SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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:
/X/ Preliminary Proxy Statement
/_/ Definitive Proxy Statement
/_/ Definitive Additional Materials
/_/ Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
CSL LIGHTING MANUFACTURING, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
/_/ $125 per Exchange Act Rule 0-11(c)(1)(ii), 14a-6(i)(1) or 14a-6(j)(2).
/_/ $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:*
_____________________________________________________________________________
4) Proposed maximum aggregate value of transaction:
_____________________________________________________________________________
/_/ 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 No. ______________________________________
3) Filing party: ___________________________________________________________
4) Date filed: _____________________________________________________________
___________
*Set forth the amount on which the filing fee is calculated and state how it was
determined.
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PRELIMINARY PROXY
CSL LIGHTING MANUFACTURING, INC.
827615 Avenue Hopkins
Valencia, California 91355-3493
-------------------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON FEBRUARY 18, 1997
-------------------------
To the Stockholders of
CSL Lighting Manufacturing, Inc.
NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of CSL
Lighting Manufacturing, Inc. (the "Company") will be held on February 18, 1997
at 3:00 p.m. at the offices of Morse, Zelnick, Rose & Lander, LLP, 450 Park
Avenue, Suite 902, New York, N.Y. 10022, for the following purposes:
1. To elect a board of five directors.
2. To act on a proposal to amend the Company's Certificate of
Incorporation to increase the authorized Common Stock from 10,000,000
to 30,000,000 shares, $.01 par value.
3. To consider and act upon a proposal to approve the Company's 1996
Stock Option Plan.
4. To ratify the appointment of independent auditors for 1996.
5. To consider and take action upon such other matters as may properly
come before the meeting or any adjournments thereof.
The close of business on January 24, 1997 has been fixed as the record date
for the determination of stockholders entitled to notice of and to vote at the
Annual Meeting and any adjournment thereof.
All stockholders are cordially invited to attend the meeting. Whether or
not you expect to attend, you are requested to sign, date and return the
enclosed proxy promptly. Stockholders who execute proxies retain the right to
revoke them at any time prior to the voting thereof. A return envelope which
requires no postage if mailed in the United States is enclosed for your
convenience.
By Order of the Board of Directors
Mark Allen, Secretary
Dated: January 28, 1997
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CSL LIGHTING MANUFACTURING, INC.
827615 Avenue Hopkins
Valencia, California 91355-3493
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PROXY STATEMENT
-------------------------
ANNUAL MEETING OF STOCKHOLDERS
This Proxy Statement is furnished in connection with the solicitation by
the Board of Directors of CSL Lighting Manufacturing, Inc. (the "Company") of
proxies in the form enclosed for the Annual Meeting of Stockholders to be held
February 18, 1997 at 3:00 p.m. at the Morse, Zelnick, Rose & Lander, LLP, 450
Park Avenue, Suite 902, New York, N.Y. 10022, and for any adjournment or
adjournments thereof, for the purposes set forth in the accompanying Notice of
Annual Meeting of Stockholders. The Board of Directors knows of no other
business which will come before the meeting.
All shares represented by each properly executed unrevoked proxy received
in time for the meeting will be voted as specified. In the absence of any
specification, proxies will be voted (a) for the election of the five persons
listed herein as nominees as directors, (b) in favor of the adoption of the
Company's 1996 Stock Option Plan, (c) for the ratification of auditors, (d) to
increase the authorized shares of Common Stock of the Company from 10 to 30
million shares and (e) in the judgment of the Board of Directors on any other
matters which may properly come before the meeting. Any stockholder giving a
proxy has the power to revoke the same at any time before it is voted.
The approximate date on which this Proxy Statement and the accompanying
form of proxy along with the Company's 1996 Annual Report will be mailed to the
Company's stockholders is January 28, 1997. The principal executive offices of
the Company are located at 27615 Avenue Hopkins, Valencia, California
91355-3493.
