SEC Info - Brake Headquarters USA Inc - ‘PRES14A’ for 12/31/98

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Brake Headquarters USA Inc – ‘PRES14A’ for 12/31/98

As of: Friday, 9/25/98 · For: 12/31/98 · Accession #: 950116-98-1919 · File #: 0-28640

  As Of                Filer                Filing    For·On·As Docs:Size              Issuer               Agent

 9/25/98  Brake Headquarters USA Inc        PRES14A    12/31/98    1:58K                                    St Ives Financial/FA

Preliminary Proxy Solicitation Material — Special Meeting — Schedule 14A
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: PRES14A     Preliminary Proxy Solicitation Material -- Special    23    105K 
                          Meeting

Document Table of Contents

Page	(sequential)	\|	(alphabetic)	Top
			Alternative Formats (Word, et al.) Certain Relationships and Related Transactions Employment Agreements Executive Compensation
1	1st Page - Filing Submission
8	Executive Compensation
10	Employment Agreements
20	Certain Relationships and Related Transactions

PRES14A 1st Page of 23 TOC ↑Top Previous Next ↓Bottom Just 1st
 
SCHEDULE 14A
(Rule 14a-101)
 INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
 Proxy Statement Pursuant to Section 14(a) of the Securities
 Exchange Act of 1934 (Amendment No. )

Filed by the Registrant [x]                                                     
Filed by a Party other than the Registrant [ ]                                  

Check the appropriate box:                                                      
[x]  Preliminary Proxy Statement                                                
[ ]  Definitive Proxy Statement                                                 
[ ]  Definitive Additional Materials                                            
[ ]  Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12              

 BRAKE HEADQUARTERS U.S.A., INC.
(Name of Registrant as Specified In Its Charter)

None
(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:(1)                    

(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:                                                     

------------                                                                    
(1)   Set forth the amount on which the filing fee is calculated and state how  
it was determined.                                                  

PRES14A 2nd Page of 23 TOC 1st Previous Next ↓Bottom Just 2nd
 BRAKE HEADQUARTERS U.S.A., INC.

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
 to be held on November __, 1998

To the Stockholders of Brake Headquarters U.S.A., Inc.:                         

         Notice is hereby given that the Annual Meeting of Stockholders of Brake
Headquarters U.S.A., Inc., a Delaware corporation (the "Company"), will be held 
on November __, 1998, at the offices of the Company's attorneys, Snow Becker    
Krauss P.C., 605 Third Avenue, 25th Floor, New York, New York 10158, at 10:00   
a.m. for the following purposes:                                                

   1. To elect five Directors of the Company to serve until the next
          annual meeting of stockholders and until their successors are duly
elected and qualified.                                  

         2. To authorize a reverse stock split of the Company's Common Stock, if
necessary.                                              

        3. To ratify the appointment of Deloitte & Touche LLP as the Company's
   independent auditors for the year ending December 31, 1998.

    4. To transact such other business as may properly come before the
Annual Meeting or adjournments thereof.                 

       Only stockholders of record at the close of business on September 22,
1998 are entitled to notice of and to vote at the Annual Meeting or any         
adjournments thereof.                                                           

Long Island City, NY                          By Order of the Board of Directors
October __, 1998                                                                

                                 Sandra Ende
                               Secretary

IMPORTANT:

       WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE PROMPTLY
COMPLETE, SIGN AND DATE THE ENCLOSED PROXY, WHICH IS SOLICITED BY THE BOARD OF  
DIRECTORS OF THE COMPANY, AND RETURN IT TO THE COMPANY. THE PROXY MAY BE REVOKED
AT ANY TIME BEFORE IT IS VOTED, AND STOCKHOLDERS EXECUTING PROXIES MAY ATTEND   
THE MEETING AND VOTE IN PERSON SHOULD THEY SO DESIRE.                           

PRES14A 3rd Page of 23 TOC 1st Previous Next ↓Bottom Just 3rd
 BRAKE HEADQUARTERS U.S.A., INC.
 33-16 Woodside Avenue
Long Island City, New York 11101
(718) 779-4800
 -----------------------------

 PROXY STATEMENT

 -----------------------------

The Board of Directors of Brake Headquarters U.S.A., Inc. (the
"Company") presents this Proxy Statement and the enclosed proxy card to all     
stockholders and solicits their proxies for the Annual Meeting of Stockholders  
to be held on November __, 1998. The record date of this proxy solicitation is  
September 22, 1998. All proxies duly executed and received will be voted on all 
matters presented at the Annual Meeting in accordance with the instructions     
given by such proxies. In the absence of specific instructions, proxies so      
received will be voted for the named nominees for election to the Company's     
Board of Directors, for the approval of the proposal to authorize a reverse     
stock split of the Company's Common Stock, if necessary, and to ratify the      
appointment of Deloitte & Touche LLP as the Company's independent auditors for  
the year ending December 31, 1998. The Board of Directors does not anticipate   
that any of its nominees will be unavailable for election and does not know of  
any matters that may be brought before the Annual Meeting other than those      
listed on the Notice of the Annual Meeting.                                     

  In the event that any other matter should come before the Annual
Meeting or that any nominee is not available for election, the persons named in 
the enclosed proxy will have discretionary authority to vote all proxies not    
marked to the contrary with respect to such matter in accordance with their best
judgment. A proxy may be revoked at any time before being voted by sending a new
proxy bearing a later date or a revocation notice to the Company at the above   
address, attn: Secretary, or by notifying the Secretary of the Company at the   
Annual Meeting. The Company is soliciting these proxies and will pay the entire 
expense of solicitation, which will be made by use of the mails. This Proxy     
Statement is being mailed on or about October ___ , 1998.                       

      The total number of shares of common stock, $.001 par value ("Common
Stock"), of the Company outstanding as of September 22, 1998, was 5,679,413     
shares. Each share of Common Stock has one vote. The affirmative vote by holders
of a plurality of the votes represented at the Annual Meeting is required for   
the election of Directors. Only stockholders of record as of the close of       
business on September 22, 1998 will be entitled to vote at the Annual Meeting or
any adjournments thereof. As the sole stockholder of the 1,000 shares of Series 
B Preferred Stock, which votes as a separate class, Joseph Ende, the Company's  
Chairman of the Board, has the exclusive right to elect a majority of the       
Company's Board of Directors until the earlier of the redemption date of March  
31, 2001 or the reporting by the Company of at least $75 million in net sales   
for any year through December 31, 2000.                                         

PRES14A 4th Page of 23 TOC 1st Previous Next ↓Bottom Just 4th
       The affirmative vote by a majority of the votes cast on the proposals
to authorize a reverse stock split of the Company's Common Stock, if necessary, 
and to ratify the appointment of Deloitte & Touche LLP as the Company's auditors
for the year ending December 31, 1998, is required. Each share of Common Stock  
has one vote and the Series B Preferred Stock will not vote on these proposals. 
Shares represented by proxies which are marked "abstain" with respect to such   
ratification will not be included in the vote totals on this proposal. All      
proxies will be counted for determining the presence of a quorum. Votes withheld
in connection with the election of one or more nominees for Director will not be
counted as votes cast for such individuals. In addition, where brokers are      
prohibited from exercising discretionary authority for beneficial owners who    
have not provided voting instructions (commonly referred to as "broker          
non-votes"), those shares will not be included in the vote totals.              

