
Anthony Chiesa Anthony Chiesa
Lloyd Frank Lloyd Frank
Brian E. Shore
Jerry Shore
Compensation Committee Interlocks and Insider Participation
Anthony Chiesa, a member of the Compensation and Stock
Option Committees, is a former Vice President of the Company who
retired in 1977. Lloyd Frank, also a member of such Committees,
is of counsel to the law firm Jenkins & Gilchrist Parker Chapin
LLP, which firm was retained to provide counsel to the Company
during its fiscal year ended March 2, 2003 but not during its
last fiscal year. Jerry Shore, the third member of such
Committees, was President of the Company until March 4, 1996 and
Chief Executive Officer of the Company until November 19, 1996.
Brian E. Shore, a director of the Company who is also President
and Chief Executive Officer of the Company, participated in
deliberations of the Board relating to the amount of the
Company's contribution to the Profit Sharing Plan during the
Company's last fiscal year, and Brian E. Shore determines the
annual salary and cash bonus for each executive officer of the
Company, other than himself.
STOCK PERFORMANCE GRAPH
The graph set forth below compares the annual cumulative
total return for the Company's five fiscal years ended February
29, 2004 among the Company, the New York Stock Exchange Market
Index (the "NYSE Index") and a Media General Financial Services
index for electronic components and accessories manufacturers
(the "Group Index") comprised of the Company and 254 other com
panies. The companies in the Group Index are classified in the
same three-digit industry group in the Standard Industrial
Classification Code system and are described as companies
primarily engaged in the manufacture of electronic components and
accessories. The returns of each company in the Group Index have
been weighted according to the company's stock market capitaliza
tion. The graph has been prepared based on an assumed investment
of $100 on February 26, 1999 and the reinvestment of dividends
(where applicable).
[Graph]
1999 2000 2001 2002 2003 2004
Park Electrochemical $l00.00 $ 84.43 $188.96 $147.25 $88.09 $155.27
Group Indes 100.00 295.25 129.24 111.95 62.30 114.67
NYSE Index 100.00 101.26 108.67 102.04 80.55 114.87
APPROVAL OF THE MATCHING FEATURE OF THE
COMPANY'S EMPLOYEE STOCK PURCHASE PLAN
The Company maintains an Employee Stock Purchase Plan (the
"Plan") pursuant to which employee contributions and Company
matching contributions are used to acquire the Company's Common
Stock for the account of the contributing employee. Under
Section 303A.08 of the New York Stock Exchange Listed Company
Manual, the matching contribution feature of the Plan is an
"equity compensation plan" requiring shareholder approval.
Accordingly, at the Meeting, shareholders are being asked to
approve the matching contribution feature of the Plan.
Summary of the Plan
General Information
The Plan was established pursuant to a resolution of the
Board adopted on July 24, 1985. The Plan is not subject to the
provisions of the Employee Retirement Income Security Act of
1974, as amended, nor qualified under Section 401(a) or Section
423 of the Internal Revenue Code of 1986, as amended.
The purpose of the Plan is to make available to eligible
employees of the Company a means of purchasing shares of the
Company's Common Stock through regular payroll deductions. Such
purchases generally are made on the New York Stock Exchange, or
any other market on which the Common Stock may trade, at market
prices current at the time of purchase. As an added incentive,
the Company contributes for each payroll period an amount equal
to 40% of each participating employee's actual payroll deduction
for employees with less than five years service with the Company,
45% of each participating employee's actual payroll deduction for
employees with more than five years service but less than ten
years service with the Company, and an amount equal to 50% of
each participating employee's actual payroll deduction for
employees with more than ten years service with the Company.
Pursuant to a transition rule established under Section
303A.08 of the New York Stock Exchange Listed Company Manual,
shareholder approval of the matching contribution feature of the
Plan is required with respect to any Company matching
contribution after June 30, 2004. Accordingly, no Company
matching contribution will be made after June 30, 2004 unless
this proposal is approved.
The total employee and Company contributions for all
participating employees are forwarded monthly by the Company to a
broker designated by the Company (currently Computershare Plan
Managers, the "Broker") and applied to the purchase of
outstanding shares and/or fractional interests in shares of the
Company's Common Stock, except during any period that operation
of the Plan is suspended. The Company pays the brokerage
commissions with respect to such purchases for the account of
each participating employee.
Participation in the Plan is entirely voluntary, and the
Company makes no recommendations to employees as to whether they
should or should not participate. There is no guarantee under the
Plan against loss resulting from fluctuations in the market price
of the Common Stock of the Company.
As of May 19, 2004, approximately 135,000 shares of Common
Stock of the Company were held in the Plan for approximately 960
participants in the Plan, including current and former employees
of the Company and its designated subsidiaries.
Eligibility
All permanent employees of the Company (other than executive
officers) and of such of its subsidiaries as are designated by
the Company (other than employees whose annual base salary
exceeds $100,000) who have attained the age of majority in their
jurisdictions of residence and who have been employed by the
Company or one of its designated subsidiaries for at least one
year are eligible to participate in the Plan, at their election.
Notwithstanding the foregoing, if any employee otherwise
eligible to participate in the Plan is employed in any
jurisdiction where it is not legal for the Company to make
deductions from such employee's pay as hereinafter provided, or
where compliance with securities laws may be necessary but is not
(in the opinion of the Company) desirable, such employee shall
not be eligible to participate.
