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:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-12
CCA INDUSTRIES, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
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:
-----------------------------------------------------------------------
CCA INDUSTRIES, INC.
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
JULY 9, 2003
TO THE SHAREHOLDERS:
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of CCA
INDUSTRIES, INC., a Delaware corporation (hereinafter, the "Company"), will be
held on July 9, 2003, at 2 p.m., at the American Stock Exchange (14th floor
boardroom ), 86 Trinity Place, New York, NY, for the following purposes:
MANAGEMENT PROPOSALS
1. To elect directors to serve on the Board of Directors for the ensuing
year.
2. To approve management's appointment of Sheft Kahn & Company L.L.P. as
the Company's independent certified public accountants for the fiscal
year ending November 30,2003.
3. To authorize the 2003 Option Plan proposed by the Board of Directors.
* * *
Such other business, if any, as may properly come before the meeting or any
adjournment thereof, shall also be considered.
The identified proposals are more fully described, and related information
is presented, in the Proxy Statement accompanying this Notice.
Only shareholders of record at the close of business on May 29, 2003 are
entitled to notice of the meeting, and to vote at the meeting and at any
continuation or adjournment thereof.
BY ORDER OF THE BOARD OF DIRECTORS
/s/ Ira W. Berman
--------------------------------------
Ira W. Berman, Corporate Secretary and
CHAIRMAN OF THE BOARD
East Rutherford, NJ
May 23, 2003
- --------------------------------------------------------------------------------
WHETHER OR NOT YOU PLAN TO ATTEND THIS MEETING, YOU ARE URGED TO COMPLETE,
SIGN AND RETURN THE ENCLOSED PROXY CARD. NO POSTAGE NEED BE AFFIXED IF MAILED IN
THE UNITED STATES AND IN THE ENVELOPE PROVIDED THEREFOR.
- --------------------------------------------------------------------------------
CCA INDUSTRIES, INC.
EAST RUTHERFORD, NEW JERSEY 07073
---------------
PROXY STATEMENT
---------------
The enclosed proxy is solicited on behalf of the Board of Directors of CCA
INDUSTRIES, INC., a Delaware corporation (hereinafter, the "Company"), for use
at its Annual Meeting of Shareholders to be held on July 9, 2003, at 2 p.m.
Shareholders of record on May 29, 2003 will be entitled to vote. The meeting
will be held at the American Stock Exchange ( 14th floor boardroom ) , 86
Trinity Place, New York, NY.
The Company intends to mail this Proxy Statement, and the Company's Annual
Report for the 2002 fiscal year, on or about June 4, 2003.
I. GENERAL
A. VOTING
The Company, as provided in and by its Certificate of Incorporation, has
two authorized classes of common stock, denominated Common Stock and Class A
Common Stock, and one authorized class of preferred stock, denominated Preferred
Stock.
On May 23, 2003, there were 6,577,669 shares of Common Stock and 973,230
shares of Class A Common Stock outstanding.
As of the date of this statement, no Preferred Stock is issued, and the
Board has no pending negotiation or plan concerning any expected issuance of
Preferred Stock.
Owners of Common Stock and owners of Class A Common Stock are entitled to
one vote for each share of stock held, and the voting and other rights of each
class are equivalent except in respect of the election of directors.
In respect of the election of directors, the Class A Common Stock
shareholders have the right to elect four directors and the Common Stock
shareholders have the right to elect three. (In consequence, no proposal to
alter or change the right of Class A Common Stock shareholders to elect a
majority of directors could be effectively voted unless a separate majority of
the Class A Common Stock shares were voted therefor.)
A quorum, counting proxies and shares represented in person, is necessary
to the voting upon proposals proposed by Management, and other business that may
properly come before the Annual Meeting. Fifty percent (50%) of all outstanding
shares constitutes a quorum for all purposes other than the election of
directors. In respect thereof, fifty percent (50%) of the outstanding shares of
Common Stock is a quorum for the election of directors to be elected by holders
of Common Stock, and fifty percent (50%) of the outstanding shares of Class A
Common Stock is a quorum for the election of directors to be elected by holders
of Class A Common Stock.
Nonvoting of shares (whether by abstention, broker non-vote or otherwise),
other than the potential effect of denying a quorum, has no impact on voting.
B. SHARE OWNERSHIP OF DIRECTORS, OFFICERS AND 5% OWNERS
The following table sets forth certain information regarding the ownership
of the Company's Common Stock and Class A Common Stock as of May 23, 2003 by (i)
all those known by the Company to be owners of as much as five (5%) percent of
the outstanding shares of Common Stock and/or Class A Common Stock, (ii) each
Officer and Director, and (iii) Officers and Directors as a group. Moreover, it
presents individual ownership of "Option Shares," and the aggregate Option
Shares ownership of Officers and Directors (with Option Shares representing the
number of shares purchasable upon exercise of options exercisable within 60
days). Unless otherwise indicated, each of the shareholders has sole voting and
investment power with respect to the shares owned (subject to community property
laws, where applicable), and is beneficial owner of them.
OWNERSHIP,
AS A
PERCENTAGE OF
ALL SHARES
NUMBER OF SHARES OWNED OUTSTANDING/
---------------------------------------- ASSUMED
CLASS A OWNERSHIP
NAME AND ADDRESS COMMON STOCK COMMON STOCK OPTION SHARES OPTION SHARES
- ---------------- ------------ ------------ ------------- -------------
David Edell 496,993 484,615 97,500 13.5/14.8
c/o CCA Industries, Inc.