       A list of stockholders entitled to vote at the Annual Meeting will be
available at the Company's principal office, 33-16 Woodside Avenue, Long Island 
City, NY 11101, during business hours, for a period of ten (10) days prior to   
the Annual Meeting for examination by any stockholder. Such list shall also be  
available at the Annual Meeting.                                                

   The Proxy Statement, the accompanying Notice of Annual Meeting of
Stockholders and the Proxy, the 1997 Annual Report to Stockholders including    
financial statements for the three-year period ended December 31, 1997 and the  
Quarterly Report on Form 10-Q for the six month period ended June 30, 1998, are 
expected to be mailed commencing on or about October __, 1998 to stockholders of
record on September 22, 1998.                                                   

 SECURITY OWNERSHIP OF CERTAIN
BENEFICIAL OWNERS AND MANAGEMENT

         The following table sets forth, as of September 22, 1998, the number of
shares of the Company's outstanding Common Stock, $.001 par value, beneficially 
owned (as such term is defined in Rule 13d-3 under the Securities Exchange Act  
of 1934) by each person known by the Company to be the beneficial owner of more 
than 5% of the outstanding shares, by each director, by each Named Executive    
Officer, and by all directors and officers as a group. As the sole stockholder  
of the 1,000 shares of Series B Preferred Stock, which votes as a separate      
class, Joseph Ende, the Company's Chairman of the Board, has the exclusive right
to elect a majority of the Company's Board of Directors.                        

                                                                [Download Table]

Name and Address         Amount and Nature         Percentage 
of Beneficial Owner  Beneficial Ownership (1)     of Class (2)
-------------------  --------------------------   ------------
                                                              
Joseph Ende (3)                2,601,212  (4)(5)      43.7%   

Sandra Ende (3)                   53,600  (6)          1.2%   

Marc J. Ruskin (3)                19,500  (7)          (12)   

Scott Osias (3)                   29,500  (8)          (12)   

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PRES14A 5th Page of 23 TOC 1st Previous Next ↓Bottom Just 5th
                                                                [Download Table]

Name and Address            Amount and Nature        Percentage 
of Beneficial Owner     Beneficial Ownership (1)    of Class (2)
-------------------     --------------------------  ------------
                                                                
Elliot H. Lutzker                    25,000  (9)         (12)   

Adam E. Budish                        5,000  (10)        (12)   

Officers and Directors            2,733,812  (11)       45.4%   
as a Group (6 Persons)                                          

-------------                                                                   
(1)      Unless otherwise noted, the Company believes that all persons named in 
      this table have sole voting and investment power with respect to all
       shares of Common Stock beneficially owned by them. A person is deemed
       to be the beneficial owner of securities that can be acquired by such
         person within 60 days from the date of this filing upon the exercise of
      warrants or options. Unless otherwise noted, each beneficial owner's
         percentage ownership is determined by assuming that options or warrants
       that are held by such person (but not those held by any other person)
         and which are exercisable within 60 days from the date hereof have been
exercised.                                                    

(2)      Based on 5,679,413 shares of Common Stock outstanding as of            
September 22, 1998.                                           

(3)      The address of this person is c/o the Company, 33-16 Woodside Avenue,  
Long Island City, New York 11101.                             

(4)      Includes 270,000 shares issuable upon the exercise of currently        
   exercisable options, but does not include an aggregate of 510,000
  shares underlying options which are not currently exercisable or
exercisable within the next 60 days.                          

        In March 1996, the Company amended its Certificate of Incorporation to
       authorize the issuance of 1,000 shares of Series B Preferred Stock to
       be held by Joseph Ende. As sole stockholder of the Series B Preferred
    Stock, which votes as a separate class, Mr. Ende has the exclusive
         right to elect a majority of the Company's Board of Directors until the
      earlier of the redemption date of March 31, 2001 or the reporting by
       the Company of at least $75 million in net sales for any year through
December 31, 2000. See "Certain Relationships and Related     
Transactions."                                                

(5)      Does not include 53,600 shares owned of record by the Joseph and Sandra
      Ende Charitable Trust, of which Joseph and Sandra Ende are Trustees.
   Also does not include a presently indeterminable number of shares
         issuable upon conversion of up to $800,000 of 5% Convertible Debentures
       dated November 7, 1997 (the "Debentures"). On September 14, 1998, Mr.
         Ende entered into agreements with two Debentureholders to repurchase an
        aggregate of $850,000 of Debentures prior to November 2, 1998, subject
    to his obtaining personal bank financing. The Debentures mature on
       November 7, 1998 and are convertible into Common Stock at the rate of
      82.5% of the average closing bid price of the Company's Common Stock
        for the five trading days preceding conversion. Mr. Ende has purchased
        $50,000 of Debentures and converted them into 255,180 shares of Common
       Stock. As of September 17, 1998, the remaining $800,000 of Debentures
         were convertible into approximately 2,850,000 shares of Common Stock at
    the rate of $.28 per share. If all 2,850,000 shares were issued to
  Mr. Ende he would then beneficially own 5,451,212 (62.4%) of the
      8,739,413 shares  then outstanding for purposes of this computation.
 Mr. Ende has agreed to lock-up for a one-year period all shares
acquired by him on conversion.                                

(6)      Includes 53,600 shares owned of record by the Joseph and Sandra Ende   
      Charitable Trust, of which Joseph and Sandra Ende, husband and wife,
are Trustees.                                                 

(7)      Includes 14,500 shares of Common Stock issuable upon the exercise of   
      currently exercisable options, but does not include 75,000 shares of
  Common Stock issuable upon the exercise of options which are not
currently exercisable or exercisable within the next 60 days. 

3 

PRES14A 6th Page of 23 TOC 1st Previous Next ↓Bottom Just 6th
-------------                                                                   
(8)      Includes 23,500 shares of Common Stock issuable upon the exercise of   
      currently exercisable options, but does not include 53,000 shares of
  Common Stock issuable upon the exercise of options which are not
currently exercisable or exercisable within the next 60 days. 

(9)      Includes (i) 20,000 shares of Common Stock issuable upon exercise of   
        currently exercisable options held by Snow Becker Krauss P.C., counsel
       to the Company, and of which Mr. Lutzker is a partner, and (ii) 5,000
        shares of Common Stock issuable upon exercise of currently exercisable
options held by Mr. Lutzker.                                  

(10)     Includes 5,000 shares of Common Stock issuable upon the exercise of    
currently exercisable options.                                

(11)     Includes 338,000 shares of Common Stock issuable upon exercise of      
   currently exercisable stock options, but does not include 638,000
         shares of common stock which may be purchased pursuant to stock options
  which are not currently exercisable, and does not include shares
    issuable upon conversion of Debenture described in Note (5) above.

(12)     Less than one percent of the issued and outstanding shares.            

Compliance with Section 16(a) of the Exchange Act.                              

Section 16(a) of the Securities Exchange Act of 1934 requires the Company's     
Officers, Directors and persons who own more than ten percent of the registered 
class of the Company's equity securities, to file reports of ownership and      
changes in ownership with the Securities and Exchange Commission. Officers,     
Directors and ten percent Stockholders are required by regulation to furnish the
Company with copies of all Section 16(a) forms they file. Based solely on the   
Company's copies of such forms received or written representations from certain 
reporting persons that no form 5's were required for those persons, the Company 
believes that, during the time period of January 1, 1997 through December 31,   
1997, all filing requirements applicable to its Officers, Directors and greater 
than ten percent beneficial owners were complied with.                          