Approximately 700 employees of the Company and its
designated subsidiaries are currently eligible to participate in
the Plan, and approximately 310 such employees are currently
participating.
Participation
An eligible employee at such employee's election may enroll
as a participant by executing a payroll deduction authorization
and purchase order form, each in a form and manner acceptable to
the Company. Enrollment becomes effective as soon as practicable
after the payroll deduction authorization and purchase order
forms are received by the Company.
Method of Operation
The Company has instructed the Broker to open and maintain
accounts in the names of participants and to make purchases of
shares of the Company's Common Stock pursuant to the Plan for the
account of the participants.
The Company pays the Broker's commissions on purchases made
from amounts deducted from the pay of the employees who have
accounts and from amounts contributed by the Company. The
Broker's commission and any other charges in connection with
sales, reinvested dividends, or purchases not made by payroll
deductions or by Company contributions are payable directly to
the Broker by the employee who orders the transactions for such
employee's account. Commissions under the Plan are computed at
such rates as are posted by the Broker and in effect at the time
of the transaction.
The Company deducts funds from each participant's pay as
authorized and each month, as promptly as practicable, forwards
the total of the amounts deducted for all participants, together
with the Company's contributions, to the Broker, along with a
list of participants and the amount allocable to the account of
each participant, except during any period that operation of the
Plan is suspended.
Upon receipt of funds from the Company, the Broker, as
promptly as practicable, purchases, as agent for the
participants, as many shares of Common Stock of the Company as
such funds will permit. Such purchases usually are made on the
New York Stock Exchange (but may be made on any other market on
which the Common Stock may trade). The Broker uses such funds and
the Company contributions received for the account of any
participant, together with such funds and Company contributions
received for the account of other participants, to make purchases
for participants pursuant to the Plan. The amount of stock
purchased will depend upon the price paid by the Broker in any
particular transaction. Such purchases, on the basis of the
average cost, are made for the respective accounts of the
participants in proportion to the amounts withheld by the
Company, and augmented by Company contributions, for such
participants.
Payroll Deductions
Payroll deduction authorization is for an indefinite period
of time. The employee specifies therein the amount to be
withheld from such employee's pay, which amount must be in even
multiples of $5.00 per week, with a maximum of $30.00 per week
for employees who work at least 35 hours per week and a maximum
of $10.00 per week for employees who work at least 25 hours per
week but less than 35 hours per week.
The payroll deduction may be revised or terminated at any
time by the employee's written request submitted to the Company.
Commencement, revision or termination of deductions becomes
effective as soon as practicable after the employee's request is
received by the Company.
Amendment and Termination
The Company reserves the right to discontinue use of its
payroll deduction facilities at any time such action is deemed
advisable in its sole judgment, and it also reserves the right at
any time to designate a new Broker, amend or discontinue the Plan
or add or eliminate subsidiaries whose employees may participate
in the Plan if, in its sole judgment, it deems such action to be
advisable. The Broker may also terminate its services as broker
under the Plan at any time. Such termination by either the
Company or the Broker is to be on thirty days written notice to
the other. Any such amendment or termination will not result in
the forfeiture of any funds deducted from the salary of any
participant or contributed by the Company on behalf of any
participant, or of any shares or fractional interest in a share
purchased for the participant, or of any dividends or other
distribution in respect of such shares, effective before the
effective date of amendment or termination of the Plan or
elimination of participating subsidiaries.
The matching contribution feature of the Plan will expire on
May 6, 2014.
Participant's Account With the Broker
At the time of purchase of Common Stock under the Plan, each
participant for whose account funds were received immediately
acquires full ownership of all shares and of any fractional
interest in a share purchased for such participant's account.
All shares are registered in the name of the Broker. Although a
participant may not assign or hypothecate such participant's
interest in the Plan as such, shares purchased under the Plan may
be sold or assigned at any time.
An employee who has an account may add other shares of the
Company's Common Stock to such employee's account, at any time,
by separate purchases arranged with the Broker or by delivering
other shares owned by such employee to the Broker. When any such
purchases are made, the employee will be charged with the
commissions.
The employee's account will be credited with all dividends
paid in respect of the full shares and any fractional interest in
a share held in his or her account. Cash dividends will be
reinvested in the Company's Common Stock as promptly as
practicable following receipt thereof by the Broker. Brokerage
commissions on dividend reinvestments in respect of shares
purchased pursuant to the Plan will be paid by the Company.
Stock dividends and/or any stock splits in respect of shares
of Common Stock purchased pursuant to the Plan and held in a
participant's account will be credited to such participant's
account without charge. Distributions of other securities and
rights to subscribe will be sold and the proceeds will be handled
in the same manner as a cash dividend.
As noted above, a participant may instruct the Broker at any
time to sell any or all of the full shares and the fractional
interest in a share held in such participant's account. Upon
such sale, the Broker will mail the participant a check for the
proceeds, less the brokerage commission and any transfer taxes,
registration fees or other normal charges which are payable by
the participant in connection with such sale. Such instructions
to the Broker, or a request for delivery of certificates, will
disqualify the employee from making further contributions under
the Plan for a period of one year thereafter.
