<PAGE>
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 Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
P & F INDUSTRIES, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2)
or Item 22(a)(2) of 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 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:
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Notes:
<PAGE>
P&F INDUSTRIES, INC.
300 SMITH STREET
FARMINGDALE, NEW YORK 11735
----------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 22, 1996
----------------
To the Stockholders of P & F Industries, Inc.:
The Annual Meeting of Stockholders of P & F Industries, Inc. will be held at
the Huntington Hilton Hotel, 598 Broad Hollow Road, Melville, New York on
Wednesday, May 22, 1996 at 10:00 A.M., for the following purposes:
(1) To elect three directors to hold office for three years;
(2) To ratify the selection of BDO Seidman, LLP, independent certified
public accountants, as auditors for the fiscal year ending December 31,
1996; and
(3) To consider and act upon such other business as may properly come
before the meeting or any adjournment or postponement thereof.
Only stockholders of record at the close of business on April 24, 1996 are
entitled to notice of and to vote at the meeting, and any adjournment or
postponement thereof.
By order of the Board of Directors,
LEON D. FELDMAN
Secretary
Dated: April 26, 1996
Farmingdale, New York
IMPORTANT--PLEASE SIGN THE ENCLOSED PROXY AND MAIL IT PROMPTLY IN THE POSTPAID
RETURN ENVELOPE PROVIDED, PARTICULARLY IF YOU DO NOT EXPECT TO
ATTEND THE MEETING IN PERSON.
<PAGE>
P&F INDUSTRIES, INC.
300 SMITH STREET
FARMINGDALE, NEW YORK 11735
----------------
PROXY STATEMENT
This proxy statement is furnished in connection with the solicitation of
proxies by the Board of Directors of P & F Industries, Inc. (the "Company") to
be used at the meeting of stockholders of the Company (the "Annual Meeting") to
be held on Wednesday, May 22, 1996 at 10:00 A.M., at the Huntington Hilton
Hotel, 598 Broad Hollow Road, Melville, New York, or at any adjournment or
postponement thereof, for the purposes set forth in the accompanying notice of
Annual Meeting of Stockholders. If the enclosed form of proxy is executed and
returned, it may nevertheless be revoked at any time before it is exercised,
either in person at the Annual Meeting or by written notice or by a duly
executed proxy, bearing a later date, sent to the Secretary of the Company. The
Company anticipates mailing this proxy statement and the accompanying proxy to
stockholders on or about April 26, 1996.
As of April 2, 1996, there were 2,928,867 shares of the Company's Class A
Common Stock, $1.00 par value (the "Class A Common Stock"), outstanding. Each
share of Class A Common Stock is entitled to one vote. Only holders of record
of Class A Common Stock at the close of business on April 24, 1996 will be
entitled to notice of, and to vote at, the Annual Meeting. The Company will
bear the cost of the Annual Meeting and the cost of soliciting proxies,
including the cost of mailing the proxy material. In addition to solicitation
by mail, directors, officers and regular employees of the Company (who will not
be specifically compensated for such service) may solicit proxies by telephone
or otherwise.
All proxies received pursuant to this solicitation will be voted, except as
to matters where authority to vote is specifically withheld and, where a choice
is specified as to the proposal, such proxies will be voted in accordance with
such specification. If no instructions are given, the persons named in the
proxy solicited by the Board of Directors of the Company intend to vote for the
nominees for election as directors of the Company herein and for the
confirmation of the appointment of BDO Seidman, LLP as independent certified
public accountants of the Company for the fiscal year ending December 31, 1996.
If any other matter should be presented at the Annual Meeting upon which a vote
may properly be taken, the shares represented by the proxy will be voted with
respect thereto at the discretion of the person or persons holding such proxy.
