UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-K/A
[X] For the fiscal year ended December 31, 1995
OR
[ ] For the transition period from ____________ to ____________
Commission file number 1-10177
WINDMERE CORPORATION
(Exact name of registrant as specified in its charter)
Florida 59-1028301
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5980 Miami Lakes Drive, Miami Lakes, Florida 33014
(Address of principal executive offices) (Zip Code)
(305) 362-2611
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
[CAPTION]
<TABLE>
<S> <C>
Name of each exchange
Title of each class on which registered
Common Stock $.10 Par Value New York Stock Exchange
Special Preferred Stock Rights New York Stock Exchange
Common Stock Purchase Rights New York Stock Exchange
</TABLE>
Securities registered pursuant to Section 12(g) of the Act: None.
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements
for the past 90 days. Yes X No
Indicate by check mark if disclosure of delinquent filers pursuant
to Item 405 of Regulation S-K is not contained herein, and will not
be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part
III of this Form 10-K/A or any amendment to this Form 10-K/A. [
X ]
As of March 20, 1996, the aggregate market value of the voting
stock (based on the closing price as reported by NYSE of $9.75)
held by non-affiliates of the Registrant was approximately
$138,251,000.
APPLICABLE ONLY TO CORPORATE REGISTRANTS: Indicate the number of
shares outstanding of each of the Registrant's classes of common
stock, as of the latest practicable date.
16,427,924 Shares of Common Stock
(as of the close of business on March 20, 1996)
The following items of the Registrant's Form 10-K for the year
ended December 31, 1995 are hereby amended to read in their
entirety as follows:
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY
In February 1996, the Company implemented a new corporate and
management structure which is designed to streamline current
operations and facilitate the development of new businesses. Under
this plan, the Company has integrated its sales, marketing,
manufacturing and product development processes. The Company now
serves as a holding company and all business units are being
combined under a new subsidiary of the Company, with a restructured
executive management team. Certain executive officers of the
Company have assumed new and/or additional roles and have new
titles as part of such restructuring as reflected below.
The following table sets forth information with respect to the
directors and executive officers of the Company:
[CAPTION]
<TABLE>
<S> <C> <C>
Name Age Office
Belvin Friedson 71 Chairman Emeritus of the Board of
Directors
David M. Friedson 40 Chairman of the Board, President and
Chief Executive
Officer
Arnold Thaler 57 Senior Vice President
Barbara Friedson
Garrett 43 Senior Vice President
Harry D. Schulman 44 Senior Vice President
Burton A. Honig 58 Vice President - Finance
Robert W. Gorman 52 Vice President - Professional
Products
David W. O'Neill 49 President, Windmere Consumer
Products, Inc.
Jerald I. Rosen 68 Secretary
Lai Kin 65 Chairman of Durable
Raymond So 46 Senior Vice President and Managing
Director of Durable
Robert J. Weaver 47 Vice President - Sales and Marketing
- Consumer Products
Bert Sager 70 Director
Leonard Glazer 73 Director
Harold Strauss 73 Director
Felix S. Sabates 54 Director
Susan J. Ganz 36 Director
Thomas J. Kane 54 Director
</TABLE>
BELVIN FRIEDSON founded the Company and is currently Chairman
Emeritus of the Board of Directors and a consultant to the Company.
Mr. Friedson was Chairman of the Board from 1963 to January 1996.
From 1963 to January 1987, Mr. Friedson also served as Chief
Executive Officer of the Company and from 1963 to January 1985, he
served as President of the Company.
DAVID M. FRIEDSON has served as Chairman of the Board of the
Company since April 1996, Chief Executive Officer of the Company
since 1987 and as President of the Company since January 1985.
From June 1976 to January 1985, Mr. Friedson held various other
management positions with the Company.
ARNOLD THALER has served as a Senior Vice President of the
Company since February 1996 and has served as an Executive Vice
President-Product Development, Engineering and Manufacturing of the
Company since December 1988. For ten years prior thereto, Mr.
Thaler held various other management positions with the Company.
BARBARA FRIEDSON GARRETT has served as Senior Vice President
of the Company since February, 1996 and has served as an Executive
Vice President-Sales and Marketing of the Company since December
1988. For ten years prior thereto, Ms. Garrett held various other
management positions with the Company.
