<PAGE> 1
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:
<TABLE>
<S> <C>
/ / 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 Rule 14a-11(c) or Rule 14a-12
</TABLE>
Sound Advice, 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), or 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:
<PAGE> 2
SOUND ADVICE, INC.
1901 TIGERTAIL BOULEVARD
DANIA, FLORIDA 33004
________________________________________
Notice of Annual Meeting of Shareholders
to be held February 15, 1996
________________________________________
To Our Shareholders:
The 1995 Annual Meeting of Shareholders of Sound Advice, Inc. (the
"Company") will be held on Thursday, February 15, 1996, at 10:00 a.m., local
time, at The Westin Hotel Cypress Creek, 400 Corporate Drive, Fort Lauderdale,
Florida 33334, for the following purposes:
1. To elect directors; and
2. To transact such other business as may properly come before
the meeting or any postponement or adjournment thereof.
The Board of Directors has fixed Wednesday, January 3, 1996, as the
record date for the determination of shareholders entitled to vote at the 1995
Annual Meeting of Shareholders. Only shareholders of record at the close of
business on that date will be entitled to notice of, and to vote at, the
meeting or any postponement or adjournment thereof.
Copies of the Company's Proxy Statement and annual report for the year
ended June 30, 1995 accompany this notice.
You are cordially invited to attend the meeting in person. Whether or
not you expect to attend the meeting in person, you are urged to sign and date
the enclosed proxy and return it promptly in the envelope provided for that
purpose.
By Order of the Board of Directors
/s/ Michael Blumberg
--------------------
Michael Blumberg
Secretary
Dania, Florida
January 19, 1996
<PAGE> 3
SOUND ADVICE, INC.
1901 TIGERTAIL BOULEVARD
DANIA, FLORIDA 33004
PROXY STATEMENT
INTRODUCTION
GENERAL
This proxy statement, which together with the accompanying proxy card
is first being mailed to shareholders on or about January 22, 1996, is
furnished to the shareholders of the Company in connection with the
solicitation of proxies by the Board of Directors of the Company for use in
voting at the 1995 Annual Meeting of Shareholders, including any adjournment or
postponement thereof.
Proxies in the form enclosed, if properly executed and received in
time for voting, and not revoked, will be voted as directed in accordance with
the instructions thereon. In voting by proxy in regard to the election of six
directors to serve until the 1996 annual meeting of shareholders, shareholders
may vote in favor of all nominees or withhold their votes as to all or as to
any specific nominees. Any properly executed and timely received proxy not so
directing or instructing to the contrary will be voted FOR each of the
Company's nominees as directors. See "ELECTION OF DIRECTORS." Sending in a
signed proxy will not affect a shareholder's right to attend the meeting and
vote in person since the proxy is revocable. Any shareholder giving a proxy
may revoke it at any time before it is voted at the meeting by, among other
methods, giving notice of such revocation to the Secretary of the Company,
attending the meeting and voting in person or by duly executing and returning a
proxy bearing a later date.
The cost of this solicitation will be borne by the Company. In
addition to solicitation by mail, proxies may be solicited in person or by
telephone, telegraph or other means by officers and/or regular employees of the
Company without additional compensation or remuneration therefor. Arrangements
have also been made with brokers, dealers, banks, voting trustees and other
custodians, nominees and fiduciaries to forward proxy materials and annual
reports to the beneficial owners of the shares held of record by such persons,
and the Company will, upon request, reimburse them for their reasonable
expenses in so doing.
The management knows of no other matters to be presented for action at
the meeting other than as mentioned herein. However, if any other matters come
before the meeting, it is intended that the holders of the proxies will vote
thereon in their sole discretion.
A copy of the Company's annual report for the fiscal year ended June
30, 1995 (which has included therein audited consolidated financial statements
for the Company for the fiscal years ended June 30, 1993, 1994 and 1995) is
being mailed to the Company's shareholders together with this Proxy Statement.
Such annual report is not, however, incorporated into this Proxy Statement nor
is it to be deemed a part of the proxy soliciting material.
<PAGE> 4
VOTING SECURITIES
At the close of business on Wednesday, January 3, 1996, the record
date for the determination of shareholders entitled to receive notice of and to
vote at the meeting, the Company's outstanding voting securities consisted of
3,728,894 shares of Common Stock, par value $0.01 per share. Holders of Common
Stock are entitled to one vote per share.
SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT
The following table sets forth certain information regarding the
beneficial ownership of the Company's Common Stock, as of January 3, 1996, by
(i) each person who is known by the Company to own beneficially more than 5% of
the Company's Common Stock; (ii) each of the Company's directors and nominees
for director who own shares of the Company's Common Stock; (iii) the Company's
Chief Executive Officer ("CEO") and its four most highly compensated executive
officers other than the CEO who were serving as executive officers at the end
of fiscal year 1995; and (iv) all directors and executive officers of the
Company as a group. Except as noted in the footnotes to the table, the persons
named in the table have sole voting and investment power with respect to all
shares of Common Stock shown as beneficially owned by them.
<TABLE>
<CAPTION>
Name and Address Shares Beneficially Owned
of -------------------------
Beneficial Owner Number Percentage
---------------- ------ ----------
<S> <C> <C>
FMR Corp. (1)(2) . . . . . . . . . . . . . 392,035.0 (2) 10.45% (2)
Peter Beshouri (3) . . . . . . . . . . . . 341,005.8 (4)(5) 9.14% (4)(5)
Michael Blumberg (3) . . . . . . . . . . . 341,005.8 (4)(5) 9.14% (4)(5)
U.S. Bancorp (1)(6) . . . . . . . . . . . 326,100.0 (6) 8.75% (6)
Dimensional Fund Advisors
Inc. (1)(7) . . . . . . . . . . . . . . . 210,800.0 (7) 5.65% (7)
Joseph Piccirilli (3) . . . . . . . . . . 210,467.5 (4) 5.64% (4)
Gregory Sturgis (3) . . . . . . . . . . . 150,467.5 (4) 4.04% (4)
Kenneth L. Danielson (3) . . . . . . . . . 57,000.0 (8) 1.51% (8)
Christopher O'Neil (3) . . . . . . . . . . 35,838.1 (5)(8) .95% (5)(8)
G. Kay Griffith (1) . . . . . . . . . . . . 35,000.0 (8) .93% (8)
Richard W. McEwen (9) . . . . . . . . . . . 4,000.0 .10%
All directors and executive officers
as a group (eight persons including
certain of those listed above) (4)(5)(8) . 1,174,784.7 30.67%
</TABLE>
__________________________
(1) The information set forth herein with respect to each such person(s)
is based solely upon a Schedule(s) 13G (and any amendments thereto)
filed with the SEC by such person(s)
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<PAGE> 5
with respect to the calendar year ended December 31, 1994 and,
accordingly, may not reflect their respective holdings as of the date
of this proxy statement.
