<PAGE>
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE
SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant [_]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] CONFIDENTIAL, FOR USE OF THE
[ ] Preliminary Proxy Statement COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
CCA INDUSTRIES, INC.
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
N/A
(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)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(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):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[_] 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:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
Notes:
<PAGE>
CCA INDUSTRIES, INC.
------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
JUNE 16, 1998
------------
To The Shareholders:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of CCA
INDUSTRIES, INC., a Delaware corporation (hereinafter, the "Company"), will be
held on June 16, 1998, at 4 p.m. at the Grand Hyatt Hotel, Park Avenue at
Grand Central Station, New York, New York, for the following purposes:
MANAGEMENT PROPOSALS
1. To elect directors to serve on the Board of Directors for the ensuing
year.
2. To approve the appointment of Sheft Kahn & Company L.L.P. as the
Company's independent certified public accountants for the fiscal year ending
November 30, 1998.
3. To consider and vote upon a proposal to amend the Company's Certificate
of Incorporation to authorize the Board of Directors to issue up to 20,000,000
shares of Preferred Stock in one or more series with such preferences,
limitations, and relative rights as the Board may determine.
OTHER MATTERS
To transact such other business as may properly come before the meeting or
any adjournment thereof.
* * *
The foregoing items of business are more fully described in the Proxy
Statement accompanying this notice.
Only shareholders of record at the close of business on May 12, 1998 are
entitled to notice of the meeting, and to vote at the meeting and at any
continuation or adjournment thereof.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Ira W. Berman
Ira W. Berman,
Corporate Secretary and
Chairman of the Board
East Rutherford, New Jersey
April 20, 1998
WHETHER OR NOT YOU PLAN TO ATTEND THIS MEETING, YOU ARE URGED TO
COMPLETE, SIGN AND RETURN THE ENCLOSED PROXY CARD. NO POSTAGE NEED BE
AFFIXED IF MAILED IN THE UNITED STATES AND IN THE ENVELOPE PROVIDED
THEREFOR.
<PAGE>
CCA INDUSTRIES, INC.
EAST RUTHERFORD, NEW JERSEY 07073
------------
PROXY STATEMENT
------------
The enclosed proxy is solicited on behalf of the Board of Directors of CCA
INDUSTRIES, INC., a Delaware corporation (hereinafter, the "Company"), for use
at its Annual Meeting of Shareholders to be held on June 16, 1998, at 4 p.m.
Shareholders of record on May 12, 1998 will be entitled to vote. The meeting
will be held at the Grand Hyatt Hotel, Grand Central Station, New York, New
York.
The Company intends to mail this Proxy Statement, and the Company's Annual
Report for the 1997 fiscal year, on or about May 15, 1998.
I. GENERAL
A. VOTING
There are two classes of stock authorized by the Company's Certificate of
Incorporation; Common Stock and Class A Common Stock. On April 20, 1998, there
were 7,259,581 total shares outstanding; consisting of 6,246,151 shares of
Common Stock and 1,020,930 shares of Class A Common Stock. (The Board of
Directors has resolved in favor of the authorization of Preferred Stock as a
third class of authorized stock, subject to shareholder approval. See Proposal
No. 3)
Owners of Common Stock and owners of Class A Common Stock are entitled to
one vote for each share of stock held, and voting on all matters other than
the election of directors is as though all such stock were Common Stock.
Moreover, except in respect of the election of directors (as hereinbelow
described), the Common Stock and Class A Common Stock, and attendant rights of
each, are equivalent.
The holders of Common Stock have the right to elect three directors, and the
holders of Class A Common Stock have the right to elect four. In a particular
election, each holder of Common Stock is entitled to vote the number of shares
held for as many persons as there are directors then to be elected by holders
of Common Stock, and each holder of Class A Common Stock is entitled to vote
shares held for as many persons as there are directors then to be elected by
holders of Class A Common Stock.
A quorum, counting proxies and shares represented in person, is necessary to
the voting upon proposals proposed by Management, and other business that may
properly come before the 1998 Annual Meeting. Fifty percent (50%) of all
outstanding shares constitutes a quorum for all purposes other than the
election of directors. In respect thereof, fifty percent (50%) of the
outstanding shares of Common Stock is a quorum for the election of directors
to be elected by holders of Common Stock, and fifty percent (50%) of the
outstanding shares of Class A Common Stock is a quorum for the election of
directors to be elected by holders of Class A Common Stock.
Nonvoting of shares (whether by abstention, broker non-vote or otherwise),
other than the potential effect of denying a quorum, has no impact on voting.