For purposes of determining whether a proposal has received the required number
of votes for approval, abstentions will be included in the vote totals with the
result that an abstention has the same effect as a negative vote. In instances
where nominee recordholders, such as brokers, are prohibited from exercising
discretionary authority for beneficial owners who have not returned a proxy
("broker non-votes"), those shares of Class A Common Stock will not be included
in the vote totals and, therefore, will have no effect on the vote. If a quorum
should not be present, the Annual Meeting may be adjourned from time to time
until a quorum is obtained.
<PAGE>
ELECTION OF DIRECTORS
The Company's By-Laws provide for three classes of directors, as nearly equal
in number as possible, with three-year terms of office expiring in three
successive years. A director elected to fill a vacancy serves for the remaining
term of the class in which the vacancy exists. The Board of Directors presently
consists of seven members, with two members in each of two classes and three
members in the third class.
Management proposes that Messrs. Robert L. Dubofsky, Leon D. Feldman and Marc
A. Utay, whose terms of office expire in 1996, be re-elected as directors to
serve for terms to expire at the 1999 annual meeting of stockholders. Unless
otherwise indicated, the enclosed proxy will be voted for the election of such
nominees. Should any one or more of these nominees become unable to serve for
any reason, or for good cause, will not serve, which is not anticipated, the
Board of Directors may, unless the Board by resolution provides for a lesser
number of directors, designate substitute nominees, in which event the persons
named in the enclosed proxy will vote for the election of such substitute
nominee or nominees.
Directors will be elected by the plurality vote of the holders of the Class A
Common Stock entitled to vote at the Annual Meeting and present in person or by
proxy.
THE BOARD OF DIRECTORS RECOMMENDS THAT STOCKHOLDERS VOTE "FOR"
THE FOREGOING NOMINEES.
INFORMATION AS TO DIRECTORS AND NOMINEES FOR DIRECTORS
Set forth below is the name and age of each nominee for director and each
director currently in office and whose term continues, his principal
occupation, the year each became a director of the Company and a description of
his principal occupation for the past five years. The information set forth
below is as of April 24, 1996.
<TABLE>
<CAPTION>
YEAR FIRST
NAME PRINCIPAL OCCUPATION AGE ELECTED DIRECTOR
---- -------------------- --- ----------------
<S> <C> <C> <C>
NOMINEES TO SERVE UNTIL THE AN-
NUAL MEETING
IN 1999:
Robert L. Dubofsky............. Insurance Broker 56 1990
Leon D. Feldman................ Executive Vice-President, 66 1967
Secretary and Treasurer
Marc A. Utay................... Investment Banker 36 1992
DIRECTORS WHOSE TERMS EXPIRE AT
THE ANNUAL MEETING IN 1997:
Sidney Horowitz................ Chairman Emeritus of the 75 1962
Board of Directors and
Former CEO
Arthur Hug, Jr................. Retired Bank Chairman 73 1987
and Former Investment
Banker
DIRECTORS WHOSE TERMS EXPIRE AT
THE ANNUAL MEETING IN 1998:
Richard A. Horowitz............ Chairman of the Board of 46 1975
Directors, CEO and
President
Earle K. Moore................. Attorney 74 1987
</TABLE>
2
<PAGE>
Robert L. Dubofsky has been Managing Director of BWD Group Limited (formerly
Blumencranz, Klepper, Wilkins & Dubofsky, Ltd.), an insurance brokerage group,
since April 1992. From 1985 until March 1992, Mr. Dubofsky was Senior Vice-
President of Alexander & Alexander of New York, Inc., an insurance brokerage
firm.
Leon D. Feldman has been Treasurer of the Company since 1967, Executive Vice-
President since 1981 and Secretary since 1986, and was Vice President from 1968
until 1981.
Richard A. Horowitz has been Chairman of the Board of Directors since
November 1995, has been President of the Company since 1986, was President of
the Company's subsidiary, Embassy Industries, Inc., from 1976 until 1993, and
was Secretary and Vice President from 1981 until 1986.