VOTING SECURITIES
Only stockholders of record at the close of business on January 28, 1997
are entitled to notice of and to vote at the Annual Meeting or any adjournment
thereof. On the record date there were issued and outstanding ___________ Common
Shares. Each outstanding Common Share is entitled to one vote upon all matters
to be acted upon at the meeting.
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BENEFICIAL OWNERSHIP OF COMMON STOCK
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 Securities and Exchange Commission
("SEC"). Officers, directors and greater than ten-percent shareholders are
required by SEC regulation 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, or written representations that no Forms 5 were
required, the Company believes that all Section 16(a) filing requirements
applicable to its officers and directors were complied with.
The following table, together with the accompanying footnotes, sets forth
information, as of December 31, 1996, regarding stock ownership of all persons
known by the Company to own beneficially 5% or more of the Company's outstanding
Common Shares, all directors and nominees, and all directors and executive
officers of the Company as a group.
Name and Address Number of Shares Percent
of Beneficial Owner Beneficially Owned of Ownership
- ------------------- ------------------ ------------
Directors and Officers
Sylvan Gerber (3) (4) 1,205,000 23.3%
Mark Allen (1) 237,000 4.7%
Bert Finmark (2) 75,900 1.5%
Scott Searle 100,000 2.0%
Michael Smith --- ---
Dhananjay G. Wadakar --- ---
Directors and Officers as a Group (6 persons)(5) 1,801,900 34.1%
- ----------
(1) Includes 32,000 shares subject to currently exercisable warrants.
(2) Includes 70,000 shares subject to currently exercisable warrants.
(3) The address of Mr. Gerber is c/o CSL Lighting Manufacturing, Inc. 27615
Avenue, Hopkins, Valencia, California 91355-3493.
(4) Includes (i) 206,250 common shares that are subject to a seven year escrow
agreement with H.J. Meyers & Co., Inc. (Formerly Thomas James & Associates,
Inc.), the underwriter of the Company's initial public offering ("H.J.
Meyers"), (ii) an aggregate of 150,000 common shares that Mr. Gerber has
gifted in equal amounts to his three adult children, all shares are subject
to a ten year voting trusts of which Mr. Gerber is the sole voting trustee,
and (iii) 115,000 shares subject to currently exercisable warrants.
(5) Includes 217,000 shares subject to currently exercisable warrants.
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COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
The following table sets forth certain information with respect to the
annual and long-term compensation of the Company's Chief Executive Officer,
President and three other most highly paid executives and employees during the
fiscal years ended December 31, 1995, 1994 and 1993. During the fiscal years
ended December 31, 1995 and 1994 only one other key employee received total cash
and bonus compensation in excess of $100,000. The Company did not grant any
restricted stock awards or stock appreciation rights or make any long-term
incentive plan pay-outs to the individuals named in the tables below during the
fiscal years indicated.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long Term Compensation
---------------------------------------------------
Annual Compensation Awards Payout
------------------- ------ ------
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Year Other
Name and Ending Annual Restricted
Principal December Annual Compen- Stock Options/ LTIP All Other
Position 31, Salary Bonus sation Awards SARS Payouts Compensation
- --------------- ------------- -------------- --------- ---------- ------------ ----------- ---------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Sylvan Gerber, 1995 $ 11,250 -- -- $ 2,500 -- -- --
Chief Executive 1994 $ 71,666 -- -- -- -- -- --
Officer, President 1993 $119,800 -- -- -- -- -- --
Mark Allen, 1995 $112,325 -- -- $ 5,000 -- -- --
Chief Operating 1994 - -- -- -- -- -- --
Officer, Vice 1993 - -- -- -- -- -- --
President of
Finance
Philip Artsis, 1995 $115,762 -- -- -- -- -- --
Vice President (2) 1994 $197,353 -- -- -- -- -- --
1993 $110,000 -- -- -- -- -- --
Barry Leib, 1995 $117,385 -- -- -- -- -- --
Executive Vice 1994 $118,068 -- -- -- -- -- --
President (1) 1993 $118,300 -- -- -- -- -- --
Gilbert Sperry, 1995 $130,513 -- -- -- -- -- --
Senior Vice 1994 $141,400 -- -- -- -- -- --
President 1993 $100,000 -- -- -- -- -- --
Jack J. Zukerman, 1995 $ 29,167 -- -- -- -- -- --
former Chief 1994 $145,833 -- -- -- -- -- --
Executive Officer 1993 $119,800 -- -- -- -- -- --
</TABLE>
(1) Mr. Lieb passed away in August of 1995, in accordance with his employment
agreement his salary was paid to his wife through December 31, 1995.