(2) FMR Corp., 82 Devonshire Street, Boston, Massachusetts 02109, through
the ownership of its wholly-owned subsidiary, Fidelity Management &
Research Company, a registered investment advisor located at the same
address as FMR Corp., is deemed to be the beneficial owner of 392,035
shares of Common Stock, with respect to which shares it has sole
dispositive power, as a result of acting as an investment advisor to
several registered investment companies. The number of shares of
Common Stock owned by such investment companies includes 21,135 shares
resulting from the assumed conversion of certain of the Company's
warrants. In addition, Edward C. Johnson 3d, the Chairman of FMR
Corp. and who with various Johnson family members and trusts for the
benefit of Johnson family members form a control group with respect to
FMR Corp., indirectly would also be deemed the beneficial owner of
such 392,035 shares by reasoning of having sole dispositive power over
such shares. Fidelity Low-Priced Stock Fund, one of the registered
investment companies as to which Fidelity Management & Research
Company acts as an investment advisor, may also be deemed a beneficial
owner of 382,105 of such 392,035 shares as a result of its right to
receive or the power to direct the receipt of dividends from, or the
proceeds from the sale of, such 382,105 shares.
(3) The address of each such person is care of the Company, 1901 Tigertail
Boulevard, Dania, Florida 33004. Messrs. Beshouri, Blumberg,
Piccirilli and Sturgis collectively are herein referred to as the
"Principal Shareholders."
(4) As a result of the retirement as an officer and employee of the
Company of each of Gregory Sturgis effective June 30, 1989, and Joseph
Piccirilli effective October 13, 1989, Peter Beshouri and Michael
Blumberg, the two remaining Principal Shareholders, each currently has
the right to vote one-half of the shares of Common Stock beneficially
owned by each of Messrs. Sturgis and Piccirilli. As a result thereof,
each of the two remaining Principal Shareholders currently has the
right to vote approximately 521,473, or 13.98%, of the outstanding
shares of Common Stock of the Company. See "Right of First Refusal
and Voting Trust Agreement" hereinbelow.
(5) Includes such person's or members' of the group vested interest (if
any) in shares of Common Stock of the Company resulting from such
person's or members' of the group participation in the Company's
Employee Stock Ownership Plan ("ESOP") based upon the latest available
annual report of the ESOP for the fiscal year ended June 30, 1994.
Based on such annual report, Mr. Beshouri had 538.307 vested shares,
Mr. Blumberg had 538.309 vested shares and Mr. O'Neil had 338.059
vested shares, and all current directors and executive officers as a
group had 1,414.68 vested shares.
(6) U.S. Bancorp, 111 S.W. Fifth Avenue, Portland, Oregon, 97204, as a
result of the Trust Group of the United States National Bank of Oregon
(a national banking association located at the same address and owned
by U.S. Bancorp) holding the sole voting power over 162,600 shares of
Common Stock, is deemed, together with United States National
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<PAGE> 6
Bank of Oregon, to be the beneficial owner of such 162,600 shares. In
addition, Qualivest Capital Management, Inc. (a registered investment
adviser located at the same address and owned by United States
National Bank of Oregon) holds the sole voting power over 163,500
shares of Common Stock and is deemed the beneficial owner of such
additional 163,500 shares, as a result of acting as an investment
adviser to The Qualivest Funds, a registered investment company.
(7) Dimensional Fund Advisors Inc. ("Dimensional"), 1299 Ocean Avenue,
11th Floor, Santa Monica, California 90401, which is a registered
investment advisor, is deemed to have beneficial ownership of 210,800
shares of Common Stock, with respect to which shares it has sole
voting power over 130,800 and sole dispositive power over 210,800.
All of such shares are held in portfolios of DFA Investment Dimensions
Group Inc., a registered open-end management investment company, or
in series of The DFA Investment Trust Company, a registered open-end
management investment company, or The DFA Group Trust and DFA
Participating Group Trust, investment vehicles for qualified employee
benefit plans, with respect to all of which Dimensional serves as
investment manager. In addition, persons who are officers of
Dimensional also serve as officers of DFA Investment Dimensions Group
Inc. and The DFA Investment Trust Company and, in their capacity as
officers of DFA Investment Dimensions Group Inc. and The DFA
Investment Trust Company, such persons have sole voting power over the
balance (80,000 shares) of the 210,800 shares not voted by
Dimensional. Dimensional disclaims beneficial ownership of such
shares.
(8) Includes (as applicable) immediately exercisable incentive stock
options held by: (i) Mr. O'Neil for 3,000 shares of Common Stock at an
exercise price of $7.27 per share, for 2,000 shares at an exercise
price of $5.45 per share, for 11,000 shares at an exercise price of
$6.29 per share and for 15,000 shares at an exercise price of $5.96
per share; and (ii) each of Mr. Danielson and Ms. Griffith for 20,000
shares of Common Stock at an exercise price of $6.29 per share and for
15,000 shares at an exercise price of $5.96 per share. See also
"EXECUTIVE COMPENSATION. - Executive Compensation Tables" and "-Board
of Directors Report on Executive Compensation."
(9) The address of Richard W. McEwen is 3752 Bobbin Brook West,
Tallahassee, Florida 32312.
RIGHT OF FIRST REFUSAL AND VOTING TRUST AGREEMENT
On June 30, 1986, the Principal Shareholders entered into a right of
first refusal and voting trust agreement. Pursuant to such agreement, each
Principal Shareholder, for himself and on behalf of his heirs, beneficiaries,
legal representatives and permitted assigns, has agreed not to sell, transfer,
assign, pledge, encumber or otherwise dispose of any of his shares of Common
Stock except (a) by will or the laws of intestate succession, (b) to a trust in
which such Principal Shareholder or his immediate family are the sole
beneficiaries, (c) with the written consent of all
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<PAGE> 7
of the other Principal Shareholders or (d) pursuant to the right of first
refusal granted to the other Principal Shareholders. Under such right of first
refusal, in the event a Principal Shareholder or his heirs, beneficiaries,
legal representative or permitted assigns desires to sell any shares of Common
Stock pursuant to a bona fide offer or otherwise, such other Principal
Shareholders shall have the right and option to purchase such shares at a price
equal to the bona fide offer price per share (if any) or the average of the
closing bid and ask prices for the Common Stock over the four full weeks
preceding the date the notice of intent to sell is given.
