-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, VWJTPyiN+kUCUIgNRfXHzWyqLiVXIUliEQ2iDY6cU9GrMpel9hiKFWedj9CdsJUa M6sIbIvOXj06pgd0QsLnfQ== 0000085608-97-000006.txt : 19970508 0000085608-97-000006.hdr.sgml : 19970508 ACCESSION NUMBER: 0000085608-97-000006 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 19970330 FILED AS OF DATE: 19970507 SROS: AMEX FILER: COMPANY DATA: COMPANY CONFORMED NAME: MATEC CORP/DE/ CENTRAL INDEX KEY: 0000085608 STANDARD INDUSTRIAL CLASSIFICATION: STEEL WORKS, BLAST FURNACES & ROLLING & FINISHING MILLS [3310] IRS NUMBER: 060737363 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-04184 FILM NUMBER: 97597274 BUSINESS ADDRESS: STREET 1: 75 SOUTH ST CITY: HOPKINTON STATE: MA ZIP: 01748 BUSINESS PHONE: 5084359039 MAIL ADDRESS: STREET 1: 75 SOUTH STREET CITY: HOPKINTON STATE: MA ZIP: 01748 FORMER COMPANY: FORMER CONFORMED NAME: RSC INDUSTRIES INC DATE OF NAME CHANGE: 19840515 FORMER COMPANY: FORMER CONFORMED NAME: REEVES INDUSTRIES INC DATE OF NAME CHANGE: 19710520 10-Q 1 FORM 10Q UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q [X] QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 30, 1997 ----------------------------------------- OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to ------------- ------------- Commission File Number 1-4184 -------------------------------------------------- MATEC Corporation - ------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 06-0737363 - ------------------------------- ------------------------- (State or other jurisdiction of (I.R.S Employer incorporation or organization) Identification Number) 75 South St., Hopkinton, Massachusetts 01748 - ---------------------------------------- ------------- (Address of principal executive offices) (Zip Code) (508) 435-9039 - ------------------------------------------------------------------------- (Registrant's telephone number, including area code) Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No --- --- As of May 6, 1997, the number of shares outstanding of Registrant's Common Stock, par value $.05 was 2,735,191. -1- MATEC Corporation Index Page ---- PART I. FINANCIAL INFORMATION Consolidated Condensed Balance Sheets - March 30, 1997 and December 31, 1996 .................... 3 Consolidated Statements of Operations - Three Months Ended March 30, 1997 and March 31, 1996 .... 4 Consolidated Condensed Statements of Cash Flows - Three Months Ended March 30, 1997 and March 31, 1996 .... 5 Notes to Consolidated Condensed Financial Statements ..... 6 Management's Discussion and Analysis of Financial Condition and Results of Operations ..................... 7-9 PART II. OTHER INFORMATION Item 4 - Submission of Matters to a Vote of Security Holders ................................ 10 Item 6 - Exhibits and Reports on Form 8-K ................ 10 Signatures ..................................................... 11 -2- PART I - FINANCIAL INFORMATION Item 1. Financial Statements MATEC Corporation and Subsidiaries Consolidated Condensed Balance Sheets (In thousands, except share data) (Unaudited) 3/30/97 12/31/96 -------- -------- ASSETS Current assets: Cash and cash equivalents ............................ $ 834 $ 884 Receivables, less allowances of $132 and $145 ........ 5,794 5,764 Inventories .......................................... 5,309 5,464 Deferred income taxes and other current assets ....... 1,124 1,037 ------- ------- Total current assets ............................... 13,061 13,149 ------- ------- Property, plant and equipment, at cost ................. 18,972 18,894 Less accumulated depreciation ........................ 12,618 12,480 ------- ------- 6,354 6,414 ------- ------- Marketable equity securities ........................... 2,652 2,782 Other assets ........................................... 120 109 ------- ------- $22,187 $22,454 ======= ======= LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Notes payable ........................................ $ 1,140 $ 1,190 Current portion of long-term debt .................... 200 200 Accounts payable ..................................... 2,212 2,035 Accrued liabilities .................................. 1,220 1,399 Income taxes ......................................... 115 119 ------- ------- Total current liabilities .......................... 4,887 4,943 ------- ------- Deferred income taxes .................................. 1,611 1,652 Long-term debt ......................................... 1,985 1,984 Stockholders' equity: Preferred stock, $1.00 par value- Authorized 1,000,000 shares; issued none ............ - - Common stock, $.05 par value- Authorized 10,000,000 shares; Issued 3,804,195 shares 190 190 Capital surplus ...................................... 6,443 6,443 Retained earnings .................................... 10,936 10,955 Net unrealized gain on marketable equity securities .. 1,492 1,570 Treasury stock at cost, 1,068,979 and 1,049,467 shares (5,357) (5,283) ------- ------- Total stockholders' equity ...................... 13,704 13,875 ------- ------- $22,187 $22,454 ======= ======= See notes to consolidated condensed financial statements. -3- MATEC Corporation and Subsidiaries Consolidated Statements of Operations (In thousands, except per share data) (Unaudited) Three Months Ended 3/30/97 3/31/96 ------- ------- Net sales ............................ $ 7,445 $ 8,652 Cost of sales ........................ 5,933 6,263 ------- ------- Gross profit ....................... 1,512 2,389 Operating expenses: Selling and administrative ......... 