HARRY D. SCHULMAN has served as Senior Vice President of the
Company since February 1996 and Executive Vice President-Finance
and Administration of the Company since February 1993. From March
1990 to January 1993, he served as Senior Vice President-Finance
and Administration of the Company. From January 1989 to March
1990, he was Vice President-Financial Analysis and Administration
of the Company. Mr. Schulman has served as Chief Financial Officer
of the Company since March 1990.
BURTON A. HONIG has served as Vice President-Finance of the
Company since December 1982. He was also Treasurer of the Company
from March 1987 to March 1992 and from August 1981 to December
1982. Mr. Honig is a Certified Public Accountant.
ROBERT W. GORMAN has served as Vice President-Professional
Products of the Company since December 1986.
DAVID W. O'NEILL has served as President of Windmere Consumer
Products, Inc., a significant subsidiary of the Company, since
October 1984.
JERALD I. ROSEN has served as Secretary of the Company since
1977. Mr. Rosen has been engaged in the practice of law since 1969
and has been a Certified Public Accountant since 1952.
LAI KIN has been Chairman of Durable Electrical Metal Factory,
Ltd. ("Durable"), a 100%-owned subsidiary of the Company, since
1995. From 1973 to 1995, Mr. Lai was Managing Director of Durable.
In addition, Mr. Lai Kin has been Managing Director of Ourimbah
Investment, Limited ("Ourimbah"), a holding and investment company,
since 1989.
RAYMOND SO has served as a Senior Vice President of the
Company since February 1996 and has been Managing Director of
Durable since February 1996. Prior to his current positions and
beginning in 1986, Mr. So held various senior executive management
positions with Durable.
ROBERT J. WEAVER has served as Vice President-Sales and
Marketing-Consumer Products since September 1995. Prior to his
service with the Company, Mr. Weaver served as National Accounts
Manager for Helen of Troy Corp. from February 1993 to September
1995, and served as a Regional General Manager for Hamilton-
Beach/Proctor-Silex Corp. from September 1987 to February 1993.
BERT SAGER has been an attorney-at-law since 1949 and Chairman
of the Board of Acorn Venture Capital Corporation, a venture
capital company, for more than the past 5 years. Mr. Sager is also
a director of Computer Products, Inc., a manufacturer of electronic
products.
LEONARD GLAZER retired in 1992 and is a private investor. For
more than 5 years prior thereto, Mr. Glazer was President of
Professional Engineering International, Inc., an engineering
consulting firm.
HAROLD STRAUSS has been a Professor of Business Management and
Organizational Behavior at the University of Miami since 1968.
FELIX S. SABATES has been Chief Executive Officer of Top Sales
Company, Inc., an independent sales representative, since January
1965.
SUSAN J. GANZ has served as President and Chief Executive
Officer of each of Lion Brothers Co., Inc., a manufacturer of
embroidered emblems and material, and Chesapeake Cap Company, Inc.,
a manufacturer of hats, for more than the last five years.
THOMAS J. KANE has served as President of T.J.K. Sales, Inc.,
an independent sales representative, since he founded such company
in 1978.
There is no family relationship between any director,
executive officer or nominee, except that David M. Friedson and
Barbara Friedson Garrett are the son and daughter of Belvin
Friedson, and Desmond Lai is the son of Lai Kin.
ITEM 11. EXECUTIVE COMPENSATION
Summary Compensation Table. The following table sets forth
the aggregate compensation paid during each of the years ended
December 31, 1995, 1994 and 1993 to the Company's Chief Executive
Officer (the "CEO") and each of the four most highly compensated
executive officers of the Company other than the CEO during 1995.
The CEO and such other executive officers are sometimes referred to
herein as the "Named Executive Officers."