In addition, the Principal Shareholders have agreed that at any time a
Principal Shareholder is no longer an employee of the Company for any reason
whatsoever (other than in the event of termination of his employment by the
Company without cause), voting rights arising from the ownership of the shares
of Common Stock owned by such Principal Shareholder or by his heirs,
beneficiaries, legal representatives or permitted assigns shall be exercised
and controlled until June 30, 1996, unless the agreement is earlier terminated
in accordance with its terms, by the Principal Shareholders who are still
employees of the Company at the time that such voting rights have to be
exercised (collectively the "Trustees"). The Trustees will vote such shares in
accordance with their respective individual ownership of shares of Common
Stock. The right to exercise such voting control by the Trustees shall
terminate upon the arm's length bona fide sale by such Principal Shareholder to
a third party of such shares so long as the other Principal Shareholders have
been given an opportunity to purchase such shares pursuant to the right of
first refusal described above. As a result of the retirement of each of
Messrs. Sturgis and Piccirilli as an officer and employee of the Company,
Messrs. Beshouri and Blumberg are the only Trustees. See footnote (4) to the
beneficial ownership table set forth above.
ELECTION OF DIRECTORS
Six directors are to be elected at the 1995 Annual Meeting of
Shareholders to hold office until the annual meeting of shareholders next
succeeding their election and until their respective successors are elected and
qualified or as otherwise provided in the by-laws of the Company. The nominees
for directors who receive a plurality of the votes cast by the holders of
outstanding shares of Common Stock entitled to vote at the 1995 Annual Meeting
of Shareholders will be elected. Abstentions (withheld authority) and broker
non-votes are not counted in determining the number of shares voted for or
against any nominee for director.
The Board of Directors has designated the persons listed below to be
nominees for election as directors. Each is currently serving as a director of
the Company and has consented to being named in the Proxy Statement and to
serve if elected. The Company has no reason to believe that any of the
nominees will be unavailable for election; however, should any nominee become
unavailable for any reason, the Board of Directors may designate a substitute
nominee or the number of authorized directors may be reduced. Each proxy will
be voted for the election to the Board of Directors of all of the Board of
Director's nominees unless authority is withheld to vote for all or any of said
nominees.
5
<PAGE> 8
The following information regarding the Company's nominees for
election as directors is based, in part, on information furnished by these
individuals.
<TABLE>
<CAPTION>
Director
Name Age Position(s) with the Company Since
- ---- --- ---------------------------- --------
<S> <C> <C> <C>
Peter Beshouri 41 Chairman of the Board, President 1982
and Chief Executive Officer
Michael Blumberg 47 Director, Senior Vice President 1974
and Secretary
Gregory Sturgis(2) 44 Director 1974
Joseph Piccirilli(1,2) 47 Director 1974
G. Kay Griffith(1) 51 Director, Executive Vice President 1992
and Chief Administrative Officer
Richard W. McEwen(1,2) 75 Director 1994
</TABLE>
_____________________
(1) Member of the Audit Committee of the Company's Board of Directors.
(2) Member of the Stock Option Committee of the Company's Board of Directors.
PETER BESHOURI, who has been an employee of the Company since 1974,
has served as Chairman of the Board and Chief Executive Officer of the Company
since August 1982. Prior thereto he was the general sales manager of the
Company, as well as having served as a showroom manager and district manager.
He was elected President of the Company in May 1985. Mr. Beshouri currently
serves as a director of Progressive Retailers Organization, Inc., a buying
group comprised of approximately 14 retailers (including the Company) of home
entertainment and consumer electronic products located throughout the country.
In August 1995, Mr. Beshouri, together with the Company and a former chief
financial officer of the Company, voluntarily agreed with the Securities and
Exchange Commission ("SEC"), without admitting or denying any wrongdoing, to
the entry of a cease and desist order by the SEC concerning the Company's Form
10-K for fiscal year 1991 and Forms 10-Q for the quarters ended September 30
and December 31, 1991, which the SEC found in such order had been materially
misstated. The cease and desist order with respect to Mr. Beshouri related to
his supervisory responsibility in connection with the Company violating certain
provisions of the securities laws that require public companies to keep
accurate books and records, to maintain appropriate internal accounting
controls and to file accurate annual and quarterly reports. No censure, fine
or penalty was imposed by the SEC on Mr. Beshouri.
6
<PAGE> 9
MICHAEL BLUMBERG, a founder of the Company, was elected a Vice
President in August 1982, Vice President-Purchasing and Finance in May 1986,
Vice President-Purchasing and Marketing in December 1987, and Senior Vice
President in May 1989. From the Company's inception until February 1995, Mr.
Blumberg served as Treasurer of the Company and, since October 13, 1989, he
has also been serving as Secretary of the Company. His responsibilities
include overall supervision of all purchasing and selecting new product
categories and lines for the Company, as well as consulting with certain of the
Company's manufacturers in connection with product design.
GREGORY STURGIS, a founder of the Company, had been an executive
officer of the Company from its inception until June 30, 1989, including
holding the position of Vice President-Planning and Development. Effective
June 30, 1989, he resigned as an officer and employee of the Company, but is
continuing as a director. Mr. Sturgis is currently self-employed providing
consulting services to companies in the marine industry as well as performing
consulting services for the Company. See "CERTAIN TRANSACTIONS."
JOSEPH PICCIRILLI, a founder of the Company, had been an executive
officer of the Company from its inception until October 13, 1989, including
holding the positions of Vice President-Advertising and Marketing, Vice
President-Public Relations and Personnel and Vice President-Home Audio
Purchasing. Effective October 13, 1989, he resigned as an officer and employee
of the Company, but is continuing as a director. Mr. Piccirilli is currently
self-employed providing general business consulting services to companies,
including, upon the request of the Company's management from time to time, to
the Company.
