UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington, D.C.
20549
SCHEDULE 14A
Proxy
Statement Pursuant to Section 14(a) of the Securities
Exchange
Act of 1934 (Amendment No. )
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Filed
by the Registrant
x
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Filed
by a Party other than the Registrant
o
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Check
the appropriate box:
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Preliminary Proxy Statement
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Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
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x
Definitive
Proxy Statement
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Definitive Additional Materials
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Soliciting Material Pursuant to
§240.14a-12
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IEH
Corporation
(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):
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x
No
fee required.
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o
Fee
computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11.
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1) Title
of each class of securities to which transaction
applies:
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2) Aggregate
number of securities to which transaction
applies:
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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):
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4) Proposed
maximum aggregate value of
transaction:
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Fee
paid previously with preliminary
materials.
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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.
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1) Amount
Previously Paid:
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2) Form,
Schedule or Registration Statement
No.:
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SEC
1913 (02-02)
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Persons
who are to respond to the collection of information contained in this form
are not required to respond unless the form displays a currently valid OMB
control number.
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IEH
CORPORATION
140
58th Street, Bldg. B, Suite 8E
Brooklyn,
New York 11220
NOTICE
OF ANNUAL MEETING OF SHAREHOLDERS
To
Be Held on Tuesday, September 7, 2010
To the Shareholders of
IEH
CORPORATION:
NOTICE IS
HEREBY GIVEN that the Annual Meeting of Shareholders of IEH CORPORATION (“IEH”
or the "Company") will be held at the Company’s offices at 140 58th Street,
Bldg. B, Suite 8E, Brooklyn, New York 11220 on Tuesday, September 7, 2010 at
10:00 a.m., New York time, for the following purposes:
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1.
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To
elect two (2) Class I Directors to IEH's Board of Directors to hold office
for a period of two years or until their successors are duly elected and
qualified;
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2.
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To
ratify the appointment of Jerome Rosenberg, CPA, P.C. as our independent
registered public accounting firm;
and
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3.
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To
transact such other business as may properly come before the Annual
Meeting or any adjournment thereof.
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The close
of business on August 10, 2010 has been fixed as the Record Date for the
determination of shareholders entitled to notice of, and to vote at, the Annual
Meeting and any adjournment thereof.
You are
cordially invited to attend the Annual Meeting. Whether or not you
plan to attend, or to assure that your shares are represented at the Annual
Meeting, please either complete, date and sign the accompanying proxy and return
it promptly in the enclosed envelope. If you do attend, you may
revoke any prior proxy and vote your shares in person if you wish to do
so. Any prior proxy will automatically be revoked if you execute the
accompanying proxy or if you notify the Secretary of IEH, in writing, prior to
the Annual Meeting of Shareholders. We have included a
postage-prepaid envelope for your use. Submitting a signed proxy will
not affect your right to attend the meeting and vote in person.
Important
Notice Regarding the Availability of Proxy Materials for the Annual Meeting of
Shareholders on September 7, 2010
The Proxy
Statement and Our Annual Report to Shareholders for the Fiscal Year Ended March
26, 2010 are available at: http://www.cfpproxy.com/0795
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By
Order of the Board of Directors
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Robert
Knoth
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Chief
Financial Officer and Secretary
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Dated:
August 13, 2010
YOUR VOTE IS VERY
IMPORTAN
T
TABLE OF
CONTENTS
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Page
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QUESTIONS
AND ANSWERS ABOUT THESE PROXY MATERIALS
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3
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SOLICITATION,
VOTING AND REVOCABILITY OF PROXIES
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9
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Quorum
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9
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Voting
Required
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10
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Manner
of Voting
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10
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Revocation
of Proxies
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11
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Solicitation
of Proxies
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12
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Annual
Report
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12
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Principal
Offices
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12
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Recommendation
of the Board of Directors
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12
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PROPOSAL
1 ELECTION OF DIRECTORS
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13
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Board
Structure and Nominees
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13
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Other
Executive Officer
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14
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Significant
Employees
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15
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Compliance
with Section 16(a) of the Exchange Act
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15
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Board
Committee and Compensation, Board Meetings and Director
Independence
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16
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Compensation
Committee Interlocks and Insider Participation in Compensation
Decisions
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16
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Audit
Committee and Audit Committee Financial Expert
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16
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Nominations
to the Board of Directors
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17
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Communications
with the Board of Directors
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18
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PROPOSAL
2 RATIFICATION OF APPOINTMENT
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OF
INDEPENDENT R EGISTERED PUBLIC ACCOUNTING FIRM
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18
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Principal
Accountant Fees and Services
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18
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Vote
Required and Board Recommendation
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19
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EXECUTIVE
COMPENSATION AND RELATED INFORMATION
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20
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Summary
Compensation Table
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20
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Employment
Agreements with Named Executive Officer
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20
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Stock
Option Plan
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24
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Cash
Bonus Plan
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25
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VOTING
SECURITIES AND SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
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25
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CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS
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27
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HOUSEHOLDING
OF PROXY MATERIALS
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27
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SHAREHOLDER
PROPOSALS
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27
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ADDITIONAL
INFORMATION
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28
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OTHER
BUSINESS
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28
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IEH
CORPORATION
140
58
th
Street
Building
B, Suite 8E
Brooklyn,
New York 11220
PROXY
STATEMENT FOR THE IEH CORPORATION
ANNUAL
MEETING OF SHAREHOLDERS
TO
BE HELD ON TUESDAY, SEPTEMBER 7, 2010
QUESTIONS
AND ANSWERS ABOUT THESE PROXY MATERIALS
Why
am I receiving this proxy statement?
This
proxy statement describes the proposal on which our Board of Directors of IEH
Corporation
(“IEH”
or the “Company”) would like you, as a shareholder, to vote at the Annual
Meeting of the Shareholders of the Company, which will take place on Tuesday,
September 7, 2010 at 10:00 a.m. at the Company’s offices. It also gives you
information on this proposal so that you can make an informed decision. We
intend to mail this proxy statement and accompanying proxy card on or about
August 13, 2010 to all shareholders of record entitled to vote at the Annual
Meeting.
In this
proxy statement, we refer to IEH Corporation
as “IEH,” the
“Company,” “we,” “us” or “our.”
Who can vote
at the Annual Meeting of
Shareholders?
Shareholders
who owned shares of common stock on August 10, 2010 may attend and vote at the
Annual Meeting. Each share is entitled to one vote. There were 2,303,468 shares
of the Company’s common stock outstanding on August 10, 2010. All shares of
common stock shall vote together as a single class. Information about the
shareholdings of our directors and executive officers is contained in the
section of this proxy statement entitled “
Voting Securities and Security
Ownership of Certain Beneficial Owners and Management
” on pages 25
through 27 of this proxy statement.
What
is the proxy card?
The proxy
card enables you to appoint Michael Offerman, our President and Chief Executive
Officer, and Robert Knoth, our Chief Financial Officer and Secretary, as your
representatives at the Annual Meeting. By completing and returning
the proxy card, you are authorizing these persons to vote your shares at the
Annual Meeting in accordance with your instructions on the proxy card. This way,
your shares will be voted whether or not you attend the Annual Meeting. Even if
you plan to attend the Annual Meeting, it is a good idea to complete and return
your proxy card before the Annual Meeting date just in case your plans change.
If a proposal comes up for vote at the Annual Meeting that is not on the proxy
card, the proxies will vote your shares, under your proxy, according to their
best judgment.
What
am I voting on?
At the
Annual Meeting you are being asked to vote on the election of Michael Offerman
and Murray Sennet as Class I Directors on the Board of Directors of
IEH. Each of them is currently a Director of the Company.
At the
Annual Meeting you are also being asked to ratify Jerome Rosenberg CPA, P.C. as
our independent registered public accounting firm for the fiscal year ending
March 25, 2011.
Although
we are unaware of any possible business to be addressed at the Annual Meeting,
we will also transact any other business that properly comes before the Annual
Meeting.
How
does the Board of Directors recommend that I vote?
Our Board
of Directors unanimously recommends a vote FOR election of the nominees for
Class I Directors. (See Proposal 1).
Our Board
of Directors also recommends a vote FOR the ratification of Jerome Rosenberg
CPA, P.C. as our independent registered public accounting firm for fiscal year
2011 (See Proposal 2).