Ira W. Berman 466,603 473,615 117,000 12.9/14.5
c/o CCA
Drew Edell 51,250 0 75,000 06/1.6
c/o CCA
Dunnan Edell 41,250 0 75,000 .05/1.5
c/o CCA
Jack Polak 27,700 0 25,000 .04/.07
98 Park Avenue
New York, NY 10016
Stanley Kreitman 0 0 25,000 0/.03
c/o CCA
Robert Lage 0 0 0 0
c/o CCA Industries
John Bingman 0 0 0 0
c/o CCA
Officers and Directors 1,083,796 958,230 414,500 28.1/31.9
As a Group (8 persons)
TABLE NOTES
The numbers shown as "Option Shares" assume that unexercised options,
exercisable within 60 days, have been exercised (and, thus, that subject shares,
not actually owned, are actually owned). The percentage ownership figure,
"Assumed Ownership-Option Shares," aggregates the assumptions for the group of
Officers and Directors and, for each individual owner, presents a measurement
which assumes that the particular individual has exercised such options and
purchased subject shares, but that no other owner of such options has `exercised
and purchased.' The catergory "as a group " assumes exercise of all unexercised
options by the table-represented parties.
David Edell and Ira Berman own all of the outstanding shares of Class A
Common Stock.
Messrs. David Edell, Dunnan Edell, Drew Edell and Ira Berman are officers
and directors. John Bingman is an officer. Messrs. Polak, Kreitman, and Lage are
directors.
2
Rami Abada, Ira Berman's son-in-law, was a director until April 1, 2003,
when he resigned to accomodate the Company's compliance with S.E.C. regulations
regarding the "independence" of directors who serve as Audit Committee members,
as defined by Listing Standards of The American Stock Exchange, `where' the
Company's Common Stock is now traded. Therefore and thereupon, Mr.Lage was
appointed to replace Mr. Abada. (See Executive Compensation - Audit and
Compensation Committee, and Proposal No.1, including Mr.Lage's election
nomination and biographical data.)
C. EXECUTIVE COMPENSATION
I. SUMMARY COMPENSATION TABLE
The following table summarizes compensation earned in the 2002, 2001 and
2000 fiscal years by the "Named Officers" -- all of the executive officers whose
fiscal 2002 compensation exceeded $100,000, including the Chief Executive
Officer.( Whereas none received stock options, or other long term compensation
otherwise to be reported, in any of those last three fiscal years, no Long Term
Compensation `tables' are presented.)
ANNUAL COMPENSATION
-------------------
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS OTHER(1)
- --------------------------- ---------- ------------ ----------- --------------
David Edell 2002 $584,155 $332,060 $38,176
President and Chief 2001 514,399 247,806 35,985
Executive Officer 2000 425,372 132,221 12,552
Ira. W. Berman 2002 584,155 332,060 23,372
Secretary and Executive 2001 514,399 247,806 24,117
Vice President 2000 425,372 132,221 11,775
Dunnan Edell 2002 253,172 45,000 1,626
Executive Vice President - 2001 232,595 4,231 2,914
Sales 2000 218,076 4,194 2,723
Drew Edell 2002 203,845 25,000 1,178
Vice President - 2001 187,596 3,365 816
Manufacturing 2000 175,000 3,365 577
John Bingman 2002 99,843 20,000 948
Treasurer 2001 101,354 1,862 821
2000 98,662 -0- 855
- ---------------------
(1) Includes the personal-use value of Company-leased automobiles, the value of
Company-provided life insurance, and health insurance that is made
available to all employees.
II. FISCAL 2002 OPTION GRANTS AND OPTION EXERCISES, YEAR-END OPTION VALUATION,
OPTION REPRICING
No new options were issued to any of the Named Officers in fiscal 2002.
3
The next table identifies 2002 fiscal-year option exercises by Named
Officers, and reports a valuation of their options.
FISCAL 2002 AGGREGATED OPTION EXERCISES
AND NOVEMBER 30,2002 OPTION VALUES
NUMBER OF SHARES VALUE OF
COVERED BY UNEXERCISED
NUMBER OF UNEXERCISED IN-THE-MONEY
SHARES ACQUIRED OPTIONS AT OPTIONS AT
ON EXERCISE VALUE REALIZED NOV. 30,2002 NOV.30,2002(1)
--------------- -------------- ---------------- --------------
David Edell 100,000 $150,000 157,500 $193,725
Ira W. Berman 100,000 150,000 202,000 248,460
Dunnan Edell -0- -0- 75,000 92,250
Drew Edell -0- -0- 75,000 92,250
John Bingman -0- -0- -0- -0-
(1) Represents the difference between market price and the respective exercise
prices of options at November 30, 2002.
The following table identifies the stock options held by the Named Officers
and all other officers and directors, the exercise prices of which have been
reduced during the past 10 years.
REPRICED OPTIONS
ORIGINAL ORIGINAL
NUMBER OF SHARES GRANT DATE PRICE DATES REPRICED NEW PRICES
------------------ --------------- ---------- ---------------------------
David Edell 100,000 Aug. 1, 1997 $2.50 11/3/98-5/24/01 $1.50-$.50
Ira W.Berman 100,000 Aug. 1, 1997 2.50 11/3/98-5/24/01 1.50- .50
Dunnan Edell 50,000 Aug. 1, 1997 2.50 11/3/98-5/25/01 1.50-.50
Drew Edell 50,000 Aug. 1, 1997 2.50 11/3/98-5/24/01 1.50- .50
Stanley Kreitman 25,000 Aug. 1, 1997 2.50 11/3/98-5/24/01 1.50-.50
Rami Abada 25,000 Aug. 1, 1997 2.50 11/3/98-5/24/01 1.50- .50
Dunnan Edell 25,000 June 10, 1995 4.50 6/10/00-5/24/01 1.50-.50
DrewEdell 25,000 June 10, 1995 4.50 6/10/00-5/24/01 1.50- .50
- ----------------------------
(1) On November 3, 1998, the full Board of Directors authorized the repricing
in consequence of a declining market valuation, inconsistent with the
Company's realizable value. The market price of the Common Stock at the
date of repricing was $1.00; and, at that date, the original option terms
(10 years from August 1, 1997) had approximately 8 years and 10 months to
run. When the options were originally issued, on August 1, 1997, the market
price of the Company's Common Stock was $2.50. On May 24,2001, the company
repriced the options again when the market price was $.50.