G. KAY GRIFFITH, who was elected a director of the Company and a
member of the Audit Committee of its Board of Directors in July 1992, joined
the Company as an employee in May 1993 and was formally elected Executive Vice
President and Chief Administrative Officer in September 1993. From March 1992
until joining the Company as an employee, she was President and Chief Executive
Officer of Admiralty Bank, headquartered in Palm Beach Gardens, Florida. From
June 1991 to March 1992, Ms. Griffith was a senior partner of GKG Management
Services, a firm providing consulting services to banks and businesses who
require assistance with their banking relationships. From September 1983 to
June 1991, she held a variety of officer positions with NCNB National Bank of
Florida, N.A. (now known as NationsBank of Florida, N.A.), the last of which
was Senior Vice President/Regional Banking Executive. Ms. Griffith's principal
role at the Company is to oversee, supervise and coordinate all aspects of
human resources/benefits and employee recruiting and training.
RICHARD W. MCEWEN was elected a director of the Company at its annual
meeting of shareholders held in January 1994 and was also appointed a member of
the Audit Committee and Stock Option Committee of its Board of Directors at
such time. From 1977 until his retirement in 1984, he was Chairman of the
Board of Burdines, a chain of Florida department stores then owned by Federated
Stores, Inc. He is currently a director of Lennar Corporation, a Florida based
home builder, having served as such since 1987, and Supreme International
Corp., a Florida based designer and importer of men's and boys' sportswear,
having been elected as such in 1994.
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<PAGE> 10
He also currently serves as a director of two other privately held companies.
For approximately eight years until 1993, he was a director of Pueblo
International, Inc., a supermarket company.
BOARD MEETINGS AND COMMITTEES OF THE BOARD
The Board of Directors held four meetings (excluding actions by the
Board of Directors taken by unanimous written consent in lieu of a meeting, of
which there were eight such unanimous written consents) during the fiscal year
ended June 30, 1995. Each director attended 75% or more of the aggregate
number of meetings of the Board of Directors and committees of the Board of
Directors on which he or she served during the 1995 fiscal year.
The Board of Directors has an Audit Committee comprised of a majority
of directors who are not officers or employees of the Company. The duties and
responsibilities of such Audit Committee include meeting independently with
representatives of the Company's independent public accountants and
representatives of the Company's senior management, reviewing the general scope
of the Company's annual audit, the fee charged by the independent public
accountants and other matters relating to internal accounting controls and
financial procedures and reporting, reviewing and monitoring the performance of
non-audit services by the Company's auditors, recommending the engagement or
discharge of the Company's independent public accountants and conducting an
appropriate review of all related party transactions and conflict of interest
situations where appropriate. Such Audit Committee held two formal meeting
during the fiscal year ended June 30, 1995, although members of such Audit
Committee on an informal basis and in their capacity as members of the Board of
Directors kept informed throughout fiscal year 1995 of the financial condition
of the Company and its internal accounting controls and financial reporting.
The Board of Directors does not currently have a nominating committee
or a compensation committee or committees performing similar functions.
However, a Stock Option Committee of the Board of Directors administers the
Company's Stock Option Plan originally adopted in May 1986 as subsequently
amended and restated (the "Stock Option Plan"). Such Stock Option Committee
had one formal meeting during fiscal year 1995.
DIRECTORS COMPENSATION
Directors who are also officers or employees of the Company are not
paid additional compensation for acting as a director of the Company.
Commencing after the 1993 annual meeting of shareholders of the Company a
standard arrangement was established by the Company for compensating directors
who are not officers or employees of the Company for any services provided in
such person's capacity as a director. Each such outside director receives a
fee of $1,500 on a quarterly basis for serving as a director of the Company
plus an additional fee of $500 for each meeting of the Board of Directors or
any committee thereof such director attends, as well as reimbursement of any
out-of-pocket expenses incurred for travel, lodging and meals in connection
with attendance at any such meeting. See also "CERTAIN TRANSACTIONS."
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<PAGE> 11
DIRECTOR AND OFFICER SECURITIES REPORTS
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's officers and directors, and persons who own more than ten percent of
a registered class of the Company's equity securities, to file reports of
ownership and changes in ownership with the SEC and the National Association of
Securities Dealers, Inc. Officers, directors and greater than ten percent
shareholders are required by SEC regulations to furnish the Company with copies
of all Section 16(a) forms they file.
Based solely on review of the copies of such forms furnished to the
Company and written representations that no Form 5's were required when
applicable, the Company believes that during the fiscal year ended June 30,
1995, all Section 16(a) filing requirements applicable to its officers,
directors and greater than ten percent beneficial owners were complied with,
except that Richard W. McEwen, a director of the Company, inadvertently failed
to file a Form 4 reflecting his acquisition on May 22, 1995, of 1,000 shares of
Common Stock of the Company. Mr. McEwen has since filed a Form 5 correcting
that failure.
EXECUTIVE COMPENSATION
BOARD OF DIRECTORS REPORT ON EXECUTIVE COMPENSATION
During the fiscal year ended June 30, 1995, the Board of Directors of
the Company in conjunction with the Stock Option Committee of the Board adopted
specific compensation policies applicable to the Company's executive officers
(including the CEO and the other four most highly compensated executive
officers) as well as other senior management personnel, including the specific
relationship of corporate performance to executive compensation.