<PAGE>
B. SHARE OWNERSHIP OF DIRECTORS, OFFICERS AND 5% OWNERS
The following table sets forth certain information regarding the ownership
of the Company's Common Stock and/or Class A Common Stock as of April 20, 1998
by (i) all those known by the Company to be owners of as much as five (5%)
percent of the outstanding shares of Common Stock or Class A Common Stock,
(ii) each officer and director who is an owner, and (iii) all officers and
directors as a group. Unless otherwise indicated, each of the shareholders has
sole voting and investment power with respect to the shares owned (subject to
community property laws, where applicable), and is beneficial owner of them.
<TABLE>
<CAPTION>
NUMBER OF
SHARES OWNED:
----------------- OWNERSHIP
COMMON PERCENTAGE
NAME AND ADDRESS STOCK CLASS A (ALL SHARES)
---------------- ------- --------- ------------
<S> <C> <C> <C>
David Edell................................. 234,685 484,615 9.91
c/o CCA Industries, Inc.
200 Murray Hill Parkway
East Rutherford, NJ 07073
Ira W. Berman............................... 204,745 473,615 9.34
c/o CCA Industries, Inc.
Jack Polak.................................. 25,000 47,700 1.00
90 Park Avenue
New York, NY 10016
Dunnan Edell................................ 41,250 -- 0.57
c/o CCA Industries, Inc.
Drew Edell.................................. 51,250 -- 0.71
c/o CCA Industries, Inc.
Sidney Dworkin.............................. 50,000 -- 0.69
1550 No. Powerline Road
Pompano, FL 33069
Officers and Directors as a group (9
persons)................................... 606,930 1,005,930 22.22
</TABLE>
- --------
(1) David Edell, Ira Berman and Jack Polak own over 95% of the outstanding
shares of Class A Common Stock. Messrs. David Edell, Dunnan Edell and Ira
Berman are officers and directors. Mr. Drew Edell is an officer. Messrs.
Polak and Dworkin are directors.
2
<PAGE>
C. EXECUTIVE COMPENSATION
i. Summary Compensation Table
The following table summarizes compensation earned in the 1997, 1996 and
1995 fiscal years by all of the executive officers whose fiscal 1997
compensation exceeded $100,000, including the Chief Executive Officer (the
"named officers").
<TABLE>
<CAPTION>
ANNUAL COMPENSATION LONG-TERM COMPENSATION
----------------------------------------- --------------------------
NUMBER
OF SHARES
ALL OTHER COVERED BY OTHER
NAME AND PRINCIPAL ANNUAL STOCK OPTIONS LONG-TERM
POSITION YEAR SALARY BONUS COMPENSATION(1) GRANTED(2) COMPENSATION
------------------ ---- -------- -------- --------------- ------------- ------------
<S> <C> <C> <C> <C> <C> <C>
David Edell............. 1997 $357,305 $171,254 $24,812 100,000 0
President and Chief
Executive 1996 337,080 131,896 21,560 -- 0
Officer 1995 318,000 63,600 18,456 -- 0
Ira W. Berman........... 1997 357,305(3) 171,254 22,345 100,000 0
Secretary and Executive
Vice 1996 337,080(4) 131,896 22,876 -- 0
President 1995 318,000(5) 63,600 17,096 -- 0
Dunnan Edell............ 1997 200,000 25,000 14,898 50,000 0
Executive Vice 1996 185,096 25,000 15,659 -- 0
President--Sales
1995 175,000 3,365 13,440 25,000 0
Drew Edell.............. 1997 131,800 15,000 2,283 50,000 0
Vice President-- 1996 112,100 15,000 12,063 -- 0
Manufacturing
1995 98,000 1,885 2,925 25,000 0
</TABLE>
- --------
(1) Includes the personal-use value of Company-leased automobiles, the value
of Company-provided life insurance, and health insurance that is made
available to all employees, plus directors fees paid to Messrs. David
Edell, Ira Berman and Dunnan Edell.
(2) Information in respect of stock option plans appears below in the sub-
topic, Employment Contracts/Executive Compensation Program.
(3) Includes $99,396 paid to Ira W. Berman & Associates, P.C.
(4) Includes $110,046 paid to Ira W. Berman & Associates, P.C.
(5) Includes $99,396 paid to the New York City law firm of Berman & Murray,
where Mr. Berman was the Senior Partner through 1995.
ii. 1997 Option Grants, Fiscal Year Option Exercises, Year-End Option
Valuation
<TABLE>
<CAPTION>
FISCAL 1997 OPTION GRANTS TO NAMED
OFFICERS
---------------------------------------
% OF TOTAL
NUMBER OF OPTIONS GRANTED POTENTIAL
UNDERLYING TO ALL EXPIRATION REALIZABLE
SHARES EMPLOYEES DATE VALUES(1)
---------- --------------- ------------ -----------------
5% 10%
-------- --------
<S> <C> <C> <C> <C> <C>
David Edell.......... 100,000 33.3 Aug. 1, 2007 $157,224 $398,436
Ira W. Berman........ 100,000 33.3 Aug. 1, 2007 157,224 398,436
Dunnan Edell......... 50,000 16.7 Aug. 1, 2007 78,612 199,218
Drew Edell........... 50,000 16.7 Aug. 1, 2007 78,612 199,218
</TABLE>
- --------
(1) The figures shown as Potential Realizable Values are net gains that could
be realized if assumed rates of appreciation of 5% and 10% per annum, were
to result during the term of the options. The SEC requires the
presentation of these assumptions and information based thereon, and no
part is intended to forecast possible future appreciation. Actual net
gains, if any, are dependent upon the actual future performance of the
Company's Common Stock, and overall economic conditions.