1,397 1,762 Research and development ........... 51 134 ------- ------- 1,448 1,896 Operating profit ..................... 64 493 Other income (expense): Interest expense .................... (83) (116) Other, net .......................... (13) (13) ------- ------- (96) (129) Earnings (loss) before income taxes .. (32) 364 Income tax (expense) credit .......... 13 (146) ------- ------- Net earnings (loss) .................. $ (19) $ 218 ======= ======= Earnings (loss) per share ............ $ (.01) $ .08 ====== ====== Average shares outstanding ........... 2,748 2,764 ===== ===== Cash dividends per share ............. $ - $ - ===== ===== See notes to consolidated condensed financial statements. -4- MATEC Corporation and Subsidiaries Consolidated Condensed Statements of Cash Flows (In thousands) (Unaudited) Three Months Ended 3/30/97 3/31/96 -------- -------- Cash flows from operating activities: Net earnings (loss) .............................. $ (19) $ 218 Adjustments to reconcile net earnings (loss) to net cash provided (used) by operating activities: Non-cash items ................................. 333 285 Changes in operating assets and liabilities .... 52 (12) ------- ------- Net cash provided by operating activities 366 491 - ---------------------------------------------------------------------- Cash flows from investing activities: Capital expenditures, net ........................ (277) (262) Other, net........................................ (16) (10) ------- ------- Net cash (used) by investing activities (293) (272) - ---------------------------------------------------------------------- Cash flows from financing activities: Net (repayments) under lines of credit ........... (50) (200) Purchases of common stock ........................ (73) - Payments on long-term debt ....................... - (24) ------- ------- Net cash (used) by financing activities (123) (224) - ---------------------------------------------------------------------- Net (decrease) in cash and cash equivalents ......... (50) (5) Cash and cash equivalents: Beginning of period .............................. 884 830 ------- ------- End of period .................................... $ 834 $ 825 ======= ======= See notes to consolidated condensed financial statements. -5- MATEC Corporation and Subsidiaries Notes to Consolidated Condensed Financial Statements 1. Financial Presentation: The interim financial statements are unaudited but, in the opinion of management, reflect all adjustments necessary for fair presentation of results for such periods. The results of operations for any interim period are not necessarily indicative of results for the full year. The accounting policies followed by the Company are set forth in Note 1 to the Company's financial statements in the 1996 MATEC Corporation and Subsidiaries Annual Report which is incorporated by reference in Form 10-KSB for the year ended December 31, 1996. 2. Inventories: Inventories consist of the following (in thousands): 3/30/97 12/31/96 ------- -------- Raw materials ....................... $ 2,657 $ 2,586 Work in process ..................... 940 849 Finished goods ...................... 1,712 2,029 ------- ------- $ 5,309 $ 5,464 ======= ======= Inventories of $2,455,000 in 1997 and $2,575,000 in 1996 are determined by the LIFO method. 3. New Accounting Standards: The Company will adopt Statement of Financial Accounting Standards ("SFAS") No. 128, "Earnings Per Share" in the fourth quarter of 1997, as required. The Company will continue to apply APB Opinion No. 15, "Earnings Per Share" until the adoption of SFAS 128. The standard specifies the computation, presentation and disclosure requirements for earnings per share. -6- Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Financial Condition - ------------------- Cash and cash equivalents decreased $50,000 during the three months ended March 30, 1997. The Company's operations generated $366,000 in cash during this period, while investing and financing activities used cash of $293,000 and $123,000, respectively. The sources of cash from operations were the net noncash items, mainly depreciation, of $333,000 and $52,000 from the favorable change in operating assets and liabilities, partially offset by the $19,000 loss. The decrease in inventory and the increase in accounts payable, offset in part by a decrease in accrued liabilities were the primary reasons for the decrease in net operating assets. The decrease in inventory was mainly due to lower levels in the steel cable and electronics segments due to a combination of shorter lead times for certain products, the Company's effort to reduce certain inventory levels and the increased shipments in the steel cable segment. The increase in accounts payable is mainly attributable to the timing of inventory purchases. The decrease in accrued liabilities resulted mainly from the payments of the 401(k) match and restructuring expenses. The Company's principal investing activity during the three months ended March 30, 1997 was the purchase of $277,000 of capital equipment. Machinery and equipment additions geared toward adding new and upgrading existing production capabilities and processes in the steel cable segment accounted for the majority of these expenditures. During the quarter ended March 30, 1997, the Company reduced its lines of credit borrowings by $50,000. At March 30, 1997, the Company's unused portion of these lines of credit was $1,710,000. Management believes that based on its current debt arrangements, its current working