Sidney Horowitz has been Chairman Emeritus of the Board of Directors since
November 1995, was Chairman of the Board of Directors and Chief Executive
Officer from 1968 until November 1995, was President from 1978 until 1986 and
from 1962 until 1968, and was Treasurer from 1962 until 1967.
Arthur Hug, Jr., who is retired, was the President of Vanguard Ventures, Inc.
from 1987 until 1989, and was Chairman of North American Bancorp from 1974
until 1987.
Earle K. Moore is counsel to and a former member of the law firm of Bondy &
Schloss, which was general counsel to the Company from 1990 until 1992. Mr.
Moore was a member of the former law firm of Moore, Berson, Lifflander,
Eisenberg & Mewhinney, which was general counsel to the Company from 1968 until
1990.
Marc A. Utay has been a Managing Director of Wasserstein Perella Co., Inc.,
an investment banking firm, since May 1993. From October 1991 until May 1993,
Mr. Utay was a Managing Director of BT Securities Corporation, a subsidiary of
Bankers Trust New York Corporation. From April 1990 until October 1991, Mr.
Utay was a Managing Partner of Kent Capital Partners, Inc., an investment firm.
Mr. Utay was with Drexel Burnham Lambert, Inc. from 1983 until March 1990 in
various positions, the last of which was as a First Vice-President in the
Mergers and Acquisitions division.
OWNERSHIP OF EQUITY SECURITIES
The following table shows the beneficial ownership of Class A Common Stock as
of April 2, 1996, including shares as to which a right to acquire beneficial
ownership within 60 days exists (for example, through the exercise of stock
options) within the meaning of Rule 13d-3(d)(1) under the Securities Exchange
Act of 1934 (the "Exchange Act"), by (i) each director and nominee for
director, (ii) the chief executive officer, (iii) the other executive officers
who are listed in the Summary Compensation Table, (iv) each person known by the
Company to be the beneficial owner of more than 5% of its Class A Common Stock
and (v) all executive officers and directors as a group. Except as indicated in
the applicable footnotes, each beneficial owner listed has sole voting power
and sole investment power over the shares of Class A Common Stock indicated.
3
<PAGE>
<TABLE>
<CAPTION>
SHARES OF CLASS A
COMMON STOCK PERCENT
BENEFICIALLY OWNED OF
NAME APRIL 2, 1996 CLASS
- ---- ------------------ -------
<S> <C> <C>
Sidney Horowitz(1)(2)................................ 293,875(3) 9.8%
Richard A. Horowitz(1)(2)............................ 967,800(4) 31.4%
Leon D. Feldman(1)................................... 214,000(5) 6.8%
Earle K. Moore....................................... -- --
Robert L. Dubofsky................................... 20,000 (6)
Arthur Hug, Jr....................................... 1,000 (6)
Marc A. Utay......................................... 70,000(7) 2.3%
Steel Partners II(8)................................. 435,000 14.9%
All directors and officers as a group (7 persons).... 1,566,675(9) 45.6%
</TABLE>
- --------
(1) The address of each of Sidney Horowitz, Richard A. Horowitz and Leon D.
Feldman is in care of the Company, 300 Smith Street, Farmingdale, New York
11735.
(2) Sidney Horowitz is the father of Richard A. Horowitz.
(3) Includes 99,988 shares owned by Grace Horowitz, wife of Sidney Horowitz,
individually and as trustee for their daughter, and 400 shares owned by the
Sidney and Grace Horowitz Foundation, as to all of which Sidney Horowitz
disclaims beneficial ownership, and 85,000 shares issuable upon the
exercise of stock options.
(4) Includes 22,400 shares owned by Linda Horowitz, wife of Richard A.
Horowitz, individually and as Trustee for their daughter, and 660,000
shares owned by Linda Horowitz, individually, as to all of which Richard A.
Horowitz disclaims beneficial ownership. Linda Horowitz has granted to her
husband, Richard A. Horowitz, a ten year irrevocable proxy to vote the
660,000 shares. Includes 150,000 shares issuable upon the exercise of stock
options.