(2) On June 10, 2000, the full Board of Directors authorized the repricing in
consequence of a declining market valuation, inconsistent with the
Company's realizable value. The market price of common stock at the date of
repricing was $1.10; and at that date the original terms (5 years from June
10, 1995) were extended for an additional 5 years. When the options were
originally issued on June 10, 1995, the market price of the Company's
common stock was $3.00. On May 24, 2001, the Company repriced the options
again when the market price was $.50, and changed the expiration date to
August 1, 2007.
III. COMPENSATION OF DIRECTORS
Each `outside' director (Messrs. Kreitman, Polak and Abada) was paid $3,000
per meeting for attendance of board meetings in fiscal 2002. No other
compensation was paid to any director for directorship duties or meeting
attendance. No new options were granted to any director in fiscal 2002.
The full Board of Directors met three times in the 2002 fiscal year.
4
IV. EXECUTIVE COMPENSATION PRINCIPLES;
AUDIT AND COMPENSATION COMMITTEES
Until April I, 2003, the Audit Committee of the Board of Directors was
comprised of Ira W. Berman, Stanley Kreitman, Jack Polak and Rami Abada.They met
three times in fiscal 2002. On April 1, 2003, Mr.Abada resigned as a director
and Audit Committee member, and Mr. Berman (who is still a director) resigned
his Audit Committee membership, to assure compliance with "independent " Audit
Committee member regulations . ( Mr. Berman's status as an officer-employee
director, and Mr. Abada's status as his son-in-law, under the subject S.E.C.
regulations, define each as not "independent" for Audit Committee purposes. )
The Audit Committee is now comprised of Messrs. Kreitman and Polak, and Mr.
Robert Lage. Mr. Lage was appointed to the Board (and Audit Committee ) to serve
`instead' of Mr.Abada, and is herewith proposed for election. (See Proposal No.
1. Included there, in the biographies of the persons proposed for election to
the Board, are particular "Audit Committee Credentials" of Messrs. Kreitman,
Polak and Lage.)
(An Audit Committee Charter was adopted by the full Board of Directors in
fiscal 2000, and a copy of it was appended to the Proxy Statement disseminated
for and in respect of the Company's 2001 Annual Meeting.)
Re fiscal 2002, the Audit Committee (a) reviewed and discussed the
Company's audited financial statements, with management; (b) received and
discussed the information required to be discussed, pursuant to Auditing
Standards and S.E.C. regulations, with the Company's independent auditors; (c)
received written disclosures, and the letter concerning same, from the
independent auditors as required by S.E.C. regulations and described by
Independence Standard Board Standards; (d) discussed the independence of the
auditors, with the auditors; and (e) recommended that the audited financial
statements be included in the Company's Annual Report on Form 1O-K.
V. EMPLOYMENT CONTRACTS/COMPENSATION PROGRAM
The Company's Executive Compensation Program, administered by the
Compensation Committee (the membership of which is the same as the Audit
Committee), is based on guiding principles designed to align executive
compensation with Company values and objectives, business strategy, management
initiatives, and financial performance, and has an established program to:
o Reward executives for long-term strategic management and the
enhancement of shareholder value.
o Integrate compensation programs with both the Company's annual and
long-term strategic planning.
o Support a performance-oriented environment that rewards performance
not only with respect to Company goals, but also Company performance
as compared to industry-performance levels.
The total compensation program consists of both cash and equity based
compensation. The Compensation Committee determines the level of salary and
bonuses, if any. The Committee determines the salary or salary range based upon
competitive norms. Actual salary changes are based upon performance.
On March 17, 1994, the Board of Directors approved lO-year employment
contracts (hereinbelow, the "Edell/Berman Contracts") for David Edell and Ira
Berman (with Mr. Edell and Mr. Berman abstaining). Pursuant thereto, each was
provided a base salary of $300,000 in fiscal 1994, with a year-to-year CPI or 6%
increment, plus 2.5% of the Company's pre-tax income, less depreciation and
amortization (the "2.5% measure"), plus 20% of the base salary, as bonus.
In February 1999, the 2.5% measure in the bonus provisions of the
Edell/Berman Contracts was amended so as to calculate it against earnings before
income taxes, less depreciation, amortization, and expenditures for media and
cooperative advertising in excess of $8,000,000.
5
On May 24, 2001, the Edell/Berman Contracts were amended to increase their
base annual salaries to $400,000, and to extend the terms through November 30,
2007, and on October 16, 2002, their contracts (otherwise unamended), were
extended to December 1, 2010.
David Edell's sons, Dunnan Edell and Drew Edell have 5-year employment
contracts which expire November 30, 2007, providing base annual salaries of
$270,000 and $200,000, respectively.
Long-term incentives are provided through the issuance of stock options.
VI. STOCK OPTION PLANS
The Company's 1994 Stock Option Plan covered 1,000,000 shares of its Common
Stock.(The1994 Plan has expired ; but there are 427,500 stock options issued
under the 1994 Plan outstanding, and yet exercisable to purchase 427,500 shares
of Common Stock.)
For the reasons expressed in "Proposal No. 3," the Board of Directors has
authorized a "2003 Option Plan" that is generally described in Proposal No.3,
and presented as an appendix following the last page of the "Proxy Statement
proper." (The proposed 2003 Plan will become effective if it is approved by vote
of the shareholders.)
