<PAGE> 1
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
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 Rule 14a-
6(e)(2))
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant toSection 240.14 a-11(c) orSection 240.14a-12
Certron Corporation
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the 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 transaction applies:
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2) Aggregate number of securities to which transaction applies:
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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):
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4) Proposed maximum aggregate value of transaction:
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[ ] 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:
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4) Date Filed:
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<PAGE> 2
CERTRON CORPORATION
1545 SAWTELLE BOULEVARD
LOS ANGELES, CALIFORNIA 90025
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MARCH 28, 2000
The annual meeting of the shareholders of Certron Corporation will be
held on Tuesday, March 28, 2000, at 10:00 o'clock A.M., local time, at the
Company's offices located at 1545 Sawtelle Boulevard, Los Angeles, California
90025.
The meeting will consider the following business, which is described in
the accompanying Proxy Statement:
1. Election of Board of Directors to hold office until their
successors are elected and qualified. The nominees intended to be
presented by the Board of Directors for election are described in the
accompanying Proxy Statement.
2. Such other business as may properly come before the meeting
or any adjournment thereof.
The Board of Directors has fixed the close of business on January 31,
2000, as the record date for determining those shareholders who will be entitled
to vote at the meeting.
By order of the Board of Directors.
SUSAN E. KASS
Secretary
February 28, 2000
IT IS DESIRABLE THAT AS LARGE A PROPORTION AS POSSIBLE OF THE
SHAREHOLDERS' INTERESTS BE REPRESENTED AT THE MEETING AND, THEREFORE, IF YOU ARE
UNABLE TO BE PRESENT IN PERSON OR OTHERWISE REPRESENTED AT THE MEETING, YOU ARE
REQUESTED TO SIGN AND RETURN THE ENCLOSED PROXY, SO THAT YOUR SHARES WILL BE
REPRESENTED.
<PAGE> 3
PROXY STATEMENT
FEBRUARY 28, 2000
GENERAL INFORMATION
This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors of Certron Corporation (the "Company") of proxies for use
at the Annual Meeting of Shareholders of the Company to be held on Tuesday,
March 28, 2000, 10:00 o'clock A.M., at the Company's principal executive offices
located at 1545 Sawtelle Boulevard, Los Angeles, California 90025.
If the accompanying Proxy form is signed, dated and returned, the shares
represented thereby will be voted in accordance with the specifications therein.
If no choice is specified, the shares will be voted FOR the election of the six
(6) nominees for Director listed in this Proxy Statement. Your executed Proxy
may be revoked at any time before its exercise by filing with the Secretary of
the Company, 1545 Sawtelle Boulevard, Los Angeles, California 90025, a written
notice of revocation or a duly executed Proxy bearing a later date. The
execution of the enclosed Proxy will not affect your right to vote in person
should you find it convenient to attend the Annual Meeting and desire to vote in
person. To the Company's knowledge, the Directors of the Company and the
nominees intend to vote FOR the election of such nominees.
The expense of soliciting these Proxies will be borne by the Company. It
is contemplated that Proxies will be solicited principally through the use of
the mails, but officers and regular employees of the Company may solicit Proxies
personally or by telephone or special letter. Although there is no formal
agreement to do so, the Company will reimburse banks, brokerage houses, and
other custodians, nominees and fiduciaries for their reasonable expenses in
forwarding Proxy materials to their principals.
SHAREHOLDER PROPOSALS
Proposals of security holders intended to be presented at the next
annual meeting must be received by the Company by October 31, 2000 for inclusion
in the Company's proxy statement and form of proxy relating to that meeting. If
a shareholder intends to present a proposal at the Annual Meeting of
Shareholders to be held in 2000 but not seek inclusion of that proposal in the
proxy statement of that meeting, the proxy holders for that meeting will be
entitled to exercise their discretionary authority on that proposal if the
Company does not have notice of the proposal by January 14, 2001. If notice of
any such proposal is timely received, the proxy holders may exercise
discretionary authority with respect to such proposal but only to the extent
permitted by the regulations of the Securities and Exchange Commission.