3
<PAGE>
The next table identifies 1997 fiscal-year option exercises by named
officers, and reports a valuation of their options.
FISCAL 1997 AGGREGATED OPTION EXERCISES
AND NOVEMBER 30, 1997 OPTION VALUES
<TABLE>
<CAPTION>
NUMBER OF
SHARES VALUE OF
COVERED BY UNEXERCISED
NUMBER OF UNEXERCISED IN-THE-MONEY
SHARES OPTIONS AT OPTIONS AT
ACQUIRED VALUE NOVEMBER 30, NOVEMBER 30,
ON EXERCISE REALIZED 1997 1997(1)
------------ -------- ------------ ------------
<S> <C> <C> <C> <C>
David Edell..................... 30,000 $49,687 567,500 $1,628,313
Ira W. Berman................... 30,000 49,687 492,000 1,612,500
Dunnan Edell.................... -0- -0- 25,000 -0-
Drew Edell...................... -0- -0- 25,000 -0-
</TABLE>
- --------
(1) Represents the difference between market price and the respective exercise
prices of options at November 30, 1997.
iii. Compensation of Directors
Each director was paid $2,000 per meeting for attendance of board meetings
in fiscal 1997 (without additional compensation for committee meetings); and
directors Rami G. Abada, Stanley Kreitman and Sidney Dworkin were each granted
25,000 options on August 1, 1997, exercisable through August 1, 2007, at $2.50
per share.
iv. Executive Compensation Principles; Audit and Compensation Committee
The Company's Executive Compensation Program is based on guiding principles
designed to align executive compensation with Company values and objectives,
business strategy, management initiatives, and financial performance. In
applying these principles the Audit and Compensation Committee of the Board of
Directors, comprised of David Edell, Ira W. Berman, Stanley Kreitman and Jack
Polak, which met three times in 1997, has established a program to:
. Reward executives for long-term strategic management and the enhancement
of shareholder value.
. Integrate compensation programs with both the Company's annual and long-
term strategic planning.
. Support a performance-oriented environment that rewards performance not
only with respect to Company goals but also Company performance as
compared to industry performance levels.
v. Employment Contracts/Compensation Program
The total compensation program consists of both cash and equity based
compensation. The Audit and Compensation Committee (the "Committee")
determines the level of salary and bonuses, if any, for key executive officers
other than Messrs. David Edell and Ira Berman. The Committee determines the
salary or salary range based upon competitive norms. Actual salary changes are
based upon performance.
Bonuses (see the Summary Compensation Tables), other than Mr. David Edell's
and Mr. Berman's, were awarded in consideration of the Company's performance
during 1997.
On March 17, 1994, the Board of Directors approved 10-year employment
contracts for David Edell and Ira Berman (with Mr. Edell and Mr. Berman
abstaining). Pursuant thereto, each was provided a base salary of $300,000 in
fiscal 1994, with a year-to-year CPI or 6% increment, and each is paid 2 1/2%
of the Company's pre-tax income, less depreciation and amortization, plus 20%
of the base salary, as bonus.
4
<PAGE>
Long-term incentives are provided through the issuance of stock options.
vi. Stock Option Plans
The Company's 1984 Stock Option Plan covered 1,500,000 shares of its Common
Stock.
The Company's 1986 Stock Option Plan covered 1,500,000 shares of its Common
Stock.
The Company's 1994 Stock Option Plan covers 1,000,000 shares of its Common
Stock.
The 1994 Option Plan provides (as had the 1984 and 1986 plans) for the
granting of two (2) types of options: "Incentive Stock Options" and
"Nonqualified Stock Options". The Incentive Stock Options (but not the
Nonqualified Stock Options) are intended to qualify as "Incentive Stock
Options" as defined in Section 422(a) of The Internal Revenue Code. The Plans
are not qualified under Section 401(a) of the Code, nor subject to the
provisions of the Employee Retirement Income Security Act of 1974.
Options may be granted under the Options Plans to employees (including
officers and directors who are also employees) and consultants of the Company,
provided, however, that Incentive Stock Options may not be granted to any non-
employee director or consultant.