(5) Includes 200,000 shares issuable upon the exercise of stock options and
14,000 shares held by the Feldman Family Living Trust.
(6) Less than 1%.
(7) Includes warrants to purchase 70,000 shares.
(8) The number of shares held is shown as reported in Steel Partners II's
Schedule 13D, as amended, as filed with the Securities and Exchange
Commission. Steel Partners II's address is 750 Lexington Avenue, 27th
Floor, New York, New York 10022.
(9) Includes 505,000 shares issuable upon the exercise of stock options and
warrants.
MEETINGS OF THE BOARD OF DIRECTORS AND COMMITTEES AND DIRECTOR COMPENSATION
During 1995, the Board of Directors held three meetings and each director
attended all meetings, except that Mr. Robert L. Dubofsky missed one meeting.
The Board of Directors has an Audit Committee and a Stock Option Committee, the
current members of each of which are Messrs. Arthur Hug, Jr., Earle K. Moore
and Robert L. Dubofsky. The Audit Committee recommends the selection of
independent auditors to the Board of Directors, reviews the overall scope and
the results of the annual audit and reviews the overall internal controls of
the Company. During 1995, the Audit Committee met once and each committee
member attended the meeting. The Stock Option Committee administers the Stock
Option Plan. During 1995, the Stock Option Committee met once and each
committee member attended the meeting. The Board does not have a nominating or
a compensation committee or a committee performing similar functions.
4
<PAGE>
Each director who was not an employee of the Company or any of its
subsidiaries received fees of $3,500 per year plus $1,250 per each meeting of
the Board of Directors or Audit Committee attended. Directors who are also
officers of the Company are not compensated for their duties as directors.
EXECUTIVE COMPENSATION
The following table shows the compensation for the past three fiscal years of
the chief executive officer and each of the other most highly compensated
executive officers whose aggregate compensation exceeded $100,000.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION
ANNUAL COMPENSATION AWARDS
----------------------------------- ---------------
OTHER ANNUAL SECURITIES
NAME AND PRINCIPAL FISCAL SALARY BONUS COMPENSATION UNDERLYING ALL OTHER
OCCUPATION YEAR ($) ($)(1) ($)(2) OPTIONS/SARS(#) COMPENSATION($)(3)
- ------------------ ------ ------- ------- ------------ --------------- ------------------
<S> <C> <C> <C> <C> <C> <C>
Richard A. Horowitz..... 1995 385,000 184,000 -- -- 10,800
Chairman and 1994 353,100 158,000 -- 250,000 10,800
President 1993 321,000 125,000 -- -- 17,667
Sidney Horowitz......... 1995 229,167 128,000 -- 50,000(4) 10,800
Chairman Emeritus 1994 321,458 110,000 -- -- 10,800
1993 315,000 87,000 -- 35,000 17,667
Leon D. Feldman......... 1995 275,000 100,000 -- -- 10,800
Executive 1994 261,450 86,000 -- -- 10,800
Vice-President 1993 249,000 68,000 -- -- 17,667
</TABLE>
- --------
(1) The Company has an incentive compensation bonus plan (the "Bonus Plan").
Under the terms of the Bonus Plan, the total bonuses paid to executive
officers may not exceed 15% of the Company's pre-tax, pre-bonus income
prior to the payment under the Bonus Plan. Allocations to the individuals
set forth above are made at the discretion of the Board of Directors.
Amounts are accrued in the year shown above and paid in the following year.
In 1993, the bonus compensation paid under the Bonus Plan to the named
executive officers was calculated based on the pre-tax, pre-bonus income of
the Company's continuing operations after allocating corporate overhead to
the Company's discontinued operations.
(2) No amounts for executive perquisites and other personal benefits are shown
because the aggregate dollar amount per executive is the lesser of either
$50,000 or 10% of annual salary and bonus.
