SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A
AMENDMENT NO. 1
(Mark One)
(X) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended 31 December 1993
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number 1-4400
FISCHER & PORTER COMPANY
(Exact name of registrant as specified in its charter)
125 East County Line Road, Warminster, Pennsylvania 18974
(Address of principal executive offices and zip code)
Pennsylvania 23-0582516
(State of incorporation) (I.R.S. Employer Identification No.)
Registrant's telephone number, including area code: 215-674-6000
________________________
Securities registered pursuant to Section 12(b) of the Act:
Title of each Class Name of Each Exchange on Which Registered
Common Stock American Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
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 or any amendment to
this Form 10-K. (X)
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
(Insert number of shares outstanding of each class of common stock, as of latest
practicable date and the aggregate market value of the voting stock held by non-
affiliates.)
Outstanding at
Class 28 February 1994
Common Stock 5,295,250 shares
The aggregate market value of the voting stock held by non-affiliates is
$88,018,557 as of 28 February 1994.
PART III
ITEM 10 DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
(a) Directors of the Registrant
Following is a brief listing of the principal occupation, certain other
affiliations, and age on the date hereof of each Director of the Company:
Dr. Gloria T. Chisum Director Since 1978
Term Expires 1996 Age 63
Dr. Chisum was Research Psychologist - Head, Vision Laboratory, U.S. Naval
Air Development Center, Warminster, Pennsylvania, from 1960 until she retired in
1990, and was Head, Environmental Physiology Research Team and Manager, Life
Sciences Research Group, from 1981 to 1987.
E. Joseph Hochreiter Director Since 1991
Term Expires 1996 Age 47
In October 1991, Mr. Hochreiter was appointed President and Chief Operating
Officer of the Company. He was a principal and founder of HMA Investments,
Inc., a private investment firm, from 1987 to 1991; prior thereto he was
Executive Vice President of Penn Central Telecommunications Co. from 1984 to
1987 and held various other senior management positions with the Penn Central
Corporation from 1972 to 1984. In addition to serving on the Board of Fischer &
Porter Company, he is a director of Pennsylvania Pressed Metals, Inc., and is
the Chairman of the Board of Superior Air Parts, Inc.
William E. Learnard Director Since 1991
Term Expires 1995 Age 58
Mr. Learnard is the Managing Director of Trident Group, a marketing,
financial and management consulting firm, which he founded in 1990. For over 30
years prior thereto, he served in various executive management positions at
SmithKline Corporation, a pharmaceutical and health care company, including
service from 1985 to 1990 as President of SmithKline Consumer Products division,
retiring in 1991 as Vice Chairman of SmithKline Beecham Consumer Brands division
of SmithKline Beecham Corporation. Mr. Learnard is also a director of Nelson
Communications, Inc., and DiMark, Inc.
John J. Manion, Jr. Director Since 1991
Term Expires 1994 Age 64
Mr. Manion, a business consultant, served as Executive Vice President,
Philadelphia Suburban Corporation, a water utility with other diversified, non-
utility holdings, from 1985 until he retired in 1989. He was a management
consultant at Worden & Risberg, of Philadelphia, Pennsylvania, from 1980 to
1983. From 1966 to 1980, he held various executive positions at CBS, Inc., New
York, including, Vice President Treasurer, Vice President Controller, Vice
President Development and President of W. B. Saunders Company, a medical
publishing subsidiary of CBS, Inc.
Frank J. Ryan Director Since 1991
Term Expires 1995 Age 62
Mr. Ryan spent over 30 years with Air Products & Chemicals, Inc., a
manufacturer and distributor of chemicals, industrial gases and related
equipment, retiring in 1990 as its President and Chief Operating Officer.
Additionally, he was a member of the Finance Committee of the Air Products
Board. Mr. Ryan also serves as a director of Southdown, Inc.
Jay H. Tolson Director Since 1971
Term Expires 1995 Age 58
Mr. Tolson has held the offices of Chairman of the Board of Directors of
the Company since 1971, Chief Executive Officer since 1983, and President from
1974 to 1983 and from 1986 to 1991. Mr. Tolson also serves on the Boards of
Directors of a number of the Company's Subsidiaries and serves as a director of
Colonial Penn Life Insurance Company and Colonial Penn Insurance Company.
