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JETRONIC INDUSTRIES, INC.
4200 Mitchell Street
Philadelphia, Pennsylvania 19128
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NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
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NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of Jetronic
Industries, Inc. (the "Company") will be held at Williamson's, Atop the GSB
Building, Belmont and City Line Avenues, Bala Cynwyd, Pennsylvania, on September
21, 1995, at 1:00 p.m., for the purposes set forth below.
1. To elect one Director, the term of such Director to be three years.
2. To transact such other and further business as may properly come before
the meeting or any adjournment thereof.
A proxy statement and proxy are enclosed herewith. If you are unable to
attend the Annual Meeting in person you are urged to sign, date and return the
enclosed proxy promptly in the enclosed addressed envelope which requires no
postage if mailed in the United States.
By Order of the Board of Directors
Daniel R. Kursman
President
Dated: Philadelphia, Pennsylvania
July 3, 1995
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JETRONIC INDUSTRIES, INC.
4200 Mitchell Street
Philadelphia, Pennsylvania 19128
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PROXY STATEMENT FOR ANNUAL MEETING OF SHAREHOLDERS
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This proxy statement is furnished to the shareholders of Jetronic
Industries, Inc. (herein called the "Company") in connection with the Board of
Directors' solicitation of proxies to be used at the Annual Meeting of
Shareholders on September 21, 1995 or any adjournments thereof. This proxy
statement was first mailed to Shareholders of the Company on or about July 12,
1995, accompanied by the Company's Annual Report to Shareholders for the fiscal
year ended January 31, 1995.
Only holders of Common Stock of record on the books of the Company at the
close of business on July 3, 1995 (the "Record Date") will be entitled to notice
of and to vote at the Annual Meeting. On that date, there were 3,604,499 shares
of Common Stock outstanding. Each holder of record of Common Stock of the
Company as of the Record Date will be entitled to one vote for each share of
stock standing of record in his name, except that for the election of directors
by Common Shareholders, shareholders shall be entitled to as many votes as shall
equal the number of shares standing in their names multiplied by the number of
directors to be elected, and they may cast all such votes for a single director
or may distribute them among the number to be voted for. The nominees receiving
the greatest number of votes cast at the Annual Meeting will be elected as
directors.
It is expected that the solicitation of proxies will be primarily by mail.
Proxies may be solicited personally and by telephone by officers, directors or
other representatives of the Company. The total expenses of preparing,
assembling and mailing the proxy statement and accompanying notice and form of
proxy, which are estimated to be $20,000, will be borne by the Company. Such
expenses may also include reimbursement for out-of-pocket disbursements incurred
by brokerage houses and other custodians, nominees or other fiduciaries, for
forwarding such documents to shareholders.
Each proxy delivered pursuant to this solicitation is revocable by the
person giving it at any time before it is voted. Proxies may be revoked by
filing with the Secretary of the Company written notice of revocation bearing a
later date than the proxy, by duly executing a subsequent proxy relating to the
same shares of Common Stock or by attending the Annual Meeting and voting in
person. Attendance at the Annual Meeting will not in and of itself constitute
revocation of a proxy unless the shareholder votes his shares of Common Stock in
person at the Annual Meeting. Any notice revoking a proxy should be sent to the
Assistant Secretary of the Company, Leonard W. Pietrzak, 4200 Mitchell Street,
Philadelphia, Pennsylvania 19128.
Proxies given in the form enclosed, unless previously revoked, will be voted
at the Annual Meeting in accordance with the instructions contained therein and
if no choice is specified, will be voted in favor of the nominees for Director
and the proposals set forth herein.
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ELECTION OF DIRECTORS
Nominees for Election as Directors
The By-Laws of the Company were amended in 1975 to provide for a classified
Board of Directors consisting of three approximately equal classes, each to
serve for a term of three years or until their successors shall have been
elected and qualified. The proxies will be voted for the election of the
following nominees. Should any nominee become unavailable for any reason before
the meeting (which is not anticipated) the proxies will be voted for a
substitute person to be selected by the Board of Directors of the Company.