With
respect to any other matter that properly comes before the Annual Meeting, the
proxy holders will vote as recommended by the Board of Directors, or if no
recommendation is given, they will vote in their own discretion. If
you sign and return your proxy card but do not specify how you want to vote your
shares, the persons named as proxy holders on the proxy card will vote in
accordance with the recommendations of the Board of Directors.
What
is the difference between holding shares as a shareholder of record and as a
beneficial owner?
Most of
our shareholders hold their shares beneficially in an account at a brokerage
firm, bank or other nominee holder, rather than holding share certificates in
their own name. As summarized below, there are some distinctions between shares
held record and those owned beneficially.
Shareholder
of Record
If on
August 10, 2010, your shares were registered directly in your name with our
transfer agent, Registrar and Transfer Company, you are a shareholder of record
who may vote at the Annual Meeting, and we are sending these proxy materials
directly to you. As the shareholder of record, you have the right to direct the
voting of your shares by returning the enclosed proxy card to us or to vote in
person at the Annual Meeting. Whether or not you plan to attend the Annual
Meeting, please complete, date and sign the enclosed proxy card to ensure that
your vote is counted.
Beneficial
Owner
If on
August 10, 2010, your shares are held in an account at a brokerage firm or at a
bank or other nominee holder, you are considered the beneficial owner of shares
held “in street name,” and these proxy materials are being forwarded to you by
your broker, bank or other nominee holder who is considered the shareholder of
record for purposes of voting at the Annual Meeting. As the beneficial owner,
you have the right to direct your broker, bank or other nominee on how to vote
your shares and to attend the Annual Meeting. If your shares are
registered in the name of a bank, other nominee holder or brokerage firm you
will receive instructions from your holder of record that must be followed in
order for the record holder to vote the shares per your
instructions. If you provide specific voting instructions your shares
will be voted as you instruct. If you sign but do not provide
instructions, your shares will be voted as described below. Many
banks and brokerage firms have a process for their beneficial holders to provide
instructions over the phone or via the Internet. If Internet or
telephone voting is unavailable from your bank or brokerage firm, please
complete and return the enclosed voting instruction card in the addressed,
postage paid envelope provided. If you hold your shares “in street
name” through a broker, bank or other nominee holder, then the broker, bank or
other nominee holder who holds your shares has the authority under the
applicable stock exchange rules to vote on certain items when they have not
received instructions from you. If you hold your shares “in street
name” it is critical that you cast your vote, if you want it to count in the
election of directors (Proposal 1). In the prior years, if you held
your shares “in street name” and you did not indicate how you wanted your shares
voted in the election of directors, your bank, broker or other nominee was
allowed to vote your shares on your behalf in the election of directors as they
felt appropriate. Recent changes in regulation were made to take away
the ability of your your bank, broker or other nominee to vote your uninstructed
shares in the election of directors on a discretionary basis. Thus,
if you hold your shares “in street name” and you do not instruct your your bank,
broker or other nominee how to vote in the election of directors, no votes will
be cast on your behalf. Your your bank, broker or other nominee will,
however, continue to have discretion to vote your uninstructed shares on the
ratification of the appointment of the Company’s independent registered public
accounting firm (Proposal 2).
If you are a beneficial owner, please
complete the voting instruction card and return it as instructed to your
brokerage firm, bank or other nominee holder so your shares of common stock will
be counted toward a quorum and voted at the Annual Meeting.
How
do I vote?
(1) You
may vote by mail.
You may
vote by mail by completing, signing and dating your proxy card and returning it
in the enclosed, postage-paid and addressed envelope. If you mark your voting
instructions on the proxy card, your shares will be voted:
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according
to the best judgment of Messrs. Offerman and Knoth if a proposal comes
up
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for
a vote at the Annual Meeting that is not on the proxy
card.
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If you
return a signed card, but do not provide voting instructions, your shares will
be voted:
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to
approve the election of the nominated persons to the Company’s Board of
Directors;
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to
ratify the appointment of the Company’s independent registered public
accounting firm for the fiscal year ending March 25, 2011;
and
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according
to the best judgment of Messrs. Offerman and Knoth if a proposal comes up
for a vote at the Annual Meeting that is not on the proxy
card.
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(2) You
may vote in person at the Annual Meeting.
We will
pass out written ballots to anyone who wants to vote at the Annual
Meeting. However, if you hold your shares in street name, you must
bring to the Annual Meeting a valid proxy from the broker, bank or other nominee
holding your shares that confirms your beneficial ownership of the shares and
gives you the right to vote your shares. Holding shares in street name means you
hold them through a brokerage firm, bank or other nominee, and therefore the
shares are not held in your individual name. We encourage you to examine your
proxy card closely to make sure you are voting all of your shares in the
Company.
What
does it mean if I receive more than one proxy card?
You may
have multiple accounts at the transfer agent and/or with stockbrokers. Please
sign and return all proxy cards to ensure that all of your shares are
voted.
What
if I change my mind after I return my proxy?
You may
revoke your proxy and change your vote at any time before the polls close at the
Annual Meeting. You may do this by:
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sending
a written notice to the Secretary of the Company, Mr. Robert Knoth,
stating that you would like to revoke your proxy of a particular
date,
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signing
another proxy card with a later date and returning it before the polls
close at the Annual Meeting, or attending the Annual Meeting and voting in
person.
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Please
note, however, that if your shares are held of record by a brokerage firm, bank
or other nominee, you must instruct your broker, bank or other nominee that you
wish to change your vote by following the procedures on the voting form provided
to you by the broker, bank or other nominee. If your shares are held in street
name, and you wish to attend the Annual Meeting and vote at the Annual Meeting,
you must bring to the Annual Meeting a legal proxy from the broker, bank or
other nominee holding your shares, confirming your beneficial ownership of the
shares and giving you the right to vote your shares.
Will
my shares be voted if I do not sign and return my proxy card?
If your
shares are held in street name or in your name and you do not sign and return
your proxy card, your shares will not be voted unless you vote in person at the
Annual Meeting.
How
are votes counted?
You may
vote “For” or “Withhold Authority” on electing nominated persons to be Class I
Directors on the Board of Directors.
How
many shareholders are needed either in person or by proxy to hold the Annual
Meeting?
To hold
the Annual Meeting and conduct business, a majority of the Company’s outstanding
shares of common stock entitled to vote, in person or represented by proxy, must
be present at the Annual Meeting. This is called a quorum.
Shares
are counted as present at the Annual Meeting if the shareholder
either:
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is
present and votes in person at the Annual Meeting,
or
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has
properly submitted a proxy card.
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How
many votes are required to elect the nominated persons to be Class I Directors
on the Board of Directors?
The
affirmative vote of a plurality of the votes cast at the Annual Meeting of the
shareholders by the holders of shares of common stock entitled to vote in the
election is required to elect each director.
How
many votes are required to approve other matters that may come before the
shareholders at the Annual Meeting?
An
affirmative vote of a majority of the votes cast at the Annual Meeting is
required for approval of all other items being submitted to the shareholders for
their consideration.
What
happens if I don’t indicate how to vote my proxy?
If you
just sign your proxy card without providing further instructions, your shares
will be counted as a “
FOR
” vote for the election of
the persons nominated to be Class I Directors. Your shares will also be counted
as a “
FOR
” vote to
ratify the appointment of the Company’s independent registered public accounting
firm for the fiscal year ending March 25, 2011.
Is
my vote kept confidential?
Proxies,
ballots and voting tabulations identifying shareholders are kept confidential
and will not be disclosed except as may be necessary to meet legal
requirements.
Where
do I find the voting results of the Annual Meeting?
We will
announce preliminary voting results at the Annual Meeting. We will also publish
the final results in our quarterly report on Form l0-Q for the fiscal quarter
following the results of the voting on this matter. We will file that
report with the Securities and Exchange Commission (“SEC”) , and you can obtain
a copy by calling the SEC at l-800-SEC-0330 for the location of the nearest
public reference room, or through the EDGAR system at
www.sec.gov
.
Who
can help answer my questions?
You can
contact our corporate headquarters at (718) 492-4440 or by sending to Mr. Robert
Knoth at 140 58th Street, Bldg. B, Suite 8E, Brooklyn, New York 11220, any
questions about proposals described in this proxy statement or how to execute
your vote.