The 1994 Stock Option Plan provided (as the 2003 Plan proposes):
(1) for the granting of two types of options: "Incentive Stock Options"
and "Nonqualified Stock Options". The Incentive Stock Options (but not
the Nonqualified Stock Options) are intended to qualify as "Incentive
Stock Options" as defined in Section 422(a) of The Internal Revenue
Code. The Plans are not qualified under Section 401(a) of the Code,
nor subject to the provisions of the Employee Retirement Income
Security Act of 1974.
(2) For option grants to employees (including officers and directors who
are also employees) and consultants of the Company ( provided,
however, that Incentive Stock Options may not be granted to any
non-employee director or consultant).
EQUITY COMPENSATION PLAN INFORMATION
(a) (b) (c)
- ------------------------------------------------------------------------------------------------------------------
Plan Category........................ No. of Securities to be Weighted average No.of securities
issued upon exercise exercise price of remaining available
of outstanding options outstanding options for future issuance
warrants and rights under equity
compensation plans
(excluding securities
reflected in column (a)
- ------------------------------------------------------------------------------------------------------------------
Equity Compensation.................. 427,500 $.50 -0-
plans approved
by security holders
- ------------------------------------------------------------------------------------------------------------------
Equity Compensation.................. -0- -0- -0-
plans not approved by
security holders
- ------------------------------------------------------------------------------------------------------------------
6
VII. PERFORMANCE GRAPH
Set forth below is a line graph (followed by a numerical table) comparing
cumulative total shareholder return on the Company's Common Stock.
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*
AMONG CCA INDUSTRIES, INC, THE DOW JONES US COSMETICS INDEX
AND THE DOW JONES US TOTAL MARKET INDEX
[PERFORMANCE GRAPH]
CUMULATIVE TOTAL RETURN*
------------------------
12/97 12/98 12/99 12/00 12/01 12/02
----- ----- ----- ----- ----- -----
CCA Industries, Inc. 100 57 51 26 59 91
DJ US Cosmetics Index 100 104 92 88 80 77
DJ US Total Market Index 100 125 153 139 122 95
- ---------------
* $100 invested on December 31, 1997 in stock and indices, including
reinvestment of dividends.
7
D. THE BOARD OF DIRECTORS AND STANDING COMMITTEES
The Company's Board of Directors has no nominating committee. Its Audit and
Compensation Committee members are Messrs. Stanley Kreitman, Jack Polak, and
Robert Lage.
E. RELATED DIRECTORS AND/OR OFFICERS
David Edell is the Company's President and Chief Executive Officer. He is
also a director. Drew Edell and Dunnan Edell are his sons. Both are directors,
and Vice-Presidents of the Company.
F. AUDIT FEES
Its independent auditors (Sheft, Kahn & Company, L.L.P.) charged the
Company as follows, for fiscal 2002 services (and was paid the sums charged):
(a) approximately $90,000 for the fiscal 2002 year-end audit of the Company's
financial statements; (b) approximately $50,000 for interim reviews; (c) $1,000
for "Financial Information Systems" services; and (d) approximately $35,000 for
other professional services (tax,management consulting, etc.).
The Audit Committee considered all fees paid to Sheft, Kahn & Company in
recent years, and in the 2002 fiscal year, and concluded that no fee-issue
threatens their `independence.'
G. REVOCABILITY OF PROXIES
Any person giving a proxy in the form accompanying this statement has the
power to revoke it at any time before its exercise. Thus, it may be revoked
prior to its exercise by the filing of an instrument of revocation, or a duly
executed proxy bearing a later date, with the Secretary of the Company at the
Company's principal executive office. A proxy holder can also revoke a filed
proxy by attending the meeting and voting in person.
H. SOLICITATION OF PROXIES
It is estimated that the costs associated with proxy solicitation will be
approximately $15,000. The Company will bear the entire cost of solicitation,
including preparation, assembly, printing and mailing of this Proxy Statement,
the proxy, and any additional material furnished to shareholders. Copies of
solicitation material will be furnished to brokerage houses, fiduciaries, and
custodians holding shares in their names that are beneficially owned by others,
for forwarding of such material to beneficial owners. The Company may reimburse
such persons their forwarding costs. Original solicitation of proxies by mail
may be supplemented by telephone, telegram, or personal solicitation by
directors, officers or employees of the Company. No additional compensation will
be paid for any such services.
I. SHAREHOLDER PROPOSALS FOR THE YEAR 2004
Proposals of shareholders that are intended to be presented at the
Company's year 2004 Annual Meeting of Shareholders must be received by the
Company no later than February 13, 2004 in order to be included in the Company's
proxy materials relating to that meeting.
8
II. MANAGEMENT PROPOSALS
PROPOSAL NO.1
NOMINATION AND ELECTION OF DIRECTORS
All seven seats on the Company's Board of Directors are subject to one -
year terms and annual election. Four are subject to election by holders of Class
A Common Stock and three by holders of Common Stock. Each director holds office
until the next Annual Meeting of Shareholders and until a successor is elected
and has qualified, or until death, resignation or removal.
The four nominees proposed for election by the holders of the Company's
Class A Common Stock (David Edell, Ira Berman, Jack Polak and Stanley Kreitman)
already serve as directors, as do the three proposed for election by the holders
of Common Stock (Dunnan Edell, Drew Edell and Robert Lage). All have agreed to
continue to serve if elected.
Set forth below is information regarding all nominees, including
information they have furnished concerning their principal occupations and
certain other directorships, and their ages as of May 23, 2003. (The stock
ownership of each of the nominees is presented above, under "Share Ownership of
Directors, Officers and 5% Owners.")