Such compensation policies adopted were based upon the information and
recommendations provided in the Executive Compensation Review prepared during
fiscal year 1994 by the Employees Benefit Services division of KPMG Peat
Marwick LLP ("Peat Marwick"), the Company's independent public accountants who
were retained by the Board of Directors to undertake an executive compensation
review on behalf of the Company. The Executive Compensation Review contained
an assessment of the Company's then compensation practices for senior
executives, which included a comparison of the Company's recent financial
performance with its public company peer group and a competitive analysis of
total compensation (base salary, bonuses and long term incentives) of the top
five highest paid executives of the Company compared to such public company
peer group, a competitive compensation analysis of senior and middle management
positions compared to a broader retail industry norm, a proposed annual
incentive bonus plan and proposed competitive long term incentive award
guidelines. The Executive Compensation Review indicated that, although the
Company's total cash compensation (base salary plus annual bonuses) to
executive officers generally approximated median levels overall of total cash
compensation paid by its peer group, the Company's annual bonus and long
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<PAGE> 12
term incentive programs were each generally below the market norms and, as a
result, total compensation (all cash compensation plus long term incentives)
fell below competitive ranges. After review and discussion of the Executive
Compensation Review, the Board of Directors unanimously determined to adopt an
overall compensation program that would over time shift a higher percentage of
total compensation to annual bonus and long term incentive programs in order to
strengthen the link between the Company's performance and compensation and to
more effectively reward individuals for corporate performance and individual
achievement. Accordingly, in December 1994 the Board of Directors in
conjunction with the Stock Option Committee of the Board determined to
implement commencing for fiscal year 1995 such programs. The Company's Board
of Directors, based upon the recommendations of Peat Marwick, adopted an annual
incentive bonus plan for four categories of the Company's employees (two of
which categories were the CEO and other executive officers) based upon the
annual operating performance of the Company. The percentage of the targeted
bonus award to be earned by the different employee categories is directly tied
to a percentage of the Company's projected operating performance (after taking
into account accruals for the annual incentive bonus plan) to be approved each
year by the Company's Board of Directors. Achievement of 100% of the projected
operating performance will result in the award of a targeted bonus ranging from
approximately 10% to up to 25% of base salary (with the CEO at 25% and other
executive officers at 20%), with the percentage of the targeted bonus award
earned increasing or decreasing based upon the percentage (ranging from 70% to
130%) of projected operating performance achieved. The Executive Compensation
Review indicated that such range around the projected operating performance was
consistent with the approach typically taken by smaller companies in industries
like the Company. As part of this program and to increase the percentage of
total annual compensation of executive officers to be based upon the operating
performance of the Company, the Board of Directors contemplates in the short
term maintaining the CEO's and certain other executive officers' base salaries
at or near their current levels. Consistent with the foregoing, the Board
authorized during fiscal year 1995 on two separate occasions the renewal on
substantially the same terms and conditions as the 1992 fiscal year of the
CEO's and Senior Vice President's employment agreements for one additional year
at the time of their expiration on each of June 30, 1994 and June 30, 1995.
See "Employment Agreements" hereinbelow.
The Stock Option Committee (comprised of Messrs. McEwen, Piccirilli
and Sturgis), after also considering the Executive Compensation Review and the
recommendations therein, determined to implement over the next several years a
structured and more formal long term incentive program in order to more
effectively take advantage of the benefits to the Company derived from the
granting of stock options and to remain competitive with companies in the
Company's peer group who have previously used such form of compensation to a
much greater extent than the Company. Based upon the recommendations of Peat
Marwick, the Stock Option Committee determined to implement over the next
several fiscal years a stock option program for the same four categories of the
Company's employees that will be covered by the annual incentive bonus plan.
Under the program the Stock Option Committee currently contemplates granting
non-qualified stock options under the Stock Option Plan exercisable at 85% of
fair market value on date of grant, vesting in three equal annual installments
commencing one year from date of grant and having an exercise period of up to
ten years. The Stock Option Committee believes that the use of a vesting
period (which in the past has not been used) will
10
<PAGE> 13
provide a greater long term incentive and motivation to the Company's employees
and the ten year exercise period, and the inclusion in options granted of
provisions covering acceleration of vesting on death or disability and up to
two years after termination to exercise such options under certain
circumstances, will create additional value to the options and make the options
a more attractive form of compensation available to the Company. The number
of non- qualified stock options expected to be awarded each fiscal year under
this program will be based upon a percentage of base salary ranging from
approximately 5% to 45%, with the CEO at 45% and other executive officers at
30%. No options have as yet been awarded under the program. However, as part
of the consideration for and inducement to two individuals to become executive
officers of the Company in September 1993, and to seek to retain such
individuals as well as another qualified executive and give all of them
incentive for future performance, the Stock Option Committee (then comprised of
Messrs. Beshouri, Blumberg, Piccirilli and Sturgis), when it issued in
September 1993 each of Kenneth L. Danielson (the Chief Financial and Accounting
Officer) and G. Kay Griffith (the Executive Vice President and Chief
Administrative Officer) incentive stock options covering 20,000 shares of
Common Stock and Christopher O'Neil (the Executive Vice President and Chief
Operating Officer) incentive stock options covering 11,000 shares of Common
Stock at an exercise price of $6.29, contemplated issuing each of such three
executive officers additional stock options covering 15,000 shares of Common
Stock approximately about the time of each of the first and second anniversary
dates of the foregoing issuances (or an aggregate of stock options covering
30,000 shares of Common Stock to each of them) at the then fair market value of
the Company's Common Stock at the time of each issuance thereof. Accordingly,
the Stock Option Committee (currently comprised of Messrs. McEwen, Piccirilli
and Sturgis) authorized in December 1994 the granting to each of Messrs.
Danielson and O'Neil and Ms. Griffith the first installment of such additional
incentive stock options covering 15,000 shares of Common Stock at an exercise
price of $5.96 per share, all of which incentive stock options expire no later
than December 13, 1999. See "OPTIONS GRANTED IN 1995 FISCAL YEAR" hereinbelow
and footnote (8) to the table under the heading "SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT."
THE BOARD OF DIRECTORS
11
<PAGE> 14
EXECUTIVE COMPENSATION TABLES
The following tables provide information about executive compensation.
SUMMARY COMPENSATION TABLE
The following table sets forth information about the compensation of
the Company's CEO and each of the other four most highly compensated executive
officers of the Company during the fiscal year ended June 30, 1995 for services
in all capacities.
<TABLE>
<CAPTION>
Annual Compensation (1) Long Term Compensation
---------------------------------------------- ----------------------
Name and Principal Fiscal All Other
Position Year Salary ($) Bonus ($)(2) Stock Options (#)(3) Compensation($)(4)
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Peter Beshouri 1995 324,008 0 0 0
Chairman, President 1994 324,008 48,000 0 0
and CEO 1993 322,672 0 0 0
Michael Blumberg 1995 294,008 0 0 0
Senior Vice 1994 294,008 23,000 0 0
President 1993 292,672 0 0 0
G. Kay Griffith 1995 160,000 0 15,000 0
Executive Vice President 1994 160,000 23,000 20,000 0
and Chief Administrative 1993 20,000(5) 0 0 0
Officer
Christopher O'Neil 1995 150,000 0 15,000 8,268(6)
Executive Vice 1994 150,000 23,000 11,000 8,268(6)
President and Chief 1993 150,000 0 0 8,268(6)
Operating Officer
Kenneth L. Danielson 1995 160,000 0 15,000 0
Chief Financial 1994 133,333(7) 23,000 20,000 0
and Accounting 1993 _ _ _ _
Officer
</TABLE>
___________________________________
(1) Does not include any amounts for perquisites and other personal
benefits, securities or property extended to such executive officers
of the Company, such as life insurance and disability insurance,
because the Company does not believe that in any individual case the
dollar value of such other annual compensation would equal or exceed
the lesser of either $50,000 or 10% of such individual's total annual
compensation shown above.