capital, and the expected cash flows from operations the Company's resources are sufficient to meet its financial needs in 1997 including a remaining capital expenditures budget of approximately $1,000,000. -7- Results of Operations -- Overview -- - ------------------------------------ Net sales for the quarter ended March 30, 1997 decreased $1,207,000 (14%) from the comparable period in 1996, as lower sales in the electronics and instruments segments were partially offset by increased sales in the steel cable segment. The overall gross profit percentage decreased 26% from 1996 as lower margins in the electronics and steel cable segments were partially offset by higher margins in the instruments segment. Total selling and administrative expenses decreased $365,000 (21%) from 1996. Selling expenses decreased $303,000 (27%) from 1996 as all segments reported lower expenses. Overall general and administrative expenses decreased $62,000 (10%) mainly as a result of the lower provision for Company-wide profit sharing and incentive bonus expense. Research and development expenses decreased $83,000 (62%) from 1996 as a result of lower expenses in the instruments segment. Interest expense decreased $33,000 from 1996 due to the lower levels of short and long-term debt. Other income (expense), net remained level with 1996. The estimated effective income tax rate for both 1997 and 1996 is 40%. Based on the lower sales level and the lower gross margin, offset in part by a decrease in operating expenses, operating profit decreased from $493,000 in 1996 to $64,000 during the quarter ended March 30, 1997. Nonoperating expenses decreased $33,000 from 1996 mainly as a result of lower interest expense. As a result, the Company reported a pre-tax loss of $32,000 during the quarter ended March 30, 1997 versus a pre-tax profit of $364,000 in 1996. The net loss amounted to $19,000 in 1997 compared to net earnings of $218,000 in 1996. Business Segment Results - ------------------------ Sales in the steel cable segment increased $760,000 (26%) over 1996 mainly due to increased sales to the automotive market. The overall gross profit percentage decreased 30% from last year mainly as a result of increased operating costs, primarily labor and freight, in its Mexican facility. Based on the increased sales volume and delivery requirements of the Mexican facility, the Company experienced an increase in the number of and turnover of direct labor people, resulting in significant labor inefficiencies and higher than anticipated labor costs. In addition, in order to meet customer delivery schedules, the Company incurred higher than expected freight expenses. Operating expenses decreased $50,000 from 1996 mainly due to a lower bad debt expense provision. As a result of the lower gross margin, partially offset by a decrease in operating expenses, the steel cable segment reported a $39,000 decrease in operating profit from 1996. -8- Sales in the electronics segment decreased $1,409,000 (32%) from 1996 as this segment continues to experience softness from both the OEM and contract manufacturers in the telecommunications market. The segment first began to see this softness in the latter part of the second quarter of 1996. The gross profit percentage decreased 28% from 1996 as a result of the negative effect of allocating the fixed overhead expenses over the lower sales level and changes in product mix. Total operating expenses decreased 14% from 1996 mainly as a result of lower sales commission expense. Based on the decreased sales and gross profit, offset in part by lower operating expenses, the electronics segment reported a decrease in operating profit of $527,000 from 1996. Total sales in the instruments segment decreased $557,000 (41%) from 1996 as lower sales to both the NDT/NDE and medical research markets were partially offset by increased unit sales of instruments to the colloidal markets. The overall gross profit percentage increased 15% from 1996 mainly as a result of decreased personnel expense due to the phasing out of the AcoustoSizer(TM) in 1996, reduced operating expenses and operating efficiencies achieved by the consolidation of this segment in one location, and changes in sales mix. Total operating expenses declined 43% from 1996 mainly due to decreases in selling and research and development expenses. The selling expense decrease was mainly due to lower personnel, travel and advertising expenses. Decreased personnel expense and operating supplies were the primary reasons for the decrease in research and development expense. While sales decreased, based on an increase in the gross profit percentage and lower operating expenses, the instruments segment reported a $103,000 reduction in its operating loss incurred in 1996. -9- PART II - OTHER INFORMATION Item 4. Submission of Matters to a Vote of Security Holders The Annual Meeting of Stockholders was held on April 28, 1997 to consider and vote on the election of seven directors. Stockholders cast votes for the election of directors as follows: Nominee "For" "Withheld" ------------------ --------- ---------- Eli Fleisher 2,256,395 5,582 Robert B. Gill 2,104,183 157,794 Lawrence Holsborg 2,256,495 5,482 John J. McArdle III 2,256,445 5,532 Robert W. Muir, Jr. 2,256,495 5,482 Joseph W. Tiberio 2,256,395 5,582 Ted Valpey, Jr. 2,256,345 5,632 Item 6. Exhibits and Reports on Form 8-K (a) Exhibits: 3. (b) Amendment to Article III, Section 1 of the By-Laws effective April 28, 1997. Filed herein. 3 (c) By-Laws. Filed herein. 