VOTING SECURITIES
On January 31, 2000, the record date for the determination of
shareholders entitled to vote at the Annual Meeting of Shareholders, 3,128,306
shares of the Company's Common Stock were outstanding. The presence, in person
or by proxy, of a majority of the outstanding shares of Common Stock of the
Company is necessary to constitute a quorum at the Annual Meeting of
Shareholders. Each share of Common Stock is entitled to one vote. In electing
directors, each shareholder is entitled to cumulate his votes and give one
candidate a number of votes
1
<PAGE> 4
equal to the number of directors to be elected, multiplied by the number of
shares held by the shareholder or to distribute his votes among as many
candidates he sees fit, if at the meeting and prior to the voting, any
shareholder gives notice of his intention to cumulate his votes. In the election
of directors, the candidates receiving the highest number of affirmative votes
of the shares entitled to be voted at the meeting, up to the number of directors
to be elected, are the directors elected. Any votes against a candidate or
withheld from voting (whether by abstention, broker non-votes or otherwise) will
not be counted and have no legal effect or effect on the vote.
Set forth below is information as of January 31, 2000 with respect to
the shareholders who were known by the Company to own beneficially more than 5%
of the Company's outstanding Common Stock, its only outstanding voting security.
<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF
NAME AND ADDRESS BENEFICIAL PERCENT OF
OF BENEFICIAL OWNER OWNERSHIP CLASS
------------------- ------------ ----------
<S> <C> <C>
Louart Corporation 1,596,840 (1) 49.8%
1545 Sawtelle Boulevard
Los Angeles, California 90025
</TABLE>
(1) Includes 1,205,200 shares owned directly by Louart Corporation, as
reported in its Schedule 13D, dated January 1994 and filed with the
Securities and Exchange Commission. Such Schedule 13D indicates that
Louart Corporation has sole voting and dispositive power of such shares.
Also includes 391,640 shares beneficially owned (including shares
issuable upon options which are currently exercisable or exercisable
within 60 days) by officers and directors of Louart Corporation.
ELECTION OF DIRECTORS
Unless directed otherwise, it is intended to vote the Proxy in favor of
electing the six (6) persons listed below to serve as Directors of the Company
until the next Annual Meeting and until their successors are duly elected and
qualified. All of such nominees are now serving as Directors and were elected by
shareholders. The principal occupation or employment of each nominee is
indicated following his or her name on the table set forth below. If any shares
are voted at the meeting for the election of any person other than those
nominees named below, the discretionary authority given to the designated
proxies includes the authority to cumulate votes for any one or more of the
management nominees in such manner as the proxies deem advisable. If any nominee
shall become unavailable for election for any reason which is not now foreseen,
the proxies will, subject to the foregoing, be voted for the election of some
other qualified persons; provided, however, that the proxies cannot be voted for
a greater number of persons than six.
2
<PAGE> 5
<TABLE>
<CAPTION>
BENEFICIAL OWNERSHIP OF EQUITY SECURITIES
OF COMPANY ON JANUARY 31, 2000 (1)
--------------------------------------------------------------
NAME AND PRESENT POSITION WITH COMMON PERCENT OF FIRST ELECTED
COMPANY OR PRINCIPAL OCCUPATION AGE STOCK HELD CLASS AS DIRECTOR
------------------------------- --------- --------------- ------------- ---------------
<S> <C> <C> <C> <C>
Marshall I. Kass 71 1,501,315(2)(3) 47.7%(2)(3) 1988
Chairman of the Board,
Chief Executive Officer and
Chief Operating Officer of
the Company and Chairman
of the Board, Chief Executive
Officer and Chief Operating
Officer of Louart Corporation,
an investment company
Jonathan F. Kass 41 1,236,200(2)(3) 39.3%(2)(3) 1989
President of
the Company and Senior Vice
President and Director of
Louart Corporation, an
investment company
Michael S. Kass 46 1,248,725(2)(3) 39.7%(2)(3) 1988
Executive Vice President of the
Company and President
and Director of Louart
Corporation, an
investment company
Susan E. Kass 43 1,226,200(2)(3) 39.0%(2)(3) 1989
Secretary and Treasurer of
the Company and Vice
President, Secretary and
Director of Louart
Corporation, an investment
company
Rogelio Buenrostro 60 10,000(4) * 1996
Manager and Chief Executive
Officer-Certron, Mexicali
Jesse A. Lopez 49 10,000(4) * 1996
Controller of the Company
Directors and Officers as a 1,616,840(2)(3)(4) 50.1%(2)(3)(4)
Group (6 persons)
</TABLE>
* Represents less than one percent of the shares of Common Stock
outstanding.
(1) Except as otherwise indicated, nature of beneficial ownership is
possession of sole voting and investment power.