Each participant receives quarterly confirmations or a
statement from the Broker reflecting changes in the amount of
stock held in such participant's account. The relationship
between the Broker and the participant is the normal relationship
of a broker and the broker's client, and the Company assumes no
responsibility in this respect. The brokerage relationship is
subject to, among other things, the Broker's terms and
conditions, rules and regulations of the Securities and Exchange
Commission and rules of the New York Stock Exchange and the
National Association of Securities Dealers, Inc.
The Broker is required to forward to each participant as
promptly as practicable, by mail or otherwise, all notices of
meetings, proxy statements, and other material distributed by the
Company to its shareholders. The full shares of stock in each
participant's account are voted in accordance with the
participant's signed proxy instructions duly delivered to the
Broker or otherwise in accordance with the applicable rules of
the New York Stock Exchange. There is no charge to participants
for the Broker's retention of stock certificates or in connection
with forwarding notices, proxies or other such material.
Closing a Participant's Account
An employee who terminates such employee's payroll deduction
authorization may request the Broker to maintain or to close such
employee's account. The employee may direct that all full shares
and any fractional interest in shares in such employee's account
be sold and the net proceeds remitted to such employee, or the
employee may request that the full shares in the account be
delivered to such employee, along with a check representing the
net proceeds of the sale of the fractional interest in a share.
The employee may thereafter re-enter the Plan after a period of
one year by following the procedure set forth herein under
"Participation."
Plan Benefits
Employee contributions under the Plan will be made at the
discretion of employees and the amount of Company matching
contributions will depend on the amount of employee
contributions. In addition, the ultimate value of an employee's
account under the Plan depends on the value of the Company's
Common Stock. Accordingly, it is not possible to determine the
future benefits that might be received by participants under the
Plan.
Vote Required
The affirmative vote of a majority of the votes cast at the
Meeting is required to approve this proposal, provided that the
total votes cast represent a majority of the outstanding shares
of Common Stock. Abstentions and broker non-votes are not
considered to be votes cast and will therefore make it more
difficult to meet this requirement.
The Board of Directors recommends that shareholders vote FOR
the approval of this proposal. Proxies will be voted in
accordance with their terms and, in the absence of contrary
instructions, for the approval of this proposal.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Exchange Act requires the Company's
officers and directors, and persons who own more than 10 percent
of a registered class of the Company's equity securities, to file
reports of ownership and changes in ownership with the Securities
and Exchange Commission and the New York Stock Exchange.
Officers, directors and greater than 10 percent shareholders are
required by regulations of the Securities and Exchange Commission
to furnish the Company with copies of all Section 16(a) reports
they file. Based solely on a review of the copies of such reports
furnished to the Company, or written representations that no Form
5 reports were required, the Company believes that all Section
16(a) filing requirements applicable to its officers, directors
and greater than 10 percent beneficial owners were complied with
during the 2004 fiscal year.
SHAREHOLDER PROPOSALS
Shareholder proposals intended to be presented at the 2005
Annual Meeting of Shareholders pursuant to Rule 14a-8 under the
Exchange Act must be received by the Company at the Company's
principal executive offices for inclusion in the Proxy Statement
and form of Proxy relating to that meeting by February 16, 2005.
In order for shareholder proposals made outside of Rule 14a-8
under the Exchange Act to be considered "timely" within the
meaning of Rule 14a-4(c) under the Exchange Act, such proposals
must be received by the Company at the Company's principal
executive offices by April 15, 2005. The Company's By-Laws
require that proposals of shareholders made outside of Rule 14a-8
under the Exchange Act must be submitted, in accordance with the
requirements of the By-Laws, not later than April 15, 2005 and
not earlier than March 16, 2005.
OTHER MATTERS
Audit Committee Report
The Audit Committee assists the Board in fulfilling its
oversight responsibilities with respect to the accounting,
auditing, financial reporting, internal control and legal
compliance functions of the Company and its subsidiaries. The
Board of Directors has determined that all members of the Audit
Committee are "independent", as required by the current rules of
the New York Stock Exchange. The Committee functions pursuant to
a Charter that has been adopted by the Board, as required by
rules of the New York Stock Exchange, a copy of which is attached
as Appendix A to this Proxy Statement, as required by rules of
the Securities and Exchange Commission.
As set forth in the Charter, management of the Company is
responsible for the preparation, presentation and integrity of
the Company's financial statements, and for maintaining
appropriate accounting and financial reporting principles and
policies and internal controls and procedures designed to provide
reasonable assurance of compliance with accounting standards and
applicable laws and regulations. The independent accountants are
responsible for planning and carrying out an audit in accordance
with generally accepted auditing standards and expressing an
opinion as to the conformity of the financial statements with
generally accepted accounting principles.
In the performance of its oversight function, the Audit
Committee has reviewed and discussed the audited financial
statements for the fiscal year ended February 29, 2004 with
management and with Ernst & Young LLP, the Company's independent
public accountants for the 2004 fiscal year. The Audit Committee
has also received from the independent accountants a letter
pursuant to Statement on Auditing Standards No. 61, Codification
of Statements on Auditing Standards, AU 380, as currently in
effect, and has discussed the matters referred to in such letter
with the independent accountants. The Audit Committee has also
received the written disclosures and the letter from the
independent accountants required by Independence Standards Board
Standard No. 1, Independence Discussions with Audit Committees,
as currently in effect. The Audit Committee has considered
whether the provision of non-audit services by the independent
accountants to the Company is compatible with maintaining the
accountants' independence and has discussed with Ernst & Young
LLP their independence.