11. Statement re Computation of Per Share Earnings (Loss). Filed herein. 27. Financial Data Schedule. Filed for electronic purposes only. (b) Reports on Form 8-K - None -10- SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. MATEC Corporation ------------------------------------ Date: May 7, 1997 By /s/ Ted Valpey, Jr. --------------------------------- Ted Valpey, Jr. Chairman of the Board and President Date: May 7, 1997 By /s/ Michael J. Kroll --------------------------------- Michael J. Kroll, Vice President and Treasurer (Principal Financial and Accounting Officer) -11- EX-3 2 BY LAW CHANGE Exhibit 3.(b) ARTICLE III DIRECTORS Section 1. Number, Qualification and Term. The property and business of the Corporation shall be managed by its Board of Directors consisting of not less than Five (5) nor more than Thirteen (13) persons. The number of directors constituting the entire Board shall be Seven (7); provided, however, that from time to time, such number may be decreased to not less than Five (5) or increased to not more than Thirteen (13) persons by amendment of this section of the By-laws by a majority of the entire Board of Directors. Directors need not be stockholders. They shall be elected at the Annual Meeting of Stockholders and each director shall be elected to serve until his successor shall be elected and shall qualify. EX-3 3 BY LAWS Exhibit 3.(c) MATEC Corporation By-Laws ARTICLE I OFFICES Section 1. Offices. The Corporation shall maintain a registered office in Delaware. The Corporation may maintain such other offices and keep its books, documents and records at such other places both within and without the State of Delaware as the Board of Directors may from time to time determine or the business of the Corporation may require. ARTICLE II STOCKHOLDERS Section 1. Place of Meetings. Meetings of stockholders for all purposes shall be held at such place within or without the State of Delaware as shall be determined by the Board of Directors. Section 2. Annual Meetings. Annual meetings of stockholders shall be held on the last Wednesday in April, in each year, if not a legal holiday, and if a legal holiday, then on the next secular day following, or on such other day as shall be fixed by the Board of Directors and stated in the notice of the meeting, when stockholders shall elect by a plurality vote a Board of Directors, and transact such other business as may properly be brought before the meeting. The annual meeting shall be held at a time determined by the Board of Directors and stated in the notice of the meeting. Section 3. Notice of Annual Meeting. Written or printed notice of the annual meeting stating the place, date and hour of the meeting shall be delivered not less than ten nor more than sixty days before the date of the meeting, by mail, by or at the direction of the chief executive officer, the Secretary, or the officer or persons calling the meeting, to each stockholder of record entitled to vote at such meeting. Section 4. Special Meetings. Special meetings of the stockholders, for any purpose or purposes, unless otherwise prescribed by statute or by the Certificate of Incorporation, may be called by the chief executive officer or the Board of Directors. The business transacted at any special meeting of stockholders shall be limited to the purposes stated in the notice of the meeting. Section 5. Notice of Special Meetings. Written or printed notice of a special meeting stating the place, date and hour of the meeting and the purpose or purposes for which the meeting is called, shall be delivered not less than ten nor more than sixty days before the date of the meeting, by mail, by or at the direction of the chief executive officer, the Secretary, or the officer or persons calling the meeting, to each stockholder of record entitled to vote at such meeting. The notice shall also indicate that it is being issued by, or at the direction of, the person calling the meeting. Section 6. Quorum. The holders of a majority of the shares issued and outstanding and entitled to vote, represented in person or by proxy, shall constitute a quorum at all meetings of the stockholders for the transaction of business except as otherwise provided by statute or by the Certificate of Incorporation. If, however, such quorum shall not be present or represented at any meeting of the stockholders, the stockholders present in person or represented by proxy shall have power to adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present or represented. At such adjourned meeting at which a quorum shall be present or represented any business may be transacted which might have been transacted at the meeting as originally noticed. Section 7. Voting. At any meeting of stockholders each outstanding share having voting power shall be entitled to one vote on each matter submitted to a vote. A stockholder may vote either in person or by proxy executed in writing by the stockholder or by his duly authorized attorney-in-fact. All elections shall be determined by plurality vote, and except as otherwise provided by statute or in the Certificate of Incorporation, all other matters shall be determined by vote of a majority of the shares present or represented at such meeting and voting on such matters. Section 8. Inspectors of Election. The Board of Directors in advance of any meeting of stockholders may appoint one or more inspectors to act at the meeting or any adjournment thereof. If inspectors are not so appointed, the person presiding at a meeting of stockholders may, and, on the request