Option plans are administered and interpreted by the Board of Directors.
(Where issuance to a Board member is under consideration, that member must
abstain.) The Board has the power, subject to plan provisions, to determine
the persons to whom and the dates on which options will be granted, the number
of shares subject to each option, the time or times during the term of each
when options may be exercised, and other terms. The Board has the power to
delegate administration to a Committee of not less than two (2) Board members,
each of whom must be disinterested within the meaning of Rule 16b-3 under the
Securities Exchange Act, and ineligible to participate in the option plan or
in any other stock purchase, option or appreciation right under plan of the
Company or any affiliate. Members of the Board receive no compensation for
their services in connection with the administration of option plans.
Option Plans permit the exercise of options for cash, other property
acceptable to the Board or pursuant to a deferred payment arrangement. The
1994 Plan specifically authorizes that payment may be made for stock issuable
upon exercise by tender of Common Stock of the Company; and the Executive
Committee is authorized to make loans to option exercisers to finance optionee
tax-consequences in respect of option exercise, but such loans must be
personally guaranteed and secured by the issued stock.
The maximum term of each option is ten (10) years. No option granted is
transferable by the optionee other than upon death.
Under the plans, options will terminate three (3) months after the optionee
ceases to be employed by the Company or a parent or subsidiary of the Company
unless (i) the termination of employment is due to such person's permanent and
total disability, in which case the option may, but need not, provide that it
may be exercised at any time within one (1) year of such termination (to the
extent the option was vested at the time of such termination); or (ii) the
optionee dies while employed by the Company or a parent or subsidiary of the
Company or within three (3) months after termination of such employment, in
which case the option may, but need not provide that it may be exercised (to
the extent the option was vested at the time of the optionee's death) within
eighteen (18) months of the optionee's death by the person or persons to whom
the rights under such option pass by will or by the laws of descent or
distribution; or (iii) the option by its terms specifically provides
otherwise.
The exercise price of all nonqualified stock options must be at least equal
to 85% of the fair market value of the underlying stock on the date of grant.
The exercise price of all Incentive Stock Options must be at least equal to
the fair market value of the underlying stock on the date of grant. The
aggregate fair market value of stock of the Company (determined at the date of
the option grant) for which any employee may be granted
5
<PAGE>
Incentive Stock Options in any calendar year may not exceed $100,000, plus
certain carryover allowances. The exercise price of an Incentive Stock Option
granted to any participant who owns stock possessing more than ten (10%) of
the voting rights of the Company's outstanding capital stock must be at least
110% of the fair market value on the date of grant and the maximum term may
not exceed five (5) years.
Consequences to the Company: There are no Federal income tax consequences to
the Company by reason of the grant or exercise of an Incentive Stock Option.
As at November 30, 1997, 1,529,500 stock options, yet exercisable, to
purchase 1,529,500 shares of the Company's Common Stock, were outstanding.
vii. Performance Graph
Set forth below is a line graph comparing cumulative total shareholder
return on the Company's Common Stock, with the cumulative total return of
companies in the NASDAQ Stock Market (U.S.) and the cumulative total return of
Dow Jones's Cosmetics/Personal Care Index.
LOGO
CUMULATIVE TOTAL RETURN
<TABLE>
<CAPTION>
11/92 11/93 11/94 11/95 11/96 11/97
------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
CCA Industries, Inc. .... 100.00 378.57 214.29 82.14 132.14 135.71
DJ Equity Market......... 100.00 109.88 110.77 152.58 195.23 250.10
DJ Cosmetics/Personal
Care.................... 100.00 98.25 119.12 160.96 216.14 262.08
</TABLE>
6
<PAGE>
D. THE BOARD OF DIRECTORS AND STANDING COMMITTEES
The Company's Board of Directors has no nominating committee. Its Audit and
Compensation Committee members are Messrs. David Edell, Ira W. Berman, Stanley
Kreitman and Jack Polak. They meet as such approximately once every three
months, to review financial information in respect of the Company's business.
During the 1997 fiscal year there were three formal meetings of the full
Board. Informal meetings of members of the Board were held quarterly.
E. RELATED DIRECTORS AND/OR OFFICERS
David Edell is the Company's President and Chief Executive Officer. He is
also a director. Drew Edell and Dunnan Edell are his sons. Both are Vice-
Presidents of the Company, and Dunnan Edell is also a director.
F. REVOCABILITY OF PROXIES
Any person giving a proxy in the form accompanying this statement has the
power to revoke it at any time before its exercise. Thus, it may be revoked
prior to its exercise by the filing of an instrument of revocation, or a duly
executed proxy bearing a later date, with the Secretary of the Company at the
Company's principal executive office. A proxy holder can also revoke a filed
proxy by attending the meeting and voting in person.