IEH
CORPORATION
140
58th Street
Bldg.
B, Suite 8E
Brooklyn,
New York 11220
PROXY
STATEMENT
FOR
Annual
Meeting of Shareholders
To
Be Held on Tuesday, September 7, 2010
This
proxy statement and the accompanying form of proxy have been mailed on or about
August 13, 2010 to the holders of record on August 10, 2010 (the “Record Date”)
of the common stock, par value $.01 per share (“Common Stock”) of IEH
CORPORATION, a New York corporation (“IEH” or the “Company”) in connection with
the solicitation of proxies by the Board of Directors of IEH for use at the
Annual Meeting of Shareholders to be held on Tuesday, September 7, 2010 at 10:00
a.m., New York time, at IEH's offices at 140 58th Street, Suite 8E, Brooklyn,
New York 11220, and at any adjournment thereof.
SOLICITATION,
VOTING AND REVOCABILITY OF PROXIES
Shares of
IEH's Common Stock represented by an effective proxy in the accompanying form
will, unless contrary instructions are specified in the proxy, be voted:
(i)
FOR
the
election of the TWO (2) persons nominated by the Board of Directors to serve as
Class I Directors; (ii)
FOR
the ratification of Jerome
Rosenberg, CPA P.C., as our independent registered public accounting firm for
the fiscal year ending March 25, 2011; and (iii)
FOR
such other matters as may
properly come before the Annual Meeting or any adjournment thereof and for which
the persons named on the enclosed proxies determine, in their sole discretion,
to vote in favor.
Any such
proxy may be revoked at any time before it is voted. A shareholder
may revoke this proxy by notifying the Secretary of IEH either in writing prior
to the Annual Meeting or in person at the Annual Meeting, by submitting a proxy
bearing a later date or by voting in person at the Annual Meeting.
Quorum
The
presence of a majority of the holders of the outstanding shares of Common Stock
entitled to vote, in person or represented by proxy, will constitute a quorum
for the transaction of business. Shares are counted as present at the
Annual Meeting if you are present in person at the Annual Meeting, or if you
have properly submitted a proxy. In addition, abstentions and
broker
non-votes
are counted as present at the Annual Meeting for the purpose of determining the
presence of a quorum. A “broker non-vote” occurs when a broker, bank or other
nominee holding shares for a beneficial owner in “street name” does not vote on
a particular proposal, because the broker, bank or other nominee does not have
discretionary voting power with respect to that proposal and has not received
voting instructions from the beneficial owner.
Election of Directors (Proposal 1) is
by a plurality of the votes cast at a meeting of the shareholders by the holders
of shares entitled to vote in the election with the two (2) nominees receiving
the highest vote totals to be elected as Class I Directors of
IEH. The ratification of the appointment of Jerome Rosenberg CPA,
P.C. as our independent registered public accounting firm for fiscal year 2011
(Proposal 2) requires the affirmative vote by holders of at least a majority of
the shares of IEH’s common stock who attend the Annual Meeting in person or are
represented at the meeting by proxy and who cast votes. Abstentions will have
the effect of a vote against this proposal, while broker non-votes will not be
taken into account in determining the outcome of the vote on this
proposal.
Any other
matter submitted to the shareholders will require the affirmative vote of a
majority of the shares represented and entitled to vote, in person or by proxy,
at the Annual Meeting, unless a greater percentage is required either by law or
by our amended certificate of incorporation or bylaws. If you “abstain” from
voting on any of these matters, your abstention will be considered as present
and entitled to vote for purposes of determining the presence of a quorum, but
will have the effect of a vote against the particular matter. In
addition, the proxy confers discretionary authority to the persons named in the
proxy authorizing those persons to vote, in their discretion, on any other
matters properly presented at the Annual Meeting of shareholders. The Board of
Directors is not currently aware of any such other matters. If any other matter
does properly come before the Annual Meeting, the Board of Directors intends
that the persons named in the enclosed form of proxy will vote on such matter in
accordance with their judgment. The persons named as proxies may propose one or
more adjournments of the Annual Meeting to permit further solicitations of
proxies or for other reasons. Any such adjournment would require the affirmative
vote of the majority of the outstanding shares present in person or represented
by proxy at the Annual Meeting.
Manner
of Voting
Shareholders
whose shares of Common Stock are registered in their own names may vote by
mailing a completed proxy card as an alternative to voting in person at the
Annual Meeting. Instructions for voting by mail are set forth on the enclosed
proxy card and are summarized below. For shares held in street name,
please refer to the voting instruction card included by your broker, bank or
other nominee. The Company does not offer voting by telephone or via the
Internet. To vote by mail, please submit your proxy by signing your proxy card
and mailing it in the enclosed, postage-prepaid envelope.
If you
choose to vote in person, you can attend the Annual Meeting and cast your vote
in person.
If you
are a registered holder, your shares will be voted in the manner
that you indicate in your
proxy. The proxy card provides spaces for you to vote “FOR,” or to “WITHHOLD”
your authority to vote your shares for the nominees for Class I Directors
(Proposal 1). The proxy card also provides spaces for you to vote “FOR” or
“AGAINST” or “ABSTAIN” from voting in connection with our proposal to ratify the
appointment of Jerome Rosenberg CPA, P.C. as our independent registered public
accounting firm for fiscal year 2011 (Proposal 2). If you return a
signed proxy card but do not indicate how you wish to vote your shares, your
shares will be voted FOR the election of the nominees for Class I Director and
FOR the ratification of Jerome Rosenberg CPA, P.C. as our independent registered
public accounting firm for fiscal year 2011.
Shares
held in Street Name
If you
hold your shares in street name, you should follow the directions provided by
your broker, bank or other nominee regarding how to instruct your broker or
nominee. If you provide specific voting instructions, your shares will be voted
as you instruct. If you sign but do not provide instructions, your shares will
be voted as described below. Many banks and brokerage firms have a process for
their beneficial holders to provide instructions over the phone or via the
Internet. If Internet or telephone voting is unavailable from your bank or
brokerage firm, please complete and return the enclosed voting instruction card
in the addressed, postage paid envelope provided. If you hold your shares in
“street name” through a broker, bank or other nominee, then the broker who holds
your shares has the authority under the applicable stock exchange rules to vote
on certain items when they have not received instructions from you. If you hold
your shares in street name it is critical that you cast your vote if you want it
to count in the Election of Directors (Proposal 1). In prior years,
if you held your shares in street name and you did not indicate how you wanted
your shares voted in the Election of Directors, your bank, broker or other
nominee was allowed to vote those shares on your behalf in the Election of
Directors as they felt appropriate. Recent changes in regulation were made to
take away the ability of your bank, broker or other nominee to vote your
uninstructed shares in the Election of Directors on a discretionary basis. Thus,
if you hold your shares in street name and you do not instruct your bank, broker
or other nominee how to vote in the Election of Directors, no votes will be cast
on your behalf. Your bank, broker or other nominee will, however,
continue to have discretion to vote any uninstructed shares on the ratification
of the appointment of the Company’s independent registered public accounting
firm (Proposal 2).
Revocation
of Proxies
Any proxy
may be revoked at any time before it is voted at the Annual Meeting. A
shareholder may revoke a proxy by submitting a proxy bearing a later date or by
notifying the Secretary of IEH either in writing prior to the Annual Meeting or
in person at the Annual Meeting. Revocation is effective only upon receipt of
such notice by the Secretary of IEH. Shareholders who hold their shares through
a broker, bank or other nominee and wish to vote at the Annual Meeting must
bring to the meeting a letter from the broker, bank or other nominee confirming
their beneficial ownership of the shares to be voted.
IEH will
bear the cost of the solicitation of proxies by the Board of Directors. The
Board of Directors may use the services of its executive officers and certain
directors to solicit proxies from shareholders in person and by mail, telegram
and telephone. Arrangements may also be made with brokers, fiduciaries,
custodians and nominees to send proxies, proxy statements and other material to
the beneficial owners of IEH’s Common Stock held of record by such persons, and
IEH may reimburse them for reasonable out-of-pocket expenses incurred by them in
so doing.
