UNITED STATES
SECURITES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
(Mark one)
[ X ] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 (FEE REQUIRED)
For the calendar year ended December 31, 1997
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from _______ to _______
Commission File No.: 0-22175
A. Full title of the plan and the address of the plan, if different from that
of the issuer named below:
EMCORE CORPORATION 401(k) SAVINGS PLAN
B. Name of issuer of the securities held pursuant to the plan and the address
of its principal executive office:
EMCORE CORPORATION
394 ELIZABETH AVENUE
SOMERSET, NJ 08873
REQUIRED INFORMATION
EMCORE Corporation 401(k) Savings Plan ("Plan") is subject to the Employee
Retirement Income Security Act of 1974 ("ERISA"). Therefore, in lieu of the
requirements of Items 1-3 of Form 11-K, the financial statements and schedules
of the Plan for the two calendar years ended December 31, 1997 and 1996, which
have been prepared in accordance with the financial reporting requirements of
ERISA, are attached hereto as Appendix I and incorporated herein by this
reference.
SIGNATURES
The Plan. Pursuant to the requirements of the Securities and Exchange Act of
1934, the trustees (or other persons who administer the employee benefit plan)
have duly caused this annual report to be signed on its behalf by the
undersigned hereunto duly authorized.
EMCORE Corporation 401(k) Savings Plan
- ------------------------------------ ----------------
Thomas G. Werthan Date
Vice President
Chief Financial Officer
Trustee
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration
statement of EMCORE Corporation on Form S-8 (File No. 333-27507, & 333-39547 &
333-36445 & 333-45827) of our report dated July 17, 1998, on our audits of the
financial statements of the EMCORE Corporation 401(k) Savings Plan as of
December 31, 1997 and 1996, and for the year ended December 31, 1997, which is
included in this Form 11-K
Florham Park, NJ
October 15, 1998
EMCORE CORPORATION
401(k) SAVINGS PLAN
FINANCIAL STATEMENTS AND
SUPPLEMENTAL SCHEDULES
AS OF DECEMBER 31, 1997 AND 1996
AND FOR THE YEAR ENDED DECEMBER 31, 1997
EMCORE CORPORATION
401(k) Savings Plan
REPORT OF INDEPENDENT ACCOUNTANTS
July 17, 1998
To the Participants and Administrator
of the EMCORE Corporation 401(k) Savings Plan:
In our opinion, the accompanying statements of net assets available for
plan benefits and the related statement of changes in net assets available for
plan benefits present fairly, in all material respects, the net assets available
for plan benefits of EMCORE Corporation 401(k) Savings Plan (the "Plan") as
of December 31, 1997 and 1996, and the changes in net asset available for plan
benefits for the year ended December 31, 1997, in conformity with generally
accepted accounting principles. These financial statements are the
responsibility of the Plan's management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these statements in accordance with generally accepted auditing
standards which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for the opinion expressed above.
Our audits were performed for the purpose of forming an opinion on the
basic financial statements taken as a whole. The supplemental schedules, Item
27a - Schedule of Assets Held for Investment Purposes as of December 31, 1997
and Item 27d - Schedule of Reportable Transactions for the year ended December
31, 1997, are presented for the purpose of additional analysis and are not a
required part of the basic financial statements but are supplementary
information required by the Department of Labor's Rules and Regulations for
Reporting and Disclosure under the Employee Retirement Income Security Act of
1974. These supplemental schedules are the responsibility of the Plan's
management. The Fund Information in the statement of changes in net assets
available for plan benefits is presented for purposes of additional analysis
rather than to present the changes in net assets available for benefits of each
fund. The supplemental schedules and Fund Information have been subjected to the
auditing procedures applied in the audits of the basic financial statements and,
in our opinion, are fairly stated in all material respects in relation to the
basic financial statements taken as a whole.
EMCORE CORPORATION
401(K) SAVINGS PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR PLAN BENEFITS
AS OF DECEMBER 31, 1997 and 1996
1997 1996
---- ----
ASSETS
Investments, at fair value: (Note 3)
Mutual Funds $1,824,981 $ 983,462
Money Market 105,560 61,414
EMCORE Corporation stock 80,511 -
Participants' notes receivable 50,361 35,107
---------- ---------
Total investments 2,061,413 1,079,983
---------- ---------
Receivables:
Participants' contributions 48,155 44,156
Employer's contributions 16,684 -
---------- ----------
Total receivables 64,839 44,156
---------- ----------
Net assets available for plan benefits $2,126,252 $1,124,139
========== ==========
The accompanying notes are an integral part of these financial statements.