(3) This category includes Company contributions to the retirement plan which
is a defined contribution plan (the "Plan"). The Plan covers all employees
who do not receive pension benefits under a collective bargaining
agreement, have been in the employ of the Company for at least one year and
are at least 21 years of age. For 1995 and 1994, the contributions paid by
the Company were 5% of the first $40,000 of each employee's salary and 8%
of the balance up to $150,000; for 1993, the contributions paid by the
Company were 5% of the first $40,000 of each employee's salary and 8% of
the balance up to $235,840. Upon leaving the Company, an employee may
receive a lump sum payment of all amounts vested for him under the Plan,
including earnings thereon.
(4) These options were granted to Sidney Horowitz prior to his retirement as
Chairman of the Board of Directors and Chief Executive Officer of the
Company.
5
<PAGE>
STOCK OPTION GRANTS
The following table shows information concerning options to purchase Class A
Common Stock granted in 1995 to the executive officers who are set forth in the
Summary Compensation Table.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZED
VALUE AT ASSUMED
RATES OF STOCK PRICE
APPRECIATION FOR
INDIVIDUAL GRANTS OPTION TERM(3)
----------------------------------------------- ---------------------
NUMBER OF
SECURITIES % OF TOTAL
UNDERLYING OPTIONS
OPTIONS GRANTED TO EXERCISE OR
GRANTED EMPLOYEES IN BASE PRICE EXPIRATION
NAME (#)(1) FISCAL YEAR ($/SH) DATE 5% 10%
---- ---------- ------------ ----------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Richard A. Horowitz..... -- -- -- -- -- --
Sidney Horowitz......... 50,000 100% $2,6125(2) 7/12/00 $32,808 $72,498
Leon D. Feldman......... -- -- -- -- -- --
</TABLE>
- --------
(1) Options were granted pursuant to the Company's 1992 Incentive Stock Option
Plan, as amended. The Stock Option Plan is administered by the Stock Option
Committee which authorizes the issuance of options to key employees of the
Company at exercise prices not less than the fair market value at the date
of grant (market price plus 10% in the case of 10% stockholders).
(2) The market price of the Class A Common Stock on the date of the grant on
July 12, 1995 was $2.375.
(3) Based on the market price on the date of the grant and an annual
appreciation at the rate stated of such market price through the expiration
date of such options. The dollar amounts under these columns are the result
of calculations at 5% and 10% rates set by the Securities and Exchange
Commission and therefore are not intended to forecast possible future
appreciation, if any, of the Company's stock price.
AGGREGATED OPTION EXERCISES AND OPTION VALUES
The following table shows information concerning the exercise of stock
options during 1995 by the executive officers set forth in the Summary
Compensation Table and the fiscal year-end value of unexercised options.
AGGREGATED OPTION/SAR EXERCISES IN THE LAST FISCAL YEAR AND FISCAL YEAR END
OPTION/SAR VALUES
<TABLE>
<CAPTION>
NUMBER OF VALUE OF
UNEXERCISED UNEXERCISED
OPTIONS/SAR'S IN-THE-MONEY
AT OPTIONS/SAR'S
FISCAL YEAR AT FISCAL
END(#) YEAR END ($)
--------------- -------------
SHARES
ACQUIRED ON VALUE EXERCISABLE/ EXERCISABLE/
NAME EXERCISE # REALIZED UNEXERCISABLE UNEXERCISABLE
---- ----------- -------- --------------- -------------
<S> <C> <C> <C> <C>
Richard A. Horowitz.......... -- -- 100,000/150,000 38,100/57,150
Sidney Horowitz.............. -- -- 73,000/12,000 27,781/0
Leon D. Feldman.............. -- -- 200,000/0 156,250/0
</TABLE>
6
<PAGE>
COMPENSATION REPORT ON EXECUTIVE COMPENSATION
The Company does not have a compensation committee. The Board of Directors
reviews the annual compensation of the Company's executive officers. Each
executive officer's compensation includes salary and a performance bonus.