Rules adopted by the SEC allow
companies to send shareholders a notice of Internet availability of proxy
materials, rather than mail them full sets of proxy materials. This year, we
chose to mail full packages of materials to our shareholders. However, in the
future we may take advantage of this new distribution option. If, in the future,
we choose to send such notices, they would contain instructions on how
shareholders can access our notice of annual meeting and proxy statement via the
Internet. It would also contain instructions on how shareholders could request
to receive their materials electronically or in printed form on a one-time or
ongoing basis.
The
Annual Report to Shareholders on Form 10-K for the fiscal year ended March
26, 2010, including financial statements, accompanies this proxy statement.
Any reference in this proxy statement to the “year” or the “fiscal year” means
IEH’s fiscal year commencing March 27, 2009 to and including March 26, 2010
unless otherwise specifically indicated. This proxy statement
and the Annual Report to Shareholders for the fiscal year ended March 26, 2010
are available at: http://www.cfpproxy.com/0795.
The
principal executive offices of IEH are located at 140 58th Street, Bldg. B,
Suite 8E, Brooklyn, New York 11220. IEH's telephone number is
(718) 492-4440.
Recommendation
of the Board of Directors
The
recommendations of our Board of Directors are set forth in the description of
the matters to be acted on in this proxy statement. In summary, our Board of
Directors recommends a vote:
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•
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FOR
election of the two
(2) nominees for Class I Directors (see Proposal 1);
and
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•
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FOR
the ratification of
Jerome Rosenberg CPA, P.C. as our independent registered public accounting
firm for fiscal 2011 (see Proposal 2).
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With
respect to any other matter that properly comes before the Annual Meeting, the
proxy holders will vote as recommended by the Board of Directors or, if no
recommendation is given, they will vote in their own discretion. If you sign and
return your proxy card but do not specify how you want to vote your shares, the
persons named as proxy holders on the proxy card will vote in accordance with
the recommendations of the Board of Directors.
PROPOSAL 1 ELECTION
OF DIRECTORS
Board
Structure and Nominees
IEH's
Certificate of Incorporation provides that the directors of IEH are to be
elected in two (2) classes; each class to be elected to a staggered two (2) year
term and until their successors are duly elected and qualified. The
Board of Directors currently consists of four (4) members divided into two (2)
classes with two Class I Members and two Class II Members. The Bylaws
of IEH provide that the Board shall consist of between three and eleven persons,
and the Board has currently set the number of persons on the Board at four (4)
members.
The
persons nominated for election to IEH's Board of Directors at the Annual Meeting
are Michael Offerman and Murray Sennet who will serve as Class I Directors of
the Board. The nominees currently serve on the Board of
Directors.
The
affirmative vote of a plurality of the votes cast at a meeting of the
shareholders by the holders of shares of Common Stock entitled to vote in the
election is required to elect each Director. All proxies received by
the Board of Directors will be voted for the election as Directors of the
nominees as indicated below if no direction to the contrary is
given. In the event that either nominee is unable to serve, the proxy
solicited hereby may be voted, in the discretion of the holder of the proxy, for
the election of another person in his stead. The Board of Directors
knows of no reason to anticipate this will occur. No family relationships exist
between any Director or nominee for election as a Director.
THE BOARD OF DIRECTORS RECOMMENDS THAT
YOU VOTE “
FOR
”
THE TWO (2) NOMINEES FOR CLASS I DIRECTOR AS DESCRIBED IN THIS PROPOSAL
1.
The
following table sets forth certain information as of the date hereof with
respect to all of the Directors of IEH, including the two (2) nominees for
election as Class I Directors to IEH's Board of Directors at the Annual
Meeting. The information provided below indicates the Directors whose
terms of office expire at the Annual Meeting and the Directors whose term of
office expires in 2010. The Directors whose terms of office expire at the Annual
Meeting are the persons nominated to be Class I Directors for election at the
Annual Meeting.
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Name
|
Director
Since
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Age
|
Position
with
Corporation
|
Term
Expires
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|
Michael
Offerman
|
1973
|
69
|
Chairman
of the Board of Directors and President
|
2010
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Murray
Sennet
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1970
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87
|
Director
|
2010
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Allen
Gottlieb
|
1992
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69
|
Director
|
2011
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Gerald
E. Chafetz
|
2009
|
67
|
Director
|
2011
|
____________________
Michael
Offerman (Nominee) has been a member of IEH's Board of Directors since
1973. In May, 1987, Mr. Offerman was elected President and Chief
Executive Officer of IEH and has held that position since that
date. Prior to his becoming President and Chief Executive Officer,
Mr. Offerman served as Executive Vice-President of IEH.
Murray
Sennet (Nominee) has been a member of IEH's Board of Directors since 1968. Mr.
Sennet was the Secretary and Treasurer of IEH at the time of his retirement in
April, 1986.
Allen
Gottlieb has been a member of IEH’s Board of Directors since
1992. Mr. Gottlieb is retired. As previously disclosed by
the Company, in February 2003 in the United States District Court for the
Southern District of New York, the SEC obtained a judgment against certain
persons including Mr. Gottlieb (Securities and Exchange Commission v. Stewart et
al. 98 Civ. 2636 (S.D.N.Y.)) pursuant to which the defendants were found to have
violated the antifraud provisions of Section 17A of the Securities Act, Section
10(b) of the Exchange Act and Rule 10b-5 promulgated under the Exchange
Act. As a result, the defendants including Mr. Gottlieb were
permanently enjoined from future violations and were held liable for aggregate
damages totaling approximately $3 million. Mr. Gottlieb has appealed
the judgment insofar as it pertains to him (including the payment of any
damages) and the appeal is currently pending in the United States Court of
Appeals for the Second Circuit.
Gerald E.
Chafetz has been a member of IEH’s Board of Directors since May
2009. Mr. Chafetz has been President of Capitol City Companies since
1989. Capitol City Companies is a property management and home
improvement business.
Other
Executive Officer
Robert
Knoth joined IEH as Controller in January, 1990 and was elected Treasurer and
Chief Financial Officer of IEH in March, 1990. Mr. Knoth was elected
as Secretary of IEH in September 1992 and Mr. Knoth has held these positions
since said dates. From 1986 to January, 1990, Mr. Knoth was employed
as controller by G&R Preuss, Inc., a company engaged in the business of
manufacturing truck bodies and accessories.
Significant
Employees
Joan
Prideaux joined the Company in April 1994, as Director of Sales and
Marketing. Joan has been in the connector business over 30 years and
brings this experience to IEH. She also served as a Vice President
until January 2002. Ms. Prideaux resigned as an executive officer in
January 2002. Prior to joining us, she was employed by Automatic
Connector as Director of Sales.
Mark
Iskin is the Director of Purchasing, a position he has held since September
2000. Prior to joining the Company, Mr. Iskin worked as a materials
and purchasing specialist in manufacturing and distribution companies. In his
last position with an industrial distributor, Mr. Iskin was responsible for
purchasing and managing vendors for the cutting tool section of the catalog. In
addition, he participated in setting up and developing the Company’s forecasting
and planning software related to that department’s procedures.
David
Offerman joined IEH in September 2004 as the National Sales
Manager. Prior to
joining
IEH, David worked as an account executive and sales manager in the
telecommunication industry. David is the son of Michael Offerman,
President and Chief Executive Officer of the Company.
Robert
Romeo serves as Vice President of Engineering for IEH, a position he has held
since October 2005. Robert has corporate responsibility for
engineering products and driving product enhancements to satisfy the demanding
application requirements of IEH customers. In addition, Robert is
tasked with engineering new product developments in the IEH connector offerings
to broaden the market base of potential customers. These new
connectors will introduce the traditional IEH quality and value to industries
that specify exceptional reliability and performance in electrical and
electronic equipment. Before joining IEH, Robert worked for more than
20 years in positions of increasing responsibility for major national
manufacturers of electrical and electronic goods for residential, industrial,
government and OEM markets.
Paul
Tzetzos joined IEH in November 2005 as a Quality Assurance
Director. Paul has
over 20
years of experience in the field of Quality Assurance with the last 15 years as
Director/Manager. He is a degreed Engineer, with diversified
knowledge in developing, implementing, maintaining, and improving Quality
Systems, such as, ISO 9001:2000, EECS, MIL-Q-9858A, ETC. A certified
Lead and Internal Auditor, Paul has a great deal of knowledge concerning
military and industry specifications and standards.