Robert G. Williams Director Since 1991
Term Expires 1994 Age 59
Since 1983, Mr. Williams has been the Chairman of the Board and a principal
shareholder of Markel Corporation, a manufacturer of electrical, thermal and
mechanical plastic extrusions for cable and wire insulation. From 1958 to 1982,
he served The Girard Company (the parent corporation of Girard Bank which was
subsequently acquired by Mellon Bank) in various capacities, including Executive
Vice President, Vice Chairman and Director. Mr. Williams also serves as
director of Contrologic, Inc., and Glenmede Trust Company of New Jersey.
ITEM 11 EXECUTIVE COMPENSATION
The following information is furnished with respect to the Chief Executive
Officer and the four most highly compensated Executive Officers other than the
Chief Executive Officer:
SUMMARY COMPENSATION TABLE
Long Term Compensation
Annual Compensation Awards Payouts
(a) (b) (c) (d) (e) (f) (g) (h) (i)
Other
Name Annual Restr. All
and Comp. Stock Options/ LTIP Other
Principal Salary Bonus (1)(5) Award(s)SARs (2) Payouts Comp.
Position Year ($) ($) ($) ($) (#) ($) (1)(3)
Jay H. Tolson
Chairman
& CEO 1993 $306,231 $0 $7,403 -0- 50,000 -0- $4,497
1992 $288,524 $90,000 $6,100 -0- 100,000 -0- $2,961
1991 $258,172 $0 N/A -0- -0- -0- N/A
E. Joseph Hochreiter
President
& COO (4)1993 $301,921 $0 $2,965 -0- 50,000 -0- $3,662
1992 $291,160 $90,000 $2,965 -0- 100,000 -0- $3,622
1991 $53,903 $0 N/A -0- -0- -0- N/A
Laurence P. Finnegan
Senior VP
& CFO 1993 $161,044 $0 $3,958 -0- 10,000 -0- $3,741
1992 $146,977 $26,000 $3,400 -0- 21,000 -0- $1,534
1991 $140,995 $0 N/A -0- 41,669 -0- N/A
Daniel T. Hughes
Senior VP
US Oper. 1993 $196,000 $0 $6,034 -0- 15,000 -0- $1,864
1992 $160,002 $58,870 $0 -0- 20,000 -0- $1,542
1991 $160,825 $25,650 N/A -0- 28,411 -0- N/A
Joseph P. Garay
VP, Secr.
& General1993 $140,952 $0 $5,007 -0- 15,000 -0- $4,263
Counsel 1992 $101,367 $24,500 $3,400 -0- 15,000 -0- $1,084
1991 $90,596 $0 N/A -0- 19,054 -0- N/A
(1) Other Annual Compensation and All Other Compensation are not required to be
disclosed for 1991.
(2) All figures represent options to purchase common stock of the Company.
(3) The amounts represent Company contributions to 401K plans.
(4) Mr. Hochreiter joined the Company in October, 1991.
(5) Under Other Annual Compensation, the amounts shown represent monies
reimbursed during the year for the payment of taxes on imputed income for
personal use of Company automobile. Perquisites and other benefits,
securities and property, are not required to be reported as the aggregate
amounts are less than, the lesser of $50,000 or 10% of the total annual
salary and bonus reported for the named person.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
The following table provides information on stock options granted to the named
executives during 1993:
Potential
Realizable Value
at Assumed
Annual Rates
of Stock Price
Appreciation
for Option
Individual Grants (2) Term (1)
(a) (b) (c) (d) (e) (f) (g)
% of
Total
Options/
SARs
Options/ Granted
SARs to Exercise
Granted Employees or Base Expira-
(3) in Fiscal Price tion
Name (#) Year ($/Sh) Date 5% ($) 10% ($)
Jay H. Tolson, CEO
50,000 24.6 8.875 1/29/03287,110 757,500
E. Joseph Hochreiter
50,000 24.6 8.875 1/29/03287,110 757,500
Laurence P. Finnegan
10,000 4.9 8.875 1/29/03 57,422 151,500
Daniel T. Hughes
15,000 7.4 8.875 1/29/03 86,133 227,250
Joseph P. Garay
15,000 7.4 8.875 1/29/03 86,133 227,250
(1) Values shown are the potential realizable values at the end of the ten (10)
year term assuming the 5% and 10% specified compounded rates of increases in
the price of the Company's Common Stock over the 10 year period. The
figures are not present values of the assumed increases, but are noted in
constant or future dollars. By use of the 5% and 10% stock appreciation
assumptions, the Company does not represent or imply that such appreciation
may be reasonably expected, or that such assumed rates of appreciation are
reasonable. These assumptions regarding appreciation were used in
compliance with legal requirements.