[CAPTION]
<TABLE>
<S> <C> <C> <C> <C> <C>
Long
Annual Term
Compen- Compen-
sation sation
(1) Number All
Name and of Other
Principal Fiscal Options Compen-
Position Year Salary Bonus Granted(2) sation
David M. 1995 $745,028 $ 0 1,500 $2,357(3)
Friedson 1994 $689,572 $161,000 376,500 $2,357
Chairman, 1993 $626,051 $146,538 1,500 $2,231
President
and Chief
Executive
Officer
Arnold Thaler 1995 $273,634 $ 0 -0- $3,575(4)
Senior Vice 1994 $253,773 $ 60,162 100,000 $3,575
President 1993 $245,399 $ 54,962 -0- $2,231
Barbara 1995 $263,816 $ 0 1,500 $2,357(5)
Friedson 1994 $243,607 $ 58,125 101,500 $2,357
Garrett 1993 $236,544 $ 52,876 1,500 $2,357
Senior Vice
President
Lai Kin 1995 $359,444 $ 0 1,500 $ 0
Chairman of 1994 $355,304 $ 0 1,500 $ 0
Durable 1993 $326,520 $ 0 1,500 $ 0
Belvin 1995 $370,910 $ 0 1,500 $7,896(6)
Friedson 1994 $314,990 $ 0 1,500 $7,896
Chairman 1993 $314,990 $ 0 1,500 $4,410
Emeritus
and
Consultant
</TABLE>
_________________________
(1) The column for "Other Annual Compensation" has been omitted
because there is no compensation required to be reported in
such column. The aggregate amount of perquisites and other
personal benefits provided to each Named Executive Officer did
not exceed the lesser of $50,000 or 10% of the total of annual
salary and bonus of such officer.
(2) See "Option Grants Table" and "Aggregate Option Exercises and
Year-End Option Value Table" below for additional information
about these options.
(3) The amount indicated consists of life insurance premiums of
$357 paid by the Company on a policy as to which the Named
Executive Officer may designate the beneficiary and matching
contributions made by the Company of $2,000 to its 401(k)
Profit Sharing Plan.
(4) The amount indicated consists of life insurance premiums of
$1,575 paid by the Company on a policy as to which the Named
Executive Officer may designate the beneficiary and matching
contributions made by the Company of $2,000 to its 401(k)
Profit Sharing Plan.
(5) The amount indicated consists of life insurance premiums of
$357 paid by the Company on a policy as to which the Named
Executive Officer may designate the beneficiary and matching
contributions made by the Company of $2,000 to its 401(k)
Profit Sharing Plan.
(6) The amount indicated represents the amount of life insurance
premiums paid by the Company on a policy as to which the Named
Executive Officer may designate the beneficiary.
OPTION GRANTS TABLE. The following table sets forth certain
information concerning grants of stock options made during 1995 to
each of the Named Executive Officers. The Company did not grant
any stock appreciation rights in 1995.
[CAPTION]
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Individual Option Grants in 1995
% of Total
Options
Number of Granted to Exercise
Options Employees Price
Name Granted in 1995 Per Share
David M. Friedson 1,500(1) 1.4% $8.5625
Arnold Thaler -- -- --
Barbara Friedson
Garrett 1,500(1) 1.4% $8.5625
Lai Kin 1,500(1) 1.4% $8.5625
Belvin Friedson 1,500(1) 1.4% $8.5625
(continued)
<S> <C> <C>
Alternative
Expiration Grant Date
Name Date Value(2)
David M. Friedson 5/31/06 $4,734
Arnold Thaler -- --
Barbara Friedson Garrett 5/31/06 $4,734
Lai Kin 5/31/06 $4,734
Belvin Friedson 5/31/06 $4,734
</TABLE>
_________________________
(1) The options were granted pursuant to the Company's 1988
Director Option Plan on June 1, 1995.
(2) Based on the Black-Scholes option pricing model adapted for
use in valuing executive stock options. The estimated values
under that model are based on certain assumptions as to
variables such as interest rates, stock price volatility and
future dividend yields. The actual value, if any, that an
executive may realize will depend on the excess of the stock
price over the exercise price on the date the option is
exercised, so that there is no assurance that the value
realized by an executive will be at or near the value
estimated by the Black-Scholes model.
AGGREGATE OPTION EXERCISES AND YEAR-END OPTION VALUE TABLE.
The following table sets forth certain information concerning
unexercised stock options held by the Named Executive Officers as
of the end of 1995.