The members of the Audit Committee are not professionally
engaged in the practice of auditing or accounting. The Audit
Committee's considerations and discussions referred to above do
not assure that the audit of the Company's financial statements
for the fiscal year ended February 29, 2004 has been carried out
in accordance with generally accepted auditing standards or that
the financial statements are presented in accordance with
generally accepted accounting principles.
Based upon the review and discussions described in this
Report, and subject to the limitations on the role and
responsibilities of the Audit Committee referred to above and in
the Charter, the Audit Committee has recommended to the Board
that the audited financial statements be included in the
Company's Annual Report on Form 10-K for the fiscal year ended
February 29, 2004 for filing with the Securities and Exchange
Commission.
Audit Committee
Lloyd Frank, Chairman
Mark S. Ain
Anthony Chiesa
Auditors and Fees
The Audit Committee appointed Ernst & Young LLP as the
Company's independent auditor for the past fiscal year. A
representative of Ernst & Young LLP is expected to be present at
the Annual Meeting and will have an opportunity to make a state
ment if such representative so desires and will be available to
respond to appropriate questions.
The Audit Committee has not selected an independent auditor
of the Company for the current fiscal year. As previously
reported by the Company, the Company was notified by Ernst &
Young LLP on May 26, 2004 that Ernst & Young would decline
reappointment as the Company's independent auditor for the
current fiscal year, although Ernst & Young and the Company have
agreed that Ernst & Young will review the Company's financial
statements for its 2005 fiscal year first quarter ended May 30,
2004. Prior to receiving such notice from Ernst & Young, the
Company, with the approval of the Audit Committee of the Board of
Directors, had begun the process of interviewing other major
independent accounting firms to be the Company's independent
auditor for the current fiscal year.
The reports of E&Y on the Company's financial statements for
the last two fiscal years did not contain any adverse opinion or
disclaimer of opinion and were not qualified or modified as to
uncertainty, audit scope or accounting principles.
As E&Y's decision did not involve any disagreements with the
Company, the Audit Committee of the Board of Directors of the
Company did not participate in the termination of the client-
auditor relationship with E&Y, although, as stated above, the
Audit Committee had previously authorized the Company to begin
the process of interviewing other accounting firms to be the
Company's independent auditor for the current fiscal year.
During the last two fiscal years and through May 26, 2004,
there have been no disagreements with E&Y on any matter of
accounting principles or practices, financial statement
disclosure or auditing scope or procedure, which disagreements,
if not resolved to E&Y's satisfaction, would have caused E&Y to
make reference thereto in E&Y's report on the financial
statements for such years or interim period.
During the last two fiscal years and through May 26, 2004,
there have been no "reportable events," as such term is defined
in Item 304(a)(1)(v) of Regulation S-K of the Securities and
Exchange Commission.
The following table shows the fees paid or accrued for audit
services and fees paid or accrued for audit-related, tax and all
other services rendered by Ernst & Young for each of the last two
fiscal years ended February 29, 2004 and March 2, 2003:
2004 2003
Audit Fees (a) $354,421 $386,167
Audit-Related Fees (b) 18,000 28,100
Tax Fees (c) 44,883 96,333
All Other Fees (d) 4,531 8,450
$421,835 $519,050
(a) Audit fees include fees for the audit of the Company's
consolidated financial statements, interim reviews of the
Company's quarterly financial statements and audit services
provided in connection with required statutory audits of
many of the Company's subsidiaries.
(b) Audit-related fees include primarily fees for certain audits
of subsidiaries not required for purposes of Ernst & Young's
audit of the Company's consolidated financial statements but
for other statutory or regulatory requirements and the
annual audit of the Company's Employees' Profit Sharing and
401(k) Retirement Savings Plan.
(c) Tax fees include fees for services relating to tax
compliance, tax planning and tax advice. These services
include assistance regarding federal, state and
international tax compliance, tax return preparation and tax
audits.
(d) All other fees include primarily fees for certain employment
law and employee benefit plan services which are no longer
permitted to be performed by Ernst & Young under the
Sarbanes-Oxley Act of 2002, but were permitted at the time
they were arranged for prior to May 6, 2003.
The services performed by Ernst & Young in connection with
engagements subsequent to May 6, 2003 were pre-approved in
accordance with the pre-approval policy adopted by the Audit
Committee.
Audit Committee Pre-Approval Policy
The policy of the Audit Committee is to require that all
services to be provided to the Company by the Company's auditors
must be approved by the Audit Committee before such services are
provided by the auditors.
Directors' and Officers' Liability Insurance
The Company has for many years maintained directors' and
officers' liability insurance and fiduciary liability insurance
covering the directors and officers of the Company and its
subsidiaries against certain claims arising out of their service
to the Company and its subsidiaries and to certain employee
benefit plans of the Company and its subsidiaries. The current
directors' and officers' liability insurance policy runs for a
period of one year expiring May 17, 2005 at a total cost of
$300,000; and the current fiduciary liability insurance policy
runs for a period of one year expiring June 17, 2004 at a one-
year cost of $29,040.
Proxy Solicitation
The Company will bear the expense of proxy solicitation.