 ELECTION OF DIRECTORS

        The Directors to be elected at the Annual Meeting will serve until the
next Annual Meeting of Stockholders and until their successors are duly elected 
and qualified. Proxies not marked to the contrary will be voted "FOR" the       
election to the Board of Directors of the following five persons, each of whom  
are incumbent Directors.                                                        

     The following table sets forth information concerning the nominees:

Name                                 Age           Position                     
----                                 ---           --------                     

Joseph Ende                           50            Chairman of the Board       
                                                   and Chief Executive Officer

Marc J. Ruskin                        46            Chief Financial Officer and 
                                Director

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PRES14A 7th Page of 23 TOC 1st Previous Next ↓Bottom Just 7th
Name                                 Age           Position                     
----                                 ---           --------                     

Sandra Ende                           45            Secretary and Director      

Elliot H. Lutzker                     45            Director (1)                

Adam E. Budish                        38            Director (1)                
-----------------                                                               
(1) Member of Audit and Compensation Committees.                                

Joseph Ende has been Chief Executive Officer and Chairman of  
the Board of Directors of the Company since July 9, 1992. He was also President 
of the Company from July 1992 until August 1998. He has been the President and a
Director of Sanyo Automotive Parts, Ltd. ("Sanyo Automotive") since its         
inception in June 1976. Mr. Ende is the husband of the Company's Secretary,     
Sandra Ende.                                                                    

         Sandra Ende has been a Director and Secretary of the Company since July
1992. She has been employed by Sanyo Automotive since its inception in June 1976
through March 1997, in various capacities including bookkeeper, Personnel       
Manager, Director of Marketing and Office Manager. Ms. Ende is the wife of the  
Company's President, Joseph Ende.                                               

  Marc J. Ruskin, CPA, has been the Chief Financial Officer of the
Company since August 1995 and a director of the Company since February 1998. He 
has 20 years of financial experience, including a combined five years at Ernst &
Young LLP and Deloitte & Touche LLP. From 1993 until he joined the Company, Mr. 
Ruskin was Vice President of Finance and Administration for the Nason Group LLC,
a Connecticut company formed to purchase and develop real estate. From 1991 to  
1993, Mr. Ruskin was the Chief Financial Officer of REBO Group Incorporated, a  
New York based international corporation specializing in the research,          
development and production of high definition television. Mr. Ruskin was Vice   
President of Finance and Administration of Kaufman Astoria Studios, Inc., a     
company specializing in film/television and real estate management, from 1982 to
1991. Mr. Ruskin holds an MBA from the University of Bridgeport.                

     Elliot H. Lutzker has been a Director of the Company since February
1998. Since 1985, Mr. Lutzker has been a partner in the law firm of Snow Becker 
Krauss P.C., counsel to the Company. He was formerly an attorney with the       
Division of Enforcement of the NorthEast Regional Office of the U.S. Securities 
and Exchange Commission. Mr Lutzker serves on the Board of Directors of         
Photonics Industries International, Inc.                                        

        Adam E. Budish has been a Director of the Company since February 1998.
Mr. Budish has been Vice President- Business Affairs at Reuters Health          
Information Inc. (a wholly-owned subsidiary of Reuters PLC) since June 1994.    
From January 1994 to June 1994 Mr. Budish was General Counsel to GeoMedica      
Networks, which was acquired by Reuters PLC in June 1994. From 1992 to 1994 Mr. 
Budish was Legal Counsel, Business Affairs at Rebo Studio, Inc. Mr. Budish has  
an M.B.A. from The Wharton School of the University of Pennsylvania, and a J.D. 
from George Washington University School of Law.                                

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PRES14A 8th Page of 23 TOC 1st Previous Next ↓Bottom Just 8th
Certain Information Concerning the Board of Directors                           

         The Board of Directors held one meeting during 1997 and conducted other
business by unanimous written consent. Each Director attended all Board         
meetings.                                                                       

         All directors hold office until the next annual meeting of stockholders
and the election and qualification of their successors. Directors currently     
receive no cash compensation for serving on the Board of Directors. Officers are
elected annually by the Board of Directors and, subject to existing employment  
agreements, serve at the discretion of the Board. The Company's Placement Agent,
G-V Capital Corp., has the right at its discretion for a three-year period      
ending August 13, 1999 to designate either a member of the Board of Directors or
an advisor to the Board.                                                        

INFORMATION ABOUT EXECUTIVE OFFICERS

    In addition to Joseph Ende, the Company's Chairman of the Board of
Directors and Chief Executive Officer, Marc J. Ruskin, the Company's Chief      
Financial Officer, and Sandra Ende, the Company's Secretary, the following      
individual serves as an executive officer of the Company:                       

     Scott Osias has been President of the Company since August 1998 and
prior thereto was Executive Vice President and Chief Operating Officer from     
April 1997. Prior thereto, he was Vice President of Sales and Marketing of the  
Company from October 1992. Mr. Osias has been employed in the retail automotive 
industry since 1973 and was the principal owner and operator of Automotive      
Discount Centers, a 14 store retail automotive parts store chain in New York    
from 1973 to 1988. Prior to joining the Company, from 1988, Mr. Osias was       
General Manager of Prime Automotive Warehouse, a warehouse distribution         
automotive parts chain.                                                         

EXECUTIVE COMPENSATION
Summary Compensation                                                            

        The following table sets forth all compensation awarded to, earned by,
or paid for all services rendered to the Company during the years ended December
31, 1997, 1996 and 1995, by the Company's Chief Executive Officer, who was the  
Company's only executive officer ("Named Executive Officers") whose total       
compensation exceeded $100,000.                                                 

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                                                                [Download Table]


                                            Summary Compensation Table         
                                                                    Long Term  
                                         Annual Compensation       Compensation
                                    -----------------------------  ------------
                                                                     Securities
                                                          Other      Underlying
Name and                                                  Annual      Options/ 
Principal                                                 Compen-       SARs   
Position                   Year     Salary       Bonus    sation        (#)    
---------                  ----     ------       -----    -------     -------  
                                                                               
Joseph Ende,               1997    $156,000     $ -0-(2)  $ -0-         -0-    
Chief Executive            1996    $156,000       -0-(2)    -0-      30,000(1) 
Officer and Director       1995    $127,500       -0-(2)    -0-     300,000(1) 

Marc Ruskin                1997    $ 75,000     $ -0-     $52,000(3)    -0-    
Chief Financial Officer                                                        
and Director                                                                   

------------                                                                    

(1)      On July 31, 1995, Mr. Ende was granted, non-qualified stock options    
        under the Company's 1995 Stock Option Plan, to purchase 180,000 shares
  of Common Stock at $3.00 per share expiring on July 30, 2000. On
     December 15, 1995, Mr. Ende was granted non-qualified stock options
        under the 1994 Stock Option Plan, to purchase 120,000 shares of Common
         Stock at $2.50 per share expiring on December 15, 2000. On November 19,
   1996, Mr. Ende was granted a non-qualified stock option under the
      Company's 1994 Stock Option Plan to purchase 30,000 shares of Common
Stock at $5.25 per share expiring on November 18, 2001.       
See "Stock Option Plans" below.                               

(2)      The Board of Directors has the discretion to grant Mr. Ende a bonus of 
       $50,000 for each of the six-month periods ending June 30 and December
        31 during the three-year term of his employment agreement entered into
      on July 31, 1995, as amended, provided the Company reports operating
      income, but after payment of such bonus for the applicable six-month
period. No bonus was issued for the periods ended December    
31,1997,1996, and 1995.                                       

(3)      Represents the difference between the exercise price and the fair      
 market value of options (the "spread") on the date of exercise.