of any stockholder entitled to vote thereat, shall appoint one or more inspectors. In case any person appointed as inspector fails to appear or act, the vacancy may be filled by the Board of Directors in advance of the meeting or at the meeting by the person presiding thereat. Each inspector, before entering upon the discharge of his duties shall take and sign an oath faithfully to execute the duties of inspector at such meeting with strict impartiality and according to the best of his ability. Section 9. List of Stockholders. A list of stockholders as of the record date, certified by the officer of the Corporation responsible for its preparation or by the transfer agent, shall be produced at any meeting of stockholders upon the request thereat or prior thereto of any stockholder. If the right to vote at any meeting is challenged, the inspectors of election, or person presiding thereat shall require such list of stockholders to be produced as evidence of the right of the persons challenged to vote at such meeting, and all persons who appear from such list to be stockholders entitled to vote thereat may vote at such meeting. ARTICLE III DIRECTORS Section 1. Number, Qualification and Term. The property and business of the Corporation shall be managed by its Board of Directors consisting of not less than Five (5) nor more than Thirteen (13) persons. The number of directors constituting the entire Board shall be Seven (7); provided, however, that from time to time, such number may be decreased to not less than Five (5) or increased to not more than Thirteen (13) persons by amendment of this section of the By-laws by a majority of the entire Board of Directors. Directors need not be stockholders. They shall be elected at the Annual Meeting of Stockholders and each director shall be elected to serve until his successor shall be elected and shall qualify. Section 2. Removal. Any or all of the directors may be removed for cause at any time by the vote of the stockholders. Section 3. Vacancies. Newly created directorships resulting from an increase in the Board of Directors and all vacancies occurring in the Board of Directors, except vacancies caused by removal without cause, may be filled by a majority vote of the directors then in office, though less than a quorum exists. A director elected to fill a vacancy shall be elected for the unexpired portion of the term of his predecessor in office. A director elected to fill a newly created directorship shall serve until the next succeeding annual meeting of stockholders and until his successor shall have been elected and qualified. Section 4. Additional Powers. In addition to the powers and authorities by these By-Laws expressly conferred upon it, the Board of Directors may exercise all such powers of the Corporation and do all such lawful acts and things as are not by statute or by the Certificate of Incorporation or by these By-Laws directed or required to be exercised or done by the stockholders. ARTICLE IV MEETINGS OF THE BOARD OF DIRECTORS Section 1. Place. Meetings of the Board of Directors, regular or special, may be held either within or without the State of Delaware. Section 2. First Meeting. The first meeting of each newly elected Board of Directors shall be held immediately after the annual meeting of stockholders at the same place as such meeting is held and no notice of such meeting to the newly elected directors shall be necessary in order legally to constitute the meeting provided a quorum shall be present, or it may convene at such place and time as shall be specified in a notice given as hereinafter provided for special meetings of the Board of Directors, or as shall be specified in a duly executed waiver of notice thereof. Section 3. Regular Meetings. Regular meetings of the Board of Directors may be held upon such notice, or without notice, and at such time and at such place as shall from time to time be determined by the Board. Section 4. Special Meetings. Special meetings of the Board of Directors may be called by the chief executive officer on written notice to each director, deposited in the United States mail no later than the third calendar day preceding the meeting date or delivered by hand or to the telegraph company no later than the first calendar day preceding the meeting date; special meetings shall be called by the chief executive officer or Secretary in like manner and on like notice on the written request of two directors. Section 5. Quorum. A majority of the entire Board of Directors shall constitute a quorum for the transaction of business unless a greater or lesser number is required by law or by the Certificate of Incorporation. The vote of a majority of the directors present at any meeting at which a quorum is present shall be the act of the Board of Directors, unless the vote of a greater number is required by law or by the Certificate of Incorporation. If a quorum shall not be present at any meeting of directors, the directors present may adjourn the meeting from time to time. Notice of any such adjournment shall be given to any director who was not present at the time of such adjournment and unless announced at the meeting to the other directors. Section 6. Consent in Lieu of Meeting. Any action required or permitted to be taken by the Board of Directors or any committee thereof may be taken without a meeting if all members of the Board or the committee consent in writing to the adoption of a resolution authorizing the action. The resolution and the written consents thereto by the