SecProbe.io

CORRESP
1
filename1.htm

    Unassociated Document

              March
      19, 2010

              Via
      Edgar and Overnight Mail

    Mr.
Stephen G. Krikorian

    Accounting
Branch Chief

    Division
of Corporation Finance

    Securities
and Exchange Commission

    Washington,
DC 20549

    Mail Stop
4561

              Re:

              Park
      Electrochemical Corp.

              Form
      10-K Filed on May 15, 2009

              Form
      8-K Filed on December 22, 2009

              File
      No. 001-04415

    Dear Mr.
Krikorian:

    We have
reviewed the comments relating to the above referenced filings and to our
response letter dated January 29, 2010 presented in the letter signed by you and
dated February 23, 2010 to Mr. Brian E. Shore, President and Chief Executive
Officer of Park Electrochemical Corp. (hereinafter “Park” or the
“Company”).  The comments and Park’s responses to the comments are set
forth below:

    Form 10-K For the Fiscal
Year Ended March 1, 2009

    Item 7. Management’s
Discussion and Analysis of Financial Condition and Results of
Operations

    General, page
25

    COMMENT:

              1.

              We
      are considering your response to prior comment 1.  As previously
      requested, explain why you believe that you have satisfied paragraph 16(b)
      of SFAS 140 in derecognizing these liabilities.  In this regard,
      your response states that “the Court dismissed the claim against the
      company in its entirety and ordered the insolvency administrator to bear
      the costs of the proceedings.”  Your response should
      specifically describe the release of the liabilities in the context of
      paragraph 16(b).

    48 South Service Road, Suite
300, Melville, NY 11747 / Phone +1.631.465.3600 / Fax
+1.631.465.3100 / www.parkelectro.com

    RESPONSE:

    In your
letter dated December 23, 2009, you requested that the Company explain why it
believed that it had satisfied paragraph 16(b) of SFAS 140 in order to
derecognize the liabilities of the Company’s Dielektra GmbH (“Dielektra”)
subsidiary in Germany.  In its response letter dated January 29, 2010,
the Company outlined that it had derecognized the liabilities of Dielektra
because the Commercial Court of Cologne, Germany dismissed the claim of the
insolvency administrator against the Company in its entirety and released the
Company from any obligation or liability with respect to such
claim.

    The
Company acknowledges your reference to paragraph 16(b) of SFAS
140.  However, the Company does not think its accounting for this
matter falls under SFAS 140, but rather SFAS 5.  The Company initially
recognized and subsequently derecognized the liabilities from the discontinued
operations of Dielektra under SFAS 5.

    As a
matter of background, the subject liabilities were liabilities of Dielektra, the
Company’s former subsidiary in Germany.  In 2004, after the Company
discontinued its financial support of this subsidiary, Dielektra filed an
insolvency petition, and the Company wrote-off all of the assets of
Dielektra.  However, at that time, in the Company’s judgment the
likelihood of the Company’s incurring any loss relating to such liabilities was
probable.  Therefore, the Company continued to report such liabilities
from the discontinued operations of Dielektra on its Consolidated Balance Sheet
in accordance with SFAS 5.

    In
December 2008, the Company concluded that it was remote that the Company would
incur any future loss relating to such liabilities.  The Company based
its conclusion on (i) the decision of the Commercial Court of Cologne in
December 2008 to dismiss the claim of the insolvency administrator in its
entirety and release the Company from any liability with respect to such claim
and (ii) the advice of counsel that the success of the insolvency
administrator’s appeal was remote.  Therefore, in December 2008, the
Company recorded the benefit from discontinued operations related to the
elimination of the liabilities of Dielektra under SFAS 5.

    The
decision of the Commercial Court of Cologne was confirmed by the Cologne Court
of Appeals in September 2009 when it dismissed the insolvency administrator’s
appeal without a hearing and with prejudice. In accordance with the Court’s
order that the insolvency administrator bear the costs of the proceedings, the
Company received a total of €222,055 from the insolvency
administrator.