Individualized Option/Grants in Last Fiscal Year                                

       The following table sets forth the number of stock options granted to
the Named Executive Officers in the Summary Compensation Table during the year  
ended December 31, 1997, exercise information and potential realizable value.   

                                                        [Enlarge/Download Table]


      Individual Grants                                         Potential Realizable  
      Number of         Percent of                                Value at Assumed    
      Shares Total      Options                                 Annual Rates of Stock 
      Underlying        Granted to                                Price Appreciation  
      Options           Employees in  Exercise      Expiration       for Option Term  
Name  Granted (#)       Fiscal Year   Price ($/sh)  Date             5% ($)    10% ($)
----  -----------       -----------   ------------  ----             ------    -------
                                                                                      
None                                                                                  

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                                                        [Enlarge/Download Table]

               Aggregated Option/SAR Exercises in Last Fiscal Year                          
                           and FY End Option/SAR Values                                     
               ----------------------------------------------------                         

     (a)        (b)              (c)                       (d)               (e)            
                                                        Number of         Value of          
                                                       Unexercised      Unexercised         
              Shares                                 Options/SARs at    In-The-Money        
             Acquired                                  FY-End (#)       Options/SARs        
             on Exer-           Value                 Exercisable/     at FY-End ($)        
Name          cise (#)        Realized                Unexercisable      Exercisable        
---------    ---------        --------               --------------    -------------        
                                                                                            
Joseph Ende      -0-               -0-                210,000/120,000  $492,300/$285,600(1) 
Marc Ruskin    8,000           $52,000                 9,500/20,000      $7,235/$50,600(1)  
Scott Osias      -0-               -0-                 13,500/33,000   $18,255/$ 8,640(1)(2)

--------------------                                                            

(1) The closing price of the Company's Common Stock on December 31, 1997 was    
$5.38 per share.                                                        

(2) Does not include 30,000 options exercisable at $6.75 per share which were   
not in-the-money at December 31, 1997.                                  

Employment Agreements                                                           

    On July 31, 1995, the Company entered into a three-year employment
agreement with Joseph Ende, then President and Chief Executive Officer of the   
Company. The agreement automatically renews for consecutive one-year periods    
unless terminated on thirty days' prior written notice by either party. The     
agreement was renewed on July 31, 1998, with Mr. Ende currently serving as Chief
Executive Officer and Chairman of the Board. In 1997, Mr. Ende received a base  
annual salary of $156,500. The Board of Directors has the discretion to grant   
Mr. Ende a performance bonus of $50,000 for each of the six-month periods ending
June 30 and December 31 during the term of the agreement, provided the Company  
reports operating income, but after payment of such bonus for the applicable    
six-month period. Such bonus will not accrue in the event the income level is   
not met. No bonus was paid or accrued in 1997. Under the agreement, Mr. Ende is 
also entitled to an automobile or a monthly allowance equal to the cost of      
leasing such automobile, and health and other benefits. Mr. Ende has agreed not 
to compete with the Company during the term of, and for a one-year period from  
the date of termination of, his employment with the Company.                    

     On April 10, 1997, the Company entered into a three-year employment
agreement with Scott Osias, then Executive Vice President and Chief Operating   
Officer and currently President. The agreement automatically renews for one     
additional three-year period unless terminated on thirty days' prior written    
notice by either party. Under this agreement, Mr. Osias receives a base annual  
salary of $91,000, with a bonus to be determined by the Board of Directors. No  
bonus was paid for 1997. Under the agreement, Mr. Osias is also entitled to the 
use of an automobile, health insurance and other benefits and five-year options 
to purchase 30,000 shares of the Company's Common Stock at $6.75 per share. Mr. 
Osias has agreed not to compete with the Company during the term of, and for a  
period of six months from the date of termination of, his employment with the   
Company.                                                                        

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Employee Stock Bonus Plan                                                       

       In April 1995, the Company adopted an Employee Stock Bonus Plan which
enables all full-time permanent employees to purchase shares of Common Stock at 
85% of its then fair market value through payroll deductions. There are 100,000 
shares available for sale under such plan without limitation as to the number of
shares which may be purchased by any employee. These shares may be newly-issued 
shares or which may be purchased by the Company in the open market. An aggregate
of 10,638 shares have been purchased under such plan as of December 31, 1997.   
The 100,000 shares of Common Stock reserved and/or issued to date under this    
plan are registered for sale on the Company's Registration Statement on Form    
S-8, which became effective when filed with the Commission on September 27, 1996
(the "S-8").                                                                    

Employee Stock Option Plans                                                     

1994 Employee Stock Option Plan                               

      The Company has established the 1994 Employee Stock Option Plan (the
"1994 Plan"). The 1994 Plan is intended to provide the employees, directors,    
independent contractors and consultants of the Company with an added incentive  
to continue their services to the Company and to induce them to exert their     
maximum efforts toward the Company's success. The 1994 Plan provides for the    
grant of options to qualified directors, employees (including officers),        
independent contractors and consultants of the Company to purchase an aggregate 
of 300,000 shares of Common Stock. Options to purchase no more than 120,000     
shares of Common Stock may be granted to any one person in any two-year period. 
The 1994 Plan is currently administered by the Board of Directors. The Board    
determines, among other things, the persons to be granted options under the 1994
Plan, the number of shares subject to each option and the option price. The     
shares of Common Stock authorized under the 1994 Plan are registered for sale on
the S-8.                                                                        

   The 1994 Plan allows the Company to grant incentive stock options
("ISOs"), as defined in Section 422(b) of the Internal Revenue Code of 1986, as 
amended (the "Code"), Non-Qualified Stock Options ("NQSOs") not intended to     
qualify under Section 422(b) of the Code and Stock Appreciation Rights ("SARs"; 
collectively, with ISOs and NQSOs referred to as "Options") at any time within  
10 years from the date the 1994 Plan was adopted. The exercise price of ISOs may
not be less than the fair market value of the Common Stock on the date of grant,
provided that the exercise price of ISOs granted to an optionee owning more than
10% of the outstanding Common Stock may not be less than 110% of the fair market
value of the Common Stock on the date of grant. In addition, the aggregate fair 
market value of stock with respect to which ISOs are exercisable for the first  
time by an optionee during any calendar year shall not exceed $100,000. Options 
may not have a term exceeding ten years, except that ISOs granted to an optionee
owning more than 10% of the outstanding Common Stock may not have a term of more
than five years and ISOs must be granted to, and exercised by, employees of the 
Company (including officers). Options are not transferable, except upon the     
death of the optionee.                                                          

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PRES14A 12th Page of 23 TOC 1st Previous Next ↓Bottom Just 12th
    Since the 1994 Plan's adoption, ISOs to purchase 383,000 shares of
Common Stock have been granted (of which options to purchase 123,000 shares have
been cancelled and are available for reissuance under the 1994 Plan), and no    
SARs have been granted under the 1994 Plan. Options to purchase 260,000 shares  
of Common Stock remain outstanding and options to purchase 40,000 shares of     
Common Stock remain reserved for grant under the 1994 Plan.                     

               Joseph Ende was granted 120,000 options to purchase 120,000
shares of Common Stock exercisable at $20 per share under the 1994 Plan, which  
in December 1994, were canceled by the Company. These options were re-granted to
Mr. Ende at an exercise price of $2.50 per share. Such options were re-granted  
because the Company's Board of Directors determined that such re-grant would    
provide a greater incentive to Mr. Ende. All 120,000 of such options are        
currently exercisable. An additional 30,000 options were granted on November 19,
1996 and are currently exercisable at $5.25 per share.                          