Compliance
with Section 16(a) of the Exchange Act
Section
16(a) of the Securities Exchange Act of 1934, as amended, requires the Company’s
directors and officers and persons who own, directly or indirectly, more than
10% of a registered class of IEH’s equity securities, to file with the SEC
initial reports of ownership and reports of changes in ownership of Common Stock
of IEH.
Officers,
directors and greater than 10% shareholders are required to furnish the Company
with copies of all Section 16(a) reports that they file. Based solely
on review of the copies of such reports received by the Company, the Company
believes that filing requirements applicable to officers, directors and 10%
shareholders were complied with during the 2010 fiscal year.
Board
Committees and Compensation, Board Meetings, and Director
Independence
Our Board
of Directors currently consists of four individuals. IEH does not
have any Nominating, Audit or Compensation Committee of the Board of Directors.
The Board believes that because of its relatively small size and operations, the
Board is well positioned to address issues as a whole, including the appointment
of independent auditors. All matters relating to audit, compensation,
nominations and corporate governance are considered and acted upon by our Board
of Directors. Each Director receives an annual fee of $l,000 for
serving as a member of the Board of Directors each fiscal
year. Murray Sennet has received the sum of $7,200 for consulting
services provided to IEH for each of the last three fiscal years.
During
the fiscal year ended March 26, 2010, one (1) meeting of the Board of Directors
was held by telephone conference call. All Directors participated in
such meeting of the Board. In addition, during the fiscal year ended
March 26, 2010, the Board of Directors took action by unanimous written consent
on two (2) occasions.
We
believe that three (3) of our directors, Allen Gottlieb, Murray Sennet and
Gerald Chafetz, would both qualify as “independent directors” within the meaning
of the term as applied by the Nasdaq Stock Market Rule 4200(a)(15).
Compensation
Committee Interlocks and Insider Participation in Compensation
Decisions
The Board
does not have a Compensation Committee. There are no interlocks
between our Directors and Directors of other companies.
Audit
Committee and Audit Committee Financial Expert
We do not
have an Audit Committee of the Board. Because of our small size of
operations and because our shares of Common Stock are not traded on an exchange
or on the Nasdaq Stock Markets, we are not required by law or applicable
regulations to have an Audit Committee. The Board of Directors acts
as a whole with respect to matters which might otherwise be acted upon by an
Audit Committee. Further, as a result of our financial condition, and
limited financial resources to obtain directors’ and officers’ insurance and to
provide financial incentives to Board members, we have been unable to attract
other qualified persons to serve on our Board.
Our Board
of Directors has determined that we do have one current director, Murray Sennet,
who qualifies as an audit committee financial expert pursuant to Item 401 of
Regulation S-B.
Nominations
to the Board of Directors
Given the
small size of our operations, and our lack of financial resources, we do not
have a separate Nominating Committee of our Board of Directors. As a
result, our Board acts as a whole with respect to the consideration of
additional candidates for service on the Board. The Board considers
candidates for election to our Board of Directors, whether recommended by
security holders or otherwise, in accordance with the following criteria,
applicable to all candidates:
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Nominees
shall have a reputation for integrity, honesty and adherence to high
ethical standards.
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Nominees
should have demonstrated business acumen, experience and the ability to
exercise sound judgment in matters that relate to current and long-term
objectives of IEH and should be willing and able to contribute positively
to our decision-making process.
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Nominees
should have a commitment to understand IEH and its industries and to
regularly attend and participate in meetings of the Board and its
committees.
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Nominees
should have the interest and ability to understand the sometimes
conflicting interests of the various constituencies of IEH, which include
shareholders, employees, customers, governmental units, creditors and the
general public, and to act in the interests of all
shareholders.
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Nominees
should not have, nor appear to have, a conflict of interest that would
impair the nominees’ ability to represent the interests of all of IEH
shareholders and to fulfill the responsibilities of a
director.
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Nominees
shall not be discriminated against on the basis of race, religion,
national origin, sex, disability or any other basis proscribed by
applicable law.
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The
renomination of existing directors is not viewed as automatic, but shall be
based on
continuing
qualification under the criteria set forth above. In addition, the Board
considers the existing directors’ performance on the Board and any committee
thereof. The Board also considers the backgrounds and qualifications
of the directors considered as a group and our ability to attract other persons
to serve in light of our industry, financial condition and financial
resources. The Board desires to ensure that the Board, when taken as
a whole, should provide a significant breadth of experience, knowledge and
abilities that shall assist the Board in fulfilling its
responsibilities.
Procedure
to be Followed by Shareholders in Submitting Director Candidate
Recommendations
Any
shareholder who desires the Board to consider one or more candidates for
nomination
as a director should either by personal delivery or by United States mail,
postage prepaid, deliver a written recommendation addressed to the Chairman of
the Board of Directors, at 140 58
th
Street Building B, Suite 8E, Brooklyn, New York 11220, not later than (i) with
respect to an election to be held at an Annual Meeting of Shareholders, 120 days
prior to the anniversary date of the immediately preceding Annual Meeting; and
(ii) with respect to an
election
to be held at a special meeting of shareholders for the election of directors,
the close of business on the 10th day following the date on which notice of such
meeting is first given to shareholders. Each written recommendation should set
forth: (a) the name and address of the shareholder making the recommendation and
of the person or persons recommended; (b) the consent of such person(s) to serve
as a director(s) of IEH if nominated and elected;
(c)
description of how the person(s) satisfy the general criteria for consideration
as a candidate referred to above and (d) a biography or similar information
regarding the person being nominated as would satisfy the information
requirements required under the rules and regulations of the SEC for inclusion
in a proxy statement.
Communications
with the Board of Directors
Any
shareholder who wishes to communicate with the Board of Directors should send a
written
letter to the Secretary of the Company, at the Company’s principal
address. Letters may be directed to the Board as a whole or to
individual members.
THE BOARD OF DIRECTORS RECOMMENDS
THAT YOU VOTE
“
FOR
”
THE TWO (2) NOMINEES FOR CLASS
I DIRECTOR AS DESCRIBED IN THIS PROPOSAL 1.
PROPOSAL
2
RATIFICATION
OF APPOINTMENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Jerome Rosenberg CPA, P.C. has served
as our independent registered public accounting firm since April 1991. The Board
of Directors has reappointed Jerome Rosenberg CPA, P.C. as our independent
registered public accountants for the fiscal year ending March 25, 2011, and has
further directed that management submit the selection of Jerome Rosenberg CPA,
P.C. as our independent registered public accountants for ratification by the
shareholders at the Annual Meeting. Shareholder ratification of the selection of
Jerome Rosenberg CPA, P.C. our independent registered public accounting firm, is
not required by our bylaws, New York corporate law or otherwise. The Board of
Directors has elected to seek such ratification as a matter of good corporate
practice. Should the shareholders fail to ratify the selection of Jerome
Rosenberg CPA, P.C. as our independent registered public accounting firm, the
Board of Directors will reconsider whether to retain that firm for fiscal year
2011. Even if the selection is ratified, the Board of Directors in its
discretion may direct the appointment of a different independent registered
accounting firm at any time during the year if they determine that such a change
would be in the best interests of our shareholders and the Company.
Representatives of Jerome Rosenberg CPA, P.C. are expected to be present at the
Annual Meeting, will have an opportunity to make a statement if they so desire
and will be available to respond to appropriate questions.
Principal
Accountant Fees and Services
The Board of Directors has reappointed
Jerome Rosenberg CPA, P.C. as our independent registered public accounting firm
for the fiscal year ending March 25, 2011. During the fiscal
year
ending March 26, 2010, the audit services provided by Jerome Rosenberg CPA, P.C.
consisted of examination of financial statements, services relative to filings
with the SEC, and consultation in regard to various accounting
matters.
During the fiscal years ended March 26,
2010 and March 27, 2009, respectively, the total fees billed for professional
audit, non-audit services and other services rendered by our independent
registered public accounting firm were as follows:
Audit Fees
. During
the fiscal years ended March 26, 2010 and March 27, 2009, IEH paid an aggregate
of $40,000 and $36,600, respectively, each year to Jerome Rosenberg, CPA, P.C.
for fees related to the audit of its financial statements.