A. CLASS A COMMON STOCK NOMINEES
(No vote or proxy is solicited in respect of the Class A nominees, since
two of them - Messrs. Berman and David Edell - own all of the Class A Common
Stock shares, and they have jointly proposed themselves, Mr. Polak and Mr.
Kreitman, for re-election.)
David Edell, age 71, is a director, and the Company's President and Chief
Executive Officer. Prior to his association with the Company he was a marketing
and financial consultant; and, by 1983, he had extensive experience in the
health and beauty aids field as an executive director and/or officer of Hazel
Bishop, Lanolin Plus and Vitamin Corporation of America. In 1954, David Edell
received a Bachelor of Arts degree from Syracuse University.
Ira W. Berman, age 71, is the Company's Executive Vice President and
Corporate Secretary. He is also Chairman of the Board of Directors. Mr. Berman
is an attorney who has been engaged in the practice of law since 1955. He
received a Bachelor of Arts Degree (1953) and Bachelor of Laws Degree (1955)
from Cornell University, and is a member of the American Bar Association.
Jack Polak, age 90, has been a private investment consultant since April
1982. He was knighted by Queen Beatrix of the Netherlands for his efforts on
behalf of the Anne Frank Center, USA, for which he still actively works, and is
Chairman Emeritus, and holds a tax certification in The Netherlands. He was a
director and member of the Audit and Compensation Committee of K.T.I.
Industries, Inc., from February 1995 until 1999, when K.T.I., a waste-to-energy
business was `taken over' by Casella Industries. From 2000 until 2002, he was a
director of Oakhurst Industries, a public company that owns an automotive
accessories distributor, a waste-to-energy tire facility, and a road
construction company.
Stanley Kreitman, age 71, has been Vice Chairman of the Board of Manhattan
Associates, an equity investment firm, since 1994. He is also a director of
Medallion Financial Corp., an SBIC. Mr. Kreitman has been Chairman of the Board
of Trustees of the New York Institute of Technology since 1989, and of Crime
Stoppers Nassau County (NY), since 1994. Since February 1999 and June 1999,
respectively, he has been a member of the Board of Directors of K.S.W. Corp. and
P.M.C.C. Mortgage Corp. He is also a director and/or executive committee member
of the following organizations: The New York City Board of Corrections, Bank
Hapdalim USA (Signature Bank), The New York College of Osteopathic Medicine, and
the Police Athletic League. From 1975 until 1993, he was President of United
States Banknote Corporation, a securities printer.
9
B. COMMON STOCK NOMINEES
Dunnan Edell, age 47, is the son of David Edell and the brother of Drew
Edell. He is graduate of George Washington University. He has been a director
since 1994. A Senior Vice President-Sales, he joined the Company in 1984 and was
appointed Divisional Vice-President in 1986. He was employed by Alleghany
Pharmacal Corporation from 1982 to 1984, and by Hazel Bishop from 1977 to 1981.
Drew Edell, age 45, is the son of David Edell and the brother of Dunnan
Edell. He is a graduate of Pratt Institute, with a degree in Industrial Design.
He has been a director since 2000. He joined the Company in 1983, and has been
its Vice President-Product Development and Production, since 1985.
Robert A. Lage, age 66, a C.P.A., was a partner at PriceWaterhouseCoopers
Management Consulting Service prior to his retirement in 1997. He has been
engaged in the practice of public accounting and management consulting since
1959. He received a BBA from Bernard Baruch College of The City University of
New York in 1958.
AUDIT AND COMPENSATION COMMITTEE CREDENTIALS
Stanley Kreitman, former president of a national bank, will qualify as a
"financial expert" as the same is proposed by the S.E.C. in its Release No. 34 -
46701( October 22, 2002). Mr. Kreitman is "independent" as defined by Section
121(A) of The American Stock Exchange's Listing Standards and, thus, S.E.C.
Rules. (In fact, the subject definitions detail relationships etc. that `define'
non-independence. No issue `thereunder' is `presented' by Mr. Kreitman--or, see
below, by Mr. Polak, or Mr. Lage).
In any event, Mr. Kreitman qualifies `under' existing AMEX/Audit
Committee/financial `sophistication' rules as `having past employment experience
or background which results in financial sophistication...'-as do Mssrs.Polak
and Lage (as next presented).
Jack Polak is a certified Dutch tax consultant and a member of the
Association of Certified Tax Accountants. As shown above he is both
"independent" and AMEX-qualified as financially sophisticated.
Robert A. Lage, as shown above, is both "independent" and AMEX-qualified as
financially sophisticated.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE IN FAVOR OF EACH OF THE COMMON
STOCK NOMINEES AS PROPOSED IN THIS PROPOSAL NO.1. A MAJORITY OF THE COMMON STOCK
VOTE IS REQUIRED FOR APPROVAL.
PROPOSAL NO.2
APPROVAL OF APPOINTMENT OF AUDITORS
The Board of Directors has appointed the firm of Sheft Kahn & Company LLP.,
independent certified public accountants (the "Auditors"), to audit the accounts
and certify the financial statements of the Company for the fiscal year ending
November 30, 2003. The appointment shall continue at the pleasure of the Board
of Directors, subject to approval by the shareholders. The Auditors have acted
as the Company's auditors since 1983.
The Board of Directors expects that one or more representatives of the
Auditors will be present at the meeting. The Auditors will then be given the
opportunity to make a statement, and will be available to respond to appropriate
questions.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE IN FAVOR OF PROPOSAL NO.2. A
MAJORITY OF THE AGGREGATED CLASS A COMMON STOCK AND COMMON STOCK VOTE IS
REQUIRED FOR APPROVAL.