EMCORE CORPORATION
401(K) SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
1. DESCRIPTION OF PLAN
The following description of the EMCORE Corporation (the "Company") 401(k)
Plan (the "Plan") provides only general information. Participants should
refer to the Plan agreement for a more complete description of the Plan's
provisions.
1. General. The Plan is a defined contribution plan covering all full-time
employees of the Company who have completed one month of service and
are age twenty or older. It is subject to the provisions of the
Employee Retirement Income Security Act of 1974 (ERISA).
2. Contributions. Each year, participants may contribute up to 15% percent
of pretax annual compensation, as defined in the Plan. Participants may
also contribute amounts representing distributions from other qualified
defined benefit or contribution plans. Effective August 1, 1997, the
Company began contributing 50 percent of the first 6 percent of base
compensation that a participant contributes to the Plan. Additional
amounts may be contributed at the option of the Company's board of
directors. All employer contributions are invested in EMCORE
Corporation common stock. Contributions are subject to certain
limitations.
3. Participant Accounts. Each participant's account is credited with the
participant's contribution and allocations of (a) the Company's
contribution and (b) Plan earnings. Allocations are based on
participant earnings or account balances, as defined. The benefit to
which a participant is entitled is the benefit that can be provided
from the participant's vested account.
4. Vesting. Participants are immediately vested in their contributions
plus actual earnings thereon. Vesting in the Company's matching and
discretionary contributions plus actual earnings thereon is based on
years of continuous service. A participant becomes 100 percent vested
after five years of credited service, with vesting taking place ratably
over such period.
5. Investment Options. Upon enrollment in the Plan, a participant may
direct employee contributions in any percent increments in any of the
available investment options. Participants may change their investment
options at any time.
Description of investment options:
Money Market: Prudential Government Securities Trust - Funds are
invested in United States Government securities.
Mutual Funds:
Prudential Utility - Funds are invested in equity and debt securities
of utility companies, including electric, gas, telephone and cable
companies.
Prudential Equity - Funds are invested in common stocks of major &
established corporations.
Prudential Small Company - Funds are invested in commons stocks
selected for their potential for high return on equity, increased
earnings, increasing or expected dividends and low P/E ratios.
Prudential Allocation Strategy/Balanced - Funds are invested in
allocations between stocks, bonds, convertibles and cash.
Prudential Government Income - Funds are invested on bonds backed by
the United States Government or by government-linked agencies.
Putnam Voyager - Funds are invested in primarily common stocks of mid
size firms.
Alliance Growth - Funds are invested in equity securities issued by
companies with favorable earnings and long-term growth prospects.
Mutual Beacon - Funds are invested in common and preferred stocks and
corporate debt.
Aim Aggressive Growth - Funds are invested in equity securities of
small-to medium-sized companies.
Oppenheimer Quest Opportunity Value - Funds are invested among stocks,
bonds and cash.
Kemper-Dreman High Return - Funds are invested in common stocks that
pay high dividends relative to the dividend yield of the S&P 500
index.
EMCORE Corporation Stock - Funds are invested in common stock of
EMCORE Corporation.
6. Participant Loans. Participants may borrow from their fund accounts a
minimum of $1,000 up to a maximum equal to the lesser of $50,000 or 50%
percent of their vested account balance. Loan transactions are treated
as a transfer to (from) the investment fund(s) from (to) the
Participants' Loan Fund. Loan terms range from 1-5 years or up to 25
years for the purchase of a primary residence. Loans are collateralized
by the balance in the participant's account and bear interest at a rate
commensurate with local prevailing rates as determined quarterly by the
Plan administrator. Interest rates in 1997 ranged from 7.5 percent to
8.5 percent. Principal and interest is paid ratably through bi-weekly
payroll deductions.
7. Payment of Benefits. On termination of service due to death, disability
or retirement, a participant or their beneficiary may elect to receive
either a lump sum amount equal to the value of the participant's vested
interest in his or her account, or annual installments over a ten-year
period. For termination of service due to other reasons, a participant
receives the value of the vested interest in his or her account as a
lump-sum distribution.
8. Forfeited Accounts. At December 31, 1997, forfeited nonvested accounts
amounted to approximately $800. These accounts will be used to reduce
future employer contributions.
9. Administrative Fees. The Company pays all administrative fees of the
Plan. Fees paid by the Company for the investment management services
amounted to approximately $8,200 for the year ended December 31, 1997.
2. SUMMARY OF ACCOUNTING POLICIES
Basis of Accounting
The financial statements of the Plan are prepared under the accrual method
of accounting.
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles require management to make estimates and
assumptions that affect the reported amounts of assets, liabilities, and
changes therein, and disclosure of contingent assets and liabilities.