(2) Mr. Philip Artsis is the son-in-law of Jack J. Zukerman, the former Chief
Executive Officer of the Company.
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Employment Agreements
In August 1995 the Company entered into an employment agreement with Scott
Searle, for a term expiring in September 1997, pursuant to which Mr. Searle
serves as President of the Company. Mr. Searle's agreement provides for a base
salary of $275,000.
In July 1995 the Company entered into employment agreements with each of
Sylvan Gerber and Mark Allen, for terms expiring in October 1998, pursuant to
which they serve as Chairman of the Board and Chief Executive Officer and
Executive Vice President and Chief Operating Officer, respectively. Mr. Gerber's
and Mr. Allen's agreements provide for a base salary of $150,000 and for the
payment to them upon a "change in control" (as defined in the agreements) of an
amount equal to the greater of $150,000 or the compensation remaining due to
each individual for the balance of the employment term.
All of the Company's employment agreements contain strict confidentiality
provisions and non-competition covenants. Compensation is subject to annual
increases and bonuses in the discretion of the Board of Directors. The
agreements also entitle the individuals to participate in any employee benefit
plans, such as group life, health, hospitalization and life insurance offered by
The Company. Under each of these agreements, each officer's employment shall
terminate upon death or disability of the employee and may be terminated by the
Company for "cause," which is generally defined as, among other things, an act
of fraud or embezzlement, material gross misconduct, conviction of a felony
involving moral turpitude, breach of the employees non-competition or
confidentiality covenants.
Stock Option Plans
In February 1994, the Board of Directors and stockholders of the Company
adopted a stock option plan (the "Option Plan") which provides for the grant to
employees, officers and consultants of options to purchase up to 120,000 Common
Shares consisting of both "incentive stock options" within the meaning of
Section 422 of the United States Internal Revenue Code of 1986 (the "Code") and
non-qualified options. The Option Plan is intended to qualify under Rule 16b-3
of the Securities Exchange Act of 1934. Incentive stock options are issuable
only to employees of the Company, while non-qualified options may be issued to
non-employees, consultants, and others, as well as to employees of the Company.
The Option Plan is administered by the Stock Option Committee of the Board
of Directors, which determines those individuals who shall receive options, the
time period during which the options may be partially or fully exercised, the
number of Common Shares that may be purchased under each option, and the option
price. The members of this committee are ineligible to receive options under the
Option Plan.
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The per share exercise price of an incentive or non-qualified stock option
may not be less than the fair market value of the Common Stock on the date the
option is granted. The aggregate fair market value (determined as of the date
the option is granted) of the shares of Common Stock for which incentive stock
options are first execrable by any individual during any calendar year may not
exceed $100,000. No person who owns, directly or indirectly, at the time of the
granting of an incentive stock option to him, more than 10% of the total
combined voting power of all classes of stock of the Company shall be eligible
to receive any incentive stock options under the Option Plan unless the option
price is at least 110% of the fair market value of the Common Stock subject to
the option, determined on the date of grant. Non-qualified options are not
subject to this limitation.
No incentive stock option may be transferred by an optionee other than by
will or the laws of descent and distribution, and during the lifetime of an
optionee, the option will be exercisable only by him or her. In the event of
termination of employment other than by death or disability, the optionee will
have three months after such termination during which to exercise the option.