G. SOLICITATION OF PROXIES
It is estimated that the costs associated with proxy solicitation will be
approximately $15,000. The Company will bear the entire cost of solicitation,
including preparation, assembly, printing and mailing of this Proxy Statement,
the proxy, and any additional material furnished to shareholders. Copies of
solicitation material will be furnished to brokerage houses, fiduciaries,and
custodians holding shares in their names that are beneficially owned by
others, for forwarding of such material to beneficial owners. The Company may
reimburse such persons their forwarding costs. Original solicitation of
proxies by mail may be supplemented by telephone, telegram, or personal
solicitation by directors, officers or employees of the Company. No additional
compensation will be paid for any such services.
H. SHAREHOLDER PROPOSALS FOR 1999
Proposals of shareholders that are intended to be presented at the Company's
1999 Annual Meeting of Shareholders must be received by the Company no later
than January 15, 1998 in order to be included in the Company's proxy materials
relating to that meeting.
II. MANAGEMENT PROPOSALS
PROPOSAL NO. 1
NOMINATION AND ELECTION OF DIRECTORS
Management proposes that seven directors be elected at the 1998 Annual
Meeting; three by holders of Common Stock and four by holders of Class A
Common Stock. Each elected director will hold office until the next Annual
Meeting of Shareholders and until a successor is elected and has qualified, or
until death, resignation or removal.
Management recommends that holders of Common Stock vote in favor of the
three nominees they propose for election by holders of Common Stock. Each of
such nominees has agreed to serve if elected. Unless otherwise instructed, the
proxy holders will vote the received proxies for Management's nominees.
7
<PAGE>
Set forth below is information regarding Management's Common Stock nominees,
including information they have furnished concerning their principal
occupations and certain other directorships, and their ages as of May 1, 1998.
(Mr. Abada does not own any Company stock. The stock ownership of each of the
other Common Stock nominees, Messrs. Sidney Dworkin and Dunnan Edell, is
presented above, under "Share Ownership of Directors, Officers and 5%
Owners.")
a. Common Stock Nominees
Dunnan Edell, the 42 year-old son of David Edell, became a director in 1994.
A Senior Vice President--Sales, he joined the Company in 1984, and was
appointed Divisional Vice-President in 1986. He was employed by Alleghany
Pharmacal Corporation from 1982 to 1984, and by Hazel Bishop from 1977 to
1981.
Sidney Dworkin, age 77, has been a director since 1985. He was one of the
founders, and from 1966 until 1987, was the President and Chairman of the
Board of Revco D.S., Inc., one of the largest drug store chains in the United
States. (He terminated his association with Revco in September 1987.) Mr.
Dworkin is a certified public accountant and a graduate of Wayne State
University. He is also a director of Northern Technologies International,
Inc., Crager Industries, Inc., Entile Company, Inc., Q.E.P. Company, Inc. and
Viragen Inc., and is Chairman of the boards of Comtrex Systems, Inc.,
MarbleEdge Group, Inc., and Interactive Technologies, Inc. He was a director
of Neutrogena Corp. until its acquisition by Johnson & Johnson, and is a
former Chairman of the National Association of Chain Drug Stores.
Rami G. Abada, age 38, is the President and Chief Operating Officer of the
publicly-owned Jennifer Convertibles, Inc. He has been its Chief Operating
Officer since April of 1994, and was Executive Vice President from April 1994
to December 1997. From 1982 to 1994, he was a Vice President of Operations in
the Jennifer Convertibles organization. Mr. Abada, who is Ira Berman's son-in-
law, earned a B.B.A. in 1981 upon his graduation from Bernard Baruch College
of The City University of New York.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE IN FAVOR OF EACH OF THE COMMON
STOCK NOMINEES AS PROPOSED IN THIS PROPOSAL NO. 1. A MAJORITY OF THE COMMON
STOCK VOTE IS REQUIRED FOR APPROVAL.
b. Class A Common Stock Nominees
The four nominees proposed for election by the holders of the Company's
Class A Common Stock have agreed to continue to serve as directors, and will
be elected since three of them (Messrs. Berman, Polak and David Edell) own, in
aggregate, more than 95% of the outstanding shares of Class A Common Stock,
and they have nominated themselves and the fourth Class A director and nominee
(Mr. Stanley Kreitman). Thus, no vote or proxy is solicited in respect of the
Class A nominees. (Mr. Kreitman does not own any Company Stock. The stock
ownership of each of the other Class A Nominees is presented above, under
"Share Ownership of Directors, Officers and 5% Owners.")
David Edell, age 66, is President and Chief Executive Officer. Prior to his
association with the Company he was a marketing and financial consultant; and,
by 1983, he had extensive experience in the health and beauty aids field as an
executive director and/or officer of Hazel Bishop, Lanolin Plus and Vitamin
Corporation of America.