10
PROPOSAL NO.3
AUHORIZATION OF THE "2003 STOCK OPTION PLAN"
On February 12, 2003, the Board of Directors adopted a 2003 Stock Option
Plan authorizing the issuance of up to 1,000,000 shares of the Company's Common
Stock. The plan is similar to the 1994 Stock Option Plan. The Audit and
Compensation Committee (hereinafter, the "Committee") will administer the plan.
The plan will specifically authorize the payment for Options with the Company's
Common Stock, if requested by an Optionee.
If approved, The 2003 Option Plan will provide (as the 1994 Plan provided)
for the granting of two (2) types of options: "Incentive Stock Options" and
"Nonqualified Stock Options". The Incentive Stock Options (but not the
Nonqualified Stock Options) are intended to qualify as "Incentive Stock Options"
as defined in Section 422 of the Code. The Plan is not qualified under Section
401(a) of the Code nor is it subject to the provisions of the Employee
Retirement Income Security Act of 1974.
Options may be granted under the 2003 Option Plan to employees (including
officers and directors who are also employees) and consultants of the Company,
provided, however, that Incentive Stock Options may not be granted to any
non-employee director or consultant.
The 2003 Option Plan is to be administered and interpreted by the
Committee, with the power, subject to the provisions of the Plan, to determine
the persons to whom and the dates on which the options will be granted, the
number of shares to be subject to each option, the term of each and the other
terms of the options. The Committee has the power to delegate administration of
the Plan to a Committee of not less than two (2) Board members, each of whom
must be disinterested within the meaning of Rule 16b-3 under the Exchange Act
and ineligible to participate in the Plan or in any other stock purchase, option
or appreciation right plan of the Company or any of its affiliates. Members of
the Committee receive no compensation for their services in connection with the
administration of the Option Plan.
The maximum term of each option will be ten (10) years. No option granted
under the 2003 Option Plan will be transferable by the Optionee other than upon
death.
Under the 2003 Option Plan an option will terminate three (3) months after
the Optionee ceases to be employed by the Company or a parent or subsidiary of
the Company unless (i) the termination of employment is due to such person's
permanent and total disability, in which case the option may, but need not,
provide that it may be exercised at any time within one (1) year of such
termination (to the extent the option was vested at the time of such
termination); or (ii) the Optionee dies while employed by the Company or a
parent or subsidiary of the Company or within three (3) months after termination
of such employment, in which case the option may, but need not provide that it
may be exercised (to the extent the option was vested at the time of the
Optionee's death) within eighteen (18) months of the Optionee's death by the
person or persons to whom the rights under such option pass by will or the laws
of descent or distribution; or (iii) the option by its terms specifically
provides otherwise.
The exercise price of all nonqualified stock options granted under the 2003
Option Plan must be at least equal to 85% of the fair market value of the
underlying stock on the date of grant. The exercise price of all Incentive Stock
Options granted under the Plan must be at least equal to the fair market value
of the underlying stock on the date of grant. The aggregate fair market value of
stock of the Company (determined at the date of the option grant) for which any
employee may be granted Incentive Stock Options in any calendar year may not
exceed $100,000, plus certain carryover allowances, if any. The exercise price
of an Incentive Stock Option granted to any participant who owns stock
possessing more than ten (10%) of the voting rights of the Company's outstanding
capital stock must be at least 110% of the fair market value on the date of
grant and the maximum term may not exceed five (5) years.
11
The 2003 Option Plan , as proposed, will permit the exercise of options for
cash, other property acceptable to the Committee and (as the 1994 Plan
specifically authorized ) that payment may be made for stock issuable upon
exercise by tender of Common Stock of the Company..
Consequences to the Company: There are no Federal income tax consequences
to the Company by reason of the grant or exercise of an Incentive Stock Option.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE IN FAVOR OF THE 2003 STOCK OPTION
PLAN - PROPOSAL NO. 3--IN ORDER TO BETTER ENABLE THE COMPANY TO ATTRACT KEY
EXECUTIVES AND EMPLOYEES, MAINTAIN INCENTIVES FOR CURRENT MANAGEMENT, AND AID
THE COMPANY'S GROWTH EFFORTS. A MAJORITY OF THE AGGREGATED CLASS A COMMON STOCK
AND COMMON STOCK VOTE IS REQUIRED FOR APPROVAL.
III. OTHER MATTERS
The Board of Directors knows of no other matters to be presented, but if
any other matters properly come before the Annual Meeting it is intended that
the persons holding proxies will vote thereon in accordance with their best
judgments.
When a proxy in the form enclosed with this Proxy Statement is returned
properly executed, the shares represented thereby will be voted as indicated
thereon or, if no direction is indicated, in accordance with the recommendations
of the Board of Directors.
IV. CERTAIN REPORTS
Based upon reports furnished to the Company, all reports required to be
filed during or concerning the Company's 2002 fiscal year, by officers,
directors and principal shareholders, pursuant to Section 16 of the Securities
Exchange Act of 1934 (Form 3, Initial Statement of Beneficial Ownership; Form 4,
Statement of Changes of Beneficial Ownership; and Form 5, Annual Statement of
Beneficial Ownership), were timely filed with the Securities and Exchange
Commission.
By Order of the Board of Directors
/s/ Ira W. Berman
------------------------------------
Ira W. Berman,
CHAIRMAN OF THEBOARD OFDIRECTORS
East Rutherford, New Jersey
May 23, 2003
12
CCA INDUSTRIES, INC.