Audit Related Fees; Financial
Systems Design and Implementation
. During the fiscal years
ended March 26, 2010 and March 27, 2009, no fees were paid to Jerome Rosenberg,
CPA, P.C. with respect to financial systems design or
implementation.
Tax Fees.
During
the fiscal years ended March 26, 2010 and March 27, 2009, the Company paid to
Jerome Rosenberg, CPA, P.C. the sums of $3,200 and $3,000, respectively, for tax
compliance, tax advice and tax planning services.
All Other
Fees.
During the fiscal year ended March 26, 2010 and March
27, 2009, IEH did not pay any other fees for services to its
auditor.
The Board
of Directors has determined that the services provided by Jerome Rosenberg, CPA,
P.C. and the fees paid to it for such services during the fiscal year ended
March 26, 2010 has not compromised the independence of Jerome Rosenberg, CPA,
P.C. We do not have an Audit Committee of the
Board. Because of our small size of operations and because we are not
traded on an exchange or on the Nasdaq Stock Markets, we are not required by law
or applicable regulations to have an Audit Committee. The Board acts
as a whole with respect to all matters which might otherwise be acted upon by an
Audit Committee.
Vote
Required and Board Recommendation
The
affirmative vote of the holders of a majority of the votes cast at the Annual
Meeting is required for the ratification of Jerome Rosenberg CPA, P.C. as our
independent registered public accounting firm for fiscal 2011.
THE BOARD OF DIRECTORS RECOMMENDS
THAT YOU VOTE
FOR
THE RATIFICATION OF JEROME ROSENBERG
CPA, P.C. AS OUR INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR FISCAL YEAR
2011 AS DESCRIBED IN THIS PROPOSAL NO. 2.
EXECUTIVE
COMPENSATION AND RELATED INFORMATION
Summary
Compensation Table
The
following table sets forth below the summary compensation paid or accrued by the
Company during the fiscal years ended March 26, 2010, March 27, 2009 and March
28, 2008, for the Company’s President and Chief Executive Officer and Chief
Financial Officer:
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Name
and Principal Position
|
Year
|
Salary
|
Bonus
|
Other
Annual
Compensation
|
Total
|
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Michael
Offerman, Chief
Executive
Officer, President (1)
|
March
26, 2010
March
27, 2009
March
28, 2008
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$175,538
158,500
105,000
|
$47,000
35,000
18,500
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$0
0
0
|
$222,538
193,500
123,500
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Robert
Knoth,
Chief
Financial Officer
|
March
26, 2010
March
27, 2009
March
28, 2008
|
$130,404
119,601
84,002
|
$34,000
25,000
14,600
|
$0
0
0
|
$164,404
144,601
98,602
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(1)
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During
the years ended March 26, 2010, March 27, 2009 and March 28, 2008 the
Company provided automobile allowances to Mr. Offerman. This
does not include the aggregate incremental cost to the Company of such
automobile or automobile
allowances.
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No officer of the Company (other than
Mr. Offerman and Mr. Knoth) received compensation (salary and bonus) in excess
of $100,000 during any of the fiscal years ended March 26, 2010, March 27, 2009
and March 28, 2008.
Employment
Agreements with Named Executive Officers
The
following are summaries of the employment agreements with our named executive
officers. The agreements provide the general framework and the specific terms
for the compensation of the named executive officers.
Michael
Offerman
On
September 1, 2010, the Company entered into an employment agreement with
Mr. Offerman, as President and Chief Executive Officer of the
Company the terms of which are summarized below.
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Under
the employment agreement, Mr. Offerman will be entitled to serve as an
executive officer of the Company for the “Active Period” which is defined
as such period until he attains the age of 70 years or further period of
employment beyond such date if extended by mutual agreement of the Company
and Mr. Offerman. The “Retirement Period” is defined as the period
beginning with the executive attaining the age of 70 years and continuing
until ten (10) years thereafter, unless his employment has been previously
terminated or extended by mutual agreement of the Company and the
executive. The Retirement Period shall take effect only on termination of
the Active Period.
The
Active Period shall terminate on the first to occur of the following
events: (i) Expiration of the later of either the original time limit for
such Active Period, or the renewal or extension thereof by the
Company; (ii) Executive attaining the age of 70 years, unless his
Active Period of employment has been extended by mutual agreement of
executive and the Company; (iii) Death of executive before attaining an
age of 70 years; (iv) Disability of executive before attaining an age of
70 years; (v) Termination of Executive by mutual consent of executive
and the Company before attaining age 70 years; or (vi) The
passage of sixty (60) days following receipt by executive of notice in
writing from Company's intention to terminate the employment relationship
for Cause. "Cause" means (i) willful malfeasance or willful
misconduct by executive in connection with his employment; (ii)
executive's gross negligence in performing any of his duties under the
employment agreement; (iii) executive's conviction of, or entry of a plea
of guilty to, or entry of a plea of nolo contendre with respect to, any
crime other than a traffic violation or infraction which is a misdemeanor;
(iv) executive's material breach of any written policy applicable to all
executives adopted by the Company which is not cured to the reasonable
satisfaction of the Company within thirty (30) business days after notice
thereof; or (v) material breach by executive of any of his obligations
under the employment agreement which is not cured to the reasonable
satisfaction of the Company within thirty (30) business days after notice
thereof.
The
Retirement Period shall terminate with the first to occur of any of the
following events: (i) Expiration of the time limit for such Retirement
Period; (ii) The death of executive, subject to the provisions of
termination payments to the executive’s estate or beneficiaries for the
remainder of the executive’s 10-year Retirement Period; (iii) Violation by
executive of provisions of the employment agreement relating to employment
duties and competitive activities, such termination being a termination
for Cause. The Company shall give sixty (60) days notice, in writing, to
executive of its intention to terminate for Cause; or (iv) Termination by
mutual consent of the Company and executive.
Compensation
During
the Active Period, Mr. Offerman’s compensation shall be fixed by the Board
of Directors of the Company from time to time. During the fiscal year
ending March 26, 2010, Mr. Offerman received a salary of
$175,538.
During
During the Retirement Period, the amount payable shall be at the rate of
$50,000 per year annum for a period of ten (10) years, payable in equal
monthly installments, with the first payment to be made on the 1
st
day of the next month following the month in which the last to occur of
the following events: (a) executive has attained the age of 70 years; or
(b) if executive's employment and active service has been extended by the
Company beyond executive attaining the age of 70 years, from the date of
termination of such active service
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Termination
Payments
|
On
termination of his Active Period, except by reason of termination by the
Company for Cause or by mutual consent of executive and the Company,
executive shall be paid at the rate of $50,000 per annum for a period of
ten (10) years, payable in equal monthly installments. If
executive, however, dies after commencement of the Retirement Period and
before the expiration of the ten (10) year Retirement Period, the monthly
payments shall be made to executive's estate, or to the beneficiary or
beneficiaries designated by executive in writing, on an appropriate form
as may be submitted to the Company by executive, for the balance of the
Retirement Period.
|
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However,
the aggregate of such termination payments under the employment agreement
shall not in any event exceed the sum of
$500,000.
|
On
September 1, 2010, the Company entered into an employment agreement with
Mr. Knoth, the terms of which are summarized below.
Under the
employment agreement, Mr. Knoth will be entitled to serve as an executive
officer of the Company for the “Active Period” which is defined as such period
until he attains the age of 70 years or further period of employment beyond such
date if extended by mutual agreement of the Company and Mr. Knoth. The
“Retirement Period” is defined as the period beginning with the executive
attaining the age of 70 years and continuing until ten (10) years thereafter,
unless his employment has been previously terminated or extended by mutual
agreement of the Company and the executive. The Retirement Period shall take
effect only on termination of the Active Period
Under the
employment agreement, Mr. Knoth will be entitled to serve as an executive
officer of the Company for the “Active Period” which is defined as such period
until he attains the age of 70 years or further period of employment beyond such
date if extended by mutual agreement of the Company and Mr. Knoth. The
“Retirement Period” is defined as the period beginning with the executive
attaining the age of 70 years and continuing until ten (10) years thereafter,
unless his employment has been previously terminated or extended by mutual
agreement of the Company and the executive. The Retirement Period shall take
effect only on termination of the Active Period.
