NEW YORK-Audiovox Corp. will seek shareholder approval next month to exchange outstanding debt for common stock in order to improve its financial strength and meet growth objectives.
Headquartered in Hauppauge, N.Y., Audiovox markets cellular telephones and accessories and automotive aftermarket products.
All shareholders of record as of the close of business Oct. 21 are entitled to vote on the proposal at a special meeting tentatively scheduled for Nov. 19. At the meeting, shareholders will vote whether to approve the issuance of additional stock to support the debt-for-equity swap. John J. Shalem, majority shareholder, has indicated he will vote in favor of the plan, which the company’s board of directors approved Oct. 17.
If shareholders approve the plan, Audiovox will exchange its $65 million in outstanding 6.25 percent convertible subordinated debentures due 2001 for Class A common stock. The company set an exchange ratio of 165 shares of common stock for each $1,000 principal amount of debentures. The total number of new shares of stock could reach 10.73 million depending on participation in the exchange offer.