Actual results could differ from those estimates.
Investment Valuation and Income Recognition
The Plan's investments are stated at fair value. The Company stock is
valued at its quoted market price. Participants' notes receivable is valued
at cost which approximates fair value.
The Plan presents in the statement of changes in net assets available for
plan benefits the net appreciation (depreciation) in the fair value of its
investments which consists of both realized gains or losses and the
unrealized appreciation (depreciation) on those investments.
Purchases and sales of securities are recorded on a trade-date basis.
Interest income is recorded on the accrual basis. Dividends are recorded on
the ex-dividend date.
Payment of Benefits
Benefits are recorded when paid.
3. INVESTMENTS
The following table presents the fair values of the Plan's investments held
by Prudential Investments as of December 31, 1997 and 1996:
1997 1996
---- ----
Money Market:
Prudential Government Securities Trust $ 105,560 * $ 61,414 *
Mutual Funds:
Prudential Utility Class B 258,979 * 345,251 *
Prudential Utility Class A 237,469 * -
Prudential Equity Class B 234,969 * 302,991 *
Prudential Small Company Class B 175,835 * 207,832 *
Prudential Equity Class A 352,389 * -
Prudential Small Company Class A 325,478 * -
Prudential Allocation Strategy Class A - -
Prudential Allocation Balanced Class A 84,932 -
Prudential Allocation Strategy Class B - 112,624 *
Prudential Allocation Balanced Class B 57,176 -
Prudential Government Income Class B 7,311 14,764
Prudential Government Income Class A 9,063 -
Putnam Voyager Class A 5,878 -
Alliance Growth Class A 5,368 -
Mutual Beacon Class I 38,848 -
Aim Aggressive Growth 13,215 -
Oppenheimer Quest Opportunity value - Cl 6,355 -
Kemper-Dreman High Return Class A 11,716 -
EMCORE Corporation Stock Fund 80,511 -
Participants' Loans Fund 50,361 35,107
------------ --------
Total Trust $ 2,061,413 $ 1,079,983
============ ===========
* - greater than 5% of net assets available for plan benefits
4. PARTICIPANT SHARES AND SHARE VALUES
Total participant shares and share values as of December 31, 1997 and 1996:
1997 1996
----------------------- ------------------------
NUMBER SHARE NUMBER SHARE
OF SHARES VALUE OF SHARES VALUE
--------- ----- --------- ------
Money Market:
Prudential Government Securities Trust 105,560 $ 1.00 61,414 $ 1.00
Mutual Funds:
Prudential Utility Class B 21,021 12.32 31,733 10.88
Prudential Utility Class A 19,259 12.33 - -
Prudential Equity Class B 11,849 19.83 17,575 17.24
Prudential Small Company Class B 11,366 15.47 15,853 13.11
Prudential Equity Class A 17,753 19.85 - -
Prudential Small Company Class A 19,385 16.79 - -
Prudential Allocation Strategy Class B - - 9,239 12.19
Prudential Allocation Balanced Class A 6,922 12.27 - -
Prudential Allocation Balanced Class B 4,675 12.23 - -
Prudential Government Income Class B 808 9.05 1,670 8.84
Prudential Government Income Class A 1,001 9.05 - -
Putnam Voyager Class A 309 19.05 - -
Alliance Growth Class A 125 42.98 - -
Mutual Beacon Class 1 2,757 14.09 - -
Aim Aggressive Growth 286 46.21 - -
Oppenheimer Quest Opportunity Value Clas 179 35.42 - -
Kemper-Dreman High Return Class A 357 32.78 - -
EMCORE Corporation Stock 4,129 19.50 - -
5. NUMBER OF PARTICIPANTS IN EACH FUND
A total of 168 and 88 active and former employees have investments in the
Plan as of December 31, 1997 and 1996, respectively.
The number of participant accounts invested in each fund at December 31,
1997 and 1996 are summarized as follows:
1997 1996
---- -----
Money Market:
Prudential Government Securities Trust 30 16
Mutual Funds:
Prudential Utility Class B 43 43
Prudential Utility Class A 79 -
Prudential Equity Class B 68 47
Prudential Small Company Class B 63 44
Prudential Equity Class A 123 -
Prudential Small Company Class A 100 -
Prudential Allocation Strategy Class B - 15
Prudential Allocation Balanced Class A 34 -
Prudential Allocation Balanced Class B 19 -
Prudential Government Income Class B 5 5
Prudential Government Income Class A 10 -
Putnam Voyager Class A 10 -
Alliance Growth Class A 6 -
Mutual Beacon Class I 11 -
Aim Aggressive Growth 12 -
Oppenheimer Quest Opportunity Value Clas 13 -
Kemper-Dreman High Return Class A 14 -
EMCORE Corporation Stock 153 -
Participants' Loans 11 5
6. PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the
right under the Plan to discontinue its contributions at any time and to
terminate the Plan subject to the provisions of ERISA. In the event of Plan
termination, participants receive the value of the vested interest in his
or her account as a lump-sum distribution.