Upon termination of employment of an optionee by reason of death or permanent
total disability, the option remains exercisable for one year thereafter to the
extent it was exercisable on the date of such termination. No similar limitation
applies to non-qualified options.
In February 1994, the Board of Directors and stockholders of the Company
adopted a non-discretionary non-employee directors' stock option plan (the
"Directors' Plan") that provides for the grant to non-employee directors of
non-qualified options to purchase up to 30,000 Common Shares. Pursuant to the
Directors' Plan, each new non-employee director of the Company is automatically
granted, six-months after becoming a director, an option to purchase 2,500
Common Shares at the fair market value of such shares on the grant date. In
addition, each non-employee director shall automatically be granted an option to
purchase 2,500 shares at the fair market value of such shares on the date of
grant, every six-months thereafter during which he serves as a director of the
Company. All such options shall vest one year from the date of grant.
Options under the Option Plan and Directors' Plan must be granted within 10
years from the effective date of each respective plan. Incentive stock options
granted under the plans cannot be exercised more than 10 years from the date of
grant, except that incentive stock options issued to greater than 10%
stockholders are limited to five year terms. All options granted under the plans
provide for the payment of the exercise price in cash or by delivery to the
Company of Common Shares already owned by the optionee having a fair market
value equal to the exercise price of the options being exercised, or by a
combination of such methods of payment. Therefore, an optionee may be able to
tender Common Shares to purchase additional Common Shares and may theoretically
exercise all of his stock options without making any additional cash investment.
Any unexercised options that expire or that terminate upon an optionee's
ceasing to be affiliated with the Company become available once again for
issuance. As of December 31, 1995, the Company had outstanding incentive stock
options to purchase _________ Common Shares exercisable at $4.75 to per share.
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Option Grants in Fiscal Year 1995 and Fiscal Year-End Option Values
No options were granted or outstanding to any Named Executive under the
Company's option plans at December 31, 1995.
Director Committees
The Board of Directors of the Company currently maintains an Executive
Committee, Audit Committee, Compensation Committee and Stock Option Committee.
The Executive Committee is empowered to exercise all powers and authority of the
Board of Directors in the management of the business and affairs of the
corporation, except as limited by Section 141(c) of the Delaware General
Corporation Law. The Executive Committee is comprised of Mssrs. Gerber, Sperry,
Allen, Finmark and Smith, and included Mr. Leib until his demise. The Audit
Committee reviews the engagement of the independent accountants, reviews and
approves the scope of the annual audit undertaken by the independent accountants
and review the independence of the accounting firm. The Audit Committee also
reviews the audit and non-audit fees of the independent accountants and the
adequacy of the Company's internal control procedures. The Audit Committee is
comprised of Mssrs. Gerber, Finmark, Dhananjay and Smith. The Compensation
Committee establishes and reviews the compensation terms for management and key
employees of the Company. The Compensation Committee is comprised of Mssrs.
Gerber, Dhananjay and Smith. The Company's Stock Option Plans are administered
by a disinterested committee of Directors comprised of Mssrs. Finmark and Smith.
Certain Transactions
The foregoing transactions between the Company and its officers, directors
or principal stockholders were for bona fide business purposes, and were on
terms no less favorable than could be obtained from unaffiliated third parties
and were approved by a majority of the Company's independent and disinterested
directors.
Director Compensation
The Company pays a fee of $500 per meeting to outside directors as
compensation for their services rendered as directors. Each director is
reimbursement for travel expenses incurred in connection with attendance at
meetings of the Board of Directors and its committees.
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ELECTION OF DIRECTORS
At the meeting, five Directors will be elected by the stockholders to serve
until the next annual meeting or until their successors are elected and
qualified. The accompanying form of proxy will be voted for the election as
Directors of the five persons named below, unless the proxy contains contrary
instructions. Proxies cannot be voted for a greater number of persons than the
number of nominees named herein. Management has no reason to believe that any of
the nominees will not be a candidate or will be unable to serve. However, in the
event that any of the nominees should become unable or unwilling to serve as
Director, the proxy will be voted for the election of such person or persons as
shall be designated by the Board of Directors.