[CAPTION]
<TABLE>
<S> <C> <C>
Shares
Acquired Value
Name on Exercise Realized
David M. Friedson -- --
Arnold Thaler -- --
Barbara Friedson Garrett -- --
Lai Kin -- --
Belvin Friedson -- --
(continued)
<S> <C> <C>
Number of Value of
Unexercised Unexercised
Options at In-the-Money
1995 Fiscal Options at
Year-End 1995 Fiscal
Exercisable (E) Year-End(1)
Name Unexercisable (U) Exercisable (E)
David M. Friedson 419,500 (E) $ 204,118 (E)
1,500 (U) $ 0 (U)
Arnold Thaler 89,000 (E) $ 164,875 (E)
60,000 (U) $ 7,500 (U)
Barbara Friedson Garrett 163,500 (E) $ 430,868 (E)
61,500 (U) $ 7,500 (U)
Lai Kin 9,000 (E) $ 19,680 (E)
1,500 (U) $ 0 (U)
Belvin Friedson 48,000 (E) $ 170,805 (E)
1,500 (U) $ 0 (U)
</TABLE>
______________________
(1) Based on the closing price of the Company's Common Stock on
the New York Stock Exchange on December 31, 1995, which was
$7.13.
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION.
The Compensation Committee of the Board of Directors consists of
Jerald I. Rosen, Bert Sager and Felix S. Sabates. Mr. Rosen serves
as Secretary of the Company, although he is not compensated for his
services in such capacity. Mr. Sager is an independent director of
the Company, and is neither an officer of the Company nor
affiliated with any principal shareholder of the Company. Mr.
Sabates is the sole shareholder and Chief Executive Officer of Top
Sales Company, Inc. ("Top Sales"). Pursuant to an agreement dated
August 15, 1988 between the Company and Top Sales, Top Sales sells
certain products manufactured by the Company. In 1995, the Company
paid Top Sales $556,400 pursuant to this agreement. Each member of
the Compensation Committee is a "disinterested person" within the
meaning of Rule 16b-3 under the Exchange Act.
DIRECTOR COMPENSATION. Directors of the Company who are
salaried employees of the Company do not receive any additional
compensation for serving as a director or committee member. In
1995, non-employee directors of the Company received $1,500 per
month for service on the Board of Directors and $750 for each Board
of Directors' meeting attended and for each committee meeting
attended.
In 1989, the Board of Directors and the shareholders of the
Company adopted the 1988 Director Option Plan (the "Director Plan")
to attract and retain the services of experienced and knowledgeable
directors and to provide an incentive for such persons to increase
their proprietary interest in the Company's long-term success and
progress.
Under the terms of the Director Plan, which is administered by
a committee composed of Burton A. Honig, Joseph Reid, the
Controller of the Company, and another officer of the Company,
options to purchase an aggregate of 375,000 shares of Common Stock
may be issued to the directors of the Company. The Director Plan
provides for the granting to each director of the Company on June
1, 1988, or as soon thereafter as reasonably possible, nonqualified
options to purchase shares of Common Stock ("option shares") in an
amount determined in accordance with the following formula:
[CAPTION]
<TABLE>
<S> <C>
number of completed years of service on
1,500 X the Company's Board + 1,500 = number of option shares
of Directors through June 1,
1988
</TABLE>
In addition, 1,500 option shares will automatically be granted
to each of the Company's then serving directors on June 1 (or, if
June 1 is not a business day, on the next succeeding business day)
of each successive year commencing on June 1, 1989 and ending with
the last grant of options under the Director Plan on June 1, 1997.
The option price of each option granted under the Director Plan may
not be less than 100% of the fair market value of the Common Stock
on the date of grant, and no option may be exercised before the
first anniversary of the date upon which it was granted (the
"Vesting Date"). Options granted under the Director Plan, which
remain unexercised, expire upon the earlier of (i) the date which
is ten years from the Vesting Date, (ii) eight months after the
date the optionee ceases to be a director or (iii) one year after
death. In the event of a change in control of the Company, as
defined in the Director Plan, all options become immediately
exercisable with respect to the full number of option shares.
In June 1995, an automatic grant of 1,500 shares was made to
each of the Company's directors.
EMPLOYMENT CONTRACTS.
The Company entered into an employment agreement with David M.