Ira W. Berman, age 66, is the Company's Executive Vice President and
Corporate Secretary. He is also Chairman of the Board of Directors. Mr. Berman
is an attorney who has been engaged in the practice of law since 1955. He
received a Bachelor of Arts Degree (1953) and Bachelor of Laws Degree (1955)
from Cornell University, and is a member of the American Bar Association.
Jack Polak, age 85, has been a private investment consultant since April
1982, and holds a tax consultant certification in The Netherlands. From 1977
until 1995, he was a director of Petrominerals Corporation, a public company
engaged in oil and gas production, located in Tustin, California. From August
1993 until
8
<PAGE>
February 1995, he was a director of Convergent Solutions, Inc. Since February
1995 (upon a merger involving Convergent Solutions), he has been a director of
K.T.I. Industries, Inc. of Guttenberg, NJ, and a member of its Board's Audit
and Compensation Committee. K.T.I. is a public company engaged in the waste-
to-energy business.
Stanley Kreitman, age 66, has been Vice Chairman of the Board of Manhattan
Associates, an equity-investment firm, since 1994. He is also a director of
Medallion Financial Corp., an SBIC. Mr. Kreitman has been Chairman of the
Board of Trustees of The New York Institute of Technology since 1989, and of
Crime-Stoppers of Nassau County (NY), since 1994. He is also a director and/or
executive committee member of the following organizations: The New York City
Board of Corrections, The New York City Police Foundation, St. Barnabas
Hospital, The New York College of Osteopathic Medicine, and The Police
Athletic League. From 1975 until 1993, he was President of United States
Banknote Corporation, a security printer.
PROPOSAL NO. 2
APPROVAL OF APPOINTMENT OF AUDITORS
The Board of Directors has appointed the firm of Sheft Kahn & Company
L.L.P., independent certified public accountants (the "Auditors"), to audit
the accounts and certify the financial statements of the Company for the
fiscal year ending November 30, 1998. The appointment shall continue at the
pleasure of the Board of Directors, subject to approval by the shareholders.
The Auditors have acted as the Company's auditors since 1983.
The Board of Directors expects that one or more representatives of the
Auditors will be present at the meeting. The Auditors will then be given the
opportunity to make a statement, and will be available to respond to
appropriate questions.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE IN FAVOR OF PROPOSAL NO. 2. A
MAJORITY VOTE OF THE AGGREGATED CLASS A COMMON STOCK AND COMMON STOCK IS
REQUIRED FOR APPROVAL.
PROPOSAL NO. 3
AMENDMENT TO THE COMPANY'S CERTIFICATE OF INCORPORATION TO AUTHORIZE THE BOARD
OF DIRECTORS TO ISSUE UP TO 20,000,000 SHARES OF PREFERRED STOCK IN ONE OR
MORE SERIES WITH SUCH POWERS, DESIGNATIONS, PREFERENCES, RIGHTS,
QUALIFICATIONS, LIMITATIONS, AND RESTRICTIONS AS THE BOARD OF DIRECTORS
MAY DETERMINE
The Company's Board of Directors has proposed an amendment to the Company's
Certificate of Incorporation, which would authorize the Company to issue up to
20,000,000 shares, $1.00 par value per share, of undesignated preferred stock
(the "Preferred Stock") in one or more series. If the proposed amendment is
approved, the Board of Directors would be empowered, without the necessity of
further action or authorization by the Company's stockholders (except as set
forth below), to authorize the issuance of the Preferred Stock from time to
time in one or more series or classes, and to fix by resolution the powers,
designations, preferences, qualifications, limitations, and relative rights of
each series or class, including without limitation: (i) the distinctive
designation and number of shares constituting such series or class; (ii) the
dividend rates, if any, on the shares of that series or class and whether
dividends would be cumulative or non-cumulative; (iii) whether, and upon what
terms and conditions, the shares of that series or class would be convertible
into or exchangeable for other securities or cash or other property or rights;
(iv) whether, and upon what terms and conditions, the shares of that series or
class would be redeemable, including the date or dates upon or after which
they shall be redeemable; (v) the rights and preferences, if any, to which the
shares of that series or class would be entitled in the event of voluntary or
involuntary dissolution or liquidation or winding up of the Company; (vi)
whether a
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sinking fund would be provided for the redemption of the series or class and,
if so, the terms of and the amount payable into such sinking fund; (vii)
whether the holders of such securities would have voting rights and the extent
of those voting rights; (viii) whether the issuance of any additional shares
of such series or class, or of any other series or class, shall be subject to
restrictions as to issuance or as to the powers, preferences, or rights of any
such other series or class; and (ix) any other preferences, privileges, and
relative rights of such series or class as the Board of Directors may deem
advisable. Holders of the Company's Common Stock would have no preemptive
right to purchase or otherwise acquire any Preferred Stock that may be issued
in the future. Each series or class of Preferred Stock could, as determined by
the Board of Directors at the time of issuance, rank with respect to dividends
and redemption and liquidation rights, senior to the Company's Common Stock.