Principal Occupation Director
Director Age During the Past Five Years Since
-------- --- -------------------------- --------
Dr. David Silverman.... 80 Physician (Former President, 1984
Metropolitan Hospital in
Philadelphia)
The other directors who are presently serving, and who were elected
previously for terms which have not expired are:
Term expires 1996
Daniel R. Kursman...... 69 Chairman of the Board, President 1951
and Treasurer
Leonard W. Pietrzak.... 55 Vice President - Finance 1994
Term expires 1997
Peter J. Kursman....... 42 Vice President 1982
Herbert Myers.......... 75 Certified Public Accountant 1968
William L. Weiss ...... 66 Attorney in private practice 1973
INFORMATION ABOUT MANAGEMENT
Executive Officers
The following table contains information as to the Executive Officers of the
Company.
Officer
Individual Age Position Since
---------- --- -------- -------
Daniel R. Kursman (1). 69 President, Treasurer 1951
Peter J. Kursman (1).. 42 Vice President 1978
Leonard W. Pietrzak... 55 Vice President - Finance 1981
All Executive Officers have held their present positions with the Company
for at least five years.
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(1) Peter J. Kursman is the son of Daniel R. Kursman.
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Security Ownership
The following table contains information as to the number of shares of the
Company's Common Stock, owned as of April 10, 1995, by each Director and by all
Directors and Officers of the Company as a group. The information is based upon
information furnished by the persons concerned.
Individual or Number Shares of Company Stock Percentage
of Persons in Group Owned Beneficially (1) of Class
-------------------- ----------------------- ----------
Daniel R. Kursman.................... 219,536 6.1%
Herbert Myers........................ 483 o
David Silverman...................... 1,000 o
William L. Weiss..................... 1,464 o
All Directors and Officers
as a group (four in group)......... 222,483 6.2%
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(1) Does not include options granted under the 1990 Incentive Stock Option Plan.
See "1990 INCENTIVE STOCK OPTION PLAN".
o Less than 1%.
Management Remuneration
The following table contains information with respect to the aggregate cash
compensation paid by the Company during the fiscal year ended January 31, 1995
to the four most highly compensated Executive Officers of the Company whose
total cash consideration exceeded $100,000.
All Other
Name & Principal Position (1) Year Salary Bonus Compensation (2)(3)
- ----------------------------- ---- ------ ----- -------------------
Ernest Aiu, General Manager,
Transchem Division 1995 109,200 15,610 567
1994 109,200 14,928 614
1993 103,740 30,553 601
Daniel R. Kursman, President,
Treasurer and Director (4) 1995 174,945 2,934
1994 171,474 2,801
1993 171,194 2,775
Peter J. Kursman, Vice
President and Director 1995 142,622 31,616 2,957
1994 140,899 2,100
1993 114,346 2,100
Leonard W. Pietrzak, Vice
President - Finance and 1995 104,078 2,584
Director 1994 102,589 1,540
1993 92,625 1,463
(1) Does not include fees paid to William L. Weiss, general counsel to the
Company, in the amount of $102,000. Mr. Weiss is a Director of the Company.
(2) Directors who are not employees of the Company receive $1,250 per meeting
and employee-Directors receive $700 per meeting.
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(3) The Company has a defined contribution pension plan and a profit sharing
plan covering certain employees, including Officers (the "Jetronic
Industries, Inc. Retirement and Profit Sharing Plans"). Contributions to the
Profit Sharing Plan are made at the discretion of the Board of Directors and
are limited to a maximum of 5.7% of eligible compensation of participants.
Company contributions to the defined contribution pension plan are limited
to .8% of a maximum of 4% of eligible contributions. Contributions made for
the account of each individual during the fiscal year ended January 31, 1995
are included in the amounts reflected.
(4) Daniel R. Kursman is employed as Chief Executive Officer under a contract
expiring on March 31, 2001, at an annual salary of $225,000, plus a yearly
bonus of 4 1/2% of the Company's annual pretax earnings.
Compensation Committee Report
Decisions regarding compensation of the Company's executives are generally
made by the three-member Stock Option and Compensation Committee (the
"Compensation Committee") of the Company's Board of Directors. Each member of
the Compensation Committee is a non-employee director.