3
<PAGE> 6
(2) Includes 1,205,200 shares owned by Louart Corporation. Messrs. Marshall,
Jonathan and Michael Kass and Ms. Kass, directors and executive officers
of the Company, own shares of the capital stock of Louart Corporation
representing a majority of the voting power of the outstanding capital
stock thereof. Includes for Marshall I. Kass 276,115 shares owned by
him, 1,000 shares for Michael S. Kass and 22,525 shares owned by his
SEP/IRA, 1,000 shares for Jonathan F. Kass and 10,000 shares owned by
him as custodian for his minor children and 1,000 shares owned by Susan
E. Kass. Excludes for Marshall I. Kass 81,500 shares owned by his wife,
of which shares Marshall I. Kass disclaims beneficial ownership.
(3) Includes for each of Marshall I. Kass, Jonathan F. Kass, Michael S. Kass
and Susan E. Kass 20,000 shares issuable upon the exercise of presently
exercisable options or options exercisable within 60 days held by such
persons.
(4) Includes for Mr. Buenrostro 10,000 shares and for Mr. Lopez 10,000
shares issuable upon the exercise of presently exercisable stock options
or options exercisable within 60 days held by such persons.
In December 1988, Mr. Marshall I. Kass was elected Chairman of the Board
of Directors and Chief Executive Officer, and in June 1990 he was elected as the
Chief Operating Officer of the Company. For more than the past five years and
until February 1996, Mr. Kass served as President of Louart Corporation, a
privately held investment company. In February 1996, he was elected Chairman of
the Board, Chief Executive Officer and Chief Operating Officer of Louart
Corporation. He is, and for more than the past five years has been, a Director
thereof. The Company and Marshall I. Kass are parties to an Employment
Agreement, dated as of November 1, 1993, pursuant to which Mr. Kass is employed
as the Chairman of the Board and Chief Executive Officer of the Company at a
rate of $200,000 per year, subject to annual adjustment at the discretion of the
Board of Directors of the Company. In 1998, the Employment Agreement was amended
to extend the term thereof from October 31, 1998 to October 31, 2001. The
Employment Agreement may be earlier terminated in the event of the death or
disability of Mr. Kass or for "good cause," defined to mean conviction of a
crime directly related to his employment or a felony, gross mismanagement of the
business and affairs of the Company or breach of any material provision of the
Employment Agreement.
In March 1996, Mr. Jonathan F. Kass was elected President of the
Company. For the five years prior thereto, he served as Executive Vice President
of the Company. In February 1996, Mr. Jonathan F. Kass was elected as Senior
Vice President of Louart Corporation. For the five years prior thereto, he
served as Vice President and Director of Louart Corporation. In March 1996, Mr.
Michael S. Kass was elected Executive Vice President of the Company. For the
five years prior thereto, he served as Vice President of the Company. In
February 1996, Mr. Michael S. Kass was elected President of Louart Corporation.
For the five years prior thereto, he served as Senior Vice President and
Director of Louart Corporation. For more than the past five years, Ms. Susan E.
Kass has served as the Secretary, Vice President and Director of Louart
Corporation. In 1990, she was elected Secretary and Treasurer of the Company.
Mr. Marshall I. Kass is the father of Mr. Jonathan F. Kass, Mr. Michael S. Kass,
and Ms. Susan E. Kass, all of whom are siblings of one another.
For more than the past five years, Mr. Buenrostro has been employed by
the Company as its general manager in Mexicali, Mexico. Mr. Lopez has been
employed by the Company since 1990 and has served as Controller of the Company
since January 1994.
4
<PAGE> 7
Except for Marshall I. Kass, all of the executive officers of the
Company serve at the pleasure of the Board of Directors.
The Board of Directors has an Audit Committee, which consists of
Jonathan F. Kass, Michael S. Kass and Susan E. Kass. The Audit Committee
recommends to the Board of Directors the appointment of independent certified
public accountants to perform the audits of the Company, reviews with the
accountants the scope and conduct of the annual audit prior to the completion of
the same, reviews the audit with the accountants following its completion,
considers comments or recommendations made by the independent accountants and
approves all material non-audit services provided by the independent
accountants. The Audit Committee had one meeting with respect to the fiscal year
ended October 31, 1999.
The Board of Directors has a Compensation Committee, which consists of
Jonathan F. Kass, Michael S. Kass and Susan E. Kass. The Compensation Committee
reviews and recommends to the Board of Directors the compensation to be paid to
executives of the Company. The Compensation Committee had four meetings with
respect to the fiscal year ended October 31, 1999.