Friedson, dated July 18, 1983, which has been amended from time to
time. Under this agreement, among other things, Mr. Friedson was
employed for a five-year term, commencing July 18, 1983, which term
is automatically extended each year for an additional one-year
period unless written notice of an intention not to extend is given
by either party. This Agreement provides for a minimum annual base
salary which, as of December 31, 1995, was $748,800, which amount
is subject to adjustment in subsequent periods according to changes
in the Consumer Price Index, in addition to other benefits. If, at
any time during the term of the agreement, there shall be a change
in control of the Company, then Mr. Friedson shall have the option
of terminating his employment upon 60 days' notice and, in such
event, any outstanding options held by Mr. Friedson may be
exercised and sold without restrictions imposed by the Company, and
the Company shall pay Mr. Friedson a lump sum equal to three times
Mr. Friedson's then annual salary. Such lump sum payment would be
in lieu of any compensation that would otherwise be due and payable
under this agreement. In consideration for such lump sum payment,
Mr. Friedson has agreed to consult with the Company and its
officers after termination of his employment, if requested to do
so, for a period of four years from the date of such termination,
devoting such time to such services as Mr. Friedson believes to be
reasonable.
The Company entered into an employment agreement with Belvin
Friedson, dated January 5, 1987, which has been amended from time
to time. Under this agreement, among other things, Mr. Friedson is
retained by the Company to serve as an advisor and consultant to
the Company for perpetual one-year periods unless four years'
written notice not to extend is provided by the Company or Mr.
Friedson (the "Advisory Period"). As of December 31, 1995, Mr.
Friedson's annual compensation was $379,080, which amount is
subject to adjustment in subsequent periods according to any
increase in the Consumer Price Index, in addition to other
benefits. During the Advisory Period, Mr. Friedson is restricted
from competing with the Company as set forth in the agreement. If
at any time during the Advisory Period, there shall be a change in
control of the Company, then Mr. Friedson shall have the option of
terminating the Advisory Period upon reasonable notice, and, upon
such termination, the Company shall pay Mr. Friedson a lump sum
equal to the sum of the payments to be made to Mr. Friedson during
the Advisory Period discounted by a factor of 10% for each year in
which such payments are accelerated. Such payment would be in lieu
of any advisory compensation remaining to be paid under this
agreement.
The Company entered into employment agreements with Arnold
Thaler and Barbara Friedson Garrett (collectively, the
"Employees"). These agreements, as amended from time to time,
provide, among other things, for the employment of Mr. Thaler and
Ms. Garrett as Executive Vice Presidents, each for an initial term
of three years, which terms are each automatically extended each
year for an additional one-year period unless written notice of an
intention not to extend is given by either party. Under these
agreements, the Employees are each entitled to a minimum annual
base salary which, as of December 31, 1995, was $274,976 for Mr.
Thaler and $265,200 for Ms. Garrett, which amounts are subject to
adjustment in subsequent periods according to changes in the
Consumer Price Index, in addition to other benefits. If at any
time during the term of these agreements, there shall be a change
in control of the Company, then each Employee shall have the option
of terminating his or her employment upon 60 days' notice and, in
such event, any outstanding options held by the Employee may be
exercised and sold without restrictions imposed by the Company, and
the Company shall pay such Employee a lump sum equal to three times
the Employee's prevailing annual salary. Such lump sum payment
would be in lieu of any compensation that would otherwise be due
thereafter under these agreements. In consideration for such lump
sum payment, each Employee has agreed to consult with the Company
and its officers after termination of his or her employment, if
requested to do so, for a period of four years from the date of
such termination, devoting only such time to such services as the
Employee believes to be reasonable.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT.
The following table sets forth, as of the Record Date,
information with respect to the beneficial ownership of the
Company's Common Stock by (i) each director of the Company (certain
of whom constitute nominees for election as directors at the Annual
Meeting), (ii) the Company's Chief Executive Officer and four other
most highly compensated officers of the Company during the year
ended December 31, 1995, (iii) the beneficial owner of more than 5%
of the outstanding Common Stock and (iv) all directors and
executive officers of the Company, as a group.