7. TAX STATUS
In a letter dated March 11, 1994, the Prudential Investments' Prototype
Non-standardized 401(k) Plan, which is utilized by employers participating
in the Prudential Mutual Fund Management Trust, was accepted by the
Internal Revenue Service under Section 401 of the Internal Revenue Code.
The Company is in the process of filing with the Internal Revenue Service
and expects to receive a favorable determination that the Plan qualifies
under Section 401(a) of the Internal Revenue Code.
Item 27a - Schedule of Assets Held for Investment Purposes
as of December 31, 1997
SHARE CURRENT
IDENTITY OF ISSUE TYPE VALUE COST VALUE
- -------------------------------------- ------------ ------- ------- ---------
Prudential Government Securities Trust Money Market $ 1.00 $105,560 $105,560
Prudential Utility Class B Mutual Fund 12.32 207,540 258,979
Prudential Utility Class A Mutual Fund 12.33 203,972 237,469
Prudential Equity Class B Mutual Fund 19.83 195,725 234,969
Prudential Small Company Class B Mutual Fund 15.47 151,087 175,835
Prudential Equity Class A Mutual Fund 19.85 323,689 352,389
Prudential Small Company Class A Mutual Fund 16.79 295,701 325,478
Prudential Allocation Balanced Class A Mutual Fund 12.27 94,274 84,932
Prudential Allocation Balanced Class B Mutual Fund 12.23 63,585 57,176
Prudential Government Income Class B Mutual Fund 9.05 7,267 7,311
Prudential Government Income Class A Mutual Fund 9.05 8,957 9,063
Putnam Voyager Class A Mutual Fund 19.05 6,063 5,878
Alliance Growth Class A Mutual Fund 42.98 5,487 5,368
Mutual Beacon Class I Mutual Fund 14.09 42,903 38,848
Aim Aggressive Growth Mutual Fund 46.21 14,196 13,215
Oppenheimer Quest Opportunity Value Class Mutual Fund 35.42 6,506 6,355
Kemper-Dreman High Return Class A Mutual Fund 32.78 11,722 11,716
EMCORE Corporation Stock Stock Fund 19.50 76,860 80,511
Participants' Loans Loan Fund - 50,361
7.50% - 8.50%
10/25/2001
Item 27a - Schedule of Assets Held for Investment Purposes
as of December 31, 1997
CURRENT VALUE OF
PURCHASE SELLING COST OF ASSET ON TRANSACTION
ASSET NAME PRICE PRICE ASSET DATE NET GAIN
- -------------------------------------- -------- -------- --------- --------------------- ---------
Prudential Utility Class B $ - $ 98,904 $ 82,769 $ 98,904 $16,135
Prudential Utility Class B - 177,448 150,413 177,448 27,035
Prudential Utility Class A 98,904 - 98,904 98,904 -
Prudential Utility Class A 258,997 - 258,997 258,997 -
Prudential Equity Class B - 99,197 79,531 99,197 19,666
Prudential Equity Class B 71,880 - 71,880 71,880 -
Prudential Equity Class B - 188,079 151,851 188,079 36,228
Prudential Small Company Class B - 83,031 70,145 83,031 12,886
Prudential Small Company Class B 75,577 - 75,577 75,577 -
Prudential Small Company Class B - 154,001 127,544 154,001 26,457
Prudential Equity Class A 99,197 - 99,197 99,197 -
Prudential Equity Class A 359,088 - 359,088 359,088 -
Prudential Small Company Class A 83,031 - 83,031 83,031 -
Prudential Small Company Class A 327,540 - 327,540 327,540 -
Prudential Allocation Strategy Class A 55,221 - 55,221 55,221 -
Prudential Allocation Balanced Class A 94,215 - 94,215 94,215 -
Prudential Allocation Strategy Class B - 72,952 71,873 72,952 1,079
Prudential Allocation Strategy Class B - 129,285 125,098 129,285 4,187
Prudential Allocation Balanced Class B 72,952 - 72,952 72,952 -
Prudential Allocation Balanced Class B 81,337 - 81,337 81,337 -
EMCORE Corporation Stock 78,121 - 78,121 78,121 -