Directors, officers and employees of the Company and its
subsidiaries may solicit proxies by mail, telephone, telegraph,
facsimile or in person (but will receive no additional
compensation for such solicitation). The Company also has
retained D. F. King & Co., Inc., New York, New York, to assist in
the solicitation of proxies in the same manner at an anticipated
fee of approximately $6,000, plus reimbursement of certain out-of-
pocket expenses. In addition, brokerage houses and other
custodians, nominees and fiduciaries will be requested to forward
the soliciting material to beneficial owners and to obtain
authorizations for the execution of proxies, and if they in turn
so request, the Company will reimburse such brokerage houses and
other custodians, nominees and fiduciaries for their expenses in
forwarding such material.
Director Candidates
The Nominating Committee will consider director candidates
recommended by shareholders. In considering candidates submitted
by shareholders, the Nominating Committee will take into
consideration the needs of the Board and the qualifications of
the candidate. The Committee may also consider the number of
shares held by the recommending shareholder and the length of
time that such shares have been held. To have a candidate
considered by the Nominating Committee, a shareholder must submit
the recommendation in writing and must include the name of the
shareholder and evidence of the person's ownership of Company
stock, including the number of shares owned and the length of
time of ownership, and the name of the candidate, the candidate's
resume or a listing of his or her qualifications to be a director
of the Company and the person's consent to be named as a director
if selected by the Nominating Committee and nominated by the
Board.
The shareholder recommendation and information described
above must be sent to the Corporate Secretary at the Company's
office at 5 Dakota Drive, Lake Success, New York 10042 and must
be received by the Corporate Secretary not less than 120 days
prior to the anniversary date of the Company's most recent annual
meeting of shareholders.
The Nominating Committee believes that the minimum
qualifications for serving as a director of the Company are that
a nominee demonstrate, by significant accomplishment in his or
her field, an ability to make a meaningful contribution to the
Board's oversight of the business and affairs of the Company and
have an impeccable record and reputation for honest and ethical
conduct in both his or her professional and personal activities.
In addition, the Nominating Committee examines a candidate's
specific experiences and skills, time availability in light of
other commitments and potential conflicts of interest.
The Nominating Committee identifies potential nominees by
asking current directors and executive officers to notify the
Committee if they become aware of persons, meeting the criteria
described above, who have had a change in circumstances that
might make them available to serve on the Board - for example,
retirement as a CEO or CFO of a public company. As described
above, the Nominating Committee will also consider candidates
recommended by shareholders.
Once a person has been identified by the Nominating
Committee as a potential candidate, the Committee may collect and
review publicly available information regarding the person to
assess whether the person should be considered further. If the
Nominating Committee determines that the candidate warrants
further consideration, the Chairman or another member of the
Committee contacts the person. Generally, if the person expresses
a willingness to be considered and to serve on the Board, the
Nominating Committee requests information from the candidate,
reviews the candidate's accomplishments and qualifications,
including in light of any other candidates that the Committee
might be considering, and conducts one or more interviews with
the candidate. In certain instances, Nominating Committee
members may contact one or more references provided by the
candidate or may contact other members of the business community
or other persons that may have greater first-hand knowledge of
the candidate's accomplishments. The Nominating Committee's
evaluation process does not vary based on whether or not a
candidate is recommended by a shareholder, although, as stated
above, the Committee may take into consideration the number of
shares held by the recommending shareholder and the length of
time that such shares have been held.
Dale Blanchfield and Steven T. Warshaw were recommended for
consideration by the Nominating Committee by the chief executive
officer of the Company.
Communications with Directors
The Board has established a process to receive
communications from shareholders and other interested parties.
Shareholders and other interested parties may contact any member
(or all members) of the Board, including the non-management
directors as a group, by mail. To communicate with the Board of
Directors, any individual director or the non-management
directors, correspondence should be addressed to the Board of
Directors or any such individual director or the non-management
directors by either name or title. All such correspondence should
be sent "c/o Corporate Secretary" at the Company's office at 5
Dakota Drive, Lake Success, New York 11042.
All communications received as set forth in the preceding
paragraph will be opened by the office of the Company's General
Counsel for the sole purpose of determining whether the contents
represent a message to the directors of the Company. Any
contents that are not in the nature of advertising, promotions of
a product or service, or patently offensive material will be
forwarded promptly to the addressee. In the case of
communications to the Board or the non-management directors, the
General Counsel's office will make sufficient copies of the
contents to send to each director who is a member of the group to
which the communication is addressed.
Code of Ethics and Business Conduct
For more than thirty-five years, the Company has maintained
basic corporate rules and guidelines agreed to in writing by its
chief executive officer and its business unit presidents and
controllers. Such rules and guidelines cover such matters as
personnel guidelines, transactions with suppliers, conflicts of
interest and business ethics, transactions with relatives and
friends, cash control and consolidations, capital expenditures,
disposal of property, plant, equipment and inventory, insurance
programs, legal matters and contracts, credit and collections,
unusual business transactions and special charges and transfer
charges, inventory levels, weekly and monthly financial reports
and annual business plans, employee safety and environmental
matters.
The Board has adopted a Code of Ethics for the Company's
chief executive officer, chief financial officer and controller,
and as required by rules of the New York Stock Exchange, the
Board has adopted a Code of Business Conduct and Ethics for the
Company's directors, officers and employees. Substantially all of
the matters required to be addressed in these recently required
Code of Ethics and Code of Business Conduct and Ethics have been
addressed in the corporate rules and guidelines which the Company
has maintained since 1967, although the new Code of Business
Conduct and Ethics applies to all directors, officers and
employees of the Company and its subsidiaries.
