SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE
SECURITIES EXCHANGE ACT OF 1934
(Amendment No. )
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 statment
/ / Definitive additional materials
/ / Soliciting material pursuant to Sec. 240.14a-11(c) or Sec. 240.14a-12
PERFORMANCE INDUSTRIES, INC.
------------------------------------------------
(Name of Registrant as Specified in Its Charter)
Robert A. Cassalia
------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of filing fee (Check the appropriate box):
/X/ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2)
or Item 22(a)(2) or Schedule 14A
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / 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 transactions applies:
- - ----------------------------------------------------------------------------
(2) Aggregate number of securities to which transactions 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:
- - ----------------------------------------------------------------------------
<PAGE>
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
PERFORMANCE INDUSTRIES, INC.
2425 E. Camelback Road
Suite 620
Phoenix, AZ 85016
Notice is hereby given to the shareholders of Performance Industries, Inc., an
Ohio corporation ("Company"), that the Annual Meeting of shareholders will be
held at Boby McGee's Restaurant (Crown Sterling Suites), 150 Anza Boulevard,
Burlingame, California, at 9:30 a.m., PDST, on June 5, 1995 to vote on the
following matters:
1. To elect directors of the Company;
2. To ratify the selection by the Board of Directors of Toback CPA's,
P.C. as Independent public accountants for the Company;
3. To vote for such other matters as may properly come before the
meeting.
The date fixed by the Board of Directors as the record date for the
determination of shareholders entitled to notice of, and to vote at, the Annual
Meeting is the close of business on May 10, 1995. Only shareholders holding
issued and outstanding shares of the Company as of the record date shall be
entitled to vote at the Annual Meeting.
Shareholders who do not expect to be present personally at the meeting are urged
to fill in, date, sign, and return the accompanying Proxy in the enclosed
self-addressed and stamped envelope. It is important that your shares be
represented and voted at the meeting. You should therefore return your Proxy at
your earliest convenience.
By order of the Board of Directors.
Robert A. Cassalia
Secretary
Enclosure
Phoenix, Arizona
May 12, 1995
PERFORMANCE INDUSTRIES, INC.
2425 E. CAMELBACK ROAD, SUITE 620
PHOENIX, ARIZONA 85016
- - --------------------------------------------------------------------------------
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS - JUNE 5, 1995
- - --------------------------------------------------------------------------------
INTRODUCTION
This Proxy Statement and the enclosed form of Proxy are being sent to
the shareholders ("Shareholders") of Performance Industries, Inc. ("Company")
(formerly known as Mr. Gasket Company) as of May 10, 1995 ("Record Date") in
connection with the solicitation by the Board of Directors of the Company of
proxies to be used at the Annual Meeting of Shareholders to be held at 9:30 a.m.
PDST, June 5, 1995, and any and all adjournments thereof for the purposes set
forth in the attached Notice of Annual Meeting. The Annual Meeting of
Shareholders will be held at Bobby McGee's Restaurant (Crown Sterling Suites),
150 Anza Boulevard, Burlingame, California. The first date on which this Proxy
Statement and form of Proxy are being sent to Company Shareholders is May 12,
1995. The Board of Directors unanimously recommend approval of the proposals set
forth in this Proxy Statement and the election of the nominees for directors.
<TABLE>
TABLE OF CONTENTS
<CAPTION>
PAGE
----
<S> <C>
EXPENSES AND SOLICITATION.......................................................................................3
PROXY...........................................................................................................3
a. Revocation....................................................................................3
b. Voting by Proxy...............................................................................3
c. Shareholder Proposals for 1996 ...............................................................3
RECORD DATE AND OUTSTANDING VOTING SECURITIES.................................................................. 3
SECURITY OWNERSHIP..............................................................................................4
a. Security Ownership of Certain Beneficial Owners...............................................4
INTEREST OF CERTAIN PERSONS IN MATTERS TO BE ACTED UPON.........................................................5
EMERGENCE FROM BANKRUPTCY AND SUBSTANTIAL CONSUMMATION OF
PLAN OF REORGANIZATION..........................................................................................5
PROPOSALS ..............................................................................................5
1. ELECTION OF DIRECTORS..................................................................................5
a. Legal Proceedings.............................................................................6
b. Table.........................................................................................6
c. General Background of Candidates..............................................................7
d. Board of Directors, Committees, Meetings and Fees.............................................8
e. Compensation of Directors and Executive Officers..............................................8
f. Vote Required; Board Recommendation..........................................................14
2. RATIFICATION AND APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS........................................14
a. Background ..................................................................................14
b. Vote Required; Board Recommendation..........................................................15
3. OTHER MATTERS.........................................................................................15
ANNUAL REPORT .............................................................................................15
</TABLE>
EXPENSES AND SOLICITATION:
Arrangements will be made with brokers and other custodians, nominees,
and fiduciaries to forward solicitation materials to the beneficial owners of
stock held of record by such persons and they will be reimbursed for reasonable
out-of-pocket expenses incurred in connection therewith. The entire expense of
preparing, assembling and mailing material in connection with this solicitation
will be borne by the Company.