During the fiscal year ended October 31, 1999, there were five meetings
of the Board of Directors and all of the Company's incumbent Directors attended
in excess of 75% of the board meetings and meetings of committees of which they
were members. Each of the incumbent Directors (each of whom is a nominee for
election at the Annual Meeting) is a Company salaried employee and does not
receive any fee or remuneration for his or her services as a member of the
Board.
SECTION 16 (a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's executive officers and directors, as well as persons holding more than
10% of the Company's outstanding shares of Common Stock, to file initial reports
of ownership and reports of changes of ownership of the Company's Common Stock
with the Securities and Exchange Commission. Executive officers and directors
are required to furnish the Company with copies of all Section 16(a) forms that
they file. Based solely upon a review of these filings or written
representations received by the Company from certain reporting persons, to the
Company's knowledge, none of the Company's executive officers, directors or
persons holding more than 10% of the Company's outstanding shares of Common
Stock failed to file on a timely basis any reports required by Section 16(a) of
the Securities Exchange Act of 1934 during the fiscal year ended October 31,
1999.
5
<PAGE> 8
COMPENSATION OF EXECUTIVE OFFICERS
The following table sets forth the compensation paid, during the
fiscal year ended October 31, 1999, to the Chief Executive Officer (the only
executive officer whose total compensation for such fiscal year exceeded
$100,000) for services rendered by such person in all capacities to the Company:
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG TERM
COMPENSATION
------------
ANNUAL AWARDS
COMPENSATION SECURITIES
FISCAL ------------ UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY ($) OPTIONS (#) COMPENSATION($)(1)
- --------------------------- -------- ------------ ------------- ------------------
<S> <C> <C> <C> <C>
Marshall I. Kass, Chairman 1999 $160,418 -- $ 33,324
of the Board, Chief 1998 $183,750 -- $ 32,855
Executive Officer and 1997 $175,729 10,000 $ 31,067
Chief Operating Officer
</TABLE>
- ---------------
(1) Represents premiums paid during the fiscal year on life insurance
policies maintained by the Company having as of January 1, 2000 an
aggregate estimated net surrender proceeds of $169,329 on the life and
for the benefit of Mr. Marshall I. Kass.
Stock Options
In January 1989, the Board of Directors adopted a 1989 Stock Option Plan
(the "Executive Plan") covering 150,000 shares of Common Stock which was
approved by shareholders in March 1989. In January 1995, the Board of Directors
adopted an amendment to the Executive Plan changing its name to the Executive
Stock Option Plan, increasing the number of shares of Common Stock covered
thereby from 150,000 to 300,000 and extending the expiration date of the
Executive Plan from January 1999 to January 27, 2005.
Under the Executive Plan both "incentive stock options" (as defined in
Section 422 of the Internal Revenue Code of 1986, as amended) and non-incentive
options can be granted to selected executives, key employees and directors
(whether or not employees) of the Company. However, incentive stock options may
be granted only to employees (including officers and directors who are
employees). Under the Executive Plan, all options are required to be granted at
exercise prices of not less than 100% of the fair market value of the Common
Stock at the date the options are granted. The number of shares of Common Stock
covered by the Executive Plan is subject to adjustment in the case of stock
splits, reverse stock splits, stock dividends, recapitalization and similar
changes in the capitalization of the Company.
6
<PAGE> 9
Stock appreciation rights may be granted with all or part of any option
granted under the Executive Plan. Directors who are not employees of the Company
are not eligible to receive these rights. Stock appreciation rights entitle the
holder thereof, upon exercise of such rights, to surrender the related option,
or any portion thereof, and to receive, without payment to the Company (except
for applicable withholding taxes), an amount equal to the excess of the fair
market value, on the date of such exercise, of the Common Stock covered by such
option or portion thereof over the option price of the Common Stock as provided
in the option. The Board of Directors or a committee thereof has sole discretion
to determine the form in which payment may be made to the employee upon the
exercise of any stock appreciation right (i.e., Common Stock, cash, or any
combination thereof). No stock appreciation rights have been granted under the
Executive Plan.
During the fiscal year ended October 31, 1999, there were no options
granted under the Executive Plan and no options granted under the Executive Plan
were exercised.