members of the Board or committee shall be filed with the minutes of the proceedings of the Board or committee. Section 7. Telephone Participation at Meetings. Any one or more of the Board of Directors or any committee thereof may participate in a meeting of the Board of Directors or of such committee by means of conference telephone or similar communications equipment allowing all persons participating in the meeting to hear each other at the same time. Participation in a meeting by such means shall constitute presence in person at a meeting. ARTICLE V COMMITTEES Section 1. Committees. The Board of Directors, by resolution adopted by a majority of the entire board, may designate, from among its members, an executive committee and other committees consisting of three or more directors, which, to the extent provided in the resolution, shall have all the authority of the Board, except as otherwise required by law. Vacancies in the membership of such committees shall be filled by the Board of Directors at a regular or special meeting. Such committees shall keep regular minutes of its proceedings and report the same to the Board when required. Subject to the provisions of these By-Laws, the executive committee and each other committee shall fix its own rules of procedure and shall meet as provided by such rules or by resolution of the Board of Directors and it shall also meet at the call of the Chairman of the Board or President of the Corporation or any two members of such committee. A majority of the executive committee and of each other committee shall constitute a quorum for the transaction of business and the vote of a majority of the members of such committee present at any meeting at which there is a quorum shall be the act of such committee. ARTICLE VI NOTICES Section 1. Form; Delivery. Whenever, under the provisions of the statutes or of the Certificate of Incorporation or of these By-Laws, notice is required to be given to any director or stockholder, such notice may be given in writing, by mail, addressed to such director or stockholder, at his address as it appears on the records of the Corporation, with postage thereon prepaid, and such notice shall be deemed to be given at the time when the same shall be deposited in the United States mail. Notice to directors may also be given by hand delivery, effective upon such delivery, or by telegram which notice shall be deemed to have been given when delivered to the telegraph company. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the Board of Directors need be specified in the notice or waiver of notice of such meeting. Section 2. Waiver of Notice. Whenever any notice is required to be given under the provisions of any statute or under the provisions of the Certificate of Incorporation or these By-Laws, a waiver thereof in writing signed by the person or persons entitled to such notice, whether before or after the time stated therein, shall be deemed equivalent to the giving of such notice. In addition, any stockholder attending a meeting of stockholders in person or by proxy without protesting prior to the conclusion of the meeting, the lack of notice thereof to him, and any director attending a meeting of the Board of Directors without protesting prior to the meeting or at its commencement such lack of notice shall be conclusively deemed to have waived notice of such meeting. ARTICLE VII OFFICERS AND AGENTS Section 1. Officers. The officers of the Corporation shall be chosen by the Board of Directors and shall be a Chairman of the Board, a President, a Vice-President, a Secretary and a Treasurer. The Board of Directors may also choose additional Vice-Presidents, and one or more Assistant Secretaries and Assistant Treasurers. Section 2. Election. The Board of Directors at its first meeting after each annual meeting of stockholders shall choose a Chairman of the Board, a President, one or more Vice-Presidents, a Secretary and a Treasurer. Any two or more offices may be held by the same person. Section 3. Additional Officers and Agents. The Board of Directors may appoint such other officers and agents as it shall deem necessary who shall hold their offices for such terms and shall exercise such powers and perform such duties as shall be determined from time to time by the Board of Directors. Section 4. Compensation. The salaries of all officers of the Corporation shall be fixed by the Board of Directors and the compensation of employees and agents shall be so fixed or shall be fixed by officers thereunto duly authorized. Section 5. Term of Office; Removal. The officers of the Corporation shall hold office until their successors are chosen and qualify. Any officer or agent elected or appointed by the Board of Directors may be removed at any time with or without cause by the Board. Any vacancy occurring in any office of the Corporation may be filled by the Board of Directors. Section 6. Powers and Duties of the Chairman of the Board. The Chairman of the Board of Directors shall preside at all meetings of the Board and all meetings of the stockholders at which he shall be present and shall have such other powers and duties as may from time to time be assigned to him by the Board of Directors. Section 7. Powers and Duties of the President. The President shall be the Chief Executive Officer of the Corporation, and shall have the general management and superintendence of the affairs of the Corporation, subject, however, to the control of the Board of Directors; and in all cases where, and to the extent that, the