The compensation of the Company's Chief Executive Officer and other
executive officers is comprised of annual salary and cash and stock incentives
based on annual and long-term results of the Company. Annual increases, if any,
are based on individual performance, level of responsibilities and the Company's
overall performance. During the year ended January 31, 1992, annual compensation
of Daniel R. Kursman, CEO, was voluntarily reduced by 25%.
PERFORMANCE GRAPH
The following graph reflects a comparison of cummulative total returns for
the Company's Common Stock during the five year period ended January 31, 1995
with the Dow Jones Industrial Average and the Dow Jones Industry Group Average
for Diversified Technology.
The above graph assumes $100 invested on January 31, 1990 in Jetronic
Industries, Inc. Common Stock, the Dow Jones Industrial Average and the Dow
Jones Industry Group Average for Diversified Technology.
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Certain Transactions
In March 1969, the Company loaned Daniel R. Kursman $50,000 at 7 1/2%
interest (the prime interest rate on that date) due on demand in order to
exercise stock options to purchase Common Stock of the Company. The loan is
collateralized by the 25,000 shares so acquired which had a market value of
$15,625 on April 10, 1995. In January 1972, the terms of this loan, together
with certain other advances made to Mr. Kursman which aggregated $4,500 were
modified to provide for repayment of the $54,500 in January 1973 at 6 1/4%
interest (1% above the prime rate on that date). In January 1972, the Company
made further personal advances to Mr. Kursman of $18,000 at 6% interest (1%
above the prime rate on that date) due in January 1973. During January 1973, the
aggregate of all such indebtedness amounting to $72,500 was consolidated with
interest at the rate of 7% and provision was made for payment in January 1974
and extended annually to January 31, 1996. Consideration has been received and
accrued interest receivable reduced as follows: December 1975 - $10,000; March
1980 - $16,152; December 1982 - $10,000. Payment of principal at January 31,
1995 in the amount of $73,000 has been extended until February 1, 1996. At
January 31, 1995, the Company's effective rate for short-term borrowings was
9.8%. The differential between the rate charged and the Company's borrowing rate
is not included in the remuneration table above. Mr. Kursman has undertaken to
satisfy this obligation during the term of his current employment contract.
On March 13, 1984, in accordance with the option plan approved by the
shareholders of the Company in 1973 and 1979, the exercise price of options for
93,500 shares and 24,200 shares, respectively, was evidenced by a loan from the
Company in the amount of $209,500 as to Daniel R. Kursman and $48,400 as to
Jerome I. Kursman, respectively. During the year ended January 31, 1995, it was
determined by Company counsel that based upon Pennsylvania Business Corporation
Law in effect in 1984, the Company was prohibited from accepting any note or
obligation given by a shareholder for the issuance of shares of the Company,
whether secured by a pledge or otherwise. As a result thereof, such shares and
the attendant obligations have been cancelled.
Board of Directors and Committees
During the year ended January 31, 1995, the Board of Directors of the
Company held three meetings. Each Director attended all of the meetings held in
FY 1995. Daniel R. Kursman, Herbert Myers, Leonard W. Pietrzak and William L.
Weiss constitute the audit committee of the Board of Directors. The audit
committee meets at least once a year and more frequently if required. The audit
committee acts as a liaison between the Company's internal accounting staff and
its independent accountants and reports to the Board of Directors with respect
to financial reporting, financial practices and the adequacy of internal
controls. William L. Weiss, Herbert Myers and David Silverman constitute the
Stock Option and Compensation Committee. The Stock Option and Compensation
Committee determines to whom options will be granted under the 1990 Incentive
Stock Option Plan and reviews executive salaries and bonus awards.
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CERTAIN SECURITY OWNERS
The following table sets forth information concerning each person who, to
the knowledge of the Company, was the owner on May 25, 1995 of more than 5% of
the outstanding shares of the Company's Common Stock.