The following table sets forth as of October 31, 1999, information as to
the number of unexercised options (none of which are in-the-money options) held
by the Chief Executive Officer of the Company:
AGGREGATED FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
Number of Securities
Underlying Unexercised
Options at October 31, 1999
(#)
Name Exercisable/Unexercisable
- ---- ---------------------------
<S> <C>
Marshall I. Kass ...................... 20,000/0
</TABLE>
Certain Transactions
Louart Corporation (see "Voting Securities" and "ELECTION OF DIRECTORS"
above) leases to the Company a warehouse and packaging facility in Corona,
California and the Company's corporate and administrative headquarters in Los
Angeles, California. The facility in Corona, California is leased on a
triple-net basis pursuant to a lease expiring August 31, 2003 at a present
monthly rental rate of approximately $6,579 per month, subject to annual
increases in September of each year of approximately $200 per month. The
Company's corporate and administrative headquarters in Los Angeles, California
is leased to the Company pursuant to a lease expiring in November 30, 2003 at a
present monthly rental rate of approximately $4,612 per month, subject to annual
increases in March of each year based on increases in the consumer price index
and increases in operating expenses from 1992. The Company anticipates that such
lease will be renewed upon the expiration thereof on substantially the same
terms thereof for a period of one or more years.
In addition, during the fiscal year ended October 31, 1999 the Company
paid to Louart Corporation approximately $274,000 for the provision of certain
services, including secretarial and administrative services, consulting services
and use of an automobile, and will continue to pay for such services during the
Company's current fiscal year.
7
<PAGE> 10
OTHER BUSINESS
Singer Lewak Greenbaum & Goldstein, LLP was the Company's independent
accountants for the fiscal year ended October 31, 1999 and have been selected as
the Company's auditors for the current year. Representatives from that firm are
expected to be present at the annual meeting with the opportunity to make a
statement, if they desire to do so, and are expected to be available to respond
to appropriate questions from shareholders.
The Board of Directors does not know of any business to be presented
other than the matters set forth above, but if other matters come before the
meeting, it is the intention of the proxies to vote in accordance with their
best judgment on such matters.
By Order of the Board of Directors
SUSAN E. KASS
Secretary
8
<PAGE> 11
CERTRON CORPORATION
PROXY FOR ANNUAL MEETING OF SHAREHOLDERS, MARCH 28, 2000
The undersigned hereby appoints MARSHALL I. KASS and SUSAN E. KASS, and
each of them proxies, each with power of substitution, to vote for the
undersigned at the Annual Meeting of Shareholders of Certron Corporation to be
held at the Company's offices at 1545 Sawtelle Boulevard, Los Angeles,
California 90025, on Tuesday, March 28, 2000, at 10 o'clock A.M., local time,
and any adjournment thereof, with respect to:
(1) ELECTION OF DIRECTORS [ ] FOR all nominees listed below
[ ] WITHHOLD AUTHORITY to vote for all
nominees listed below
- --------------------------------------------------------------------------------
(INSTRUCTION: To withhold authority to vote for any individual nominee write
that nominee's name on the space provided above)
Marshall I. Kass, Jonathan F. Kass, Michael S. Kass, Susan E. Kass,
Rogelio Buenrostro, Jesse A. Lopez
(2) Such other matters as may properly come before the meeting or any
adjournment thereof; according to the number of shares of stock which the
undersigned would be entitled to vote if personally present, hereby revoking any
prior proxy to vote at such Meeting; and hereby ratifying and confirming all
that said proxies, or any of them, shall lawfully do by virtue hereof. With
respect to matters not known at the time of the solicitation hereof, said
proxies are authorized to vote in their discretion.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF
CERTRON CORPORATION
IMPORTANT- SIGN ON OTHER SIDE
<PAGE> 12
CONTINUED FROM OTHER SIDE
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED.
UNLESS OTHERWISE MARKED, THIS PROXY WILL BE VOTED FOR THE ELECTION OF SOME OR
ALL OF THE PERSONS NAMED IN THE ACCOMPANYING PROXY STATEMENT AS NOMINATED BY THE
BOARD OF DIRECTORS FOR ELECTION AS DIRECTORS OF CERTRON CORPORATION AND MAY BE
VOTED CUMULATIVELY.
One of the above-mentioned proxies or his or her substitute present at
the meeting may exercise the powers of both said proxies.
Date ________________________, 2000
IMPORTANT: In signing this Proxy, please
sign your name or names on the signature
lines in the same way as it is stenciled
on this Proxy. When signing as an
attorney, executor, administrator,
trustee or guardian, please give your
full title as such. EACH JOINT TENANT
SHOULD SIGN.
----------------------------------------
Signature of Shareholder
----------------------------------------
Signature of Shareholder
PLEASE SIGN, DATE AND RETURN YOUR PROXY PROMPTLY IN THE ENVELOPE PROVIDED