         Scott Osias, Vice President of Sales and Marketing, was granted a stock
option under the 1994 Plan to purchase 9,000 shares of Common Stock at $2.50 per
share, which option became exercisable on a cumulative basis on January 1, 1997 
to the extent of 4,000 shares; on January 1, 1998 for an additional 3,000       
shares, and on January 1, 1999 an additional 2,000 shares. Mr. Osias was granted
7,500 options on November 19, 1996 which are exercisable at $5.25 per share. On 
April 10, 1997, Mr. Osias was granted ISOs to purchase 30,000 shares of Common  
Stock at $6.75 per share terminating on April 10, 2002. The option becomes      
exercisable on a cumulative basis in one-third increments on April 10, 1998,    
1999, and 2000.                                                                 

     Marc J. Ruskin, Chief Financial Officer, was granted a stock option
under the 1994 Plan to purchase 6,000 shares of Common Stock at $2.25 per share,
which option becomes exercisable on a cumulative basis on September 5, 1997 to  
the extent of 2,000 shares; on September 5, 1998 to the extent of an additional 
2,000 shares, and the balance on September 5, 1999. An additional 24,000 options
were granted at $3.00 on May 29, 1996 of which 8,000 options were exercised in  
1997. The options are exercisable at various dates beginning in November 1996.  
An additional 7,500 options were granted on November 19, 1996 and are currently 
exercisable at $5.25 per share.                                                 

        On September 16, 1998, Elliot H. Lutzker and Adam Budish, non-employee
directors, were each granted NQSO's under the 1994 Plan to each purchase 5,000  
shares of Common Stock at $.75 per share, immediately exercisable and           
terminating on September 16, 2003. On November 21, 1996, Snow Becker Krauss     
P.C., counsel to the Company, and of which Mr. Lutzker is a member, was granted 
NQSO's outside of any plan to purchase 20,000 shares of Common Stock immediately
exercisable at $5.625 per share.                                                

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1995 Employee Stock Option Plan                               

 In July 1995, the Company's Board of Directors adopted the 1995
Employee Stock Option Plan (the "1995 Plan"). The 1995 Plan, as amended,        
provides for the grant of ISOs, NQSOs and SARs to purchase an aggregate of      
1,500,000 shares of Common Stock. The provisions of the 1995 Plan are otherwise 
identical to the above-stated terms of the 1994 Plan.                           

     Since the adoption of the 1995 Plan, no SARs have been granted, and
ISOs and NQSOs to purchase 980,000 shares of Common Stock have been granted and 
options to purchase 520,000 shares of Common Stock remain available for grant   
under the 1995 Plan as of September 9, 1998.                                    

        On July 31, 1995, Joseph Ende was granted NQSOs under the 1995 Plan to
purchase 180,000 shares of Common Stock at $3.00 per share terminating on July  
30, 2000. The option becomes exercisable on a cumulative basis in one-third     
increments on July 31, 1997, 1998 and 1999. The option will become immediately  
exercisable, in full, upon a change in control (as defined in the 1995 Plan) of 
the Company.                                                                    

        On January 13, 1998, Mr. Osias was granted 30,000 ISO's under the 1995
Plan to purchase common stock at an exercise price of $4.38 per share. These    
options were repriced on July 31, 1998 at $.75 per share as an incentive for    
management. These options become exercisable on a cumulative basis on January   
13, 1999 to the extent of 10,000 shares, on January 13, 2000 to the extent of an
additional 10,000 shares, and the balance on January 13, 2001.                  

         On January 13, 1998, Mr. Ruskin was granted 60,000 ISO's under the 1995
Plan to purchase Common Stock at an exercise price of $4.38 per share. These    
options were repriced on July 31, 1998 at $.75 per share as an incentive for    
management. These options become exercisable on a cumulative basis on January   
13, 1999 to the extent of 20,000 shares, on January 13, 2000 to the extent of   
20,000 shares and the balance on January 13, 2001.                              

         On January 13, 1998, Mr. Ende was granted 381,450 NQSO's under the 1995
Plan to purchase Common Stock at an exercise price of $4.38 per share. These    
options were repriced on July 31, 1998 at $.75 per share as an incentive for    
management. Mr. Ende was also granted 68,550 ISO's at an exercise price of $4.81
per share which were repriced on July 31, 1998 at $.83 per share, as an         
incentive for management. These options become exercisable on a cumulative basis
on January 13, 1999, to the extent of one-third of the option; on January 13,   
2000 to the extent of an additional one-third; and the balance on January 13,   
2001. See "Certain Relationships and Related Transactions."                     

Compensation Committee, Interlocks and Insider Participation                    

In February 1998, the Company formed an audit committee and a 
compensation committee consisting of Elliot H. Lutzker and Alan E. Budish, the  
Company's two non-officer members of                                            

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PRES14A 14th Page of 23 TOC 1st Previous Next ↓Bottom Just 14th
the Board of Directors. There are no Board of Directors interlock relationships 
with respect to the Company.                                                    

Compensation of Directors                                                       

                Directors currently receive no cash compensation for serving
on the Board of Directors.                                                      

Performance Graph                                                               

    The graph and chart below compare the performance of the Company's
Common Stock with the performance of the Standard & Poor's SmallCap 600 Index   
and a Peer Group index, assuming a $100.00 investment made on January 1, 1993   
when public trading of the Company's stock commenced. Cumulative return data    
assumes reinvestment of dividends. The stock performance shown on the graph and 
chart below is not necessarily indicative of future price performance.          

12

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TOTAL SHAREHOLDER RETURN

    250 |--------------------------------------------------------------------|
        |                                                                   []
D        |                                                                    | 
    200 |--------------------------------------------------------------------|
O        |                                                      O             | 
        |                                                     []             |
L    150 |--------------------------------------------------------------------| 
        |                                         []                         O
L        |            []             []                                       | 
    100 []-------------------------------------------------------------------|
A        V            O                            O                          | 
        |            V              V             V                          |
R     50 |--------------------------------------------------------------------| 
        |                                                      V             V
S        |                           O                                        | 
      0 |--------------------------------------------------------------------|
        2Jan92       Dec93         Dec94         Dec95        Dec96        Dec97

       YEAR ENDING

         ---------------------------------------------------------------------
         0 BRAKE HEADQUARTERS USA INC  [] S&P SMALLCAP 600 INDEX  V PEER GROUP
         ---------------------------------------------------------------------

Total Return To Shareholders
(Dividends reinvested monthly)

                                                        [Enlarge/Download Table]


                                 ANNUAL RETURN PERCENTAGE                                              
                                        Years Ending                                                   

Company Name/Index               Dec93        Dec94        Dec95        Dec96        Dec97             
------------------------------------------------------------------------------------------             
                                                                                                       
BRAKE HEADQUARTERS USA INC      -18.57       -92.98       1000.00      190.91       -32.81             
S&P SMALLCAP 600 INDEX           18.79        -4.77         29.96       21.32        25.58             
PEER GROUP                      -37.04         2.89        -13.45      -35.34        -1.77             

                                     INDEXED RETURNS                                                   
                                       Years Ending                                                    

                                  Base                                                                 
                                 Period                                                                
Company Name/Index               2Jan92        Dec93        Dec94        Dec95        Dec96       Dec97
-------------------------------------------------------------------------------------------------------
                                                                                                       
BRAKE HEADQUARTERS USA INC        100          81.43        5.72         62.88       182.92      122.90
S&P SMALLCAP 600 INDEX            100         118.79      113.12        147.01       178.35      223.98
PEER GROUP                        100          62.96       64.78         56.07        36.25       35.61


Peer Group Companies                                                            
------------------------------                                                  
AID AUTO STORES INC                                                             
HI-LO AUTOMOTIVE INC                                                            
JPE INC                                                                         
NEWCOR INC                                                                      
TRAK AUTO CORP                                                                  
UNIVERSAL AUTOMOTIVE INDS                                                       

PRES14A 16th Page of 23 TOC 1st Previous Next ↓Bottom Just 16th
PROPOSAL 2                                                                      

AMENDMENT TO THE COMPANY'S CERTIFICATE OF INCORPORATION TO AUTHORIZE, IF        
NECESSARY, A REVERSE STOCK SPLIT OF NOT MORE THAN ONE-FOR-FIVE.                 