duties of the other officers of the Corporation are not specifically prescribed by By-Laws or rules or regulations of the Board of Directors, the President may prescribe such duties. He shall have general and active supervision over the property, business and affairs of the Corporation and may sign, execute, and deliver in the name of the Corporation deeds, mortgages, bonds, contracts, powers of attorney, and other instruments, except in cases where the signing and execution thereof shall be expressly delegated by the Board of Directors or these By-Laws to some other officer or agent of the Corporation or shall be required by law or otherwise to be signed or executed, and may exercise any and all powers and perform any and all duties relating to such supervision, or which are imposed upon him by the By-Laws, or by the Board of Directors. Subject to such limitations as the Board of Directors may from time to time prescribe, the Chief Executive Officer shall have power to appoint and to dismiss all such agents and employees of the Corporation who are not officers thereof (including any appointed by the Board) as he may deem proper, and to prescribe their duties, and subject to like limitations, delegate to other officers of the Corporation any other of the powers and duties conferred upon him by the By-Laws or by the Board of Directors. Section 8. Powers and Duties of the Vice-President. The Vice-President shall perform the duties as may be prescribed by the Board of Directors and subject to the chief executive officer. Section 9. Powers and Duties of the Secretary. The Secretary shall attend all sessions of the Board and all meetings of the stockholders and record all votes and the minutes of all proceedings in a book to be kept for that purpose, and shall perform like duties for any committee of the Board when required. He shall cause to be given notice of all meetings of stockholders and directors and shall perform such other duties as pertain to his office. He shall keep in safe custody the seal of the Corporation and when authorized by the Board of Directors, affix it when required to any instrument. Section 10. Powers and Duties of the Treasurer. The Treasurer shall have the custody of all the corporate funds and securities and shall keep full and accurate accounts of receipts and disbursements in books belonging to the Corporation and shall deposit all moneys and other valuable effects in the name and to the credit of the Corporation in such depositories as may be designated by the Board of Directors. He shall disburse the funds of the Corporation as may be ordered by the Board, taking proper vouchers for such disbursements, and shall render to the chief executive officer and directors at the regular meetings of the Board, or whenever they may require it, an account of all his transactions as treasurer and of the financial condition of the Corporation. Section 11. Powers and Duties of Other Officers. All other officers shall have such duties and exercise such powers as generally pertain to their respective offices and all officers shall have such other duties and exercise such other powers as from time to time may be prescribed by the chief executive officer or the Board of Directors. ARTICLE VIII SHARES Section 1. Form; Signature. The shares of the Corporation shall be represented by certificates signed by the President or a Vice-President and the Secretary or an Assistant Secretary or the Treasurer or an Assistant Treasurer of the Corporation and may be sealed with the seal of the Corporation or a facsimile thereof. The signatures of the officers of the Corporation upon a certificate may be facsimiles if the certificate is countersigned by a transfer agent or registered by a registrar other than the Corporation itself or an employee of the Corporation. In case any officer who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer before such certificate is issued, it may be issued by the Corporation with the same effect as if he were such officer at the date of issue. Section 2. Lost Certificates. The Board of Directors may authorize the officers or agents of the Corporation to issue a new certificate in place of any certificate theretofore issued by the Corporation alleged to have been lost or destroyed and as a condition precedent to the issuance thereof, may prescribe such terms and conditions as it deems expedient, and may require such indemnities as it deems adequate to protect the Corporation from any claim that may be made against it with respect to any such certificate alleged to have been lost or destroyed. Section 3. Transfer of Shares. Upon surrender to the Corporation or the transfer agent of the Corporation of a certificate representing shares duly endorsed or accompanied by proper evidence of succession, assignment or authority to transfer, a new certificate shall be issued to the person entitled thereto, and the old certificate cancelled and the transaction recorded upon the books of the Corporation. Section 4. Fixing Record Date. For the purpose of determining stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or to express consent to or dissent from any proposal without a meeting, or for the purpose of determining stockholders entitled to receive payment of any dividend or the allotment of any rights, or for the purpose of any other action, the Board of Directors may fix, in advance, a date as the record date for any such determination of stockholders. Such date shall not be more than sixty nor less than ten days before the date of