      Item 11. Executive
Compensation (Incorporated by reference from Definitive Proxy Statement on
Schedule 14A filed on June 24, 2009)

      Compensation Discussion and
Analysis, page 6

      General

        2

      COMMENT:

              2.

              In
      response to prior comment 3, you advise that your compensation committee
      determines specific payouts under the various elements of executive
      compensation based on the chief executive officer’s and the committee’s
      “subjective view” of a number of general factors, and that the committee
      “does not utilize or consider any pre-determined or other objective
      criteria” in determining executive compensation.  Please confirm
      that you will clearly disclose in future filings, if applicable for the
      relevant period, the subjective nature of the compensation committee’s pay
      determinations.  In this regard, we note the statement in the
      closing of your response letter indicating that you will include the
      information provided in your responses in future filings, “as
      appropriate.”

    RESPONSE:

    The
Company confirms that it will clearly disclose in future filings, if applicable
for the relevant period, the subjective nature of the compensation committee’s
pay determinations.

      COMMENT:

              3.

              In
      addition, it remains unclear from your filing and your responses to prior
      comments 3, 4 and 5 what the elements of your executive compensation
      program are designed to reward and how the committee determines the amount
      to award for each element.  See Item 402(b)(ii) and (v) of
      Regulation S-K.  In particular, as previously requested, please
      provide a more meaningful description of the items of individual and/or
      corporate performance that the compensation committee subjectively
      considers in determining the amounts to award as salary increases,
      bonuses, equity compensation and any other elements of executive
      compensation, in each case to the extent
  material.

    In this
regard, we note your statement in response to prior comment 4 that the committee
considers subjective assessments of an executive’s “overall performance” and of
the company’s “overall results of operations” (among other factors) in
determining bonus awards, and that it considers subjective views of an
executive’s “overall performance” and other factors in determining annual stock
option grants.  We note further your statement in response to prior
comment 5 that the committee “does not consider specific items of corporate or
individual performance, other than the Company’s overall results of operations”
in making compensation decisions. Please explain how you assess “overall”
individual and corporate performance for purposes of determining executive
compensation.  For example, discuss the individual qualities or
achievements (e.g., leadership ability, contribution to company’s growth, etc.)
and the particular items of the company’s results of operations (e.g., revenues,
net earnings, etc.) that are material to the committee’s subjective compensation
decisions.  Please also clearly explain the way that such qualitative
inputs are ultimately translated into objective pay
determinations.

        3

      RESPONSE:

    The
amounts of compensation awarded for each element of the Company’s compensation
program (i.e., salary increases, bonuses and stock options) are subjective and
arbitrary and not based on any formula or any pre-determined or other objective
criteria. The committee’s subjective assessments of the Company’s “overall”
results of operations include the Company’s gross operating margins, operating
income and net income. The committee’s assessment of an executive’s “overall”
performance may include such performance factors as leadership qualities,
intensity of efforts, cost containment efforts and the success of product
promotions.  These qualitative inputs are not translated into
objective pay determinations for the amounts of salary increases, bonuses or
stock option grants. The amounts of bonuses are based on the Chief Executive
Officer’s general reactions and
subjective assessments regarding overall individual and company performance,
which he recommends to the committee and which the committee then reviews with
the Chief Executive Officer. The amounts of stock option grants are arbitrary
allocations based on the same general reactions and subjective assessments and
on the amounts of grants in the past and the total amount expected to be
expensed by the Company in the fiscal year for stock option grants, which the
committee reviews with the Chief Executive Officer.  The Company will
provide additional disclosure in future filings to clarify these matters in its
compensation discussion and analysis.

    General

    Please
provide any questions or comments that the staff may have with respect to our
responses to the staff’s comments to Stephen Gilhuley, Park’s Executive Vice
President, Secretary and General Counsel, or Matthew Farabaugh, Park’s Vice
President and Controller, at 631-465-3600 or send them via facsimile to
631-465-3100.

    Very
truly yours,

    PARK
ELECTROCHEMICAL CORP.

    Stephen
E. Gilhuley

    Executive
Vice President, Secretary and General Counsel

    jc

        4