PROXY:
a. Revocation. Shareholders who execute Proxies retain the right to
revoke them at any time before they are exercised; (i) by sending written notice
to the Secretary of the Company, Robert A. Cassalia, at 2425 E. Camelback Road,
Suite 620, Phoenix, Arizona 85016; (ii) by submitting a properly executed and
later dated Proxy, or; (iii) by attending the Annual Meeting and electing to
vote in person.
b. Voting by Proxy. If a quorum is not present in person or by Proxy at
the Annual Meeting, a person named as Proxy may propose one or more adjournments
of the meeting to permit further solicitation of Proxies. The persons named as
Proxies will vote all Proxies in favor of such adjournments. Proxies which are
signed and properly executed will be voted in the manner directed by the
Shareholder. If no direction is made with respect to a nominee or proposal, the
Proxy will be voted in favor of each of the nominees for election of directors
and in favor of the proposal. Abstentions and broker non-votes will be treated
as "no" or "against" votes.
c. Shareholder Proposals for 1996. Certain eligible shareholders
complying with Rule 14a-8 of the Securities and Exchange Act of 1934 may submit
proposals for review for inclusion, if appropriate, in next year's proxy
statement to be considered at the next annual meeting of shareholders if
received by the Company on or before February 10, 1996. The next annual meeting
is tentatively scheduled for Monday, June 10, 1996. If the date is subsequently
advanced by more than thirty (30) calendar days or delayed by more than ninety
(90) calendar days from the date of the annual meeting to which the proxy
statement relates, the Company will, in a timely manner, inform shareholders of
the change and the date by which shareholder proposals must be received. All
proposals should be mailed to Performance Industries, Inc. at 2425 E. Camelback
Road, Suite 620, Phoenix, Arizona 85016.
RECORD DATE AND OUTSTANDING VOTING SECURITIES
Shareholders of record at the close of business on May 10, 1995
("Record Date") are entitled to notice of, to participate in, and vote at the
Annual Meeting. On the Record Date, there should be 12,629,326 issued and
9,821,190 outstanding shares of common stock ("Common Shares"), without par
value per share. The Company has 100,000 shares of authorized preferred stock
("Preferred Shares") with a par value of $1.00 per share, but none of the
Preferred Shares are issued or outstanding. Collectively, the "Common Shares"
and "Preferred Shares" are referred to in this Proxy Statement as the "Stock".
Any class of Stock issued and outstanding on the Record Date is entitled to vote
on the matters to be voted on at the Annual Meeting. Each holder of Common or
Preferred Shares on the Record Date is entitled to one vote for each share held
by that Shareholder on every matter submitted for a vote at the Annual Meeting.
The Company's Amended and Restated Articles of Incorporation ("Articles") do not
permit cumulative voting for the election of directors.
<TABLE>
SECURITY OWNERSHIP
a. Security Ownership of Certain Beneficial Owners
The following table sets forth the number and percentage of the
outstanding Common Shares of the Company beneficially owned as of April 28, 1995
by the only persons known to the Company to own beneficially more than 5% of the
outstanding Common Shares of the Company, and by all directors, nominees,
executive officers, and the directors and officers as a group.
<CAPTION>
Name and Address Amount and Nature Percentage
of Beneficial Owners of Beneficial Ownership of Common Shares
- - -------------------- -------------------------- -------------
<S> <C> <C>
Joe Hrudka 7,071,966 (1) & (2) 64%
2425 E. Camelback Rd
Suite 620
Phoenix, AZ 85016
Chief Executive Officer, Director
Ed Fochtman, Jr 315,100(2) 3%
2425 E. Camelback Rd
Suite 620
Phoenix, AZ 85016
President, Director
Jonathan Tratt 254,500(2) 2%
2425 E. Camelback Rd
Suite 950
Phoenix, AZ 85016
Director
Allen L. Haire 101,500(2) 1%
2425 E. Camelback Rd
Suite 620
Phoenix, AZ 85016
Director
Robert A. Cassalia 75,000(2) 1%
2425 E. Camelback Rd
Suite 620
Phoenix, AZ 85016
Secretary
James W. Brown 150,000(2) 1%
2425 E. Camelback Rd
Suite 620
Phoenix, AZ 85016
Chief Financial Officer, Director --------- ----
Directors and Officers as a Group 7,968,066 72%
- - --------------------------------------------------------------------------------
(1) Certificates for 795,973 of these Common Shares are in the possession
of a bank which claims a security interest in the same in connection
with loan arrangements. The net result of future actions taken in
connection therewith cannot be predicted by the Company at this time.
(2) Includes options to purchase Common Shares currently held by management
pursuant to Performance Industries, Inc.'s qualified option program.
</TABLE>
Shareholders are advised that management collectively owns over 70% of the
Company's issued and outstanding Common Shares, so passage of the proposals is
assured.
INTEREST OF CERTAIN PERSONS IN MATTERS TO BE ACTED UPON
No director or executive officer of the Company at any time since the
beginning of the last fiscal year has any direct or indirect substantial
interest in any matter to be acted on other than election to office.
EMERGENCE FROM BANKRUPTCY AND SUBSTANTIAL CONSUMMATION OF PLAN OF REORGANIZATION
On May 4, 1993, Mr. Gasket Company, the debtor and
debtor-in-possession, now known as Performance Industries, Inc., emerged from
Chapter 11 bankruptcy proceedings under which Mr. Gasket Company had been
operating since it filed a Chapter 11 Bankruptcy Petition on April 21, 1991,
with the United States Bankruptcy Court for the Central District of California,
Chapter 11 Case No. LA-91-72714-AA.