During the fiscal year ending December 31, 1995, the three executive officers
of the Company, Sidney Horowitz, Richard A. Horowitz and Leon D. Feldman, were
covered by these provisions. As discussed below, Sidney Horowitz was an
executive officer through October 31, 1995.
Each of the Company's executive officers have employment agreements with the
Company. Richard A. Horowitz and Leon D. Feldman entered into employment
agreements with the Company in November 1989 which would have expired in
November 1996. In September 1993, the Company extended their employment
agreements so that they now expire in September 2000 with respect to Richard
Horowitz and September 1998 with respect to Leon D. Feldman. The employment
agreements provide for annual salaries, subject to annual increases at the
discretion of the Board of Directors (the executive officers do not vote on the
salary increases). The employment agreements of each of Richard A. Horowitz and
Leon D. Feldman also provide that upon "discharge" after a "change in control"
(each as defined in the respective agreements), each will receive his annual
salary for the remainder of the term of his employment agreement or a lump sum
severance payment in an amount equal to 2.99 times his annual compensation. The
Board of Directors takes into consideration the following factors in
determining the executive officers' compensation levels for the ensuing fiscal
year: the individual officer's job performance and level of responsibility,
prior years' compensation, number of years of employment with the Company and
the rate of inflation. Aggregate increases for 1995 for Richard A. Horowitz and
Leon D. Feldman were 7.4%.
Sidney Horowitz entered into an employment agreement, dated as of September
30, 1993, with the Company which provided for him to continue as the Company's
Chairman until November 1994 and thereafter as a consultant to the Company for
a three year period. As of November 1, 1994, the Company entered into a new
employment agreement with Sidney Horowitz which provided for him to continue as
the Company's Chairman through October 31, 1995 and thereafter as a consultant
to the Company for a three year period. As of November 1, 1995, the Company
entered into a consulting agreement with Sidney Horowitz which provides for him
to be a consultant to the Company for a three year period terminating on
October 31, 1998 and to receive a consulting fee of $200,000 per annum. The
Company purchased 192,000 incentive stock options held by Sidney Horowitz for
$163,200, which amount represented the product of 192,000 and the difference
between the market price of a share of Class A Common Stock at the time of the
determination by the Company's Board of Directors and the exercise price per
option.
In 1986, the Company established the Bonus Plan for its executive officers
that provides for the payment of a cash bonus not to exceed, in the aggregate,
15% of the Company's pre-tax, pre-bonus income.
Members of the Board of Directors
Robert Dubofosky Arthur Hug, Jr.
Leon D. Feldman Earle K. Moore
Richard A. Horowitz (Chairman) Marc A. Utay
Sidney Horowitz
PERFORMANCE GRAPH
The following page contains a line graph which compares the five-year
cumulative return of the Class A Common Stock to the total returns of the Nasdaq
Stock Market (U.S.A.) Index and a composite group comprised of companies with
approximately the same market capitalization as the Company for the fiscal year
ended December 31, 1992. Such composite group was used because the Company,
through its three subsidiaries, engages in several different lines of businesses
and an applicable peer group does not
7
<PAGE>
exist. In addition to the Company, the following companies are included in the
index: Driver Harris Co. Inc., Energy West, Inc., Halsey Drug Corp., Harris &
Harris Group, Inc., Leisure Concepts, Inc., Presidential Realty Corp., TSR,
Inc. and Wendi-Bristol Health Corp. Supradur Manufacturing Corp., which was
included in the index located in the Company's 1995 proxy statement, has been
omitted because the necessary information is no longer publicly available. Each
case assumes a $100 investment on January 1, 1990 and reinvestment of any
dividends. Cumulative returns are at December 31 of each year.