GENERAL                                                                         

       The Board of Directors has approved a proposal to amend the Company's
Certificate of Incorporation to authorize, if necessary, a reverse stock split  
of not more than one-for-five of the presently issued and outstanding shares of 
the Company's Common Stock (the "Reverse Split"), by changing each of up to five
issued and outstanding shares of Common Stock into one issued and outstanding   
share of Common Stock, (i) to increase the marketability and liquidity of the   
Company's Common Stock by attracting an increased number of market makers and a 
wider following (many investment banking firms are prohibited from trading      
securities of issuers that trade below $1.00 per share), (ii) to maintain its   
Nasdaq listing and (iii) to reduce the Company's stated capital $.001 for each  
share of Common Stock changed into up to one-fifth share of Common Stock as a   
result of the Reverse Split.                                                    

REASONS FOR THE REVERSE SPLIT                                                   

        The Company's shares of Common Stock are listed on the Nasdaq SmallCap
Market. On August 25, 1998, the Company received a notice from Nasdaq stating   
that unless the Company's Common Stock reports a closing bid price of $1.00 per 
share or greater, for 10 consecutive trading days during the 90 day period      
ending November 25, 1998, the Company's securities would be delisted from       
Nasdaq, effective November 25, 1998. In such event, the Company's Common Stock  
will be quoted on the OTC Bulletin Board or in the "pink sheets" maintained by  
the National Quotation Bureau, Inc.                                             

  Stock traded on the over-the-counter Bulletin Board ("OTCBB") is
subject to Rule 15g-9 promulgated under the Securities Exchange Act of 1934, as 
amended, which imposes various sales practice requirements on broker-dealers who
sell securities governed by Rule 15g-9 to persons                               

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other than established customers and accredited investors (generally            
institutions with assets in excess of $5,000,000 or individuals with a net worth
in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly 
with their spouse). For transactions covered by Rule 15g-9, the broker-dealer   
must make a special suitability determination for the purchaser and have        
received the purchaser's written consent to the transaction prior to sale.      
Consequently, Rule 15g-9 may have an adverse effect on the ability of           
broker-dealers to sell the Company's securities and may affect the ability of   
Stockholders to sell the Company's securities and otherwise affect the trading  
market in the Common Stock.                                                     

        The Commission has adopted rules that regulate broker-dealer practices
in connection with transactions in "penny stocks." If the Company's securities  
become subject to the penny stock rules, investors may find it more difficult to
sell their shares. Penny stocks generally are equity securities with a price of 
less than $5.00 (other than securities registered on certain national securities
exchanges or quoted on the NASDAQ system, provided that current price and volume
information with respect to transactions in that security is provided by the    
exchange or system). The penny stock rules require a broker-dealer, prior to a  
transaction in a penny stock not otherwise exempt from the rules, to deliver a  
standardized risk disclosure document prepared by the Commission that provides  
information about penny stocks and the nature and level of risks in the penny   
stock market. The broker-dealer also must provide the customer with current bid 
and offer quotations for the penny stock, the compensation of the broker-dealer 
and its salesperson in the transaction, and monthly account statements showing  
the market value of each penny stock held in the customer's account. The bid and
offer quotations, and the broker dealer salesperson compensation information,   
must be given to the customer orally or in writing before or with the customer's
confirmation. These disclosure requirements may have the effect of reducing the 
level of trading activity in the secondary market for a stock that becomes      
subject to the penny stock rules.                                               

          Requirements for a new listing on the NASDAQ SmallCap Market include a
minimum bid price of $4.00 per share. In order to increase the marketability and
liquidity of the Company's Common Stock by attracting an increased number of    
market members and a wider following and to maintain its Nasdaq listing, the    
Company has authorized the Company's Board of Directors to effect a Reverse     
Stock Split, if necessary. Many investment banking firms are prohibited from    
trading securities of issuers that trade below $1.00 per share and/or that are  
traded on the OTCBB. In connection with any determination by the Board of       
Directors to such effect, the Board will also in its discretion, determine the  
ratio of the Reverse Split based on prevailing market conditions, the likely    
effect on the market price of the Common Stock, and other relevant factors.     

EXCHANGE OF SHARES                                                              

      If the Shareholders approve the Reverse Split and it is subsequently
determined by the Board of Directors that the Reverse Split is necessary, upon  
the filing of the following amendment to the Company's Certificate of           
Incorporation with the Secretary of State of Delaware, the Reverse Split will be
deemed effective. The Reverse Split will be formally implemented by amending the
present                                                                         

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PRES14A 18th Page of 23 TOC 1st Previous Next ↓Bottom Just 18th
Article Fourth of the Company's Certificate of Incorporation, as amended, to add
the following Section with the ratio determined as set forth above:             

       Fourth: (c) Effective as of 5:00 p.m., Eastern time, on November ___,
     1998, all outstanding shares of Common Stock held by each holder of
    record on such date shall be automatically combined at the rate of
         one-for__________ without any further action on the part of the holders
        thereof or this Corporation. No fractional shares shall be issued. All
         fractional shares shall be increased to the next higher whole number of
share.                                                        

       Following the effectiveness of the amendment, assuming a one-for-five
ratio, each certificate representing shares of Common Stock outstanding         
immediately prior to the Reverse Split (the "Old Shares") will be deemed        
automatically, without any action on the part of the Shareholders, to represent 
[1/5] of the number of shares of Common Stock after the Reverse Split (the "New 
Shares"). After the Reverse Split becomes effective, Shareholders will be asked 
to surrender certificates representing Old Shares in accordance with the        
procedures set forth in a letter of transmittal to be sent by the Corporation.  
SHAREHOLDERS SHOULD NOT SUBMIT ANY CERTIFICATES UNTIL REQUESTED TO DO SO. Upon  
such surrender, a certificate representing the New Shares will be issued and    
forwarded to the shareholders. However, each certificate representing Old Shares
will continue to be valid and represent New Shares equal to 1/5 of the number of
Old Shares (plus one additional New Share where such Old Shares are not evenly  
divisible by 5).                                                                

     If Proposal 2 is approved by the shareholders and determined by the
Board of Directors that the Reverse Split is necessary, the Reverse Split will  
become effective upon filing a Certificate of Amendment of the Certificate of   
Incorporation with the Secretary of State of Delaware. If the Reverse Split is  
not deemed necessary by the Board of Directors on or prior to the next Annual   
Meeting of Shareholders, the Board shall have no further right to effect the    
Reverse Split.                                                                  