Sylvan Gerber, age 67, has been the Chairman of the Board and Chief
Executive of the Company since January 1995 and a Director of the Company since
inception. Until August 1995 Mr. Gerber was also President of the Company. Prior
to that time, from 1987 to May 1991, Mr. Gerber was a private investor. From
1974 to 1986, Mr. Gerber was the President and Chief Executive Officer of Capri
Lighting Manufacturing Company ("Capri Lighting") which Mr. Gerber co-founded in
1974. Capri Lighting was sold in 1984 to Thomas Industries, Inc., although Mr.
Gerber continued to manage the day-to-day operations of Capri Lighting until
1986.
Mark Allen, age 34, was appointed Chief Operating Officer, Executive Vice
President Finance of the Company in March 1995 and elected to the Board of
Directors in May, 1995. Prior to that time, he held the position of Vice
President/Finance since October, 1994. From 1991 to 1994, Mr. Allen was employed
by Thomas James Associates, Inc. (now H.J. Meyers & Co., Inc.) as Vice
President, Corporate Finance and Director of Private Placements.
Bert Finmark, age 69, was elected to the Board of Directors in May 1995.
Mr. Finmark is presently a business consultant. Mr. Finmark was the co-founder
and Chairman of Capri Lighting from 1974 to 1986. Previously, Mr. Finmark was
founder and President of Superior Wholesale Electric.
Michael Smith, age 41, is the Managing Director Corporate Finance of H.J.
Meyers & Co., Inc., (formerly known as Thomas James Associates, Inc.) ("HJM") an
investment banking firm. Mr. Smith serves on the Board of Directors of both The
Bhirud MidCap Growth Fund, a publicly traded mutual fund and The Village Green
Bookstore, Inc. Mr. Smith has been with HJM since May 1991, and from 1987 until
1991 was a lawyer with the law firm of Harter, Secrest & Emery. Mr. Smith
received a B.A. from Cornell University and a J.D. from Cornell University
School of Law.
Dhananjay Wadekar, age 42, is a co-founder of DynaGen, Inc. ("DynaGen"), a
pharmaceutical firm, and has served as a Director of that Company since 1988 and
as its Chairman of the Board and Executive Vice President of the Company since
November 1991. In addition, he served as the Chairman, Chief Executive Officer
and Treasurer of DynaGen from 1988 until July 1990 and as a
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consultant to DynaGen during the period July 1990 to October 1991. Mr. Wadekar
was, from 1985 to January 1989, the Chairman and Chief Executive Officer of
Holometrix, Inc., a publicly traded, thermal instrumentation company which he
founded. Mr. Wadekar was a director of Holometrix, Inc. from 1985 until November
1994.
During the year ended December 31, 1995, the Board of Directors held four
meetings. Each Director standing for re-election who was a Director at the time
attended at least 75% of such meetings.
The affirmative vote of holders of a plurality of the shares of Common
Stock present or represented at the Annual Meeting is required for the
election of directors.
Management Recommends a Vote FOR the Election of the Foregoing
Nominees.
APPROVAL OF 1996 STOCK OPTION PLAN
On May 2, 1996, the Board of Directors approved the 1996 Stock Option Plan
(the "Plan"). The Plan will become effective upon the ratification by the
affirmative vote of the holders of a majority of the Company's outstanding
shares of Common Stock. It provides, among other matters, for incentive and/or
non-incentive stock options.
The purpose of the Plan is to provide incentives to key employees and
consultants whose performance will contribute to the long-term success and
growth of the Company, to strengthen the ability of the Company to attract and
retain employees of high competence, to increase the identity of interests of
such key employees with those of the Company's stockholders and to help build
loyalty to the Company through recognition and the opportunity for stock
ownership. All executive officers, key employees and consultants of the Company
who are in positions which enable them to make significant contributions to the
long-term performance and growth of the Company are eligible to receive awards
under the Plan.