The Company has filed its Code of Ethics as Exhibit 14.1 to
its Form 10-K Annual Report for the fiscal year ended February
29, 2004, as provided by rules of the Securities and Exchange
Commission, and the Company's Code of Business Conduct and Ethics
will be available on the Company's web site at
www.parkelectro.com under the caption "Charters and Codes" as of
the date of the Meeting as required by rules of the New York
Stock Exchange. The Company intends to satisfy any disclosure
requirements regarding an amendment to, or waiver from, the Code
of Ethics by posting such information on the Company's web site
at the above internet address.
Other Matters to be Presented to the Meeting
The Board does not know of any other matters to be brought
before the Meeting. If any other matters not mentioned in this
Proxy Statement are properly brought before the Meeting,
including matters incident to the conduct of the Meeting or
relating to the adjournment thereof, the persons named in the
enclosed proxy intend to vote such proxy in accordance with their
best judgment on such matters.
Annual Report
The Annual Report, including financial statements, of the
Company for the fiscal year ended February 29, 2004 is enclosed
herewith but is not a part of the proxy soliciting material.
By Order of the Board of Directors,
Stephen E. Gilhuley
Senior Vice President,
Secretary and General Counsel
Dated: June 16, 2004
Appendix A
CHARTER OF THE AUDIT COMMITTEE OF THE
BOARD OF DIRECTORS OF
PARK ELECTROCHEMICAL CORP.
AS ADOPTED BY THE BOARD AS OF MAY 6, 2004
I. PURPOSE OF THE COMMITTEE
The purpose of the Audit Committee (the "Committee") of the
Board of Directors (the "Board") of Park Electrochemical Corp.
(the "Corporation") is to provide assistance to the Board in
fulfilling its legal and fiduciary obligations with respect to
matters involving the accounting, auditing, financial reporting,
internal control and legal compliance functions of the
Corporation and its subsidiaries, including, without limitation,
(a) assisting the Board's oversight of (i) the integrity of the
Corporation's financial statements, (ii) the Corporation's
compliance with legal and regulatory requirements, (iii) the
Corporation's independent auditors' qualifications and
independence, and (iv) the performance of the Corporation's inde
pendent auditors and the Corporation's internal audit function,
and (b) preparing the report required to be prepared by the
Committee pursuant to the rules of the Securities and Exchange
Commission (the "SEC") for inclusion in the Corporation's annual
proxy statement.
II. COMPOSITION OF THE COMMITTEE
The Committee shall be comprised of three or more directors
as determined from time to time by resolution of the Board. Each
member of the Committee shall be qualified to serve on the
Committee pursuant to the requirements of the New York Stock
Exchange (the "NYSE"), and any additional requirements that the
Board deems appropriate.
No director may serve as a member of the Committee if such
director serves on the audit committee of more than two other
public companies, unless the Board determines that such
simultaneous service would not impair the ability of such
director to effectively serve on the Committee. Any such
determination must be disclosed in the Corporation's annual proxy
statement.
The chairperson of the Committee shall be designated by the
Board, provided that if the Board does not so designate a
chairperson, the members of the Committee, by a majority vote,
may designate a chairperson.
Any vacancy on the Committee shall be filled by majority
vote of the Board. No member of the Committee shall be removed
except by majority vote of the Board.
Each member of the Committee must be financially literate,
as such qualification is interpreted by the Board in its business
judgment, or must become financially literate within a reasonable
period of time after his or her appointment to the Committee. In
addition, at least one member of the Committee must have
accounting or related financial management expertise, as such
qualification is interpreted by the Board in its business
judgement.
III. MEETINGS OF THE COMMITTEE
The Committee shall meet once every fiscal quarter or more
frequently as it shall determine is necessary to carry out its
duties and responsibilities. The Committee, in its discretion,
may ask members of management or others to attend its meetings
(or portions thereof) and to provide pertinent information as
necessary. The Committee should meet separately on a periodic
basis with (i) management, (ii) the director of the Corporation's
internal auditing department or other person responsible for the
internal audit function (such person referred to herein as the
"Internal Auditor") and (iii) the Corporation's independent
auditors. The Committee shall maintain minutes of its meetings
and records relating to those meetings.