There are several claims pending in Bankruptcy Court which the Company
does not believe will have a material effect upon the Company. Under the Joint
Plan of Reorganization the Company is required to fund $1,000,000 as of December
31 of each year until all disputed claims are resolved to the Option A Cash
Reserve Account to cover claims liquidated during that year if there are
insufficient funds in the account to pay the claims.
PROPOSALS
ITEM NO. 1. ELECTION OF DIRECTORS
PROPOSAL: SHOULD THE FOLLOWING NOMINEES BE APPROVED AS DIRECTORS OF THE
COMPANY: JOE HRUDKA, ED FOCHTMAN, JR., ALLEN L. HAIRE, JONATHAN TRATT, AND JAMES
W. BROWN?
All directors are to be elected at the Annual Meeting, each to hold
office until the next annual meeting or until a successor is elected and
qualified. The Company has no nominating committee to select candidates to serve
as directors. The persons named in the accompanying form of Proxy intend to vote
that Proxy for the election as directors of the persons named above who have
been designated by the Board of Directors as nominees unless authority to do so
is withheld. All of the nominees for director are currently directors. Jonathan
Tratt was elected as a Director of the Company at a Special Meeting of the Board
of Directors on May 5,1993, and replaced Howard B. Gardner who resigned on May
5, 1993. James W. Brown was elected as a Director of the Company on December 23,
1993 to replace Gary Biggs who resigned effective that date. No director
resigned or declined to stand for re-election to the Board of Directors since
the date of the last annual meeting of Shareholders because of a disagreement
with the Company on any matter related to the Company's operations, policies or
practices. Each of the nominees has agreed to serve as Director, if elected. If
any nominee should be unable to serve, which is not anticipated, the Proxy will
be voted for such other persons as shall be determined by the Proxy holder in
accordance with their judgment. No nominations will be accepted from the floor.
The Company recommends that Shareholders elect the five persons named
above to hold office until the 1996 annual meeting of Shareholders or until
their successors are elected and qualified. The Company's Code of Regulations
provides that the number of directors which shall constitute the Board of
Directors shall be fixed from time to time by resolution of the holders of a
majority of the Common Shares entitled to elect directors or by resolution of
the Board of Directors, but shall not be less than three nor more than
twenty-one. The Board of Directors has determined that five directors is a
sufficient number and has fixed the number to be elected at five. Proxies cannot
be voted for a number of directors greater than five.
a. Legal Proceedings
Joe Hrudka, Director and Chief Executive Officer of the Company, along
with other former officers and directors of the Company, is a party in a lawsuit
by a shareholder of the Company alleging a breach of fiduciary duty owed to
Shareholders as an officer and director of the Company. The action is pending in
the court of Common Pleas for the County of Cuyahoga, State of Ohio. Mr. Hrudka
has tendered the defense of this matter to the Company which is providing a
defense as permitted in the Company's Code of Regulations and under Ohio law.
b. Table
<TABLE>
The table below sets forth certain information regarding the directors and
nominees.
<CAPTION>
Current Principal Year Elected Membership on Trans.
Name of Nominees Occupation and As A Boards - Other Legal With
And Age Prin. Employment Director (2) Corporations Proceedings Mgmt.
- - ---------------- ---------------- ----------- -------------- ----------- -----
<S> <C> <C> <C> <C> <C>
Joe Hrudka - 56 Chairman of Board 1981 Director of See (a) (1)
and Director of the Company's
Company Subsidiaries
Ed Fochtman, Jr. - 57 President and 1988 Director of None None
Director of the Company Company's
Subsidiaries
Allen L. Haire - 52 Chairman, Chief 1988 Director None None
Executive Officer of Enerco
Enerco Technical Technical
Products and a Products
Director of the
Company
James W. Brown - 46 Chief Financial 1993 Director of None None
Officer, Director Company's
of the Company Subsidiaries
Jonathan Tratt - 36 President and 1993 Director None None
Director Industrial Gulp Invest-
Brokerage, Inc. and ments, Inc. and
Director of the Company Industrial
Brokerage, Inc.
- - --------------------------------------------------------------------------------
1) The Company had leased two buildings in Cleveland, Ohio used
predominantly for manufacturing, pursuant to a ten year lease, effective May
1981, from Joe Hrudka, the Company's principal shareholder and Chairman of the
Board, as successor in interest to Hrudka Realty Company. As of April 1, 1991,
the Company entered into a one year extension of the lease agreement calling for
the same monthly rental as in the previous year. During 1994 the Company
expended approximately $137,000 for repairs to the property under the terms of
the lease.
2) Directors are elected for a one-year term or until their successors
are elected and qualified.
</TABLE>
c. General Background of Executive Officers Candidates for Directors
CEO and Director
Joe Hrudka is the founder and principal shareholder of the Company.
Since 1981 he has served as the Chairman of the Board and a Director. Mr. Hrudka
has served as Chief Executive Officer of the company since November, 1993. In
1964, Mr. Hrudka founded the original Mr. Gasket company and served as Chairman
of the Board and President until the company was purchased by W.R. Grace in
1971. He was then employed as a Vice President of the Automotive Division of
W.R. Grace form 1972 to 1974 and as a consultant to W.R. Grace during 1975 and
1976. From 1977 until the formation of the Company in 1981, Mr. Hrudka was a
private investor. Mr. Hrudka has served as a Director of Action Products, Inc.
from 1987, and served as Secretary of Action Products, Inc. from October 1990 to
May 1992. In November, 1991, a Receiver was appointed by the Superior Court of
the State of Arizona to manage the affairs of Action Products, Inc. at the
request of a secured party of Action Products, Inc. As of May 1, 1992, the
assets of Action Products, Inc. were transferred to a third party in
satisfaction of a secured party's debt and the receivership terminated. Mr.