2003 STOCK OPTION PLAN
1. PURPOSES. The purposes of the plan ("Plan") are to provide an incentive
to key employees of CCA INDUSTRIES, INC. and its subsidiaries (the "Company"),
including officers and directors and consultants and/or affiliates, to
contribute to the success of the Company by purchasing a proprietary interest in
the Company, and to offer an additional inducement in obtaining and retaining
the services of key personnel. Purchases shall be made in accordance with
"incentive stock options" or "non-qualified stock options" issued pursuant to
the lnternal Revenue Code of 1954, as amended (the "Code"), and the Regulations
and Rulings promulgated thereunder.
2. STOCK SUBJECT TO THE PLAN. Options may be granted under the Plan to
purchase in the aggregate not more than one million shares of the Company's
Common Stock, par value $.01 per share ("Common Stock") which may be authorized
but unissued shares or treasury shares. Any shares subject to an option which
for any reason expires or is terminated unexercised as to such shares, shall
again become available for issuance under the Plan.
3. VALUE OF THE STOCK. The aggregate fair market value (determined as of
the time each option is granted) of the Common Stock for which any employee may
be granted incentive stock options in any calendar year shall not exceed
$100,000. There is no such limitation with respect to non-qualified options.
4. ADMINISTRATION AND SELECTION. The Plan shall be administered by the
Audit Committee designated as the Stock Option Committee ("Committee")
consisting of not less than three nor more than five Audit Committee directors
of CCA Industries, Inc. to be appointed by, and to serve at the pleasure of, the
Board of Directors. The Committee shall have full power to interpret the Plan,
and to establish and amend rules and regulations for its administration. The
Committee shall also have full power to determine the terms and conditions of
options granted under the Plan including, but not limited to, option price, term
and exerciseability of options and restrictions on Common Stock issued pursuant
thereto. The Board of Directors may from time to time appoint qualified Audit
Committee members to the Committee in substitution for or in addition to members
previously appointed and may fill vacancies, however caused, in the Committee.
The Committee shall hold its meetings at such times and places as it shall deem
advisable. A majority of its members shall constitute a quorum. Action of the
Committee shall be taken by a majority of its members at the meeting. Any action
may be taken by a written instrument signed by a majority of the members, and
action so taken shall be fully as effective as if it had been taken by a vote of
a majority of the members at a meeting duly called and held.
5. ELIGIBILITY. The Committee may grant options from time to time to key
employees of the Company, including officers and directors, consultants and/or
affiliates for such number of shares of Common Stock as it may determine.
Options granted to members of the Committee shall be ratified by a majority of
the Board of Directors.
6. OPTION PRICE. The purchase price of the Common Stock under each option
shall be such amount as the Committee in its discretion shall determine,
provided that in no event will such price be less than the par value of the
Common Stock.
7. TERM OF OPTIONS. The term of each incentive stock option and each
non-qualified stock option granted pursuant to the Plan shall be for a period
not exceeding ten (10) years from the date of granting thereof. The term of any
option, validly granted, may extend beyond the termination of the Plan. Options
shall be subject to earlier termination as hereinafter provided or as may be
provided in the option contract.
8. EXERCISE OF OPTIONS. Except as otherwise provided herein, an option may
provide for its exercise during its term in such amounts and at such times as
shall be specified in the option agreement. If the full number of shares
available for purchase in a period shall not be purchased, the balance may be
purchased at any time or from time to time thereafter but prior to the
expiration of such option. The Committee, in its discretion, may grant options
or accelerate the exercise of options granted so that options are exercisable
over a shorter period of time than that stated therein.
A-1
The Committee may provide that the options, when granted, shall not vest in
the recipient until such time as the recipient, if an employee of the Company,
is in the Company's employ for at least twelve (12) months.
The Committee may also provide that the options may vest over a three-year
period with aliquot vesting over the aforesaid period.
An option shall be exercised by giving written notice to the Company at its
executive offices, specifying the number of shares purchased and accompanied by
payment in cash or certified check of the aggregate purchase price thereof. The
Committee may also provide that in order to exercise an option, the recipient
shall be entitled to present a stock certificate of the Company at the fair
market value on the date of exercise of the option in payment of the aforesaid
option. In no case may a fraction of a share be purchased or issued pursuant to
the exercise of an option.
9. RESTRICTIONS ON COMMON STOCK. In connection with the granting of any
non-qualified stock option hereunder, the Committee may in its discretion impose
upon the holder thereof such restrictions as it shall deem advisable to be
applicable to the Common Stock to be purchased pursuant to such option. Such
restrictions may include, but shall not be limited to, restrictions which render
the Common Stock non-transferable, restrictions which create a substantial risk
of forfeiture of the Common Stock, or restrictions which by their terms will
never lapse.
Unless expressly stated to the contrary in any option agreement, either the
Committee or the Board of Directors shall have the right to cancel, alleviate or
modify, in whole or in part, any such restrictions, provided however that no
such action shall be taken without the consent of the option holder if such
action would have the effect of rendering the restrictions more onerous to the
option holder.
10. TERMINATION OF EMPLOYMENT. Any option holder whose employment has
terminated for any reason other than death or disability must exercise his
option within three months after the date of such termination, or within such
shorter period, if any, specified in his option contract, to the extent the
option was exercisable on the date of such termination, or it will lapse. If the
employment of an option holder is terminated because he becomes disabled, the
option holder may exercise his option within one year after the date of such
termination, or within such shorter period, if any, specified in his option
contract to the extent the option was exercisable on the date of such
termination. Options granted under the Plan shall not be affected by any change
of employment so long as the holder continues to be an employee of the Company
or of a corporation issuing or assuming the options.
11. DEATH OF EMPLOYEE. If the optionee dies while employed by the Company
or a parent or subsidiary of the Company or within three months after
terminination of such employment, the option may, but need not, provide that it
may be exercised (to the extent the option was vested at the time of optionee's
death) within 18 months of the optionee's death by the person or persons to whom
the rights under such option pass by will or the laws of descent or
distribution, or the option will lapse.