No Preferred Stock is presently authorized by the Company's Certificate of
Incorporation.
Generally, no further actions or authorization by stockholders would be
necessary or sought by the Board of Directors prior to an issuance of shares
of Preferred Stock except as may be required by law or applicable regulations
of the NASDAQ National Market or otherwise. For instance, current NASDAQ
National Market regulations require stockholder approval in connection with an
issuance of Preferred Stock convertible into or exchangeable for common stock
in a transaction or a series or exchange of related transactions, other than a
public offering for cash, if (i) the common stock to be issued upon conversion
or exchange has voting power equal to or in excess of 20% of the voting power
outstanding before such issuance; (ii) the number of shares of common stock to
be issued upon conversion or exchange is equal to or in excess of 20% of the
common stock outstanding before such issuance; or (iii) the issuance would
result in a change of control of the Company.
If the stockholders approve the amendment to the Certificate of
Incorporation described in Proposal No. 3, Article Fourth will be amended, to
read as set forth in Appendix A hereto, and the foregoing summary is qualified
in its entirety by reference thereto. The proposed amendment would not change
the authorized number of shares of Common Stock or Class A Common Stock.
a. Purposes And Effects Of The Proposed Amendment
The Board of Directors recommends the authorization of Preferred Stock to
increase the Company's financial flexibility. The Board believes that the
complexity of modern business financing and acquisition transactions requires
greater flexibility in the Company's capital structure than now exists. The
Preferred Stock would be available for issuance from time to time as
determined by the Board of Directors for any proper corporate purpose. Such
purposes might include, without limitation, issuance in public and private
sales for cash as a means of obtaining additional capital for use in the
Company's business and operations and issuance as part or all of the
consideration required to be paid by the Company for acquisitions of other
businesses or properties. The Company does not have, at present, any
agreements, understandings, or arrangements which would result in the issuance
of any shares of Preferred Stock.
It is not possible to state the precise effect of the authorization of the
Preferred Stock upon the rights of the holders of the Company's Common Stock
until the Board of Directors determines the respective preferences,
limitations, qualifications, and relative rights of the holders of one or more
series or classes of the Preferred Stock. However, such effect might include:
(i) reduction of the amount otherwise available for payment of dividends on
Common Stock, to the extent dividends are payable on any issued shares of
Preferred Stock, and restrictions on dividends on Common Stock if dividends on
the Preferred Stock are in arrears; (ii) dilution of the voting power of the
Common Stock to the extent that the Preferred Stock had voting rights
("Dilution"); and (iii) the holders of Common Stock not being entitled to
share in the Company's assets upon liquidation until satisfaction of any
liquidation preference granted to the Preferred Stock.
Although the Board of Directors would authorize the issuance of Preferred
Stock shares based on its judgment as to the best interests of the Company and
its stockholders, the Dilution potential resulting from such an amendment may
be viewed as having the effect, at once, (a) of diluting, among other things,
the voting power exercisable by holders of Common Stock and (b) of
discouraging an unsolicited attempt by another person or entity to acquire
control of the Company; that is, an anti-takeover effect.
10
<PAGE>
Issuances of authorized preferred shares can be implemented, and have been
implemented by some companies in recent years, with voting or conversion
privileges intended to make acquisition of the Company more difficult or
costly. For example, such shares could be used to create voting or other
impediments or to discourage persons seeking to gain control of the Company.
Such shares could be privately placed with purchasers favorable to the Board
of Directors in opposing such action. In addition, the Board of Directors
could authorize the holders of a series or class of Preferred Stock to vote
either separately as a class or with the holders of the Company's Common Stock
as a class on any merger, sale, or exchange of assets by the Company or any
other extraordinary corporate transaction. The existence of additional
authorized shares could have the effect of discouraging unsolicited takeover
attempts or could discourage or limit the stockholders' participation in
certain types of transactions that might be proposed (such as a tender offer),
whether or not such transactions were favored by the majority of the
stockholders, and could enhance the ability of the Company's officers and
directors to retain their positions.
b. Vote Required For Approval
A majority vote of the aggregated Common Stock and Class A Common Stock is
required for approval of Proposal No. 3.
THE BOARD OF DIRECTORS HAS UNANIMOUSLY APPROVED AND RECOMMENDS THAT THE
STOCKHOLDERS VOTE "FOR' THE PROPOSAL TO AMEND THE CERTIFICATE OF INCORPORATION
TO AUTHORIZE THE BOARD OF DIRECTORS TO ISSUE UP TO 20,000,000 SHARES OF
PREFERRED STOCK IN ONE OR MORE SERIES OR CLASSES WITH SUCH POWERS,
DESIGNATIONS, PREFERENCES, RIGHTS, QUALIFICATIONS, LIMITATIONS, AND
RESTRICTIONS AS THE BOARD OF DIRECTORS MAY DETERMINE.