Hrudka has served as a Director of each of the subsidiaries since they have been
formed.
President and Director
Ed Fochtman, Jr. has been President of the Company since May, 1993. He
was an Executive Vice President of the Company since January, 1992. He was
Chairman of the Board of Directors and Chief Executive Officer of Action
Products, Inc., a company engaged in the manufacture and sale of fiberglass
bodied mini-cars and sales of other promotional products since October, 1986. In
November, 1991, a Receiver was appointed by the Superior Court of the State of
Arizona to manage the affairs of Action Products, Inc. at the request of a
secured party of Action Products, Inc. As of May 1, 1992, the assets of Action
Products, Inc. were transferred to a third party in satisfaction of a secured
party's debt and the receivership terminated. From 1984 to 1986, Mr. Fochtman
was a private investor. From 1976 to 1984, he served as Vice President of F.W. &
Associates, Inc. Mr. Fochtman was elected a Director of the Company in June,
1988 and as a Director of each of the subsidiaries since 1993.
Director
Allen L. Haire has been Chairman and Chief Executive Office of Enerco
Technical Products, a manufacturer of gasfired infra-red heating equipment,
since July, 1984. He was a manufacturer's representative from 1977 to 1984. Mr.
Haire was elected a Director in June, 1988.
Director
Jonathan Tratt has been President and Director of Industrial Brokerage,
Inc., an investment and commercial real estate brokerage company, since 1992.
Prior to 1992, Jonathan Tratt was a general investor and real estate agent in
Phoenix, Arizona. Jonathan Tratt is also a Director of Gulp Investments, Inc., a
real estate and general investment company, and was elected a Director of the
Company in May, 1993.
CFO and Director
James W. Brown, a certified public accountant, has been Chief Financial
Officer and Director since December, 1993. From 1989 until joining the Company
in May, 1993, Mr. Brown was CFO of RACAM Amusement Group, a management company
with investments in diverse industries. From 1985 to 1988 he was the Chief
Operating Officer of American Educational Computers, Inc., a publicly traded
software and video publisher. Prior to 1985, he was Vice President of Finance of
National Zinc Company, a primary metals manufacturer. Mr. Brown has served as a
Director of the subsidiaries since 1993.
Secretary
Robert A. Cassalia was hired by the Company as Assistant Secretary,
In-House Counsel in January of 1991. On May 4, 1993, he was elected Secretary.
Before joining the Company Mr. Cassalia was General Counsel of Action Products,
Inc., a manufacturer of fiberglass bodied mini-cars since October, 1986. Prior
to 1986, he was in private practice in Phoenix, Arizona and Syracuse, New York.
d. Board of Directors, Committees, Meetings and Fees
The Company has an Audit Committee consisting of the following members
of the Board of Directors: Ed Fochtman, Jr., Allen L. Haire and Jonathan Tratt.
The Committee, among other functions, recommends independent auditors to the
Board of Directors, reviews the audit plan and results of the audit and
considers other matters deemed appropriate for consideration by the Board of
Directors and/or the Committee. There were nine Board of Directors and one Audit
Committee meeting during the year-ending December 31, 1993. All incumbent
directors attended all Board and Audit Committee meetings of which they were
members. Directors are not paid a fee for any Board or Committee meeting
attended.
e. Compensation of Directors and Executive Officers
The compensation disclosures set forth below cover the Company's
Chairman of the Board (Joe Hrudka) at the end of the last completed fiscal year
and the Company's most highly compensated executive officers whose total annual
salary and bonus (if any) exceeds $100,000.
1. Transactions With Third Parties Reported Under Item 404 of
Regulation S-K. There have been no transactions between third parties and the
Company in which the primary purpose of the transaction was to furnish
compensation to a named executive officer.
<TABLE>
2. Summary Compensation Table
<CAPTION>
Name and Other Annual
Principal Position Year Salary ($) Bonus ($)Compensation ($)
- - ------------------ ---- ---------- -------------------------
(a) (b) (c) (d) (e)
<S> <C> <C> <C> <C>
Joe Hrudka (1) 1994 210,000 $1,600 Car Allowance
Chairman of the Board, 1993 200,000 9,615 $1,600 Car Allowance
Chief Executive Officer, 1992 250,000
President and Director
Ed Fochtman, Jr. 1994 150,000
President, Director 1993 150,000
1992 104,780
- - --------------------------------------------------------------------------------
(1) The Company provides Mr. Hrudka the use of a vehicle acquired by
the Company in 1991 for $40,432.00. The Company pays all insurance, maintenance,
and registration for the vehicle. The other annual compensation of $1,600 was
for the use of the vehicle.
</TABLE>
No SAR's, restricted stock, LTIP awards or deferred compensation were issued or
paid during 1994, and none are anticipated to be issued or paid in 1995. The
Company has no defined benefit plans or pension plans that are applicable.