The
Active Period shall terminate on the first to occur of the following events: (i)
Expiration of the later of either the original time limit for such Active
Period, or the renewal or
extension
thereof by the Company; (ii) Executive attaining the age of 70 years,
unless his Active Period of employment has been extended by mutual agreement of
executive and the Company;(iii) Death of executive before attaining an age of 70
years;(iv) Disability of executive before attaining an age of 70 years; (v)
Termination of Executive by mutual consent of executive and the Company before
attaining age 70 years; or (vi) The passage of sixty (60) days following receipt
by executive of notice in writing from Company's intention to terminate the
employment relationship for Cause. "Cause" means (i) willful
malfeasance or willful misconduct by executive in connection with his
employment; (ii) executive's gross negligence in performing any of his duties
under the employment agreement; (iii) executive's conviction of, or entry of a
plea of guilty to, or entry of a plea of nolo contendre with respect to, any
crime other than a traffic violation or infraction which is a misdemeanor; (iv)
executive's material breach of any written policy applicable to all executives
adopted by the Company which is not cured to the reasonable satisfaction of the
Company within thirty (30) business days after notice thereof; or (v) material
breach by executive of any of his obligations under the employment agreement
which is not cured to the reasonable satisfaction of the Company within thirty
(30) business days after notice thereof.
The
Retirement Period shall terminate with the first to occur of any of the
following events: (i) Expiration of the time limit for such Retirement
Period; (ii) The death of executive, subject to the provisions of
termination payments to the executive’s estate or beneficiaries for the
remainder of the executive’s 10-year Retirement Period; (iii) Violation by
executive of provisions of the employment agreement relating to employment
duties and competitive activities, such termination being a termination for
Cause. The Company shall give sixty (60) days notice, in writing, to executive
of its intention to terminate for Cause; or (iv) Termination by mutual consent
of the Company and executive.
Compensation
During the Active Period, Mr. Knoth’s
compensation shall be fixed by the Board of Directors of the Company from time
to time. During the fiscal year ending March 26, 2010, Mr. Knoth received a
salary of $130,404.
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During
the Retirement Period, the amount payable shall be at the rate of $12,000
per year annum for a period of ten (10) years, payable in equal monthly
installments of $1,000, with the first payment to be made on the 1
st
day of the next month following the month in which the last to occur of
the following events: (a) executive has attained the age of 70 years; or
(b) if executive's employment and active service has been extended by the
Company beyond executive attaining the age of 70 years, from the date of
termination of such active service.
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On
termination of his Active Period, except by reason of termination by the
Company for Cause or by mutual consent of executive and the Company,
executive shall be paid at the rate of $12,000 per annum for a period of
ten (10) years, payable in equal monthly installments of
$1,000. If executive, however, dies after commencement of the
Retirement Period and before the expiration of the ten (10) year
Retirement Period, the monthly payments shall be made
to
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executive's
estate, or to the beneficiary or beneficiaries designated by executive in
writing, on an appropriate form as may be submitted to the Company by executive,
for the balance of the Retirement Period.
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However,
the aggregate of such termination payments under the employment agreement
shall not in any event exceed the sum of
$120,000.
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Stock
Option Plan
On September 21, 2001 the Company’s
shareholders approved the adoption of the Company’s 2002 Employees Stock Option
Plan (“2002 Plan”) to provide for the grant of options to purchase up to 750,000
shares of the Company’s Common Stock to all employees, including senior
management.
Options
granted to employees under the 2002 Plan may be designated as options which
qualify for incentive stock option treatment under Section 422A of the Internal
Revenue Code, or option which do not so qualify. Under the 2002 Plan, the
exercise price of an option designated as an incentive stock option shall not be
less than the fair market value of the Company’s Common Stock on the day the
option is granted. In the event an option designated as an incentive stock
option is granted to a ten percent (10%) shareholder, such exercise price shall
be at least 110 percent (110%) of the fair market value or the Company’s Common
Stock and the option must not be exercisable after the expiration of five years
from the day of the grant. Exercise prices of non-incentive stock
options may be less than the fair market value of the Company’s Common
Stock.
The aggregate fair market value of
shares subject to options granted to a participant, which are designated as
incentive stock options, and which become exercisable in any calendar year,
shall not exceed $100,000. As of March 26, 2010, no options had been granted
under the 2002 Plan.
Cash
Bonus Plan
In 1987, the Company adopted a cash
bonus plan for executive officers (“Cash Bonus Plan”). Contributions
to the Cash Bonus Plan are made by the Company only after pre-tax operating
profits exceed $150,000 for a fiscal year, and then to the extent of 10% of the
excess of the greater of $150,000 or 25% of pre-tax operating
profits. The contribution for the fiscal year ended March 26, 2010
was $163,000. The contribution for the fiscal year ended March 27,
2009 was $121,000.
VOTING
SECURITIES AND SECURITY OWNERSHIP
OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The
securities entitled to vote at the Annual Meeting are IEH's Common Stock. The
presence, in person or by proxy, of a majority of shares of Common Stock issued
and outstanding entitled to vote will constitute a quorum for the Annual
Meeting. Each share of Common Stock entitles its holder to one vote
on each matter submitted to shareholders. The close of business on
August 10, 2010 has been fixed as the Record Date for the determination of the
shareholders entitled to notice of and to vote at the Annual Meeting and any
adjournment thereof. At that date, 2,303,468 shares of Common Stock
were issued and outstanding. Voting of the shares of Common Stock is
on a non-cumulative basis.
The
following table sets forth certain information as of August 10, 2010 with
respect to: (i) the persons (including any "group" as that term is used in
Section 13(d)(3) of the Securities Exchange Act of 1934), known by IEH to be the
beneficial owner of more than five percent (5%) of any class of IEH's voting
securities; (ii) each Executive Officer and Director who owns Common Stock in
IEH; and (iii) all Executive Officers and Directors as a group. As of
August
10, 2010, there were 2,303,468 shares of Common Stock issued and
outstanding.
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Title of
Class
|
Name and Address of
Beneficial Owner
|
Amount
of
and Nature of
Beneficial
Ownership
|
Percentage of
Class
|
|
Common
Stock
$.01
Par Value
|
Michael
Offerman(1)
c/o
IEH Corporation
140
58
th
Street
Brooklyn,
NY 11220
|
923,784
|
40.01%
|
|
|
Murray
Sennet
c/o
IEH Corporation
140
58
th
Street
Brooklyn,
NY 11220
|
24,500
|
1.1%
|
|
|
Allen
Gottlieb
c/o
IEH Corporation
140
58
th
Street
Brooklyn,
NY 11220
|
0
|
0
|
|
|
Gerald
E. Chafetz
c/o
IEH Corporation
140
58
th
Street
Brooklyn,
NY 11220
|
0
|
0
|
|
|
Robert
Knoth
c/o IEH Corporation
140
58
th
Street
Brooklyn,
NY 11220
|
1,770
|
*
|
|
|
David
and Nancy Lopez (2)
171
Edge of Woods Road
Southampton,
NY 11969
|
188,500
|
8.2%
|
|
|
Hummingbird
Management, LLC(3)
145
E. 57
th
Street, 8
th
Floor
New
York, NY 10022
|
304,422
|
13.2%
|
|
All
Officers & Directors as a Group
(5
in number)
|
950,054
|
41.2%
|
______________________
* Less
than 1%.
|
(1)
|
43,600
shares of Common Stock are jointly owned by Mr. Offerman and his wife,
Gail
Offerman.
|
|
(2)
|
Based
on a Schedule 13D Amendment dated August 5, 2005 filed by reporting
person.
|
|
(3)
|
Based
on a Schedule 13D dated April 26, 2007 filed by reporting
person.
|
All
shares set forth above are directly owned by the named individual unless
otherwise stated.
CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS
Except as
disclosed herein, we have not entered into any material transactions or series
of similar transactions with any director, executive officer or any security
holder owning 5% or more of our common stock. For information concerning
employment agreements with, and compensation of, our executive officers and
directors, see the disclosure in the section of this proxy statement captioned
“Executive Compensation and Related Information.”
HOUSEHOLDING
OF PROXY MATERIALS
The SEC
has approved a rule governing the delivery of disclosure documents. This rule
allows us to send a single copy of this proxy statement to any household at
which two or more of our shareholders reside, if we believe that the
shareholders are members of the same family. Some banks, brokers and other
intermediaries may be participating in this practice of “householding” proxy
statements and annual reports. This rule benefits both the Company and its
shareholders as it reduces the volume of duplicate information received at a
shareholder’s house and helps reduce our expenses. Each shareholder, however,
will continue to receive individual proxy cards or voting instructions forms.
