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JETRONIC INDUSTRIES, INC.
4200 Mitchell Street
Philadelphia, Pennsylvania 19128
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NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
----------------
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
26, 1996, at 1:00 p.m., for the purposes set forth below.
1. To elect two Directors, 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
Peter J. Kursman
President
Dated: Philadelphia, Pennsylvania
July 24, 1996
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JETRONIC INDUSTRIES, INC.
4200 Mitchell Street
Philadelphia, Pennsylvania 19128
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PROXY STATEMENT FOR ANNUAL MEETING OF SHAREHOLDERS
----------------
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 26, 1996 or any adjournments thereof. This proxy
statement was first mailed to Shareholders of the Company on or about July 29,
1996, accompanied by the Company's Annual Report to Shareholders for the fiscal
year ended January 31, 1996.
Only holders of Common Stock of record on the books of the Company at the
close of business on July 24, 1996 (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.
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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.
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 approximate 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
-------- --- -------------------------- --------
Daniel R. Kursman...... 70 Chairman of the Board and 1951
Treasurer
Leonard W. Pietrzak.... 56 Vice President - Finance 1994
The other directors who are presently serving, and who were elected
previously for terms which have not expired are:
Term expires 1997
Peter J. Kursman....... 43 President (formerly Vice President) 1982
Herbert Myers (1)...... 76 Certified Public Accountant 1968
William L. Weiss ...... 67 Attorney in private practice 1973
- ---------------
(1) Herbert Myers retired from the Board in May 1996.
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). 70 Treasurer 1951
Peter J. Kursman (1).. 43 President 1978
Leonard W. Pietrzak... 56 Vice President - Finance 1981
All Executive Officers have held their present positions with the Company
for at least five years, except for Peter J. Kursman who previously held the
position of Vice President.
- ---------------
(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 May 1, 1996, 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 of Class
-------------------- ----------------------- ----------
Daniel R. Kursman.................... 219,536 6.1%
Herbert Myers........................ 483 o
William L. Weiss..................... 1,464 o
All Directors and Officers
as a group (three in group)........ 221,483 6.1%
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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, 1996
to the 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)
- ----------------------------- ---- ------ ----- -------------------
Daniel R. Kursman, Chairman
of the Board, Treasurer
and Director (4) 1996 155,872 3,579
1995 174,945 2,934
1994 171,474 2,801
Peter J. Kursman, President
and Director 1996 143,295 40,588 3,527
1995 142,622 31,616 2,957
1994 140,899 2,100
Leonard W. Pietrzak, Vice
President - Finance and 1996 98,520 3,259
Director 1995 104,078 2,584
1994 102,589 1,540
(1) Does not include fees paid to William L. Weiss, general counsel to the
Company, in the amount of $88,000. 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, 1996
are included in the amounts reflected.
(4) Daniel R. Kursman is employed as Chairman of the Board under a contract
expiring on March 31, 2000, 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 two-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.
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, 1996
with the Dow Jones Industrial Average and the Dow Jones Industry Group Average
for Diversified Technology.
Dollars
250 ---------------------------------------------------------------------------
| |
| |
| o|
200 ---------------------------------------------------------------------------
| @|
| |
| @ @ |
150 ----------------------------#-------------#o--------------o----------------
| |
| o o |
| @ @ |
100 o@#------------------------------------------------------------------------
| # |
| # |
| #|
50 ---------------------------------------------------------------------------
| |
| |
| |
0 ---------------------------------------------------------------------------
1991 1992 1993 1994 1995 1996
o = DJIA @ = DIV TECH # = JET
1991 1992 1993 1994 1995 1996
---- ---- ---- ---- ---- ----
DJIA 100 120 126 151 146 205
DIV TECH 100 108 115 165 148 198
JET 100 73 154 154 82 64
The above graph assumes $100 invested on January 31, 1991 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 May 1, 1996. 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, 1997. 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, 1996 in
the amount of $73,000 has been extended until February 1, 1997. At January 31,
1996, the Company's effective rate for short-term borrowings was 11.44%. 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.
Board of Directors and Committees
During the year ended January 31, 1996, the Board of Directors of the
Company held four meetings. Each Director attended all of the meetings held in
FY 1996. Daniel R. Kursman, Herbert Myers 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 and Herbert Myers 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.
CERTAIN SECURITY OWNERS
The following table sets forth information concerning each person who, to
the knowledge of the Company, was the owner on April 30, 1996 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
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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, 1996, 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
Peter J. Kursman
President
July 24, 1996
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JETRONIC INDUSTRIES, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby appoints Peter J. 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 26, 1996, 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 to vote for all nominees listed below [ ]
below) [ ]
INSTRUCTION: To withhold authority to vote for any individual nominee mark
the box next to the nominee's name below:
[ ] Daniel R. Kursman [ ] Leonard W. Pietrzak
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: , 1996
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Signature of Shareholder
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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.