No chief executive officer (including board chairman) or other highly
compensated employee has an employment contract with the Company or a contract
with respect to the termination of employment or change-in-control arrangement.
<TABLE>
3. Table of Options Granted in 1994
<CAPTION>
Potential
Realized Value at
Assumed Annual
Rates of Stock Price
Appreciation
Individual Grants for Option Term
- - ---------------------------------------------------------------------------------------------------------------
(a) (b) (c) (d) (e) (f) (g)
% of
Total
Options/
SARs
Options/ Granted to Exercise
SARs Employees or Base
Granted in Fiscal Price Expiration
Name (#) Year ($/Sh) Date 5% ($) 10%($)
- - ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
CEO
Joe Hrudka 175,000 14% $.61875 04/15/04 ($5,414) ( 0 )
President
Ed
Fochtman, Jr. 175,000 14% $.5625 04/15/04 $4,607 $9,214
CFO
James W.
Brown 100,000 8% $.5625 04/15/04 $2,812 $5,625
Secretary
Robert A.
Cassalia 50,000 4% $.5625 04/15/04 $1,406 $2,812
</TABLE>
4. Compensation of Directors. No director is paid a fee for their
services as a director or for attendance at meetings.
5. Performance Graph.
Due to the Company's sale of all automotive related businesses during 1993, and
the acquisition of restaurants, which were the main source of revenue for 1994,
two performance graphs are presented for your consideration. The first graph for
automotive businesses is relevant only for the years 1990 - 1993. The second
graph for restaurants is relevant only for 1994. As such, we have used a
comparison line for the Company on each graph corresponding to the relevant
years.
The following descriptive data is supplied in accordance with Rule 304(d) of
Regulation S-T.
COMPARISON OF FIVE YEAR-CUMULATIVE TOTAL RETURNS
PERFORMANCE GRAPH FOR
PERFORMANCE INDUSTRIES, INC.
LEGEND
Motor Vehicles and Motor Vehicle Equipment
------------------------------------------
Mr. Gasket Co. Nasdaq Stock Markets NASDAQ Stocks
-------------- -------------------- -------------
12/29/89 100.0 100.0 100.0
12/31/90 52.6 84.9 74.3
12/31/91 12.0 136.3 102.9
12/31/92 12.0 158.6 144.5
12/31/93 12.0 182.0 189.7
12/30/94 12.0 178.0 172.5
The Peer Group Index is based on NASDAQ Stocks (SIC 3710-3719 US Companies),
Motor Vehicles and Motor Vehicle Equipment, and is made up of the following
issuers:
ASHA CORP MASLAND CORP
ASSIX INTERNATIONAL INC METROTRANS CORP
ATHEY PRODUCTIONS CORP MILLER INDUSTRIES INC TENN
BAILEY CORP MODINE MANUFACTURING CO
BESTOP INC MONACO COACH CORP
CAMERA PLATFORMS INTL INC MOTORCAR PARTS & ACCESSORIES
CARE CONCEPTS INC INC
COLLINS INDUSTRIES INC MR. GASKET CO
CONSULIER ENGINEERING INC OSHKOSH TRUCK CORP
CONSULIER INDUSTRIES INC PACCAR INC
DE TOMASO INDS INC PARKER AUTOMOTIVE CORP
DEFLECTA SHIELD CORP R T INDUSTRIES INC
DORSEY TRAILERS INC RAWSON KOENING INC
DOUGLAS & LOMASON CO SAFETY COMPONENTS INTL INC
DREAMCAR HOLDINGS INC SIMPSON INDUSTRIES INC
EDELBROCK CORP SPARTAN MOTORS INC
ENVIROSOURCE INC STANT CORP
HARVARD INDUSTRIES INC STARCRAFT AUTOMOTIVE CORP
HILITE INDUSTRIES INC SUDBURY INC
JPE INC TESCO AMERICAN INC
KRUG INTERNATIONAL CORP TRICO PRODUCTS CORP
LUND INTERNATIONAL HOLDINGS INC TRUCK COMPONENTS INC
MACK TRUCKS INC UNIVERSAL MFG CO
MALVY TECHNOLOGY INC VECTOR AEROMOTIVE CORP
MASCO INDUSTRIES INC WILLIAMS CONTROLS INC
COMPARISON OF FIVE YEAR-CUMULATIVE TOTAL RETURNS
PERFORMANCE GRAPH FOR
PERFORMANCE INDUSTRIES, INC.