(2) All options are fully vested as a result of a change in control of the
Company after the date of grant of the options. Additionally the kind, the
number of option shares and the exercise price is subject to appropriate
adjustment in the event of a stock dividend, stock split, combination of
shares, recapitalization, merger, consolidation, and under similar
circumstances.
(3) Options to acquire Common Stock of the Company.
AGGREGATE OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FY-END OPTIONS/SAR VALUES
(a) (b) (c) (d) (d)
Value of
Number of Unexercised
Unexercised In-the-Money
Options/SARs at Options/SARs at
FY-End (#) (4) FY-End ($) (1)
Shares
Acquired Value
on Exercise Realized Exercisable/ Exercisable/
Name (#) ($) Unexercisable Unexercisable
Jay H. Tolson
0 $0 157,990 (2) / 1,395,654 /
0 0
E. Joseph Hochreiter
0 0 150,000 / 1,318,750 /
0 0
Laurence P. Finnegan
0 0 78,747 / 560,573 /
0 0
Daniel T. Hughes
0 0 65,751 (3) / 497,364 /
0 0
Joseph P. Garay
0 0 49,054 / 373,074 /
0 0
(1) Valued at 31 December 1993 closing price of $17.00.
(2) Includes 7,990 Units of Appreciation Rights; these rights were granted in
connection with a one year reduction in the base salaries of various
executive and management employees, and entitle the holder to receive from
the Company an amount of money per Unit equal to the difference between the
market price of the Common stock of the Company on the day of the demand and
$7.38 (i.e. the appreciation in stock price above a price of $7.38).
(3) 2,340 of the 65,751 units represent Units of Appreciation Rights (see note
(2) above); the balance represents stock options.
(4) Unless otherwise noted, the numbers represent options to purchase common
stock of the Company.
Compliance with Section 16(a) of the Exchange Act
To the best of the Company's knowledge, based solely on a review of Forms 3,
4 and 5 and written representation filed with the Company, all persons required
to file Forms 3, 4 or 5 under the Securities Exchange Act of 1934 have timely
filed such forms during or with respect to the year ending 31 December 1993.
Pension Plan
The Company has a noncontributory defined benefit plan, originally adopted
in 1947, for all employees who satisfy certain minimum eligibility requirements
("Retirement Plan"). The Company also adopted a defined contribution retirement
plan for salaried and a separate plan for non-salaried employees, under Section
401(k) of the Internal Revenue Code. Directors who have not served as employees
are not eligible to participate in any of the plans.
Under the Retirement Plan, normal annual retirement benefits are computed at
$228.00 multiplied by the employee's years of credited service. The annual
benefits are not subject to offset by Social Security payments. Full vesting of
accrued benefits occurs after five years, except employees who are over 55 years
old have their benefits fully vested after one year of service.
The estimated annual benefits payable under the Retirement Plan upon
retirement at normal retirement age for each of the executives named in the
Summary Compensation Table, based on the current number of years of credited
service, are as follows:
Estimated Annual
Retirement Plan
Benefits
Jay H. Tolson $5,073.00
E. Joseph Hochreiter (1) 494.00
Laurence P. Finnegan 1,672.00
Daniel T. Hughes 883.00
Joseph P. Garay (1) 931.00
(1) benefits are not vested
COMPENSATION OF DIRECTORS
Nonemployee Directors receive an annual retainer fee of $12,000, as well as
a $750 fee for each Board meeting attended; Directors who are Chairpersons of
Board Committees receive an additional annual retainer fee of $3,000; and the
Chairpersons and members of the Board Committees are paid a fee of $750 for each
Committee meeting attended. Employee Directors are not compensated separately
for their services as Directors.