Shareholders that have previously received a single set of disclosure documents
may request their own copy by contacting their bank, broker or other nominee
record holder. We will also deliver a separate copy of this proxy statement to
any shareholder upon written request to Corporate Secretary, IEH Corporation,
140 58
th
Street, Suite 8E, Brooklyn, New York 11220.
Eligibility to Submit a
Proposal.
Under Rule 14a-8 promulgated under the Securities
Exchange Act of 1934, as amended, in order to be eligible to submit a proposal,
you must have continuously held at least $2,000 in market value, or 1%, of the
Company’s securities entitled to be voted on the proposal at the meeting for at
least one year by the date you submit the proposal. You must continue to hold
those securities through the date of the meeting.
Inclusion in Next Year’s Proxy
Statement.
A shareholder who desires to have his or her proposal
included in next year’s proxy statement must deliver the proposal to our
principal
executive
offices (at the address noted above) no later than the close of business on
April 14, 2011.
Presentation at
Meeting.
Rule 14a-4(c) under the Exchange Act provides that if a
proponent of a proposal fails to notify us at the address below at least 45 days
prior to the month and day of mailing of the prior year’s proxy statement (or
any date specified in an advance notice provision), then the management proxy
holders will be allowed to use their discretionary voting authority with respect
to the voting of proxies when the proposal is presented at the meeting, without
any discussion of the matter in the proxy statement. With respect to our 2011
annual meeting of shareholders, if we are not provided notice of a stockholder
proposal, which the shareholder has not previously sought to include in our
proxy statement, by June 28, 2011, the management proxy holders will be allowed
to use their discretionary authority with respect to the voting of
proxies.
A COPY OF
THE COMPANY’S ANNUAL REPORT ON FORM l0-K FOR THE FISCAL YEAR ENDED MARCH 26,
2010 FILED WITH THE SEC WILL BE FURNISHED WITHOUT EXHIBITS TO SHAREHOLDERS
WITHOUT CHARGE UPON WRITTEN REQUEST SENT TO ROBERT KNOTH, SECRETARY, IEH
CORPORATION, 140 58
TH
STREET, BUILDING B, SUITE 8E, BROOKLYN, NEW YORK 11220. Each request must set
forth a good faith representation that as of the Record Date, the person making
the request was the beneficial owner of Common Stock of IEH entitled to vote at
the 2010 Annual Meeting of shareholders. We are subject to the
informational requirements of the Securities
Exchange Act of 1934, as amended, and in accordance therewith file reports,
proxy and information statements and other information with the SEC. Such
reports, proxy and information statements and other information we file can be
inspected and copied at the public reference facilities maintained by the SEC at
100 F Street, N.E., Washington, D.C. at prescribed rates. You can contact the
SEC at 1-800-SEC-0330 for additional information about these facilities. The SEC
maintains a web site that contains reports, proxy and information statements and
other information filed through the SEC’s Electronic Data Gathering, Analysis
and Retrieval System. This web site can be accessed at
http://www.sec.gov
.
OTHER
BUSINESS
As of the date of this proxy statement,
the items discussed herein contain the only business which the Board of
Directors intends to present, and is not aware of any other matters which may
come before the Annual Meeting. If any other matter or matters are
properly brought before the Annual Meeting, or any adjournments thereof, it is
the intention of the persons named in the accompanying form of proxy to vote the
proxy on such matters in accordance with their judgment.
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|
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By
Order of the Board of Directors.
|
|
|
|
|
|
|
|
Robert
Knoth
|
|
|
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Chief
Financial Officer and Secretary
|
Dated:
August 13, 2010
WHETHER OR NOT YOU EXPECT TO ATTEND THE
ANNUAL MEETING, YOU ARE URGED TO VOTE AS SOON AS POSSIBLE BY PROXY VIA MAIL IN
ACCORDANCE WITH THE ENCLOSED VOTING INSTRUCTIONS. PLEASE COMPLETE AND
RETURN YOUR PROXY BY MAIL PROMPTLY IN THE ENCLOSED PRE-ADDRESSED POSTAGE-PAID
ENVELOPE AS SOON AS POSSIBLE.
IEH
CORPORATION
ANNUAL
MEETING OF SHAREHOLDERS – SEPTEMBER 7, 2010
PROXY
THIS
PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned shareholder of IEH
CORPORATION, a New York corporation, hereby appoints ROBERT KNOTH and MICHAEL
OFFERMAN and each of them, proxies, with full power of substitution to each, to
vote all share of Common Stock of IEH CORPORATION owned by the undersigned at
the Annual Meeting of Shareholders of IEH CORPORATION to be held on September 7,
2010 at 10:00 am (New York time) and at any adjournments thereof, hereby
revoking any proxy heretofore given. The undersigned instructs such
proxies to vote:
THE BOARD OF DIRECTORS RECOMMENDS A
VOTE “FOR” THE FOLLOWING PROPOSALS:
|
|
1.
|
ELECTION
OF DIRECTORS
|
|
|
|
|
FOR
nominees
listed
|
WITHHOLD
AUTHORITY
|
|
|
|
below
(except as marked
|
to
vote for all nominees
|
|
|
|
to
the contrary below)
|
listed
below
˜
|
NOMINEES FOR CLASS I
DIRECTORS
Michael
Offerman
o
Murray
Sennet
o
(Instruction: Please
check appropriate box. To withhold authority for any individual nominee, strike
a line through the
Nominee’s
name in the list below.)
|
|
2.
|
TO
RATIFY THE APPOINTMENT OF JEROME ROSENBERG
|
For
|
Against
|
Abstain
|
|
|
|
CPA,
P.C. AS THE INDEPENDENT REGISTERED PUBLIC
|
o
˜
|
˜
o
|
o
˜
|
|
|
|
ACCOUNTING
FIRM OF IEH CORPORATION FOR THE
|
|
|
|
|
|
|
YEAR
ENDING MARCH 25, 2011.
|
|
|
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AND TO VOTE UPON ANY OTHER MATTER AS
MAY PROPERLY COME BEFORE THE ANNUAL MEETING OR ANY ADJOURNMENT THEREOF,
all as described in the Proxy Statement dated on or about August 13, 2010
receipt of which is hereby acknowledged.
Either of the proxies, who shall be
present and acting, shall have and may exercise all the powers hereby granted,
including, without limitation, to vote to adjourn the Annual
Meeting.
This proxy when properly executed will
be voted as directed. If no contrary instruction is made, the proxies
intend to vote the shares represented by this proxy as directed: (a)
FOR
the election of the two (2) Class I
Directors nominated; (b)
FOR
the
ratification of the appointment of the independent registered public accounting
Firm; and (c) in accordance with the judgment of the persons named as proxy
herein, on any other matters that may properly come before the Annual Meeting or
any adjournment thereof.
A majority of the proxies present and
acting in person, or by their substitutes (or if only one present and acting,
then that one) may exercise all powers conferred hereby. The proxies
will use their discretionary authority conferred with respect to any other
matters which properly come before the Annual Meeting.
|
|
Please
sign, date and return this proxy immediately in the enclosed
envelope.
|
|
|
|
|
|
Dated: _____________________,
2010
|
|
|
|
|
|
|
|
|
___________________________________
|
|
|
Signature
|
|
|
|
|
|
___________________________________
|
|
|
Print
Name
|
|
|
|
|
|
___________________________________
|
|
|
Print
Name
(if
joint)
|
|
|
|
|
|
(Please
date and sign exactly as name appears at left. For joint
accounts, each joint owner should sign. Executors, administrators,
trustees, etc. should also so indicate when
signing.)
|
YOUR
VOTE IS IMPORTANT -- VOTE TODAY
|
|
VOTE BY MAIL:
please
complete, sign, date and return the above proxy card in the postage
prepaid envelope provided.
|
YOUR
CONTROL NUMBER IS:
_______________________
ONLINE
PROXY MATERIALS CAN BE ACCESSED AT THE FOLLOWING WEBSITE:
http://www.cfpproxy.com/0795
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