LEGEND
Eating and Drinking Places
--------------------------
Mr. Gasket Co. Nasdaq Stock Markets NASDAQ Stocks
-------------- -------------------- -------------
12/29/89 100.0 100.0 100.0
12/31/90 52.6 84.9 81.6
12/31/91 12.0 136.3 135.9
12/31/92 12.0 158.6 189.7
12/31/93 12.0 182.0 192.8
12/30/94 12.0 178.0 139.0
The Peer Group Index is based on NASDAQ Stocks (SIC 5810-5819 US Companies),
Eating and Drinking Places, and is made up of the following issuers:
APPLE SOUTH INC L D B CORP
APPLEBEES INTERNATIONAL INC LANDRYS SEAFOOD RESTAURANTS
ARK RESTAURANTS CORP INC
AU BONPAIN CO INC LINIUM TECHNOLOGY INC
AUSTINS INTERNATIONAL INC LONE STAR STEAKHOUSE & SALOON
BACK BAY RESTAURANT GROUP INC IN
BACK YARD BURGER LONGHORN STEAKS INC
BAYPORT RESTAURANT GROUP INC MACHEEZMO MOUSE RESTAURANTS
BENIHANA NATIONAL CORP INC
BERTUCCIS HOLDING CORP MAGELLAN RESTAURANT SYSTEMS
BILLY BLUES FOOD CORP INC
BLIMPIE INTERNATIONAL INC MAGIC RESTAURANTS INC
BOB EVANS FARMS INC MAIN STREET & MAIN INC
BOSTON CHICKEN INC MARCUS CORP
BOSTON RESTAURANT ASSOCIATES INC MASCOTT CORP
BUFFETS INC MAVERICK RESTAURANT CO
BUGABOO CREEK STEAK HOUSE INC MAX & ERMAS RESTAURANTS INC
CALIFORNIA BEACH RESTAURANTS INC MEXICAN PATIO CAFES INC
CAPITAL ACQUISITIONS INC MIAMI SUBS CORP
CAPITAL BRANDS INC MORRISON INC
CAPTAIN CRABS INC MORRISON RESTAURANTS INC
CAPUCINOS INC NPC INTERNATIONAL INC
CATCH A RISING STAR INC NASHVILLE COUNTRY CLUB INC
CATTLEGUARD IND NATHANS FAMOUS INC
CHAMPIONS SPORTS INC NATIONAL PIZZA CO
CHAMPPS ENTERTAINMENT INC NOBLE ROMANS INC
CHECKERS DRIVE IN RESTAURANTS O CHARLEYS INC
CHEESECAKE FACTORY INC ON THE BORDER CAFES INC
CHEFS INTERNATIONAL INC OUTBACK STEAKHOUSE INC
CIATTIS INC PANCHOS MEXICAN BUFFET INC
CLUCKERS WOOD ROASTED CHICKN INC PANTERAS CORP
CONSOLIDATED PRODUCTS INC PAPA JOHNS INTL INC
CONSUL RESTAURANT CORP PICCADILLY CAFETERIAS INC
COOKER RESTAURANT CORP PIZZA INN INC
COUNTRY STAR RESTAURANTS INC POLLO TROPICAL INC
CRACKER BARREL OLD CTRY STR Q S R INC
CUCOS INC Q STEAKS INC
D F & R RESTAURANTS INC QUALITY DINING INC
DAKA INTERNATIONAL INC QUIZNOS FRANCHISE CORP
DAVCO RESTAURANTS INC R A X RESTAURANTS INC
DEL TACO RESTAURANTS INC RALLYS HAMBURGERS INC
DISCUS CORP RALLYS INC
DUNKIN DONUTS INC RITZYS G D INC
E L & S I CORP ROCK BOTTOM RESTAURANTS INC
EATERIES INC RUDYS RESTAURANT GROUP INC
EL CHICO CORP NEW RYANS FAMILY STEAK HOUSES INC
EL CHICO RESTAURANTS INC SANDWICH CHEF
ELIMERS RESTAURANTS INC SEA GALLEY STORES INC
FAMILY STEAK HOUSES FL INC SHOWBIZ PIZZA TIME INC
FAMOUS RESTAURANTS INC SIZZLER RESTAURANTS INTL INC
FAST FOOD OPERATORS INC SKOLNIKS INC
FLAGSTAR COMPANIES INC SONIC CORP
FRESH CHOICE INC SOUTHERN HOSPITALITY CORP
G B FOODS CORP SOUTHWEST CAFES INC
GOOD TIMES RESTAURANTS INC STACEYS BUFFET INC
GROUND ROUND RESTAURANTS INC STRATAMERICA CORP
HAMBURGER HAMLET RESTAURANTS INC STUFF YER FACE INC
HOMESTYLE BUFFET INC T P I ENTERPRISES INC
HOMETOWN BUFFET INC T W HOLDINGS INC
INTERNATIONAL DAIRY QUEEN INC TACO CABANA INC
INTERNATIONAL FAST FOOD CORP TUBBYS INC
INTERNATIONAL PIZZA CORP TWISTEE TREAT CORP
J B S RESTAURANTS INC UNITED RESTAURANTS INC
JAKES PIZZA INTERNATL INC VALUE HOLDINGS INC
JERRICO INC VICORP RESTAURANTS INC
KARCHER CARL ENTERPRISES INC W S M P INC
KOO KOO ROO INC WALL STREET DELI INC
KRYSTAL COMPANY WESTERN COUNTRY CLUBS INC
WILT CHAMBERLAINS RESTAURANTS
INC.
WOODROAST SYSTEMS INC.
Source: CRSP Center for Research in Security Prices
6. Compensation Committee Interlocks and Insider Participation.
Salaries are not set by a compensation committee. Instead, all compensation
decisions are made by the Board of Directors, and all directors participate in
compensation decisions. For the last completed fiscal year, Messrs. Hrudka,
Fochtman and Brown participated in compensation decisions as directors of the
Company. Related transactions under Item 404 of Regulation S-K are disclosed on
page 6 and 8 of this Proxy Statement. No executive officer of the Company served
as a member of the compensation committee (or other board committee performing
equivalent functions or, in the absence of any such committee, the entire board
of directors) of another entity, one of whose executive officers served on the
Board of Directors of the Company. No executive officer of the Company served as
a director of another entity, one of whose executive officers served on the
Company's Board of Directors and no executive officer of the Company served as a
member of the compensation committee (or other board committee performing
equivalent functions or, in the absence of any such committee, the entire board
of directors) of another entity, one of whose executive officers served as a
director of the Company.