PRINCIPAL EFFECTS OF THE REVERSE SPLIT AND THE ADDITIONAL REVERSE SPLIT         

       Shareholders have no right under the Delaware General Corporation Law
(the "DGCL") or under the Company's Certificate of Incorporation or Bylaws to   
dissent from the Reverse Split or to dissent from the rounding to the nearest   
whole share of any fractional share resulting from the Reverse Split in lieu of 
issuing fractional shares.                                                      

    The authorized capital stock of the Company will not be reduced or
otherwise affected by the Reverse Split. The number of issued and outstanding   
shares of Common Stock of the Company on September 22, 1998, was 5,679,413 and  
the number of issued and outstanding shares of Preferred Stock was 1,000. The   
Company's stated capital as of June 30, 1998 was $6,109,583. Based upon these   
figures, the aggregate number of shares of Common Stock and Preferred Stock that
would be issued and outstanding if the Reverse Split is effected on a           
one-for-five basis will be approximately 1,135,883 and 1,000, respectively, and 
the stated capital will be approximately $1,221,917. Although the authorized    
shares of Preferred Stock will not be affected by the Reverse                   

15

PRES14A 19th Page of 23 TOC 1st Previous Next ↓Bottom Just 19th
Split, the number of shares of Common Stock issuable upon conversion of the     
Preferred Stock will be adjusted in the same proportion.                        

        The Reverse Split may result in some shareholders owning "odd-lots" of
less than 100 shares of Common Stock. Brokerage commissions and other costs of  
transactions in odd-lots are generally somewhat higher than the costs of        
transactions in "round-lots" of even multiples of 100 shares.                   

         There can be no assurance that any or all of the foregoing effects will
occur. In particular, there can be no guarantee that the market price for each  
New Share after the Reverse Split will be its sum multiple of the market price  
(per Old Share) before the Reverse Split and the number of shares of Common     
Stock charged for one share of Common Stock, or that such price will either     
exceed or remain in excess of the current market price. Furthermore, there can  
be no assurance that the market for shares of Common Stock will be improved or  
that the Common Stock will continue to remain listed on the NASDAQ/SmallCap or  
any other market. The Board of Directors cannot predict what effect the Reverse 
Split will have on the market for or the market price of the Common Stock.      

DILUTION                                                                        

        The Company has suffered recurring losses from operations. The Company
may issue additional shares of its Common Stock on an ongoing basis in order to 
satisfy all or a portion of its need for cash. If and to the extent that the    
Company issues additional shares of Common Stock, either prior or subsequent to 
the implementation of the Reverse Split, each Shareholder's percentage ownership
interest in the Company and proportional voting power will be proportionately   
reduced.                                                                        

  As of September 22, 1998, the Company had issued and outstanding
various options and warrants to purchase an aggregate of approximately          
1,886,000 shares of Common Stock. In addition, the Company had outstanding      
debentures to purchase as of September 18, 1998 approximately 7,538,000 shares  
of Common Stock.                                                                

      If Proposal 2 is approved, in general, both the conversion price and
the number of shares subject to such Preferred Stock and Convertible Debentures 
and Convertible Notes will be affected by the Reverse Split.                    

       As a result, if the Reverse Split is implemented, it is possible that
the holders of all or a substantial number of the outstanding options, warrants,
Preferred Stock, Convertible Debentures and Convertible Notes to purchase or    
convert to shares of the Company's Common Stock will determine that it is not in
their best interests to exercise or convert such options, warrants, stock,      
debentures or notes. If and to the extent that such is the case, each           
Shareholder's percentage ownership interest in the Company and proportional     
voting power will not be proportionately maintained as the result of the        
exercise of such outstanding options, warrants, and rights.                     

16

PRES14A 20th Page of 23 TOC 1st Previous Next ↓Bottom Just 20th
FEDERAL INCOME TAX CONSEQUENCES                                                 

       The following description of federal income tax consequences is based
upon the Internal Revenue Code of 1986, as amended, the applicable Treasury     
Regulations promulgated thereunder, judicial authority, and current             
administrative rulings and practices as in effect on the date of this Proxy     
Statement. This discussion is for general information only and does not discuss 
consequences that may apply to special classes of taxpayers (e.g., non-resident 
aliens, broker-dealers or insurance companies). Shareholders are urged to       
consult their own tax advisors to determine the particular consequences to them.

     The exchange of Old Shares of Common Stock for New Shares of Common
Stock will not result in recognition of gain or loss. The holding period for the
New Shares will include the Shareholder's holding period for the Old Shares     
exchanged therefor, provided that the Old Shares were held as a capital asset.  
The adjusted basis of the New Shares will be the same as the adjusted basis of  
the Old Shares exchanged therefor.                                              

 THE BOARD OF DIRECTORS RECOMMENDS APPROVAL OF AND URGES YOU
 TO VOTE "FOR" THE PROPOSED AMENDMENT OF THE COMPANY'S
 CERTIFICATE OF INCORPORATION IN THE FOREGOING PROPOSAL 2.

PROPOSAL 3. RATIFICATION OF APPOINTMENT OF AUDITORS                             

   The Board of Directors has appointed Deloitte & Touche LLP as the
Company's auditors and to audit the books of account and other records of the   
Company for the year ending December 31, 1998.                                  

      Deloitte & Touche LLP has audited the Company's financial statements
since December 31, 1995. They have no financial interest, either direct or      
indirect, in the Company. Representatives of Deloitte & Touche LLP are expected 
to be present at the Annual Meeting to respond to appropriate questions from    
stockholders and to make a statement if they desire to do so.                   

        Management recommends voting "FOR" the ratification of the appointment
of the auditors.                                                                

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The Company leases an office and warehouse facilities from the Company's        
President, Joseph Ende, pursuant to a lease dated July 1, 1992 at a current rent
of $312,000 per year. The lease term expires July 1, 1999.                      

        See "Executive Compensation - Employment Agreements" for a description
of the terms of current Employment Agreements between the Company and Joseph    
Ende, President, and Scott Osias, Vice President and Chief Operating Officer;   
and "Employee Stock Options" for a description of the terms of stock options    
granted to each of the Company's executive officers.                            

17

PRES14A 21st Page of 23 TOC 1st Previous Next ↓Bottom Just 21st
 SHAREHOLDER PROPOSALS

         No person who intends to present a proposal for action at a forthcoming
stockholders' meeting of the Company may seek to have the proposal included in  
the proxy statement or form of proxy for such meeting unless that person (a) is 
a record beneficial owner of at least 1% or $2,000 in market value of shares of 
Common Stock, has held such shares for at least one year at the time the        
proposal is submitted, and such person shall continue to own such shares through
the date on which the meeting is held, (b) provides the Company in writing with 
his name, address, the number of shares held by him and the dates upon which he 
acquired such shares with documentary support for a claim of ownership, (c)     
notifies the Company of his intention to appear personally at the meeting or by 
a qualified representative under Delaware law to present his proposal for       
action, and (d) submits his proposal timely. A proposal to be included in the   
proxy statement or proxy for the Company's next Annual Meeting of Stockholders, 
will be submitted timely only if the proposal has been received at the Company's
principal executive office no later than August __, 1998. If the date of such   
meeting is changed by more than 30 calendar days from the date such meeting is  
scheduled to be held under the Company's By-Laws, or if the proposal is to be   
presented at any meeting other than the next Annual Meeting of Stockholders, the
proposal must be received at the Company's principal executive office a         
reasonable time before the solicitation of proxies for such meeting is made.    