12. OPTION CONTRACTS. Each option shall be evidenced by an option contract
which shall contain such provisions (not necessarily identical) as the Committee
shall deem appropriate or advisable. Nothing in the Plan shall confer any rights
on any employee other than those set forth in the option contract, and neither
the Plan nor the option contract shall confer upon any employee any rights to
continue in the employ of the Company or interfere in any way with the rights of
the Company to terminate his employment at any time without liability by the
Company.
13. ADJUSTMENTS. Notwithstanding any other provision of the Plan, in the
event of any change in the outstanding Common Stock by reason of a share
distribution, recapitalization, merger, consolidation, split-up, combination or
exchange of shares, or the like, the aggregate number and kind of shares
available under the Plan and the number and kind of shares subject to each
outstanding option and the option price shall be appropriately adjusted by the
Committee.
A-2
14. AMENDMENT AND TERMINATION. The Committee may at any time suspend or
terminate the Plan or amend it from time to time in such respects as it may deem
advisable to provide that options granted hereunder may qualify for the tax
treatment under federal, state or local law as was originally intended by the
Committee and to conform to any change in applicable law or regulations or
rulings of administrative agencies, or may so amend it in any other respect not
involving a substantial departure from the principles herein set forth. No
amendment by the Committee shall serve to alter the class of persons eligible to
receive options hereunder, or, except as provided in Section 13, to increase the
maximum number of shares with respect to which options may be granted hereunder.
Unless sooner terminated by the Committee, the Plan shall terminate on the 10th
anniversary of the Company's 2003 Annual Meeting vote, assuming the Plan is
thereupon approved.
15. NON-TRANSFERABILITY OF OPTIONS, No option granted under the Plan shall
be transferable otherwise than by will or the laws of descent and distribution;
and an option may be exercised during the lifetime of the holder thereof only by
him.
16. EFFECTIVE DATE OF THE PLAN. The Company's 2003 Annual Meeting date vote
shall be the effective date, if and when the Plan is thence/thereafter certified
as having been approved by shareholder vote.
A-3
CCA INDUSTRIES, INC.
PROXY SOLICITED BY THE BOARD OF DIRECTORS
The undersigned, revoking all prior proxies, hereby appoints David Edell
and Ira W. Berman, and each of them, proxies and attorneys in fact, with power
of substitution, to vote all shares the undersigned is entitled to vote at the
Annual Meeting of Shareholders of CCA INDUSTRIES, INC., to be held at The
American Stock Exchange (14th Floor Boardroom), 86 Trinity Place, New York, NY,
on July 9, 2003 at 2:00 p.m., and to vote as directed on the reverse side upon
the proposals, and in their discretion upon such other business as may properly
come before the meeting or any adjournment thereof (all as more fully set forth
in the Notice of Meeting and Proxy Statement, receipt of which is hereby
ackowledged).
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS. UNLESS OTHERWISE
SPECIFIED, IT WILL BE VOTE "FOR" THE ELECTION OF DREW EDELL, ROBERT LAGE AND
DUNNAN EDELL AS DIRECTORS, "FOR" THE APPOINTMENT OF SHEFT KAHN & COMPANY L.L.P.
AND "FOR" THE 2003 STOCK OPTION PLAN.
(CONTINUED AND TO BE SIGNED ON THE REVERSE SIDE)
Please date, sign and mail
your proxy card in the
envelope provided as soon
as possible.
Please detach and mail in the envelope provided.
- ------------------------------------------------------------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A "FOR" VOTE FOR ALL PROPOSALS.
PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE [X]
- ------------------------------------------------------------------------------------------------------------------------------------
FOR AGAINST ABSTAIN
1. Election of Directors: 2. Ratification of the Board of Directors [ ] [ ] [ ]
appointment of Sheft Kahn & Company L.L.P.
Nominees: as the Company's Independent certified
[ ] FOR ALL NOMINEES ( ) Drew Edell public accountants.
( ) Robert Lage
[ ] WITHHOLD AUTHORITY ( ) Dunnan Edell 3. To authorize the 2003 Stock Option Plan [ ] [ ] [ ]
FOR ALL NOMINEES proposed by The Board of Directors.
[ ] FOR ALL EXCEPT To grant the proxy the power to vote in his discretion upon such other
(See instructions below) matters as may properly come before the Meeting or any adjournment thereof.
THIS PROXY WILL BE VOTED AS DIRECTED. UNLESS OTHERWISE DIRECTED, THIS PROXY
WILL BE VOTED FOR ALL PROPOSALS.
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE COMPLETE, DATE AND
SIGN YOUR PROXY CARD AND RETURN IT IN THE ENCLOSED ENVELOPE SO THAT YOUR
VOTE WILL BE CONTINUED.
INSTRUCTION: To withhold authority to vote for any
individual nominee(s), mark "FOR ALL
EXCEPT" and fill in the circle next to
each nominee you wish to withhold, as
shown here (X)
- -----------------------------------------------------
- -----------------------------------------------------
To change the address on your account, please
check the box at right and indicate your new
address in the space above. Please not that [ ]
changes to the registered name(s) on the account
may not be submitted via this method.
- -----------------------------------------------------
--------------------------- --------- --------------------------- --------
Signature of Stockholder Date Signature of Stockholder Date
--------------------------- --------- --------------------------- --------
NOTE: Please sign exactly as your name or names appear on this Proxy. When shares are held jointly, each holder should
sign. When signing as executor, administrator, attorney, trustee or guardian, please give full title as such. If the
signer is a corporation, please sign in full corporate name by duty authorized officer, giving full title as such. If
signer is a partnership, please sign in partnership name by authorized person.