Number
Title Name and Address Nature of of Percentage
of Class of Owner Ownership Shares of Class
------- ---------------- --------- ------ ----------
Common Stock Robert L. Gipson Record and 426,517 11.8%
61 Broadway Beneficially
New York, NY
Common Stock Daniel R. Kursman Record and 219,536 6.1%
191 Presidential Boulevard Beneficially
Bala Cynwyd, PA
Common Stock Jetronic Industries, Inc. Record and 286,810 8.0%
Retirement and Profit Beneficially
Sharing Plans (1)
4200 Mitchell Street
Philadelphia, PA
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(1) Shares held by these Plans are voted in the manner determined by the Plans'
trustees. The Plans' current trustees are Daniel R. Kursman, President,
Treasurer and a Director of the Company and Peter J. Kursman, a Vice
President and Director of the Company.
STOCK OPTIONS
The following table contains information as to the amount of shares subject
to all unexercised options held by each Officer and Director as of April 10,
1995. All of the following options were issued during fiscal year 1991. No
options were issued or exercised during fiscal year 1995.
1990 Percentage of Class Owned
Stock Option Beneficially if all Options
Name Plan (1)(2) Exercised
---- ------------ ---------------------------
Daniel R. Kursman........... 75,000 7.8%
Peter J. Kursman............ 35,000 0.9%
Herbert Myers............... 8,000 0.2%
Leonard W. Pietrzak......... 25,000 0.7%
David Silverman............. 8,000 0.2%
William L. Weiss............ 8,000 0.2%
All Directors and
Officers as a Group
(six in group) 159,000 10.0%
Does not include 29,000 Stock Options issued to 8 key employees.
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(1) Exercise price per share is $.96 except as to Daniel R. Kursman and Peter J.
Kursman as to whom the exercise price is $1.05 per share.
(2) The number of shares issuable may be increased depending on the
anti-dilutive provisions of the Stock Option Plan at the time of exercise.
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SHAREHOLDER PROPOSALS
Shareholders who wish to submit proposals for inclusion in the Proxy
Statement for the Company's Annual Meeting must submit the same to the Company
on or before May 15 in the year in which the Shareholders' Meeting is to be
held.
INDEPENDENT ACCOUNTANTS
A representative of Asher & Company, Ltd., independent accountants for the
Company for the year ended January 31, 1995, will be present at the Annual
Meeting of Shareholders with the opportunity to make a statement if he so
desires and to respond to appropriate questions.
GENERAL
Management does not know of any other matters which may come before the
meeting. However, if any other business comes before the meeting or any
adjournment thereof, proxies will be voted in accordance with the discretion of
the persons named therein.
All shareholders are urged to complete, date and sign the accompanying form
of proxy and return it in the enclosed envelope which requires no postage if
mailed in the United States.
By Order of the Board of Directors
Daniel R. Kursman
President
July 3, 1995
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JETRONIC INDUSTRIES, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Daniel R. Kursman and Leonard W. Pietrzak,
and each of them, the attorneys and proxies of the undersigned, with full power
of substitution, to vote on behalf of the undersigned all of the shares of
Common Stock of Jetronic Industries, Inc., which the undersigned is entitled to
vote at the Annual Meeting of Shareholders thereof to be held September 21,
1995, and at any and all adjournments thereof, upon the following matters:
1. Election of Directors
FOR ALL Nominees listed below* WITHHOLD AUTHORITY
(except as marked to the contrary below) / / to vote for all nominees
listed below / /
INSTRUCTION: To withhold authority to vote for any individual nominee mark the
box next to the nominee's name below:
/ / Dr. David Silverman
2. Transaction of all such other business as may properly come before the
meeting or any adjournments thereof.
(Please see reverse side)
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*For election of Directors, shareholders are entitled to as many votes as
shall equal the number of shares of stock standing in their names multiplied by
the number of Directors. You may cast all such votes for a single Director or
may distribute them among the number to be voted for.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEMS (1) TO (2). IF NO
SPECIFICATION IS MADE, SUCH STOCK WILL BE VOTED FOR SAID ITEM.
Dated:__________________________, 1995
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Signature of Shareholder
-------------------------------------
Signature of Shareholder
Please sign exactly as name
appears. For joint account, each
joint owner should sign.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.
PLEASE DATE, SIGN AND RETURN THIS PROXY PROMPTLY.
