A mighty big allowance…
Normally, I don’t spend a lot of time looking at pink-sheet stocks. But a proxy filed yesterday by MotorCar Parts and Accessories (MPAA.PK) caught my attention because it’s a sweet old-fashioned tale of a father helping out his son — a good pre-Thanksgiving yarn. Not to mention the fact that the stock has nearly tripled since May. First, some background: the company was founded in 1968 by Mel Marks, who served as chairman and CEO until 1999. Mr. Marks’ son, Richard, served as president and COO during that time. In September 2002, the SEC filed a civil suit against the company and its former CFO over accounting improprieties in 1997 and 1998. The company settled, though the case against the former CFO remains open. A few months ago, the US Attorney’s Office for the Central District of California said that the younger Marks, who had been serving as an advisor to the board and the new CEO, was a target of its own investigation. He resigned in September. But on his way out the door, he collected $400,000. That’s in addition to the $603,000 in legal fees the company spent last year to cover his defense. Of course, the fact that dad continues to be a director — one who makes $400,000 under a consulting contract — and owns 24 percent of the company probably didn’t hurt.