IV. DUTIES AND RESPONSIBILITIES OF THE COMMITTEE
In carrying out its duties and responsibilities, the
Committee's policies and procedures should remain flexible, so
that it may be in a position to best react or respond to changing
circumstances or conditions. The following are within the
authority of the Committee:
Selection, Evaluation and Oversight of the Auditors
a. Be directly responsible for the appointment,
compensation, retention and oversight of the work of any
registered public accounting firm engaged for the purpose of
preparing or issuing an audit report or performing other audit,
review or attest services for the Corporation, and each such
registered public accounting firm must report directly to the
Committee (the registered public accounting firm engaged for the
purpose of preparing or issuing an audit report for inclusion in
the Corporation's Annual Report on Form 10-K is referred to
herein as the "independent auditors");
b. Review and, in its sole discretion, approve in advance
the Corporation's independent auditors' annual engagement letter,
including the proposed fees contained therein, as well as (i)
reviewing all audit and, as provided in Rule 2-01 of Regulation S-
X promulgated by the SEC, all permitted non-audit engagements and
relationships between the Corporation and such auditors (which
approval may be made after receiving input from the Corporation's
management) and/or (ii) adopting policies and procedures of the
Committee that provide for the pre-approval of specified services
to be provided by the Corporation's auditors. Approval of audit
and permitted non-audit services may also be made by one or more
members of the Committee as shall be designated by the Committee
or the chairperson of the Committee and the person or persons
granting such approval shall report such approval to the
Committee at the next scheduled meeting;
c. Review the performance of the Corporation's independent
auditors, including the lead partner and reviewing partner of the
independent auditors, and, in its sole discretion, make decisions
regarding the replacement or termination of the independent
auditors when circumstances warrant;
d. Obtain at least annually from the Corporation's
independent auditors and review a report describing:
(i)the independent auditors' internal quality-
control procedures;
(ii)any material issues raised by the most recent
internal quality-control review, or peer review, of the
independent auditors, or by any inquiry or
investigation by any governmental or professional
authority, within the preceding five years, respecting
one or more independent audits carried out by the
independent auditors, and any steps taken to deal with
any such issues; and
(iii) all relationships between the independent
auditors and the Corporation (including a description
of each category of services provided by the
independent auditors to the Corporation and a list of
the fees billed for each such category);
The Committee should present its conclusions with respect to
the above matters, as well as its review of the lead partner and
the reviewing partner of the independent auditors, and its views
on whether there should be a regular rotation of the independent
auditors, to the Board.
e.Evaluate the independence of the Corporation's
independent auditors by, among other things:
(i) monitoring compliance by the Corporation's
independent auditors with the audit partner rotation
requirements contained in the Sarbanes-Oxley Act of
2002 (the "Act") and the SEC's rules and regulations
thereunder;
(ii) monitoring compliance by the Corporation
with the employee conflict of interest requirements
contained in the Act and the SEC's rules and
regulations thereunder; and
(iii) engaging in a dialogue with the independent
auditors to confirm that audit partner compensation is
consistent with applicable SEC rules;
Oversight of Annual Audit and Quarterly Reviews
f.Review the annual audit plan of the Corporation's
independent auditors, including the scope of audit activities and
all critical accounting policies and practices to be used, and
monitor such plan's progress and results during the year;
g.Review with management, the Corporation's independent
auditors and, if appropriate, the Internal Auditor, the
following:
(i) the Corporation's annual audited financial
statements and quarterly financial statements,
including the Corporation's disclosures under "Man
agement's Discussion and Analysis of Financial
Condition and Results of Operations", and any major
issues related thereto;
(ii)critical accounting policies and such other
accounting policies of the Corporation as are deemed
appropriate for review by the Committee prior to any
interim or year-end filings with the SEC or other
regulatory body, including any financial reporting
issues which could have a material impact on the
Corporation's financial statements;
(iii) major issues regarding accounting
principles and financial statements presentations,
including (A) any significant changes in the
Corporation's selection or application of accounting
principles and (B) any analyses prepared by management
and/or the independent auditors setting forth
significant financial reporting issues and judgments
made in connection with the preparation of the
financial statements, including analyses of the
ramifications and effects of alternative generally
accepted accounting principles methods on the
Corporation's financial statements;
(iv)all alternative treatments of financial
information that have been discussed by the independent
auditors and management, ramifications of the use of
such alternative disclosures and treatments, and the
treatment preferred by the auditors;
(v) all other material written communications
between the independent auditors and management, such
as any management letter or schedule of unadjusted
differences; and
(vi)the effect of regulatory and accounting
initiatives, as well as off-balance sheet structures,
on the financial statements of the Corporation;
h.Resolve all disagreements between the Corporation's
independent auditors and management regarding financial
reporting;
i.Review on a regular basis with the Corporation's
independent auditors any problems or difficulties encountered by
the independent auditors in the course of any audit work,
including management's response with respect thereto, any
restrictions on the scope of the independent auditor's activities
or on access to requested information, and any significant
disagreements with management. In connection therewith, the
Committee should review with the independent auditors the
following:
(i) any accounting adjustments that were noted or
proposed by the independent auditors but were rejected
by management (as immaterial or otherwise);
(ii)any communications between the audit team and
the independent auditor's national office respecting
auditing or accounting issues presented by the
engagement; and
(iii) any "management" or "internal control" letter
issued, or proposed to be issued, by the independent
auditors to the Corporation;
Oversight of the Financial Reporting Process and Internal
Controls.