(2) The bonuses accrued by the Company during the fiscal year ended June
30, 1994, were part of a performance bonus pool established by the
Company for its senior executives and corporate department heads. The
percentage of the accrued performance bonus pool that was actually
paid out was based upon the achievement of a certain level of pre-tax
earnings by the Company in fiscal year 1994. The bonuses were awarded
and paid to such executive officers in September 1994. In fiscal year
1995, the Company's Board of Directors adopted an incentive bonus plan
for four categories of the Company's employees (two of which
categories were the CEO and other executive officers) based upon the
annual operating performance of the Company. No bonuses were paid
under such
12
<PAGE> 15
plan in fiscal year 1995. See "Board of Directors Report on Executive
Compensation" hereinabove.
(3) These currently represent immediately exercisable incentive stock
options issued pursuant to the Company's Stock Option Plan. See
footnote (8) to the table in "SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT."
(4) The Company has an Employee Stock Ownership Plan ("ESOP") for all of
its employees. In fiscal year ended June 30, 1993, the Company
contributed $12,000 in cash to the ESOP, which was primarily used to
pay out vested interests of former employees of the Company. With
respect to the fiscal year ended June 30, 1993, as a result of
reallocations to employee accounts of the ESOP caused by employee
terminations and pay outs of vested interests of former employees, Mr.
Beshouri was allocated 49.752 additional shares, Mr. Blumberg was
allocated 49.753 additional shares and Mr. O'Neil was allocated 32.504
additional shares of Common Stock held by the ESOP. In fiscal year
ended June 30, 1994, the Company contributed $50,000 in cash to the
ESOP, although no additional shares of Common Stock have been
purchased by the ESOP with such funds. With respect to the fiscal
year ended June 30, 1994, as a result of reallocation to employee
accounts of the ESOP caused by employee terminations and pay outs of
vested interests of former employees, Mr. Beshouri was allocated
29.210 additional shares, Mr. Blumberg was allocated 29.211 additional
shares and Mr. O'Neil was allocated 18.604 additional shares. The
Company made no contribution to the ESOP during the fiscal year ended
June 30, 1995. See footnote (5) to the table in "SECURITY OWNERSHIP
OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT" for the number of vested
shares of the ESOP owned by each of such individuals based upon the
latest available annual report of the ESOP.
(5) Represents salary paid to G. Kay Griffith from the commencement of her
employment by the Company in May 1993 to the end of fiscal year 1993.
Ms. Griffith was formally elected Executive Vice President and Chief
Administrative Officer of the Company in September 1993. Prior to the
commencement of her employment, Ms. Griffith also received in fiscal
year 1993 director's fees and related expense reimbursements in the
aggregate amount of $12,140.
(6) This sum represents the aggregate amount of a monthly automobile
allowance paid during fiscal years 1993, 1994 and 1995.
(7) Represents salary paid to Kenneth L. Danielson from September 1, 1993
(the commencement date of his employment), although Mr. Danielson was
elected to succeed the then Chief Financial and Accounting Officer of
the Company effective as of October 1, 1993. Mr. Danielson's salary
for fiscal year 1994 would have been $160,000 on an annualized basis.
13
<PAGE> 16
OPTION GRANTS IN 1995 FISCAL YEAR
The following table shows all grants of options to the named executive
officers of the Company during the fiscal year ended June 30, 1995. Pursuant
to SEC rules, the table also shows the value of the options granted at the end
of the option terms (five years) if the price of the Company's stock was to
appreciate annually by 5% and 10%, respectively. There is no assurance that
such stock price will appreciate at the rates shown in the table. The table
also indicates that, if the stock price does not appreciate, there will be no
increase in the potential realizable value of the options granted above the
difference (if any) between the market price of the Company's Common Stock as
of the date of grant and the exercise price per share. All of the options set
forth in the table are incentive stock options issued pursuant to the Stock
Option Plan. The Company does not have a plan whereby tandem stock
appreciation rights ("SARS") are granted.
<TABLE>
<CAPTION>
Potential Realizable Value at Assumed
Annual Rates of Stock Appreciation for
Individual Grants Option Term
- ------------------------------------------------------------------------------------- ---------------------------------------
Number of % of Total
Securities Options Closing Market
Underlying Granted to Exercise Price on Date
Options Employees Price of Grant Expiration
Name Granted (#) in Fiscal Year ($/share) ($/share)(1) Date 0% ($)(1) 5%($) 10% ($)
- ---- ----------- -------------- --------- ------------ ---------- --------- ----- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Peter Beshouri 0 N/A 0.00 N/A N/A 0 0 0
Michael Blumberg 0 N/A 0.00 N/A N/A 0 0 0
G. Kay Griffith 15,000 33.3% 5.96 5.75 12/13/99 0 20,679.28 49,506.49
Christopher O'Neil 15,000 33.3% 5.96 5.75 12/13/99 0 20,679.28 49,506.49
Kenneth L. Danielson 15,000 33.3% 5.96 5.75 12/13/99 0 20,679.28 49,506.49
</TABLE>
___________________________________
(1) For purposes of the Stock Option Plan, "fair market value" on the date
of grant of any option is the average of the "market price" of a share
of Common Stock for each of the seven (7) consecutive business days
preceding such day. The "market price" on each such day is the
closing sales price on the NASDAQ Stock Market on such day. The Stock
Option Committee of the Company believes this calculation more
accurately reflects "fair market value" of the Company's Common Stock
on any given day as compared to simply using the closing market price
on the date of grant. As a result, the closing market price on the
date of grant at times may be different than the exercise price per
share.