7. Board Report on Executive Compensation. The Board of Directors is
responsible for establishing the Company's compensation programs for all
employees, including executives. For executive officers, the Board evaluates
performance and determines compensation policies and levels.
Compensation Philosophy. The goals of the compensation program are to
align compensation with business objectives and performance, and to enable the
Company to attract, retain and reward executive officers and other key employees
who contribute to the long-term success of the Company and to motivate them to
enhance long-term shareholder value. Key elements of this philosophy are:
* The Company pays competitively with leading companies
in the industries with which the Company competes for
talent.
* The Company does not presently have annual incentive
programs. Instead the Company provides significant
equity-based incentives for executives and other key
employees to ensure that they are motivated over the
long-term to respond to the Company's business
challenges and opportunities as owners and not just
as employees.
Base Salary. The Board annually reviews each executive officer's base
salary. The Board subjectively considers individual factors, including
individual performance, level of responsibility, prior experience, breadth of
knowledge and competitive pay practices.
Long-Term Incentives. The Company's long-term incentive program
consists of the 1993 Stock Option Plan, which expires on November 30, 2003.
Through option grants, executives receive significant equity incentives to build
long-term shareholder value.
Conclusion. In summary, the Board believes that a significant portion
of the Company's compensation program and Mr. Hrudka's compensation are
contingent on Company performance, and that realization of benefits is closely
linked to achievement of key corporate objectives that will produce increases in
long-term stockholder value. The Company is committed to the philosophy of pay
for performance, recognizing that the competitive market for talented executives
and the volatility of the Company's business may result in highly variable
compensation for a particular time period. The Board will continue to monitor
closely the effectiveness and appropriateness of each of the components of
compensation to reflect changes in the Company's business environment.
Mr. Hrudka has assumed the position of president of Performance Restaurants
Group, Inc. in 1994. In addition, he has been responsible for locating and
evaluating new locations and concepts for the restaurant subsidiary, as well as
bearing responsibility for the renovation of the existing locations. As a result
of the increased responsibilities undertaken for this subsidiary, which
contributes the most revenue to the Company, the Board has increased Mr.
Hrudka's base salary in the late 1994.
The Board did not increase salaries overall for the executive officers. While
the Company's performance has increased significantly, the Board felt the
current cash flow could not absorb increases in compensation at the executive
level. The Board will review executive salaries upon an improvement in cash flow
and the anticipated increase in duties due to expansion of each officer's
responsibilities.
f. Vote Required; Board Recommendation
THE ELECTION OF MESSRS. HRUDKA, FOCHTMAN, HAIRE, TRATT, AND BROWN, WILL
REQUIRE THE AFFIRMATIVE VOTE OF THE HOLDERS OF A MAJORITY OF THE SHARES PRESENT
OR REPRESENTED BY PROXY AT THE ANNUAL MEETING.
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS A VOTE "FOR" THE
ELECTION OF MESSRS. HRUDKA, FOCHTMAN, HAIRE, TRATT, AND BROWN. PROXIES SOLICITED
BY THE BOARD WILL BE SO VOTED UNLESS SHAREHOLDERS SPECIFY OTHERWISE IN THEIR
PROXIES. ABSTENTIONS AND BROKER NON-VOTES, IF ANY, WILL BE TREATED AS A VOTE
"AGAINST" THE ELECTION OF MESSRS. HRUDKA, FOCHTMAN, HAIRE, TRATT, AND BROWN. THE
COMPANY WILL TABULATE ALL PROXIES AND HAS NOT RETAINED AN INDEPENDENT INSPECTOR
OF ELECTIONS.
ITEM NO. 2. RATIFICATION AND APPOINTMENT OF INDEPENDENT
PUBLIC ACCOUNTANTS
PROPOSAL: SHOULD THE SELECTION BY THE BOARD OF DIRECTORS OF TOBACK CPA's, P.C.
AS INDEPENDENT PUBLIC ACCOUNTANTS FOR THE COMPANY BE APPROVED?
The certified public accounting firm of Toback CPAs, P.C. ("Toback"),
has been selected to audit the Company's and its subsidiaries' accounts for
1995. Representatives of Toback may be present at the Annual Meeting and may
make a statement if desired to do so and will be available to respond to
appropriate questions.
a. Background
Prior to 1993, the certified public accounting firm of Deloitte &
Touche was responsible for the audit of the Company's and its subsidiaries'
accounts. Deloitte & Touche was dismissed by the Company through the Board of
Directors on September 16, 1993. The dismissal was approved by the Board of
Directors because Toback's services were expected to be more cost effective than
the services of Deloitte & Touche. The dismissal of Deloitte & Touche was not a
result of any disagreement with the Company's former accountants.
During the Company's two most recent fiscal years there were no
disagreements with the former accountants on any matter of accounting principles
or practices, financial statement disclosure, or auditing scope or procedure,
which disagreement(s), if not resolved to the satisfaction of the former
accountants, would have caused it to make a reference to the subject matter of
the disagreement(s) in connection with any of its reports.
During the Company's two most recent fiscal years none of the
reportable events described in Item 304(a)(1)(v) of Regulation S-K occurred.