j.Review:
(i) the adequacy and effectiveness of the
Corporation's accounting and internal control policies
and procedures on a regular basis, including the
responsibilities, budget, compensation and staffing of
the Corporation's internal audit function, through
inquiry and discussions with the Corporation's
independent auditors and management;
(ii)the yearly report prepared by management, and
attested to by the Corporation's independent auditors,
assessing the effectiveness of the Corporation's
internal control over financial reporting and stating
management's responsibility for establishing and
maintaining adequate internal control over financial
reporting prior to its inclusion in the Corporation's
annual report on Form 10-K; and
(iii) the Committee's level of involvement and
interaction with the Corporation's internal audit
function, including the Committee's line of authority
and role in appointing and compensating employees in
the internal audit function;
k.Review with management the Corporation's administrative,
operational and accounting internal controls, including any
special audit steps adopted in light of the discovery of material
control deficiencies;
l.Review the type and presentation of information to be
included in the Corporation's earnings press releases (especially
the use of "pro forma" or "adjusted" information not prepared in
compliance with generally accepted accounting principles), as
well as financial information and earnings guidance provided by
the Corporation to analysts and rating agencies (which review may
be done generally (i.e., discussion of the types of information
to be disclosed and type of presentations to be made), and the
Committee need not discuss in advance each earnings release or
each instance in which the Corporation may provide earnings
guidance);
Miscellaneous
m.Establish clear hiring policies by the Corporation for
employees or former employees of the Corporation's independent
auditors;
n.Discuss guidelines and policies governing the process by
which senior management of the Corporation and the relevant
departments of the Corporation assess and manage the
Corporation's exposure to risk, as well as the Corporation's
major financial risk exposures and the steps management has taken
to monitor and control such exposures;
o.Prepare the report required by the rules of the SEC to be
included in the Corporation's annual proxy statement;
p.Establish procedures for (i) the receipt, retention and
treatment of complaints received by the Corporation regarding
accounting, internal accounting controls or auditing matters, and
(ii) the confidential, anonymous submission by employees of the
Corporation of concerns regarding questionable accounting or
auditing matters;
q.Secure independent expert advice to the extent the
Committee determines it to be appropriate, including retaining,
with or without Board approval, independent counsel, accountants,
consultants or others, to assist the Committee in fulfilling its
duties and responsibilities, the cost of such independent expert
advisors to be borne by the Corporation;
r.Report regularly to the Board on its activities, as
appropriate. In connection therewith, the Committee should
review with the Board any issues that arise with respect to the
quality or integrity of the Corporation's financial statements,
the Corporation's compliance with legal or regulatory
requirements, the performance and independence of the
Corporation's independent auditors, or the performance of the
internal audit function;
s.Conduct an annual performance evaluation of the
Committee, which shall address all matters that the Committee
considers relevant to its performance, including a review and
assessment of the adequacy of the Committee's charter. The
performance evaluation by the Committee shall be conducted in
such manner as the Committee deems appropriate. The Committee
shall deliver to the Board a report, which may be oral, setting
forth the results of its evaluation, including any recommended
amendments to this charter; and
t.Perform such additional activities, and consider such
other matters, within the scope of its responsibilities, as the
Committee or the Board deems necessary or appropriate.
***
While the Committee has the duties and responsibilities set
forth in this charter, the Committee is not responsible for
planning or conducting the audit or for determining whether the
Corporation's financial statements are complete and accurate and
are in accordance with generally accepted accounting principles.
In fulfilling their responsibilities hereunder, it is
recognized that members of the Committee are not full-time
employees of the Corporation, it is not the duty or
responsibility of the Committee or its members to conduct "field
work" or other types of auditing or accounting reviews or
procedures or to set auditor independence standards, and each
member of the Committee shall be entitled to rely on (i) the
integrity of those persons and organizations within and outside
the Corporation from which it receives information and (ii) the
accuracy of the financial and other information provided to the
Committee, in either instance absent actual knowledge to the
contrary.
Nothing contained in this charter is intended to create, or
should be construed as creating, any responsibility or liability
of the members of the Committee, except to the extent otherwise
provided under applicable federal or state law.
****************
[PROXY CARD]
PARK ELECTROCHEMICAL CORP.
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS July 14, 2004
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby constitutes and appoints ANTHONY
CHIESA, LLOYD FRANK and BRIAN E. SHORE, and each of them, the
attorneys and proxies of the undersigned, with full power of
substitution, to attend the Annual Meeting of Shareholders of
PARK ELECTROCHEMICAL CORP. (the "Company") to be held at The Bank
of New York, One Wall Street, New York, New York on July 14, 2004
at 10:00 o'clock A.M., New York time, and any adjournments or
postponements thereof, to vote all the shares of Common Stock of
the Company which the undersigned would be entitled to vote if
personally present upon the following matters:
The Board of Directors recommends a vote "FOR" proposals 1
and 2.
1. ELECTION OF DIRECTORS
[ ] FOR all nominees listed below (except as marked to the
contrary below).
[ ] WITHHOLD AUTHORITY to vote for all nominees listed
below.
MARK S. AIN, DALE BLANCHFIELD, ANTHONY CHIESA, LLOYD
FRANK,
BRIAN E. SHORE and STEVEN T. WARSHAW
(INSTRUCTION: To withhold authority to vote for any
individual nominee, check the "FOR" box above and write
the nominee's name in the space provided below.)
____________________________________________________________
______
2. APPROVAL OF MATCHING CONTRIBUTION FEATURE OF EMPLOYEE STOCK
PURCHASE PLAN
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. The transaction of such other business as may properly come
before the meeting.
Each properly executed proxy will be voted in accordance with
specifications made hereon. If no specification is made, the
shares represented by this Proxy will be voted "FOR" the
nominees, "FOR" the matching contribution feature of the Employee
Stock Purchase Plan, and in the discretion of the Proxies on any
other business as may properly come before the meeting.
The undersigned hereby acknowledges receipt of the Company's
2004 Annual Report and the accompanying Notice of Meeting and
Proxy Statement and hereby revokes any proxy or proxies
heretofore given.
Dated: _______________________, 2004
___________________________________
___________________________________
(Signature(s) of Shareholder(s))
Please date and sign exactly as
name appears hereon. Executors,
administrators, trustees, etc.
should so indicate when signing. If
shares are held jointly, both
owners should sign.