       Even if the foregoing requirements are satisfied, a person may submit
only one proposal of not more than 500 words with a supporting statement if the 
latter is required by the proponent for inclusion in the proxy materials, and   
under certain circumstances enumerated in the Securities and Exchange           
Commission's rules relating to the solicitation of proxies, the Company may be  
entitled to omit the proposal and any statement in support thereof from its     
proxy statement and form of proxy.                                              

Expenses                                                                        

     The entire cost of preparing, assembling, printing and mailing this
Proxy Statement, the enclosed Proxy and other materials, and the cost of        
soliciting Proxies with respect to the Annual Meeting, will be borne by the     
Company. The Company will request banks and brokers to solicit their customers  
who beneficially own shares listed of record in names of nominees, and will     
reimburse those banks and brokers for the reasonable out-of-pocket expenses of  
such solicitations. The original solicitation of Proxies by mail may be         
supplemented by telephone and facsimile by officers and other regular employees 
of the Company, but no additional compensation will be paid to such individuals.

Request for Annual Report on Form 10-K                                          

        Copies of the Company's 1997 Annual Report on Form 10-K for the fiscal
year ended December 31, 1997, as filed with the Securities and Exchange         
Commission, including the financial statements, accompany these proxy materials.
Additional copies of the Company's 1997                                         

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PRES14A 22nd Page of 23 TOC 1st Previous Next ↓Bottom Just 22nd
Annual Report can be obtained without charge by stockholders (including         
beneficial owners of Common Stock) upon written request to Sandra Ende, the     
Company's Secretary, Brake Headquarters U.S.A., Inc., 33-16 Woodside Avenue,    
Long Island City, N.Y. 11101. The Company's EDGAR filing may be found on the    
Worldwide Web at www.sec.gov.                                                   

                                              By Order of the Board of Directors

                                  Sandra Ende, Secretary
New York, New York                                                              
October    , 1998                                                               

19

PRES14A Last Page of 23 TOC 1st Previous Next ↓Bottom Just 23rd
 BRAKE HEADQUARTERS U.S.A., INC.

P R O X Y                                                                       

The undersigned, a holder of Common Stock of Brake Headquarters U.S.A.,   
Inc., a Delaware corporation (the "Company"), hereby appoints Joseph Ende, the  
proxy of the undersigned, with full power to appoint his substitute, and hereby 
authorizes him to attend, represent and vote for the undersigned, all of the    
shares of the Company held of record by the Undersigned on September 22, 1998,  
at the Annual Meeting of Shareholders of the Company to be held at the offices  
of the Company's attorneys, Snow Becker Krauss P.C., 605 Third Avenue, 25th     
Floor, New York, New York 10158, at 10:00 a.m. (Eastern Standard Time), on      
November __, 1998 and any adjournment(s) thereof, as follows:                   

1.  ELECTION OF DIRECTORS, as provided in the Company's Proxy Statement:  

|_| FOR all nominees listed below                                         

|_| WITHHOLD AUTHORITY to vote for all the nominees listed below          

(Instructions: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL NOMINEE, STRIKE 
A LINE THROUGH OR OTHERWISE STRIKE OUT THE NOMINEE'S NAME BELOW)                
Joseph Ende, Sandra Ende, Marc J. Ruskin, Adam E. Budish and      
Elliot H. Lutzker                                                 

   2.  To authorize a reverse split of the Company's Common Stock, if necessary.

|_| FOR                    |_|      AGAINST               |_|      ABSTAIN

3.  To ratify the appointment of Deloitte & Touche LLP as the Company's   
auditors for the year ending December 31, 1998.                   

|_| FOR                    |_|      AGAINST               |_|      ABSTAIN

4.  Upon such other matters as may properly come before the meeting or any
adjournments thereof.                                             

      THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN ACCORDANCE WITH
THE INSTRUCTIONS INDICATED HEREON. IF NO DIRECTION IS MADE, THIS PROXY WILL BE  
VOTED FOR THE ELECTION OF THE DIRECTORS NAMED IN PROPOSAL 1, FOR THE ADOPTION OF
PROPOSALS 2 AND 3 AND AS SUCH PROXIES SHALL DEEM ADVISABLE ON SUCH OTHER        
BUSINESS AS MAY COME BEFORE THE MEETING. EACH MATTER ABOVE WAS PROPOSED BY THE  
BOARD OF DIRECTORS.                                                             

        The undersigned acknowledges receipt of a copy of the Notice of Annual
Meeting and accompanying Proxy Statement dated October __, 1998 relating to the 
Annual Meeting, the 1997 Annual Report to Shareholders including financial      
statements for the period ended December 31, 1997 and the Quarterly Report on   
Form 10-Q for the six-month period ended June 30, 1998.                         

Date:___________________, 1998                                                  

_______________________________             __________________________________  
Signature                                     Signature   

Signature of Shareholder. The signature hereon should correspond exactly with   
the name of the Shareholder appearing on the Stock Certificate. If Stock is     
jointly held, all joint owners should sign. When signing as attorney, executor, 
administrator, trustee or guardian, please give full title as such. If signer is
a corporation, please sign the full corporate name, and give title of signing   
officer.                                                                        

THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF BRAKE HEADQUARTERS U.S.A., 
INC.  PLEASE MARK, SIGN, DATE AND RETURN THE PROXY PROMPTLY USING THE ENCLOSED  
ENVELOPE. IT IS IMPORTANT THAT YOU VOTE.

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Dates Referenced Herein and Documents Incorporated by Reference

		Referenced-On Page
This ‘PRES14A’ Filing	Date	First	Last	Other Filings

	9/16/03	12
	4/10/02	12
	11/18/01	9
	3/31/01	3	5
	1/13/01	13
	12/31/00	3	5
	12/15/00	9
	7/30/00	9	13
	4/10/00	12
	1/13/00	13
	9/5/99	12
	8/13/99	8
	7/31/99	13
	7/1/99	20
	4/10/99	12
	1/13/99	13
	1/1/99	12
For Period End:	12/31/98	2	23	DEF 14A, NT 10-K
	11/25/98	16
	11/7/98	5
	11/2/98	5
Filed on:	9/25/98
	9/22/98	2	23	POS AM
	9/18/98	19
	9/17/98	5
	9/16/98	12
	9/14/98	5
	9/9/98	13
	9/5/98	12
	8/25/98	16
	7/31/98	10	13	4
	6/30/98	4	23	10-K/A, 10-Q, 10-Q/A, NT 10-Q
	4/10/98	12
	1/13/98	13
	1/1/98	12
	12/31/97	4	23	10-K, 10-K/A, NT 10-K
	11/7/97	5
	9/5/97	12
	7/31/97	13
	4/10/97	10	12
	1/1/97	6	12
	12/31/96	8		10-K, NT 10-K
	11/21/96	12
	11/19/96	9	12
	9/27/96	11		10-12G, S-8
	5/29/96	12
	12/31/95	8	20
	12/15/95	9
	7/31/95	9	13
	1/1/93	14
	7/9/92	7
	7/1/92	20
				List all Filings

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Filing Submission 0000950116-98-001919 – Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)

Brake Headquarters USA Inc – ‘PRES14A’ for 12/31/98

As of: Friday, 9/25/98 · For: 12/31/98 · Accession #: 950116-98-1919 · File #: 0-28640

Preliminary Proxy Solicitation Material — Special Meeting — Schedule 14AFiling Table of Contents

Document Table of Contents

Dates Referenced Herein and Documents Incorporated by Reference

Preliminary Proxy Solicitation Material — Special Meeting — Schedule 14A
Filing Table of Contents