REPORT OF THE COMPENSATION AND PENSION COMMITTEE
ON EXECUTIVE COMPENSATION
The Compensation and Pension Committee of the Board ("Committee"), is
comprised of all independent, non-management directors. The Committee oversees
all executive compensation, sets the compensation of executive officers of the
Company, sets compensation policies and administers the stock option programs.
The Committee annually evaluates the Company's performance and the
performance of executive officers in the context of the budget and the general
business and economic climate. Annual reviews of actual and competitive
compensation are conducted and appropriate adjustments are made based on
corporate and individual performance as well as competitive rates of
compensation. The general philosophy of the Committee is to offer fully
competitive compensation opportunities to enable the Company to attract and
retain highly qualified managers and executives and, at the same time, to tie
a significant portion of total compensation to the Company's performance in
order to focus executives' attention on the achievement of defined short and
long term goals.
Generally, executive compensation consists of a base salary, an annual
(corporate and individual performance based) variable compensation and a long
term incentive compensation, which is stock value appreciation based. Each
element is designed to provide a market median level of compensation for the
executive, at the given level of corporate performance. All corporate
executives' as well as all subsidiary managers' annual variable compensation is
determined by a formula based on consolidated pre-tax earnings. However,
occasionally the Company has found it necessary to guarantee, for a limited
period of time, a minimum bonus for a newly hired executive.
The long term incentive compensation opportunity is linked directly to
growth in the stock price, by the use of stock options. Generally, options vest
in 20% cumulative annual increments, thereby providing continuing incentive to
the optionees. All options have been granted at an exercise price equal to the
fair market value of the stock on the date of grant.
The compensation of Mr. Tolson, the Chief Executive Officer of the Company,
has been determined and adjusted on the same basis as used for all other
executives described above. As shown in the Summary Compensation Table, Mr.
Tolson had not received a bonus for the years 1991 and 1993, when the Company's
financial results were lower than expected, but did receive a bonus of $90,000
for the year 1992. The 1992 bonus was based on the Corporation achieving a
certain portion of its consolidated financial goals. Additionally, as part of
his long term incentive compensation, in 1993 Mr. Tolson received options to
purchase 50,000 shares of Common Stock at $8.875, the market price at the time
of grant of options.
By the Compensation and Pension Committee,
John J. Manion, Jr., Chairman
Gloria T. Chisum
William E. Learnard
Frank J. Ryan
Robert G. Williams
The required information with respect to the Supplemental Retirement Income
Plan and Employment Contracts and Termination of Employment and Change-in-
Control Arrangements is contained in the Company's Proxy Statement which is
herein incorporated in this Form 10-K/A by reference.
ITEM 12 SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The required information with respect to security ownership of certain
beneficial owners and Management is contained in the Company's Proxy Statement
which is herein incorporated in this Form 10-K/A by reference.
ITEM 13 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
On 30 September 1993, Messrs. Tolson and Hochreiter, Directors and
Executive Officers of this Company, and Mr. Hochreiter's son and Mr. Hochreiter
as a custodian under the Uniform Gift to Minors Act for his other two sons and
one daughter entered into an agreement with the Company pursuant to which these
individuals converted all of their Class B Stock in the Company (being all
the issued and outstanding Class B Stock of the Company) into an equal number of
Common Shares, plus a warrant to purchase two shares of Common Stock for each
share of Class B Stock converted, at an exercise price of $8.625 per share.
The agreement also contains certain provisions, rights and restrictions
relating to the parties and the Company as well as the warrants. The
agreement and the form of the warrants have been filed with the Securities and
Exchange Commission on or about 3 November 1993 as part of Mr. Tolson's
filing on Schedule 13D.
SIGNATURES
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, thereunto duly authorized.
FISCHER & PORTER COMPANY
(Registrant)
By: NATHAN T. SCHELLE
Nathan T. Schelle
Vice President-Controller
(Principal Accounting Officer)
Date: 28 April 1994