III. OTHER MATTERS
The Board of Directors knows of no other matters to be presented, but if any
other matters properly come before the Annual Meeting it is intended that the
persons holding proxies will vote thereon in accordance with their best
judgments.
When a proxy in the form enclosed with this Proxy Statement is returned
properly executed, the shares represented thereby will be voted as indicated
thereon or, if no direction is indicated, in accordance with the
recommendations of the Board of Directors.
IV. CERTAIN REPORTS
Based upon reports furnished to the Company, all reports required to be
filed during or concerning the Company's 1997 fiscal year, by officers,
directors and principal shareholders, pursuant to Section 16 of the Securities
Exchange Act of 1934 (Form 3, Initial Statement of Beneficial Ownership; Form
4, Statement of Changes of Beneficial Ownership; and Form 5, Annual Statement
of Beneficial Ownership), were timely filed with the Securities and Exchange
Commission.
By Order of the Board of Directors
/s/ Ira W. Berman
Ira W. Berman,
Chairman of the Board of Directors
East Rutherford, New Jersey
April 20, 1998
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APPENDIX A
FORM OF
AMENDMENT OF PARAGRAPH
"FOURTH" OF THE
CERTIFICATE OF INCORPORATION
CCA INDUSTRIES, INC.
FOURTH: (A) COMMON STOCK AND CLASS A COMMON STOCK
[Unchanged]
(B) 20,000,000 SHARES OF PREFERRED STOCK, PAR VALUE $1.00 PER SHARE.
In accordance with Section 102(a)(4) of the Delaware General Corporation
Law, the Board of Directors of the Corporation is hereby expressly granted the
authority to fix by resolution(s) the powers, preferences, and rights of such
shares of preferred stock, and the qualifications, limitations, or
restrictions thereof, in accordance with Section 151 of the Delaware General
Corporation law, and to amend this Certificate of Incorporation as required.
The Board of Directors shall have the authority to issue shares of Preferred
Stock at any time, and from time to time, and to (i) divide the shares into
classes and into series within any class or classes, (ii) determine the
designation of and the number of shares of any class or series of Preferred
Stock, (iii) determine the relative rights, preferences and limitations of the
shares of any class or series of Preferred Stock, and (iv) change the
designation or number of shares, or relative rights, preferences and
limitations of the shares of any theretofore established class or series of
Preferred Stock which have been issued.
<PAGE>
CCA INDUSTRIES, INC.
ANNUAL MEETING OF SHAREHOLDERS
The undersigned, revoking all prior proxies, hereby appoints David Edell and
Ira W. Berman, and each of them, proxies and attorneys in fact, with power of
substitution, to vote all shares the undersigned is entitled to vote at the
Annual Meeting of Shareholders of CCA INDUSTRIES, INC., to be held at the Grand
Hyatt Hotel, Park Avenue at Grand Central Station, New York, New York, on June
16, 1998 at 4:00 p.m., and to vote as directed below upon the proposals, and in
their discretion upon such other business as may properly come before the
meeting or any adjournment thereof (all as more fully set forth in the Notice
of Meeting and Proxy Statement, receipt of which is hereby acknowledged).
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS. UNLESS OTHERWISE
SPECIFIED, IT WILL BE VOTED "FOR" THE ELECTION OF SIDNEY DWORKIN, RAMI G. ABADA
AND DUNNAN EDELL AS DIRECTORS, AND "FOR" PROPOSALS 2 AND 3.
SEE
REVERSE
SIDE
(TO BE SIGNED ON REVERSE SIDE)
<PAGE>
[X] PLEASE MARK YOUR
VOTES AS IN THIS EXAMPLE.
1. Election of FOR WITHHELD
Directors [_] [_] Nominees:
Sidney Dworkin
Rami G. Abada
Dunnan Edell
For, except vote withheld from the following nominee(s):
_______________________________________________________
2. Ratification of the Board of Directors' appointment of Sheft Kahn & Company
L.L.P. as the Company's independent, certified public accountants for the
fiscal year ending November 30, 1998
FOR AGAINST ABSTAIN
[_] [_] [_]
3. Proposal to authorize 20,000,000 shares of Preferred Stock
FOR AGAINST ABSTAIN
[_] [_] [_]
SIGNATURE(S) __________________________ DATE ________
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME OR NAMES APPEAR HEREON. EACH JOINT
OWNER MUST SIGN. EXECUTORS, ADMINISTRATORS, TRUSTEES, ETC. SHOULD
INDICATE THOSE CAPACITIES.