Toback was not engaged as either the principal accountants to audit the
Company's financial statement or as independent accountants to audit a
significant subsidiary; however, it did assist the Company in preparing the
financial disclosures set forth in the June 30,1993 Form 10-Q and provide
related advice to the preparation of the Form 10-Q.
b. Vote Required; Board Recommendation
THE RATIFICATION AND APPOINTMENT OF TOBACK CPA's P.C., AS THE COMPANY'S
INDEPENDENT PUBLIC ACCOUNTANTS FOR THE 1995 FISCAL YEAR WILL REQUIRE THE
AFFIRMATIVE VOTE OF THE HOLDERS OF A MAJORITY OF THE SHARES PRESENT OR
REPRESENTED BY PROXY AT THE ANNUAL MEETING.
THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS A "YES" VOTE FOR THE
RATIFICATION AND APPOINTMENT OF TOBACK CPAs, P.C., AS THE COMPANY'S INDEPENDENT
PUBLIC ACCOUNTANTS FOR THE 1995 FISCAL YEAR. ABSTENTIONS AND BROKER NON-VOTES,
IF ANY, WILL BE TREATED AS NO VOTES.
ITEM NO. 3 OTHER MATTERS
The Board of Directors of the Company does not intend to bring any
other matters to vote before the Annual Meeting, and it knows of no other
proposal to be presented at the Annual Meeting by others. If other matters
properly come before the meeting, it is the intention of the persons named in
the accompanying Proxy to vote the Proxy in accordance with their best judgment
on that matter.
ANNUAL REPORT
The Company's December 31, 1994 annual report on Form 10-K, as filed
with the Securities Exchange Commission, accompanies this Proxy Statement. The
annual report does not form part of the material for the solicitation of
proxies. Additional copies may be obtained by writing to the Company at 2425 E.
Camelback Road, Suite 620, Phoenix, Arizona 85016 or by calling Robert A.
Cassalia at 602-912-0100.
DATED: May 12, 1995, Phoenix, Arizona
by Order of the Board of Directors
<PAGE>
PROXY
COMMON SHARES
PERFORMANCE INDUSTRIES, INC.
ANNUAL MEETING OF SHAREHOLDERS - JUNE 5, 1995
SOLICITED BY THE BOARD OF DIRECTORS
The undersigned shareholder of Performance Industries, Inc., an Ohio
corporation ("Company") does hereby constitute and appoint Robert A. Cassalia
and James W. Brown, or either one of them, or such other persons as the Board of
Directors of the Company may designate, proxies for the undersigned with full
power of substitution, to represent the undersigned and to vote all of the
common shares of the Company, which the undersigned is entitled to vote at the
Annual Meeting of Shareholders of the Company to be held on June 5, 1995 at 9:30
a.m., PDST, at the Bobby McGee's Restaurant (Crown Sterling Suites), 150 Anza
Boulevard, Burlingame, California, and any and all adjournments thereof.
1. Election of Directors.
SHOULD THE FOLLOWING NOMINEES BE APPROVED AS DIRECTORS OF THE
COMPANY: JOE HRUDKA, ED FOCHTMAN, JR., ALLEN L. HAIRE, JONATHAN TRATT AND
JAMES W. BROWN?
/ / FOR all nominees listed above except as marked to the
contrary.
/ / WITHHOLD AUTHORITY to vote for all nominees listed above.
/ / ABSTAIN
INSTRUCTION: TO WITHHOLD AUTHORITY TO VOTE FOR ANY NOMINEE, STRIKE A LINE
THROUGH THE NOMINEE'S NAME IN THE ABOVE LIST.
2. Accountants.
SHOULD THE SELECTION BY THE BOARD OF DIRECTORS OF TOBACK CPA's, P.C. AS
INDEPENDENT PUBLIC ACCOUNTANTS FOR THE COMPANY BE APPROVED?
FOR AGAINST ABSTAIN
/ / / / / /
3. Other Matters.
IN THEIR DISCRETION, TO VOTE ON SUCH OTHER MATTERS AS MAY PROPERLY COME
BEFORE THE MEETING, BUT WHICH ARE NOT NOW ANTICIPATED, TO VOTE FOR THE
ELECTION OF ANY PERSON AS A DIRECTOR SHOULD ANY PERSON NAMED IN THE PROXY
STATEMENT TO BE ELECTED BE UNABLE TO SERVE OR FOR GOOD CAUSE CANNOT SERVE,
AND TO VOTE UPON MATTERS INCIDENT TO THE CONDUCT OF THE MEETING.
FOR AGAINST ABSTAIN
/ / / / / /
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS AND WILL BE
VOTED AS DIRECTED HEREIN. IF NO DIRECTION IS GIVEN, THIS PROXY WILL BE
VOTED FOR THE PERSONS NAMED IN PROPOSAL 1 AND FOR PROPOSAL 2.
Dated , 1995
-----------------------------
Phone No.
---------------------------------
------------------------------------------
(Signature of Shareholder)
------------------------------------------
(Signature of Shareholder)
Please sign exactly as your name appears on the envelope in which this
material was mailed. Agents, executives, administrators, guardians and trustees
must give full title as such. Corporations should sign by their presidents or
authorized officer. Partnerships should sign in the Partnership name by an
authorized person. If shares are held in the name or two more persons, all
should sign.