14
<PAGE> 17
AGGREGATE OPTION EXERCISES IN 1995 FISCAL YEAR
AND 1995 FISCAL YEAR END OPTION VALUES
The following table provides information as to options exercised by
each of the named executives of the Company during the fiscal year ended June
30, 1995, and the value of options held by such executive officers at the
Company's fiscal year-end measured in terms of the closing market price of the
Company's stock on June 30, 1995.
<TABLE>
<CAPTION>
Number of Securities Value of Unexercised
Shares Acquired Underlying Unexercised In-the-Money Options
Name on Exercise (#) Value Realized ($) Options at FY-End(#)(1) at FY-End ($)(1)
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Peter Beshouri 0 0 0 0
Michael Blumberg 0 0 0 0
G. Kay Griffith 0 0 35,000 0
Christopher O'Neil 0 0 31,000 0
Kenneth L. Danielson 0 0 35,000 0
- -----------------------------------
</TABLE>
(1) All of the unexercised options held by such individuals were
immediately exercisable.
(2) Based on the closing market price ($3.25) of the Company's Common
Stock on the NASDAQ Stock Market on June 30, 1995 (the Company's
fiscal year-end), none of the unexercised options were in-the-money.
EMPLOYMENT AGREEMENTS
During the 1995 fiscal year Peter Beshouri and Michael Blumberg each
had an employment agreement with the Company which provided for an annual base
salary for fiscal year 1995 of $320,650 for Peter Beshouri and $290,400 for
Michael Blumberg. The term of each such employment agreement was originally
for a three year period expiring June 30, 1992, and had been extended each
fiscal year thereafter for an additional one year period. Effective as of July
1, 1995, such employment agreements were again extended for an additional one
year term (currently until June 30, 1996) on the same terms and conditions as
in effect under their respective employment agreements during the previous
fiscal year, including, without limitation, that the annual base salary payable
to each of them for the Company's current fiscal year will be the same as they
were entitled to receive for the fiscal year ended June 30, 1995. Under the
latest one-year extension of the employment agreements, each of Messrs.
Beshouri and Blumberg will be entitled to participate in the Company's annual
incentive bonus plan and long term incentive stock option program. See "Board
of Directors Report on Executive Compensation"
15
<PAGE> 18
hereinabove. The Company is also required to furnish each of Messrs. Beshouri
and Blumberg with, among other things, family health, life and disability
insurance coverage.
Such employment agreements with Messrs. Beshouri and Blumberg also
provide that, in the event of a change in control of the Company, each of them
can terminate his full-time employment thereunder. A change in control under
such employment agreements occurs when Messrs. Beshouri and Blumberg and/or
other individuals or designees voted for or approved by them no longer
collectively comprise at least a majority of the members of the Board of
Directors of the Company or if one of them is forced by a merger,
consolidation, reorganization or otherwise by operation of law or other form of
transaction to sell his shares of voting capital stock in the Company or if 50%
or more of the consolidated assets, properties and businesses of the Company is
sold or otherwise transferred to a third-party or if an individual (other than
either Messrs. Beshouri and Blumberg) or another company or entity or a group
acting in concert becomes the beneficial owner of 25% or more of the
outstanding voting capital stock of the Company as a result of acquisitions
made from other than Messrs. Beshouri and/or Blumberg or the Company, assuming
such acquisitions from the Company were approved by Messrs. Beshouri and
Blumberg. In the event such change in control was resisted by either Messrs.
Beshouri or Blumberg as evidenced by his failure to approve of such change in
control either in his capacity as a director or shareholder of the Company,
unless (i) he accepts a new employment agreement with the Company or any
successor or (ii) such change in control was supported by the Board of
Directors of the Company at a time when Messrs. Beshouri and Blumberg and/or
other individuals or designees voted for or approved by them collectively
comprise at least a majority of the members of the Board of Directors of the
Company and he was offered a new contract at least as favorable as his current
employment agreement, he would be entitled to his compensation (both annual
salary and any bonus) and the other benefits provided for in his employment
agreement for the greater of three years or the remaining term of his
employment agreement. The Company is not aware of any contemplated change in
control.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Since during the fiscal year ended June 30, 1995, the Company did not
have a compensation committee of its Board of Directors (or Board committee
performing equivalent functions), Peter Beshouri, Michael Blumberg and G. Kay
Griffith, in their capacities as members of the Company's Board of Directors,
participated in deliberations of the Board concerning the authorization of the
one-year renewals of the employment agreements of Messrs. Beshouri and Blumberg
on the terms as discussed in "Employment Agreements" hereinabove. In addition,
they participated in their capacities as directors in the adoption by the Board
of Directors during fiscal year 1995 of the Company's annual incentive bonus
plan. See "Board of Directors Report on Executive Compensation" hereinabove.
16
<PAGE> 19
PERFORMANCE GRAPH
The following graph shows a comparison of five year-cumulative total
returns to shareholders for the Company, Center for Research in Security Prices
("CRSP") Index for NASDAQ Stock Market (U.S. Companies) and CRSP Index for
NASDAQ Stocks (SIC 5730-5739 U.S. Companies) of U.S. Companies operating
radio, television, consumer electronics and/or music stores.
[PERFORMANCE GRAPH]
The following table presents in tabular form the data set forth in the
performance graph to be included in the Proxy Statement:
<TABLE>
<CAPTION>
CRSP Total Returns Index for: 06/29/90 06/28/91 06/30/92 06/30/93 06/30/94 06/30/95
- ---------------------------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Sound Advice, Inc. 100.0 115.4 57.7 88.5 90.4 50.0
Nasdaq Stock Market (US Companies) 100.0 105.9 127.2 160.0 161.6 215.4
NASDAQ Stocks (SIC 5730-5739 US Companies) 100.0 122.2 138.4 147.0 105.6 110.9
Radio, Television, Consumer Electronics and Music Stores
</TABLE>
NOTES:
A. The lines on the performance graph represent monthly index levels
derived from compounded daily returns that include all dividends
(no dividends were declared on the Company's Common Stock during
the five year period).
B. The indexes are reweighted daily, using the market capitalization
on the previous trading day.
C. If the monthly interval, based on the fiscal year-end, is not a
trading day, the preceding trading day is used.
D. The index level for all series was set to $100.0 on 6/29/90.
17
<PAGE> 20
CERTAIN TRANSACTIONS
In January 1993, the Company entered into a one year consulting
arrangement with Gregory Sturgis, a director of the Company and one of the
Principal Shareholders, pursuant to which Mr. Sturgis provided his consulting
services to the Company for up to 35 full days during such calendar year. The
term of such arrangement was previously extended through calendar year 1995.