[CAPTION]
<TABLE>
<S> <C>
Common Stock
Beneficially Owned (2)
Name and Address of Beneficial Owner(1) Shares Percent
Belvin Friedson. . . . . . . . . 455,679 (3) 2.8
Jerald I. Rosen. . . . . . . . . 48,000 (4) *
Bert Sager . . . . . . . . . . . 78,000 (5) *
Harold Strauss . . . . . . . . . 39,604 (6) *
Leonard Glazer . . . . . . . . . 24,052 (7) *
David M. Friedson. . . . . . . . 1,005,772 (8) 5.8
Barbara Friedson Garrett . . . . 241,705 (9) 1.5
Lai Kin. . . . . . . . . . . . . 1,748,000 (10) 10.6
Felix S. Sabates . . . . . . . . 36,500 (11) *
Arnold Thaler . . . . . . . . . 107,339 (12) *
Raymond So.. . . . . . . . . . . 46,500 (13) *
Susan J. Ganz. . . . . . . . . . 400 *
Thomas J. Kane . . . . . . . . . 25,000 (14) *
Desmond Lai. . . . . . . . . . . 13,000 (15) *
Ourimbah Investments, Limited. . 1,739,000 (16) 10.6
Heartland Advisors, Inc. . . . . 1,033,500 (17) 6.3
Franklin Resources, Inc. . . . . 1,419,150 (18) 8.6
Rockefeller & Co., Inc.. . . . . 878,700 (19) 5.3
All directors and executive officers
as a group (19 persons). . . . 4,103,573 (3)-(15) 22.9
</TABLE>
____________________
* Less than 1%.
(1) Unless otherwise indicated, the address of each of the
beneficial owners identified above is c/o Windmere
Corporation, 5980 Miami Lakes Drive, Miami Lakes, Florida
33014-2467.
(2) Unless otherwise indicated, each person has sole voting and
investment power with respect to all such shares. A person is
deemed to be the beneficial owner of securities that can be
acquired by such person within 60 days from the Record Date
upon the exercise of options.
(3) Includes the ownership of options to purchase 48,000 shares of
Common Stock that are exercisable within 60 days from the
Record Date. Mr. Friedson disclaims the beneficial ownership
of any shares owned by his wife or his children.
(4) Represents the ownership of options to purchase 48,000 shares
of Common Stock that are exercisable within 60 days from the
Record Date. Does not include 15,000 shares owned by the wife
of Jerald I. Rosen, as to which shares Mr. Rosen disclaims
beneficial ownership.
(5) Includes the ownership of options to purchase 48,000 shares of
Common Stock that are exercisable within 60 days from the
Record Date. Does not include 424,633 shares owned by the
wife of Mr. Sager, as to which shares Mr. Sager disclaims
beneficial ownership.
(6) Includes the ownership of options to purchase 34,500 shares of
Common Stock that are exercisable within 60 days from the
Record Date.
(7) Includes the ownership of options to purchase 24,000 shares of
Common Stock that are exercisable within 60 days from the
Record Date.
(8) Includes the ownership of options to purchase 769,500 shares
of Common Stock that are exercisable within 60 days from the
Record Date. Mr. Friedson disclaims the beneficial ownership
of any Common Stock owned by his siblings, Belvin Friedson or
his wife.
(9) Includes the ownership of options to purchase 163,500 shares
of Common Stock that are exercisable within 60 days from the
Record Date. Ms. Garrett disclaims the beneficial ownership
of any Common Stock owned by her siblings, Belvin Friedson or
his wife.
(10) Represents options to purchase 9,000 shares of Common Stock
that are exercisable within 60 days from the Record Date and
1,739,000 shares owned by Ourimbah Investments, Limited, of
which Mr. Lai Kin is Managing Director. Mr. Lai Kin disclaims
the ownership of any Common Stock owned by his wife or his
children.
(11) Represents the ownership of options to purchase 1,500 shares
of Common Stock that are exercisable within 60 days from the
Record Date and options to purchase 35,000 shares of Common
Stock that are exercisable within 60 days from the Record Date
and owned by Top Sales Company, Inc.
(12) Includes the ownership of options to purchase 89,000 shares of
Common Stock that are exercisable within 60 days from the
Record Date.
(13) Includes the ownership of options to purchase 25,000 shares of
Common Stock that are exercisable within 60 days from the
Record Date.
(14) Represents options to purchase 25,000 shares of Common Stock
that are exercisable within 60 days from the Record Date.
(15) Represents options to purchase 13,000 shares of Common Stock
that are exercisable within 60 days from the Record Date. Mr.
Lai disclaims the beneficial ownership of the shares of Common
Stock held by his siblings, his wife or Mr. or Mrs. Lai Kin.