any meeting nor more than sixty days prior to any other action. When a determination of stockholders of record entitled to notice of or to vote at any meeting of stockholders has been made as provided in this section, such determination shall apply to any adjournment thereof, unless the Board fixes a new record date for the adjourned meeting. Section 5. Registered Stockholders. The Corporation shall be entitled to recognize the exclusive right of a person registered on its books as the owner of shares to receive dividends, and to vote as such owner, and to hold liable for calls and assessments a person registered on its books as the owner of shares, and shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise provided by the laws of Delaware. ARTICLE IX GENERAL PROVISIONS Section 1. Dividends. Subject to the provisions of law and of the Certificate of Incorporation relating thereto, dividends may be declared by the Board of Directors at any regular or special meeting, pursuant to law. Dividends may be paid in cash, the Corporation's bonds or its property, including the shares or bonds of other corporations, subject to any provisions of law and of the Certificate of Incorporation. Section 2. Reserves. Before payment of any dividend, there may be set aside out of any funds of the Corporation available for dividends such sum or sums as the directors from time to time, in their absolute discretion, think proper as a reserve fund to meet contingencies, or for equalizing dividends, or for repairing or maintaining any property of the Corporation, or for such other purposes as the directors shall think conducive to the interest of the Corporation, and the directors may modify or abolish any such reserve in the manner in which it was created. Section 3. Checks. All checks or demands for money and notes of the Corporation shall be signed by such officer or officers or such other person or persons as the Board of Directors may from time to time designate. Section 4. Fiscal Year. The fiscal year of the Corporation shall begin on January 1st and end on December 31st of each year, unless otherwise provided by the Board of Directors. Section 5. Seal. The corporate seal shall have inscribed thereon the name of the Corporation, the year of its organization and the words "CORPORATE SEAL, DELAWARE". This seal may be used by causing it or a facsimile thereof to be impressed or affixed or in any manner reproduced. ARTICLE X AMENDMENTS Section 1. Amendments. These By-Laws may be amended or added to or any part thereof repealed by the affirmative vote of a majority of the votes cast by the holders of shares entitled to vote thereon at any meeting of stockholders, the notice of which meeting includes notice of the proposed amendment, addition or repeal; or the affirmative vote of a majority of the directors present at the time of the vote, if a quorum is present at such time, at any meeting of the Board of Directors, the notice of which meeting includes notice of the proposed amendment, addition or repeal, unless all members of the Board of Directors are present at such meeting or unless such notice be waived, in a writing, setting forth the proposed amendment, addition or repeal and signed by the director entitled to such notice. EX-11 4 EARNINGS PER SHARE MATEC Corporation and Subsidiaries Exhibit 11 Calculation of Earnings (Loss) Per Share (amounts in thousands, except per share data) Three Months Ended 3/30/97 3/31/96 ------ ------ Net earnings (loss) ............................... $ (19) $ 218 ====== ====== Calculation of primary earnings (loss) per share: - ------------------------------------------------- Weighted average common shares outstanding ....... 2,748 2,764 Increase from assumed exercise of stock options and investment of proceeds in treasury stock, based upon average market prices (D) ............ - 23 ------ ------- Average common stock and common equivalent shares outstanding (B) .......................... 2,748 2,787 ====== ======= Net earnings (loss) per common and common equivalent share (A) ............................ $ (.01) $ .08 ====== ======= Calculation of fully diluted earnings (loss) per share: - ------------------------------------------------------- Weighted average common shares outstanding ....... 2,748 2,764 Increase from assumed exercise of stock options and investment of proceeds in treasury stock, based upon the higher of average or quarter-end market prices ................................... 25 23 ------ ------- Average common stock and common equivalent shares used to calculate fully diluted earnings per share (B) ................................... 2,773 2,787 ====== ======= Net earnings (loss) per common and common equivalent share assuming full dilution (C) ................ $ (.01) $ .08 ====== ======= (A) Dilution from stock options is less than 3%, therefore primary earnings per share is based on the weighted average number of shares outstanding. (B) The effect of the outstanding warrants is excluded since they do not meet either test of paragraph 37 of APB Opinion No. 15. (C) Dilution is less than 3%, therefore the primary basis was used for per share calculations. (D) In loss periods, dilutive common equivalent shares are excluded as the effect would be anti-dilutive. EX-27 5 FINANCIAL DATA SCHEDULE
5 3-MOS DEC-31-1997 MAR-30-1997 834 0 5,926 132 5,309 13,061 18,972 12,618 22,187 4,887 1,985 0 0 190 13,514 22,187 7,445 7,445 5,933 5,933 0 0 83 (32) (13) (19) 0 0 0 (19) (.01) (.01)
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