For providing such services, Mr. Sturgis receives an annual fee of $25,000,
payable in twelve equal monthly installments on the first day of each month,
and reimbursement for out-of-pocket expenses incurred by him for travel,
lodging and meals in connection with the performance of his consulting
services. Such consulting arrangement expired on December 31, 1995. See also
"ELECTION OF DIRECTORS - Directors Compensation".
Jacob E. Farkas (who resigned as a director of the Company in December
1993) had a one-year arrangement, commencing as of November 1, 1993, with the
Company whereby Mr. Farkas received $5,000 per month for his consulting
services, plus reimbursement for related out-of-pocket expenses. In
consideration of the services rendered during the Company's fiscal year ended
June 30, 1995, the Company paid to Mr. Farkas and his wholly-owned consulting
corporation fees aggregating $15,000, in addition to the reimbursement of his
out-of-pocket expenses. Such consulting arrangement expired on October 31,
1994.
INDEPENDENT PUBLIC ACCOUNTANTS
The accounting firm of KPMG Peat Marwick LLP ("Peat Marwick") acted as
the Company's independent public accountants for the Company's fiscal year
ended June 30, 1995. This firm has acted as the independent public accountants
for the Company since fiscal year 1993. It is anticipated that the Audit
Committee of the Board of Directors of the Company will recommend to the Board
for its approval the selection of Peat Marwick to serve as the Company's
independent public accountants for the fiscal year ending June 30, 1996, after
the Audit Committee has undertaken the appropriate review, including reviewing
the terms of engagement of Peat Marwick for fiscal year 1996. Such independent
public accountants, if selected by the Board of Directors, will continue to
serve at the pleasure of the Board. The selection of independent public
accountant is not being submitted to shareholders for approval because there is
no legal requirement to do so. A representative of Peat Marwick is expected to
be present at the 1995 Annual Meeting of Shareholders in order to have the
opportunity to make a statement, if such representative desires to do so, and
to be available to respond to appropriate questions relating to the examination
by Peat Marwick of the Company's 1995 consolidated financial statements.
18
<PAGE> 21
SHAREHOLDER PROPOSALS FOR 1996 ANNUAL MEETING
Shareholder proposals intended to be presented at the 1996 annual
shareholders' meeting must be submitted to the Secretary of the Company, at the
principal executive offices of the Company, 1901 Tigertail Boulevard, Dania,
Florida 33004, no later than September 20, 1996, in order to receive
consideration for inclusion in the Company's 1996 proxy materials. Any such
shareholder proposal must comply with the requirements of Rule 14a-8
promulgated under the Securities Exchange Act of 1934.
OTHER MATTERS
EACH PERSON SOLICITED HEREUNDER CAN OBTAIN, WITHOUT CHARGE, A COPY OF
THE COMPANY'S ANNUAL REPORT ON FORM 10-K (WITH EXHIBITS) FOR THE COMPANY'S
FISCAL YEAR ENDED JUNE 30, 1995, AS FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION, BY SENDING A WRITTEN REQUEST TO KENNETH L. DANIELSON, THE CHIEF
FINANCIAL AND ACCOUNTING OFFICER OF THE COMPANY, AT THE COMPANY'S EXECUTIVE
OFFICES LOCATED AT 1901 TIGERTAIL BOULEVARD, DANIA, FLORIDA 33004.
By Order of the Board of Directors
/s/ Michael Blumberg
--------------------
Michael Blumberg
Secretary
January 19, 1996
19
<PAGE> 22
APPENDIX A
SOUND ADVICE, INC.
1995 ANNUAL MEETING OF SHAREHOLDERS - FEBRUARY 15, 1996
PROXY IS SOLICITED ON BEHALF OF THE COMPANY'S BOARD OF DIRECTORS
The undersigned hereby constitutes and appoints Peter Beshouri and
Michael Blumberg, and each of them, as attorneys and proxies of the
undersigned, with full power of substitution for and in the name, place and
stead of the undersigned, to appear at the annual meeting of shareholders of
Sound Advice, Inc. to be held on the 15th day of February, 1996, and at any
postponement or adjournment thereof, and to vote all of the shares of Sound
Advice, Inc. which the undersigned is entitled to vote, with all the powers
and authority the undersigned would possess if personally present. The
undersigned hereby directs that this proxy be voted as follows:
(Continued, and to be signed, on other side)
________________________________________________________________________________
1. Election of Directors for the ensuing year.
[ ] FOR the election of Peter Beshouri, Michael Blumberg,
Gregory Sturgis, Joseph Piccirilli, G. Kay Griffith
and Richard W. McEwen as directors.
[ ] To WITHHOLD AUTHORITY to vote for all nominees listed
above.
To WITHHOLD AUTHORITY to vote for any individual,
write that nominee's name on the space below.
_______________________________________________________________
2. Upon such other business as may properly come before the annual
meeting.
This proxy, when properly executed, will be voted in the manner
directed by the undersigned shareholder. IF NO DIRECTIONS TO THE CONTRARY ARE
INDICATED, THIS PROXY WILL BE VOTED FOR THE ELECTION OF ALL OF THE
AFOREMENTIONED NOMINEES LISTED IN PROPOSAL NO. 1 AS DIRECTORS.
A majority of said proxies present and acting in person or by their
substitutes (or if only one is present and acting, then that one) may exercise
all the powers conferred hereby. DISCRETIONARY AUTHORITY IS CONFERRED HEREBY
AS TO SUCH OTHER BUSINESS AS MAY PROPERLY COME BEFORE THE ANNUAL MEETING.
Receipt of the Company's 1995 Annual Report to Shareholders and the
Notice of Annual Meeting of Shareholders to be held February 15, 1996, and the
Proxy Statement relating thereto is hereby acknowledged.
PLEASE DATE AND SIGN THIS PROXY AND RETURN IT PROMPTLY IN THE
ENCLOSED, POSTAGE PAID ENVELOPE.
Date:____________________________, 1996
(Please date this Proxy)
---------------------------------------
---------------------------------------
Signature(s)
Note: It would be helpful if you signed your
name exactly as it appears hereon,
indicating any official position or
representative capacity. If shares are
registered in more than one name, all
owners must sign.