(16) The address of Ourimbah Investments, Limited is 1F, Efficiency
House, 35 Tai Yau Street, San Po Kong, Kowloon, Hong Kong.
(17) The address of Heartland Advisors, Inc. is 790 North Milwaukee
Street, Milwaukee, Wisconsin 53202.
(18) The address of Franklin Resources, Inc. is 777 Mariners Island
Boulevard, San Mateo, California 94404.
(19) The address of Rockefeller & Co., Inc. is 30 Rockefeller
Plaza, New York, New York 10112.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The Company has agreed to use its best efforts to recommend to
its shareholders and directors that Lai Kin, the Managing Director
of Durable and of Ourimbah, be appointed as, and remain a member
of, the Company's Board of Directors for such time as Mr. Lai
continues to be an indirect shareholder of the Company and
continues to be employed by Durable and/or any other affiliate of
the Company. Upon Mr. Lai's resignation or termination as Managing
Director of Durable, the Company has agreed to employ Mr. Lai as a
consultant to the Company and Durable and any of their affiliates
at a salary equal to 60% of Mr. Lai's annual base salary from
Durable in the fiscal year immediately preceding his resignation or
termination from Durable. Pursuant to this agreement, Mr. Lai will
be employed as a consultant for a three-year period which is
automatically extended by one year on the first day of the second
year of each three-year period unless two years' prior written
notice is given to terminate the agreement, in which event the term
of the agreement will be automatically extended for one additional
year beyond the expiration of the then current three year period.
In April 1994, in connection with the purchase by the Company
of 20% of the outstanding shares of capital stock of Durable, which
resulted in Durable becoming a wholly-owned subsidiary of the
Company, the Company agreed, upon a Change of Control of the
Company (as defined in said agreement), to make an additional
payment to Ourimbah in respect of shares of Durable being purchased
under such agreement equal to the greater of (i) the same multiple
of earnings per share paid for the shares of Common Stock of the
Company received in connection with such Change of Control or (ii)
the same multiple of net asset value per share paid for the shares
of Common Stock of the Company received in connection with such
Change of Control. In addition, the Company agreed to use its best
efforts to recommend to the shareholders and directors of the
Company that two individuals to be nominated by Mr. Lai and deemed
suitable by the Company be appointed as members of the Company's
Board of Directors. The Company further agreed that the
composition of Durable's Board of Directors shall initially remain
equally divided between each of the present designees of Ourimbah
and persons selected by the Company. Accordingly, for so long as
such designees of Ourimbah who are present members of the Board of
Directors of Durable (the "Durable Board"): (i) remains a
shareholder of Ourimbah, and (ii) Ourimbah remains a shareholder of
the Company, the Company shall vote its shares of Durable to
appoint such designees of Ourimbah to the Durable Board. When any
member of the Durable Board who has been designated by Ourimbah
ceases to be a shareholder of Ourimbah, such designee shall no
longer be entitled to serve on the Durable Board, and the Company
shall have the right to designate a replacement member to the
Durable Board in its sole discretion.
During 1995, the Company made a series of personal loans
bearing interest at prevailing market rates to David M. Friedson,
the Company's Chairman of the Board, President and Chief Executive
Officer. As of March 29, 1996, the balance of such loans was
$851,498.
In 1986, the Company made a non-interest bearing loan of
$78,000 to Mr. Lai, a Director of the Company. Such loan was
outstanding as of the date of this Proxy Statement.
In December 1991, the Company loaned $300,000 to Lion Redcliff
Import and Export, Ltd., a company owned 50% by the Company and 50%
by Lion Brothers Co., Inc., of which Ms. Susan J. Ganz, a Director
of the Company, is President and Chief Executive Officer. At
present, such obligation bears a prime rate of interest. The
principal amount is payable in 30 monthly installments of $10,000
commencing May 1996.
Reference is made to "Executive Compensation - Compensation
Committee Interlocks and Insider Participation" for a discussion of
the relationship between Felix Sabates, Top Sales and the Company.
SIGNATURE
Pursuant to the requirements of Section 13 or 15(d) of the
Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on its behalf by the undersigned, there-
unto duly authorized.
April 29, 1996 WINDMERE CORPORATION
By:/s/David M. Friedson
David M. Friedson
Chairman, President and
Chief Executive Officer