This page contains a line graph in which the Y axis represents dollars and the X
- -
axis represents dates beginning with December 31, 1990. The values are listed on
the following tables:
<TABLE>
<CAPTION>
12/31/90 12/31/91 12/31/92 12/31/93 12/31/94 12/31/95
<S> <C> <C> <C> <C> <C> <C>
P & F Industries, Inc. 100 100 71 100 121 136
Peer Group 100 163 235 257 175 216
Nasdaq 100 159 186 215 210 295
</TABLE>
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Exchange Act requires the Company's directors and
executive officers, and persons who own more than 10% of a registered class of
the Company's equity securities, to file with the Securities and Exchange
Commission (the "Commission") initial reports of ownership and reports of
changes in ownership of Class A Common Stock and other equity securities of the
Company. Officers, directors and greater than 10% stockholders are required by
the Commission to furnish the Company with copies of all Section 16(a) forms
they file.
To the Company's knowledge, based solely on a review of the copies of such
reports furnished to the Company or written representations that no other
reports were required, all Section 16(a) filing requirements applicable to its
officers, directors and greater than 10% beneficial owners were complied with
during, or in respect of, the fiscal year ended December 31, 1995, except that
a Form 4 and a Form 5 relating to Sidney Horowitz were not filed in a timely
manner.
RELATED TRANSACTIONS
In October 1992, the Company made an unsecured loan to Mr. Richard A.
Horowitz, evidenced by a promissory note (the "Note") in the amount of
$125,000, for the purchase by Mr. Horowitz of Class A Common Stock from an
unaffiliated third party. The Note is payable on demand and bears interest at
the annual rate charged by the Company's lender at the time the Note was
issued. As of April 15, 1996, the outstanding principal balance of such Note
was $40,000.
8
<PAGE>
In October and November 1995, the Company entered into certain arrangements
with Sidney Horowitz. See "Compensation Report on Executive Compensation" for a
description of such arrangements.
SELECTION OF AUDITORS
BDO Seidman, LLP has audited the financial statements of the Company since
1963. The Board of Directors, upon the recommendation of its Audit Committee,
has selected BDO Seidman, LLP as independent certified public accountants for
the Company, to audit and report upon the consolidated financial statements for
the 1996 fiscal year, and the Board is submitting this matter to the
stockholders for their ratification. The affirmative vote of a majority of the
shares of Class A Common Stock present or represented and entitled to vote on
the proposal at the Annual Meeting is required for the ratification of the
selection of BDO Seidman, LLP. Representatives of BDO Seidman, LLP are expected
to be present at the Annual Meeting, to make a statement if they desire to do
so and to be available to respond to appropriate questions that may be asked by
stockholders.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE STOCKHOLDERS VOTE "FOR" THE APPROVAL
OF THE SELECTION OF BDO SEIDMAN, LLP AS INDEPENDENT CERTIFIED PUBLIC
ACCOUNTANTS.
STOCKHOLDER PROPOSALS AND NOMINATIONS FOR DIRECTOR
Stockholder proposals intended for inclusion in the proxy material for the
1997 Annual Meeting of Stockholders, and nominations for director to be elected
at the 1997 Annual Meeting of Stockholders, each must be received by the
Secretary of the Company at the Company's offices at 300 Smith Street,
Farmingdale, New York 11735 not prior to October 28, 1996 and not later than
December 27, 1996 in order for such proposals and nominations to be included in
the proxy materials for the 1997 Annual Meeting of Stockholders. Any
stockholder interested in making a proposal or nominating a director is
referred to the Company's By-laws.
ADDITIONAL INFORMATION AND OTHER MATTERS
A copy of the Company's Form 10-K for the fiscal year ended December 31, 1995
as filed with the Commission may be obtained free of charge by writing to the
Company, 300 Smith Street, Farmingdale, New York 11735; Attention: Secretary of
the Company.
The management is not aware of any matters to be presented for action at the
Annual Meeting other than the matters mentioned above, and does not intend to
bring any other matters before the Annual Meeting. However, if any other
matters should come before the Annual Meeting, it is intended that the holders
of the proxies will vote them in their discretion.
By order of the Board of Directors,
LEON D. FELDMAN
Secretary
Date: April 26, 1996
9