The maximum aggregate number of shares as to which awards or options may at
any time be granted under the Plan is 350,000 shares.
The Plan is administered by the Stock Option Committee of the Board of
Directors, which determines those individuals who shall receive options, the
time period during which the options may be partially or fully exercised, the
number of shares of Common Stock that may be purchased under each option, and
the option price. The members of this committee are ineligible to receive
options under the Plan.
Terms of Options
The Plan permits the granting of both incentive stock options and
non-qualified stock options. The option price of both incentive stock options
and non-qualified stock options must be at least equal to 100% of the fair
market value of the shares on the date of grant. The maximum term of each option
is ten years. For any participant who owns shares possessing more than 10% of
the voting rights
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of the Company's outstanding Common Stock, the exercise price
of any incentive stock option must be at least equal to 110% of the fair market
value of the shares subject to such option on the date of grant and the term of
the option may not be longer than five years. Options become exercisable at such
time or times as the Stock Option Committee may determine at the time it grants
options.
No incentive stock option may be transferred by an optionee other than by
will or the laws of descent and distribution, and during the lifetime of an
optionee, the option will be exercisable only by him or her. In the event of
termination of employment other than by death or disability, the optionee will
have three months after such termination during which to exercise the option.
Upon termination of employment of an optionee by reason of death or permanent
total disability, the option remains exercisable for one year thereafter to the
extent it was exercisable on the date of such termination. No similar limitation
applies to non-qualified options.
Under certain circumstances involving a change in the number of outstanding
Common Shares without the receipt by the Company of any consideration therefor,
such as a stock split, stock consolidation or payment of a stock dividend, the
class and aggregate number of Common Shares in respect of which Options may be
granted under the Plan, the number of shares subject to each option and the
option price per share shall be proportionately adjusted.
The Plan will terminate on May 2, 2006 and may be terminated by the Board
of Directors of the Company prior to that date.
The Company believes that the Plan should be approved because of the need
to have the ability to issue stock options to the key employees and consultants
upon whose performance and contribution the long-term success and growth of the
Company is dependent.
The affirmative vote of the holders of a majority of the issued and
outstanding shares of Common Stock of the Company is required for the
approval of the 1996 Stock Option Plan.
The Board of Directors deems the adoption of the 1996 Option Plan to be
in the best of the Company and recommends a vote FOR its approval.
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RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITORS
The directors propose that the stockholders ratify the appointment of
Arthur Andersen LLP, as the Company's independent auditors for 1996. Arthur
Andersen LLP was the Company's independent auditors for its last fiscal year.
The report of Arthur Andersen LLP with respect to the Company's financial
statements appears in the Company's annual report on Form 10-K for such year. A
representative of Arthur Andersen, LLP will be at the annual meeting and will
have an opportunity to make a statement if he desires to do so and will be
available to respond to appropriate questions. In the event the stockholders
fail to ratify the appointment, the directors will consider it a directive to
consider other auditors for a subsequent year.
The affirmative vote of holders of a plurality of the shares of Common
Stock present or represented at the Annual Meeting is required for the
ratification of appointment of independent auditors.
The Board of Directors recommends a vote FOR the ratification of
appointment of independent auditors.
INCREASE THE NUMBER OF AUTHORIZED SHARES
OF COMMON STOCK
General
The Board of Directors believes it would be advantageous to amend Article
THIRD of the Company's Certificate of Incorporation to increase the aggregate
number of shares of the Company's Common Stock which the Company is authorized
to issue from 10,000,00 to 30,000,000.
Should this proposed amendment be adopted, it is not the present intention
of the Board of Directors to seek stockholders approval prior to any issuance
within the proposed authorization of additional Common Stock, unless otherwise
required by the Certificate of Incorporation, by law or any applicable
regulation of any exchange on which shares of the Company may be listed or the
Nasdaq Stock Market. Frequently, opportunities arise that require immediate
action, and it is the belief of the Board of Directors that the delay
necessitated by stockholder approval of a specific issuance could be detrimental
to the Company and its stockholders.
The proposed amendment would change the relevant portion of Article "THIRD"
of the Company's Certificate of Incorporation to read as follows:
"THIRD: The total number of shares of stock which the Corporation shall
have the authority to issue is thirty million (30,000,000) shares of the par
value of $.01 per shares."
Reasons and Effects
As of December 31, 1996, of the Company's 10,000,000 authorized shares of
Common Stock, 6,518,891 shares were issued and outstanding ______ shares were
reserved for issuance upon conversion of the Company's outstanding Convertible
Subordinated Debentures and _____ shares were reserved for issuance pursuant to
the Stock Option Plans, leaving a balance of only approximately ______ shares
available for issuance. The Board of Directors believes that it is necessary
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to have a reserve of authorized shares available for issuance from time to time
to meet the financing requirements of the Company, including their issuance in
connection with acquisitions of other businesses, for sale for cash, for use in
connection with stock dividends or stock splits or for other corporate purposes
not now determinable. The proposed increase in the number of authorized shares
of Common Stock is designed to provide the Company with additional flexibility
in pursuing its long-range business objectives.
Although there are no other present plans which would result in the need
for additional Common Stock to be issued, management is continually considering
the desirability of corporate actions which might create such a need.
The increased number of authorized shares of Common Stock could discourage,
or be used to impede, an attempt to acquire or otherwise change control of the
Company. The private placement of Common Stock into "friendly" hands, for
example, could dilute the voting strength of a party seeking control of the
Company. Furthermore, many companies have recently issued warrants or other
rights to acquire additional shares of common stock to the holders of its common
stock to discourage or defeat unsolicited stock accumulation programs and
acquisition proposals, which programs or proposals may be viewed by the board of
directors as not in the best interests of the Company and its stockholders. If
this Proposal is adopted, more capital stock of the Company would be available
for such purposes than is currently available.
The affirmative vote a majority of the outstanding shares of Common
Stock entitled to vote is required for the adoption of this Proposed
Amendment.
The Board of Directors Recommends a Vote FOR this Amendment.
GENERAL
The management of the Company does not know of any matters other than those
stated in this Proxy Statement which are to be presented for action at the
meeting. If any other matters should properly come before the meeting, it is
intended that proxies in the accompanying form will be voted on any such other
matters in accordance with the judgment of the persons voting such proxies.
Discretionary authority to vote on such other matters is conferred by such
proxies upon the persons voting them.
The Company expects representatives of Arthur Andersen LLP, the Company's
independent auditors, to be present at the Annual Meeting and to respond to
pertinent questions of stockholders.
The Company will bear the cost of preparing, assembling and mailing the
Proxy, Proxy Statement and other material which may be sent to the stockholders
in connection with this solicitation. In addition to the solicitation of proxies
by use of the mail, officers and regular employees may solicit the return of
proxies. The Company may reimburse persons holding stock in their names or in
the names of other nominees for their expenses in sending proxies and proxy
material to principals. Proxies may be solicited by mail, personal interview,
telephone and telegraph.
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The Company will provide without charge to each person being solicited by
this Proxy Statement, upon the written request of any such person, a copy of the
Annual Report of the Company on Form 10-K for the year ended December 31, 1995
(as filed with the Securities and Exchange Commission) including the financial
statements thereto. All such requests should be directed to CSL Lighting
Manufacturing, Inc., 27615 Avenue Hopkins, Valencia, California 91355-3493, Att:
Secretary.
All proposals of stockholders intended to be included in the proxy
statement to be presented at the 1997 Annual Meeting of Stockholders must be
received at the Company's executive offices no later than December 31, 1996 and
should be directed to the Secretary of the Company.
By Order of the Board of Directors
Mark Allen, Secretary
Dated: January 28, 1997
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